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HomeMy WebLinkAboutR-2015-128 Master Aquatic Center Agreement with YMCA; Ground Lease; Development Agreement; Operating AgreementA RESOLUTION RESOLUTION NO. R-2015-128 authorizing the execution of a Master Aquatic Center Agreement and associated Ground Lease, Development Agreement and Operating Agreement providing for the City's participation in the construction of an Aquatic Center in cooperation with the Young Men's Christian Association of Yakima, d/b/a the Yakima Family YMCA, all in accordance with the specific terms and conditions set forth in said Agreements WHEREAS, the residents of the City voted to amend the City Charter to set aside certain general funds for the specific purpose of creating capital improvements to and refurbishment of pubic parks and recreational facilities within the City; and WHEREAS, the City, with one indoor public pool and one outdoor public pool owned and operated by the City pursuant to RCW 35.21.020, has inadequate public aquatic facilities to meet the diverse needs of its population, which is approaching 100,000 people; and WHEREAS, the City's only existing indoor public pool consists of a six (6) lane, single body of water housed in a worn and aging facility; and WHEREAS, the City's only existing indoor public pool is frequently unavailable for public use due to school district needs and competitive swimming uses, and WHEREAS, there is no warm water therapy pool or dedicated youth/family indoor pool in the Yakima area, either public or private; and WHEREAS, a citizens pool advisory committee established recommendations for desired elements of a new aquatic center, and the now proposed Aquatic Center plan incorporates those recommendations, and WHEREAS, Yakima has been ranked as one of the most obese cities in America, pointing out the need for more recreation and exercise opportunities for youth and adults in our community; and WHEREAS, access to aquatic facilities is a valuable community resource because it provides the City's residents with low-cost recreation options, encourages residents to learn how to swim, discourages dangerous swimming conditions in rivers and irrigation canals, and provides access to therapeutic activities; and WHEREAS, in an effort to promote the overall health, safety, and welfare of Yakima's residents, the City and the YMCA desire to enter into this Agreement in order to construct and operate new aquatic facilities that will be open to the public for recreation, instruction, fitness, and therapeutic uses; and WHEREAS, the Aquatic Center that is the subject of the incorporated agreements and all programs conducted therein will remain open for public use at reasonable costs with no required YMCA membership; and WHEREAS, the Aquatic Center will more than double the existing indoor public aquatic facilities located in Yakima and increase public access to additional and diverse indoor aquatic 1 offerings by adding at least three (3) separate bodies of water for public use and programming, including (a) an eight (8) lane 25 -yard lap pool, (b) a warm water therapy pool, and (c) a multiuse pool area for family and youth recreation; and WHEREAS, the Aquatic Center's multi -pool configuration, unlike the City's current pool offerings (both public and private), will be suitable for offering multiple programming options at the same time and not be limited to single use options (e.g , it will be possible to simultaneously offer lap swimming, water walking, youth/family recreation activities, and warm water therapy/fitness classes), and WHEREAS, the siting, construction, and operation of the Aquatic Center will have expanded days and hours of operation compared to current public offerings, will create substantial benefits to and improve the quality of life of the City's residents by providing valuable and much needed indoor aquatic opportunities for all ages, and particularly for youth in the youth/family portions of the facility and seniors in the increased water walking areas and warm water therapy pool; and WHEREAS, the siting, construction, and operation of the Aquatic Center in the City will generate new jobs, promote commerce, generate new sales tax revenue to the City (both from construction and operations), and result in additional related economic benefits to the City and its residents; and WHEREAS, the Aquatic Center's location at Chesterley Park will be (a) centrally located within the City, (b) located within a fifteen minute drive of almost all of the City's residents, (c) easily accessed from several major thoroughfares and a major highway interchange, (d) served by frequent and regular public transit service, (e) connected to the Yakima Greenway and Powerhouse Canal Pathway, and (f) in close proximity to several public schools; and WHEREAS, the YMCA has been operating and offering quality youth and family programming in Yakima for over 100 years, including aquatic programming at the YMCA's downtown pool for over 50 years, and WHEREAS, the YMCA offers financial assistance in connection with the YMCA's membership and programming fees for the purpose of increasing public access to YMCA programs and facilities for low income individuals and families, and WHEREAS, the YMCA has the professional experience and capability to manage and operate the Aquatic Center, and thereby limit the City's day-to-day operation obligations and risk in connection therewith; and WHEREAS, the Ground Lease, Development Agreement, and Operating Agreement will establish a public/private partnership under which (a) the City's financial contribution to the Aquatic Center's construction costs are capped, with the YMCA assuming the obligation for construction cost overruns and (b) the YMCA and City share equally in the long-term operational, maintenance, repair, and capital needs of the Aquatic Facility; and WHEREAS, without the public/private partnership established under the Ground Lease, Development Agreement, and Operating Agreement the City (a) would not be able, due to cost constraints, to construct and operate a new indoor aquatic facility of the size and scope required under the Development Agreement, (b) would have to pay the full cost of constructing a new indoor aquatic facility (or forego doing so), and (c) would be solely responsible for managing and 2 operating a new indoor aquatic facility and be solely responsible for all of its operational, maintenance, repair, and capital needs; and WHEREAS, the YMCA's ability to participate in the construction and operation of the Aquatic Center, from both mission and sustainability standpoints, is dependent on the YMCA's ability to offer additional non -aquatic programs and services on the Leased Property in connection with the aquatic programs and services that will be offered by the YMCA at the Aquatic Center; and WHEREAS, the YMCA's construction and operation of additional non -aquatic facilities on the Leased Premises in connection with the Aquatic Center will increase the amount, scope, and diversity of youth, family, and community outreach the YMCA currently offers in Yakima, and specifically in the North Central portion of Yakima, which is a federally designated economically distressed area and severely underserved by youth programs and facilities; and WHEREAS, the non -aquatic facilities constructed on the Leased Premises will be fully funded by the YMCA, but will become City owned facilities (at no cost to the City) at the expiration of the Ground Lease; and WHEREAS, the non -aquatic programs offered in the non -aquatic facilities constructed on the Leased Premises, like the aquatic programs and facilities, will be open to the public for participation and use for reasonable fees and serve a wide range of community interests, including, community meeting space, health and wellness programs, youth outreach, and youth sports and other programming; and WHEREAS, the YMCA offers financial assistance in connection with the YMCA's membership and programming fees for the purpose of increasing public access to YMCA programs and facilities for low income individuals and families; and WHEREAS, the long term nature, reliability, and terms of the Master Aquatic Center Agreement, Ground Lease, Development Agreement, and Operating Agreement, attached hereto and incorporated herein by this reference, will be relied upon by both parties and are necessary for the YMCA's ability to procure the additional private funds and community investments needed to cover the YMCA's portion of the Aquatic Center's construction costs and other funds needed for the non -aquatic facilities to be constructed by the YMCA on the Leased Premises; and WHEREAS, the City Council determines that the City, its residents, and the public in general will derive innumerable long-term recreation, safety, health, youth, family, outreach, social, economic, and other benefits from the YMCA's construction and operation of the Aquatic Center and other facilities on the Leased Premises under the Ground Lease, Development Agreement, and Operating Agreement, and as such the City Council finds that it is in the City's best interests to enter into the Agreements attached hereto; 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 Master Aquatic Center Agreement, the Ground Lease, the Development Agreement and the Operating Agreement attached hereto and incorporated herein by this reference to provide for the City's participation in the construction of an aquatic center that will benefit the citizens of Yakima and provide for badly needed additional recreational opportunities. 3 ADOPTED BY THE CITY COUNCIL this 27th day of October, 2015 ATTEST: Sonya Claar Tee, City 4 Micah Cawley ayor PARTIES: MASTER AQUATIC CENTER AGREEMENT EFFECTIVE DATE: 01-41 , 2015 CITY OF YAKIMA, a Washington municipal corporation 129 North 2nd Street Yakima, Washington 98901 (referred to in this Agreement as the "City") YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA (d/b/a YAKIMA FAMILY YMCA), a Washington nonprofit corporation 5 North Naches Avenue Yakima, Washington 98901 (referred to in this Agreement as the "YMCA") RECITALS WHEREAS: The City, with one indoor public pool and one outdoor public pool owned and operated by the City pursuant to RCW 35.21.020, has inadequate public aquatic facilities to meet the diverse needs of its population, which is approaching 100,000 people; and WHEREAS: The City's only existing indoor public pool consists of a six (6) lane, single body of water housed in a worn and aging facility; and WHEREAS: The City's only existing indoor public pool is frequently unavailable for public use due to school district needs and competitive swimming uses; and WHEREAS: There is no warm water therapy pool or dedicated youth/family indoor pool in the Yakima area, either public or private; and WHEREAS: A citizens pool advisory committee established recommendations for desired elements of a new aquatic center, and the now proposed Aquatic Center plan incorporates those recommendations; and WHEREAS: Yakima has been ranked as one of the most obese cities in America, pointing out the need for more recreation and exercise opportunities for youth and adults in our community; and WHEREAS: Access to aquatic facilities is a valuable community resource because it provides the City's residents with low-cost recreation options, encourages residents to learn how to swim, discourages dangerous swimming conditions in rivers and irrigation canals, and provides access to therapeutic activities; and WHEREAS: In an effort to promote the overall health, safety, and welfare of Yakima's residents, the City and the YMCA desire to enter into this Agreement in order to construct and operate new aquatic facilities that will be open to the public for recreation, instruction, fitness, and therapeutic uses; and Master Aquatic Center Agreement 1 WHEREAS: The Aquatic Center that is the subject of the incorporated agreements and all programs conducted therein will remain open for public use at reasonable costs with no required YMCA membership; and WHEREAS: The Aquatic Center will more than double the existing indoor public aquatic facilities located in Yakima and increase public access to additional and diverse indoor aquatic offerings by adding at least three (3) separate bodies of water for public use and programming, including (a) an eight (8) lane 25 yard lap pool, (b) a warm water therapy pool, and (c) a multiuse pool area for family and youth recreation; and WHEREAS: The Aquatic Center's multi -pool configuration, unlike the City's current pool offerings (both public and private), will be suitable for offering multiple programming options at the same time and not be limited to single use options (e.g., it will be possible to simultaneously offer lap swimming, water walking, youth/family recreation activities, and warm water therapy/fitness classes); and WHEREAS: The siting, construction, and operation of the Aquatic Center will have expanded days and hours of operation compared to current public offerings, will create substantial benefits to and improve the quality of life of the City's residents by providing valuable and much needed indoor aquatic opportunities for all ages, and particularly for youth in the youth/family portions of the facility and seniors in the increased water walking areas and warm water therapy pool; and WHEREAS: The Aquatic Center will promote_ public safety by offering additional lifeguard supervised facilities for water activities and increasing public opportunities for swim lessons; and WHEREAS: The siting, construction, and operation of the Aquatic Center in the City will generate new jobs, promote commerce, generate new sales tax revenue to the City (both from construction and operations), and result in additional related economic benefits to the City and its residents; and WHEREAS: The Aquatic Center's location at Chesterley Park will be (a) centrally located within the City, (b) located within a fifteen minute drive of almost all of the City's residents, (c) easily accessed from several major thoroughfares and a major highway interchange, (d) served by frequent and regular public transit service, (e) connected to the Yakima Greenway and Powerhouse Canal Pathway, and (f) in close proximity to several public schools; and WHEREAS: The YMCA has been operating and offering quality youth and family programming in Yakima for over 100 years, including aquatic programming at the YMCA's downtown pool for over 50 years; and WHEREAS: The YMCA offers financial assistance in connection with the YMCA's membership and programming fees for the purpose of increasing public access to YMCA programs and facilities for low income individuals and families; and WHEREAS: The YMCA has the professional experience and capability to manage and operate the Aquatic Center, and thereby limit the City's day-to-day operation obligations and risk in connection therewith; and WHEREAS: The Ground Lease, Development Agreement, and Operating Agreement will establish a public/private partnership under which (a) the City's financial contribution to the Aquatic Center's construction costs are capped, with the YMCA assuming the obligation for construction cost overruns and (b) the YMCA and City share equally in the long-term operational, maintenance, repair, and capital needs of the Aquatic Facility; and Master Aquatic Center Agreement 2 WHEREAS: Without the public/private partnership established under the Ground Lease, Development Agreement, and Operating Agreement the City (a) would not be able, due to cost constraints, to construct and operate a new indoor aquatic facility of the size and scope required under the Development Agreement, (b) would have to pay the full cost of constructing a new indoor aquatic facility (or forego doing so), and (c) would be solely responsible for managing and operating a new indoor aquatic facility and be solely responsible for all of its operational, maintenance, repair, and capital needs; and WHEREAS: The YMCA's ability to participate in the construction and operation of the Aquatic Center, from both mission and sustainability standpoints, is dependent on the YMCA's ability to offer additional non -aquatic programs and services on the Leased Property in connection with the aquatic programs and services that will be offered by the YMCA at the Aquatic Center; and WHEREAS: The YMCA's construction and operation of additional non -aquatic facilities on the Leased Premises in connection with the Aquatic Center will increase the amount, scope, and diversity of youth, family, and community outreach the YMCA currently offers in Yakima, and specifically in the North Central portion of Yakima, which is a federally designated economically distressed area and severely underserved by youth programs and facilities; and WHEREAS: The non -aquatic facilities constructed on the Leased Premises will be fully funded by the YMCA, but will become City owned facilities (at no cost to the City) at the expiration of the Ground Lease; and WHEREAS: The non -aquatic programs offered in the non -aquatic facilities constructed on the Leased Premises, like the aquatic programs and facilities, will be open to the public for participation and use for reasonable fees and serve a wide range of community interests, including, community meeting space, health and wellness programs, youth outreach, and youth sports and other programming; and WHEREAS: The YMCA offers financial assistance in connection with the YMCA's membership and programming fees for the purpose of increasing public access to YMCA programs and facilities for low income individuals and families; and WHEREAS: The long term nature, reliability, and terms of the Ground Lease, Development Agreement, and Operating Agreement will be relied upon by both parties and are necessary for the YMCA's ability to procure the additional private funds and community investments needed to cover the YMCA's portion of the Aquatic Center's construction costs and other funds needed for the non -aquatic facilities to be constructed by the YMCA on the Leased Premises; and WHEREAS: The Operating Agreement includes important requirements for continued investment by the YMCA and the City in the upkeep, repair, and capital needs of the Aquatic Center and associated common areas in order to maintain said facilities in accordance with the Operating Standards set forth therein; and WHEREAS: Because the City, its residents, and the public in general will derive innumerable long- term recreation, safety, health, youth, family, outreach, social, economic, and other benefits from the YMCA's construction and operation of the Aquatic Center and other facilities on the Leased Premises under the Ground Lease, Development Agreement, and Operating Agreement, and as such it is hereby determined by the parties hereto that the City's and the YMCA's contributions and participation under the Ground Lease, Development Agreement, and Operating Agreement are warranted and a good and proper use of City and YMCA resources. Master Aquatic Center Agreement 3 NOW, THEREFORE, FOR GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND ADEQUACY ACKNOWLEDGED, AND IN LIGHT OF THE ABOVE -STATED RECITALS AND THE BENEFITS TO BE DERIVED HEREUNDER, THE UNDERSIGNED PARTIES AGREE AS FOLLOWS: AGREEMENT 1. Definitions. Unless the context clearly indicates another meaning and except for terms defined in this Agreement, all capitalized terms used in this Agreement have the same meaning given to said terms in the Operating Agreement, Development Agreement, and Ground Lease. The following terms, when used in this Agreement, have the following meanings, unless the context clearly indicates another meaning: 1.1 "Aquatic Center" has the meaning given to said words in Section 2 of the Development Agreement. 1.2 "Development Agreement" means and refers to the Development Agreement dated even herewith by and between the City and the YMCA in connection with the development of the Aquatic Center to be constructed by the YMCA on a portion of the Leased Premises and all future amendments to said Development Agreement (if any). 1.3 "Ground Lease" means and refers to the Ground Lease dated even herewith by and between the City as "Landlord" and the YMCA as "Tenant" for the YMCA's lease of the Leased Premises and all future amendments to said Ground Lease (if any). 1.4 "Leased Premises" has the meaning given to said words in Section 1.7 of the Ground Lease. 1.5 "Operating Agreement" means and refers to the Operating Agreement dated even herewith by and between the City and the YMCA in connection with the operations and management of the Aquatic Center to be constructed by the YMCA on a portion of the Leased Premises and all future amendments to said Operating Agreement (if any). 2. Recitals Incorporated. The above -stated Recitals are part of, incorporated into, and constitute part of this Agreement. 3. Other Agreements. Subject to the Due Diligence, Funding, and RCO Contingencies set forth therein and in anticipation of the benefits to be derived thereunder as described in the above - stated Recitals, the undersigned parties agree to enter into and execute the Ground Lease attached as Exhibit 1, the Development Agreement attached as Exhibit 2, and the Operating Agreement attached as Exhibit 3 simultaneously with the execution of this Agreement. 4. Miscellaneous Terms. 4.1 Amendments. This Agreement may not be modified or amended except by written agreement signed and acknowledged by each of the parties hereto. 4.2 No Agency Relationship. Nothing contained in this Agreement creates the relationship of principal and agent between the parties hereto. 4.3 Exhibits. There are no attachments to this Agreement except for the Exhibits expressly referenced in this Agreement and those separately attached to the agreements attached as Master Aquatic Center Agreement 4 exhibits hereto, each of which constitutes a part of this Agreement as if set forth in full herein. 4.4 Headings; Construction. The captions and paragraph headings used in this Agreement are inserted for convenience of reference only and are not intended to define, limit, or affect the interpretation or construction of any term or provision of this Agreement. This Agreement shall not be construed more strictly against one party than the other by virtue of the fact that one party drafted this Agreement and/or certain clauses contained herein. It is hereby recognized that both parties to this Agreement and their respective counsel have had a full and fair opportunity to negotiate and review all terms and provisions of hereof and to fully contribute to this Agreement's substance and form. 4.5 Governing Law. This Agreement will be interpreted, construed, and governed by the laws of the State of Washington. 4.6 Binding Effect. Subject to any limitations on assignments provided for in this Agreement, all of the provisions of this Agreement will inure to the benefit of and be binding on the successors and assigns of the City and the YMCA. 4.7 Counterparts and Copies. This Agreement may be executed in any number of identical counterparts, with each counterpart having the same effect as if all parties to this Agreement had signed the same document. All executed counterparts of this Agreement will be construed as and constitute one and the same instrument. A facsimile or electronic copy (e.g., a PDF copy) of an executed counterpart of this Agreement will have the same effect as an original executed counterpart of this Agreement. 4.8 Severability. If any provision of this Agreement or the application thereof to any person or circumstances shall to any extent be held to be invalid or unenforceable, such provision shall not affect or invalidate the remainder of this Agreement, and to this end the provisions of this Agreement are declared to be severable. If such invalidity becomes known or apparent to the parties, the parties agree to negotiate promptly in good faith in an attempt to amend such provision as nearly as possible to be consistent with the intent of this Agreement. 4.9 Entire Agreement. This Agreement, together with the associated Ground Lease, Development Agreement, and Operating Agreement, constitutes the entire understanding and agreement of the parties to this Agreement with respect to its subject matter. All prior agreements, understandings, or representations with respect to this Agreement's subject matter are hereby canceled in their entirety and are of no further force or effect. It is expressly acknowledged that there are no oral or other agreements which modify or affect this Agreement. 4.10 Authority. The execution, delivery, and performance by each party of this Agreement has been duly authorized by their respective governing bodies (i.e., the YMCA's Board of Directors and the City Council for the City of Yakima) in accordance with their respective governing documents and applicable law, and no further action is necessary on the part of either party to this Agreement or their respective governing bodies to make the execution, delivery, and performance of this Agreement by the undersigned persons valid and binding upon the parties to this Agreement. [Signatures on Following Page] Master Aquatic Center Agreement 5 EFFECTIVE as of the Effective Date first written above. YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA By: Bob Romero, CEO Master Aquatic Center Agreement CITY OF YA Tony O'Rourk: City Manager CITY CONTRAC r No: a 0 j 5 - Co RESOLUTION N0: - a0 ' 5 - 12-8 6 STATE OF WASHINGTON ) ss. COUNTY OF YAKIMA I certify that I know or have satisfactory evidence that BOB ROMERO 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 CEO for the YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA to be the free and voluntary act of such party for the uses and purposes mentioned in the instrument. DATED: ®hp Ar" e?" --1) , 2015. Notary Public State of Washington JODI L STEPHENS MY COMMISSION EXPIRES August 11, 2018 STATE OF WASHINGTON ) ss. COUNTY OF YAKIMA T NAMSlee/e Gtr NOTARY PUBLIC fori‘tc State of Was n to , residing at /.2e, a'11 i G ft4C. My appointment expires I certify that I know or have satisfactory evidence that TONY O'ROURKE 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 CITY MANAGER for the CITY OF YAKIMA to be the free and voluntary act of such party for the uses and purposes mentioned in the instrument. � DATED: Oa- Y` (/ , 2015. Notary Public State of Washington SONYA R CLAAR TEE MY COMMISSION EXPIRES OCTOBER 25, 2018 Master Aquatic Center Agreement tee [PRINT NAME] •-•..vr1 NOTARY PUBLIC for the State of Washington, residing at My appointment expires: 7 EXHIBIT 1 Ground Lease [See Attached] EXHIBIT 1 Ground Lease Agreement PARTIES: GROUND LEASE EFFECTIVE DATE: CITY OF YAKIMA, a Washington municipal corporation 129 North 2nd Street Yakima, Washington 98901 (referred to in this Lease as "Landlord") , 2015 YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA (d/b/a YAKIMA FAMILY YMCA), a Washington nonprofit corporation 5 North Naches Avenue Yakima, Washington 98901 (referred to in this Lease as "Tenant") BACKGROUND. See the Recitals set forth in the Master Agreement. AGREEMENT. LANDLORD HEREBY LEASES TO TENANT AND TENANT HEREBY LEASES FROM LANDLORD THE LEASED PREMISES IN ACCORDANCE WITH THE FOLLOWING TERMS AND CONDITIONS: 1. Definitions. Unless the context clearly indicates another meaning and except for terms defined in this Lease, all capitalized terms used in this Lease have the same meaning given to said terms in the Development Agreement and Operating Agreement. The following terms, when used in this Lease, have the following meanings, unless the context clearly indicates another meaning: 1.1 "Aquatic Center" means and refers to the "Aquatic Center" described in Section 2 of the Development Agreement. 1.2 "Development Agreement" means and refers to the Development Agreement dated even herewith by and between Landlord and Tenant in connection with the development of the Aquatic Center to be constructed by Tenant on a portion of the Leased Premises and all future amendments to said Development Agreement (if any). "Due Diligence Contingency" has the meaning given to said words in Section 2.1 below. "Extended Term" has the meaning given to said words in Section 3.2 below. "Funding Contingency" has the meaning given to said words in Section 2.2 below. "Initial Term" has the meaning given to said words in Section 3.1 below. "Leased Premises" means and refers to the Yakima County, Washington real property described on attached Exhibit A-1, together with all utility and other improvements located thereon. The Leased Premises, which is approximately seven and one-half (7.5) acres in area and constitutes a portion of the Parent Parcels, is generally depicted and labeled as the "Leased Premises" on the drawing attached as ExhibitA-2. Ground Lease 1 1.8 "Master Agreement" means and refers to the Master Agreement dated even herewith by and between Landlord and Tenant and all future amendments to said Master Agreement (if any). This Lease is entered into pursuant to the Master Agreement and the recitals and all other terms set forth in the Master Agreement are part of, incorporated into, and constitute a part of this Lease as if set forth in full herein. 1.9 "Opening Date" has the meaning given to said words in Section 1.22 of the Operating Agreement. 1.10 "Operating Agreement" means and refers to the Operating Agreement dated even herewith by and between Landlord and Tenant in connection with the operations and management of the Aquatic Center to be constructed by Tenant on a portion of the Leased Premises under the Development Agreement and all future amendments to said Operating Agreement (if any). 1.11 "Other Facility" means and refers to the "Other Facility" described in Section 2 of the Development Agreement. 1.12 "Parent Parcels" means and refers to the Yakima County, Washington real property commonly referred to as Yakima County Assessor Parcel Nos. 181315-13002, 181315- 31003, 181315-13005, and 181315-13006. 1.13 "Possession Date" has the meaning given to said words in Section 3 below. 1.14 "RCO Contingency" has the meaning given to said words in Section 2.3 below. 1.15 "Term" has the meaning given to said word in Section 3.3 below. 2. Contingencies and Other Agreements. 2.1 Due Diligence Contingency. Tenant's obligation to lease the Leased Premises under this Lease is contingent on and subject to Tenant's determination that the conditions and features of the Leased Premises are acceptable to Tenant, in Tenant's sole and absolute discretion (the "Due Diligence Contingency"). In making said determination, Tenant shall have the right, at Tenant's expense, to inspect, review, and investigate the Leased Premises and its conditions and features. Said inspection, review, and investigation may include, without limitation, (a) hazardous waste inspection (including borings for water and soil sampling); (b) engineering, geotechnical, and soil studies; (c) utility, zoning, and other development studies; (d) economic feasibility of operating facilities on the Leased Premises for Tenant's intended uses; (e) a survey of the Leased Premises; (f) title review; (g) contacting any or all state, county, and city agencies, as well as all water, sewer, and other special districts, in which the Leased Premises is located (if any); and (h) such other due diligence as may be deemed reasonably necessary by Tenant in determining whether the Leased Premises is suitable for Tenant's intended uses. Tenant intends to obtain a Phase I Environmental Site Assessment (a "Phase 1 ESA") for the Leased Premises. If the Phase I ESA indicates that hazardous substances may be located on the Leased Premises or if the Phase I ESA recommends further environmental testing, Tenant may, at Tenant's expense, obtain a Phase II Environmental Site Assessment (a "Phase H ESA") for the Leased Premises as recommended by the Phase I ESA. Ground Lease 2 Tenant will provide Landlord with complete copies of any and all Phase I and Phase II ESAs (and amendments and supplements thereto) obtained or otherwise received by Tenant that pertain to the Leased Premises within ten (10) business days of Tenant's receipt of the same. Tenant makes no representation or warranty as to the accuracy, correctness or otherwise of any Phase I or Phase II ESA (and amendments and supplements thereto). Tenant provides copies to Landlord and such copies are not intended to be relied upon by Landlord or any third parties. The Due Diligence Contingency will be deemed satisfied unless Tenant gives written notice to Landlord of Tenant's termination of this Lease under this Section 2.1 on or before April 30, 2016. From and after the Effective Date of this Lease, Tenant and Tenant's authorized agents, employees, contractors, and invitees shall have the right at reasonable times to enter upon the Leased Premises for the purpose of conducting the due diligence review described in this Section 2.1; provided, however, Tenant shall keep the Leased Premises free and clear of any liens resulting from such investigation and inspection by Tenant or any of Tenant's agents, employees, contractors, or invitees, and Tenant agrees to indemnify, defend, and hold harmless Landlord from all injuries, deaths, claims, losses, damages, and/or other liabilities (collectively "Claims") caused by the negligent acts or omissions or intentional misconduct of Tenant or Tenant's agent(s), employee(s), or representative(s) while present on the Leased Premises under this Section 2.1; provided, however, that in no event shall such indemnity extend to any (a) release of pre-existing hazardous substances present on the Leased Premises as of the Effective Date; (b) any pre-existing conditions on or about the Leased Premises, or (c) any Claims to the extent said claims result from the negligent act or omission or intentional misconduct of Landlord or any agent, contractor, employee, representative, or invitee of Landlord. 2.2 Funding Contingency. Landlord's and Tenant's respective obligations to lease the Leased Premises under this Lease are each contingent on and subject to Tenant securing at least eighty percent (80%) of the funding needed to construct the Aquatic Center, the Other Facility, and such other improvements (collectively the "Project") Tenant intends to construct and operate on the Leased Premises (the "Funding Contingency"), which may include Tenant's cash holdings, donation pledges made to Tenant for the Project (as evidenced by bona fide written pledges), Landlord's Financial Contribution under Section 3 of the Development Agreement, and financing secured by Tenant (as evidenced by one or more bona fide financing commitment letter(s)). If the Funding Contingency is not satisfied by Tenant giving Landlord written notice of the satisfaction of the Funding Contingency (and reasonable evidence confirming the satisfaction thereof) on or before December 31, 2017 (the "Funding Deadline"), either Landlord or Tenant may thereafter terminate this Lease upon at least sixty (60) days' prior written notice given to the other party; provided, however, in the event Landlord gives Tenant written notice of termination under this Section 2.2, Tenant will have the opportunity during said 60 -day notice period to satisfy the Funding Contingency and prevent Landlord's termination of this Lease under this Section 2.2. 2.3 RCO Contingency. Landlord's and Tenant's respective obligations to lease the Leased Premises under this Lease are contingent on and subject to the Interagency Committee for Outdoor Recreation for Washington State or its successor(s) (which are believed to be the Ground Lease 3 National Park Service and/or Washington Recreation Conservation Office) (collectively "RCO"), permitting the Leased Property to be removed from the existing outdoor recreational use restriction that applies to the Leased Premises ("RCO Consent") and thereby consenting to Tenant's use of the Leased Premises under this Lease (the "RCO Contingency"). It is understood that RCO Consent will be granted (and the RCO Contingency satisfied) if Landlord provides and places a comparable outdoor recreational use restriction on separate property of comparable value and use (the "Replacement Property"). Landlord will act in good faith and use its best efforts and due diligence to promptly (a) meet the Replacement Property requirements established by RCO, (b) obtain the RCO Consent in recordable form, and (c) satisfy the RCO Contingency. In doing so, Landlord will, at a minimum, offer as Replacement Property certain property now owned or under contract for purchase by the City that is located adjacent to the new SOZO soccer development that is of equal (or greater) size and of equal (or greater) fair market value to the Leased Premises (the "SOZO-Adjacent Property"). In the event the SOZO-Adjacent Property, in spite of the City's due diligence and good faith and best efforts, is rejected as Replacement Property by RCO, the City will identify and offer different property as Replacement Property for the purpose of obtaining RCO Consent and satisfying the RCO Contingency; provided, however, in the event RCO Consent cannot be obtained and the RCO Contingency satisfied by December 31, 2017 (the "RCO Deadline"), either Landlord or Tenant may thereafter terminate this Lease upon at least ninety (90) days' prior written notice given to the other party. 2.4 Effect of Termination. Subject to the provisions of Section 13.16 below (i.e., the "Survival" clause) and except as otherwise expressly provided in the Development Agreement and/or Operating Agreement, in the event this Lease is terminated as permitted under Section 2.1, 2.2, or 2.3 above as a result of the non -satisfaction of the Due Diligence Contingency, Funding Contingency, or RCO Contingency, the Development Agreement and Operating Agreement will automatically terminate when this Lease terminates, and neither party to said agreements will have any further rights, duties, or obligations under the Lease, the Development Agreement or the Operating Agreement. 2.5 Development Agreement and Operating Agreement. This Lease is subject to and together with the terms of the Development Agreement and Operating Agreement and the undersigned parties' respective rights and obligations thereunder. In the event of a conflict between the provisions of said three documents, the terms of the Operating Agreement shall prevail. 2.6 Boundary Adjustments. On or before the Possession Date, Landlord, at Landlord's expense, will cause the boundary lines for the Parent Parcels to be reconfigured such that the Leased Premises will become and exist as a separate standalone Yakima County parcel. 3. Term. 3.1 Initial Term. The "Initial Term" of this Lease will commence ninety (90) days after the satisfaction of each of the Due Diligence, Funding, and RCO Contingencies under Sections 2.1, 2.2, and 2.3 above (unless Landlord and Tenant mutually agree in writing on some earlier or later date) (the "Possession Date") and will expire exactly forty (40) Ground Lease 4 years after the Opening Date under the Operating Agreement. Upon the determination of the Opening Date under the Operating Agreement, Landlord and Tenant will execute a written and acknowledged memorandum for the purpose of confirming the expiration date for the Initial Term of this Agreement. Subject to the terms of this Lease, Tenant will take possession of the Leased Premises on the Possession Date free of all other leases and tenancies. 3.2 Extended Terms. The Initial Term will automatically extend for three (3) separate and additional ten (10) year periods (each an "Extended Term") on the same terms and conditions set forth in this Lease unless Tenant, at least six (6) months before the commencement of an Extended Term, gives Landlord written notice of Tenant's election to not extend the term of this Lease for the next Extended Term. 3.3 Term (Defined). The word "Term," when used in this Lease, means and refers to the Initial Term set forth in Section 3.1 above and the Extended Terms provided for under Section 3.2 above when and if the term of this Lease is extended under said Section 3.2. In the event the Term is extended for each of the three (3) Extended Terms described in Section 3.2 above, the total Term of this Lease would be seventy (70) years from the Opening Date. 4. INTENTIONALLY OMITTED. 5. Rent. 5.1 Base Rent. During the Term, Tenant will pay Landlord "Base Rent" in the amount of One and No/100 U.S. Dollars ($1.00) per year for Tenant's rental and use of the Leased Premises. It has been determined by Landlord that the nominal rent set forth in this paragraph is reasonable considering the benefits to be derived by Landlord and the public from the development and operation by Tenant of the Aquatic Center to be constructed by Tenant on a portion of the Leased Premises. 5.2 Additional Rent. In addition to the Base Rent described in Section 5.1 above, Tenant will also pay those other charges and expenses this Lease provides are to be paid by Tenant. All payments required to be paid by Tenant under this Lease, other than Base Rent, will constitute "Additional Rent" 6. Use. 6.1 Easements, Restrictions, Etc. Tenant's lease of the Leased Premises under this Lease is together with all rights of and appurtenances to the Leased Premises (including, but not limited to, all water and water rights and all access, utility, and other easements that benefit the Leased Premises) and is subject to the following (collectively the "Restrictions"): (a) all easements, covenants, restrictions, and other agreements of record as of the Effective Date of this Lease; and (b) all zoning and building laws applicable to the Leased Premises. Landlord represents and warrants that the Restrictions will not prevent nor unreasonably interfere with Tenant's use and occupancy of the Leased Premises for the Permitted Uses as set forth in this Lease. Moreover, from the Effective Date of this Lease and until the conclusion of Tenant's rights hereunder, Landlord covenants that Landlord will not encumber the Leased Premises with any new easement, covenant, restriction, agreement, or other encumbrance that limits or otherwise affects the title to or use of the Leased Premises after the Effective Date of this Lease unless and Ground Lease 5 until Tenant consents thereto in a signed and acknowledged writing recorded in the records of Yakima County, Washington. Moreover, subject to satisfaction of the RCO Contingency and Landlord's obligations under Section 2.3 above, Landlord will cause the instrument recorded on or about August 12, 1976, under Yakima County Auditor's File No. 2431304 to be released from the Leased Premises so that it no longer encumbers the Leased Premises. To accommodate Tenant's construction on and/or use of the Leased Premises, Tenant, at Tenant's expense, is permitted to relocate any City utilities that run over, under, or otherwise across the Leased Premises to new locations within the Leased Premises (or the areas located within fifty (50) feet south and fifty (50) feet east of the Leased Premises) so long as said work is completed in a workmanlike manner and in accordance with the City of Yakima Public Works Department's reasonable design and construction specifications for the relocated location of the utilities. In the course of relocating any utilities under this paragraph, Tenant will be permitted to abandon existing portions of utilities that are replaced with new utility improvements under this paragraph. Landlord and Tenant specifically acknowledge Tenant's anticipated need to relocate the City wastewater pipeline that runs east -west across the center of the Leased Premises. 6.2 Permitted Uses. Tenant shall have the right to use the Leased Premises for not-for-profit purposes that include the construction and operation of (a) an aquatic center (including both the Aquatic Center and any additions, modifications, expansions, or improvements thereto made by Tenant from time to time); (b) a YMCA facility (including both the Other Facility and any additions, modifications, expansions or improvements thereto made by Tenant from time to time) initial facilities and any expansion facilities) and YMCA programming; (c) community center; (d) nonprofit office, program, service, and/or meeting space; (e) health, fitness, medical, and/or wellness facility; and (f) all reasonably related business and/or incidental operations/activities, and for no other use, unless and until Landlord consents in writing to the other use, which consent may not be unreasonably withheld (the "Permitted Uses"). It is expressly acknowledged and agreed that the following activities (whether conducted in a non-profit or for-profit capacity) constitute Permitted Uses under this Lease: (a) Tenant's operation and/or sublease of a portion of Tenant's facilities on the Leased Premises (including the Other Facility and Common Areas, but excluding the Aquatic Center) to one or more third parties for the operation of a cafe, coffee cart, concession stand, and/or a similar food/beverage-related businesses; (b) Tenant's sublease of a portion of Tenant's facilities on the Leased Premises (including the Other Facility and Common Areas, but excluding the Aquatic Center) to one or more third parties for the operation of onsite healthcare services, including, without limitation, physical therapy in the Aquatic Center and/or Other Facility operated by Tenant on the Leased Premises; and (c) Tenant's sublease of a portion of Tenant's facilities on the Leased Premises (including the Other Facility and Common Areas, but excluding the Aquatic Center) to one or more nonprofit entities for non-profit purposes. 6.3 Parking. The parking lot, entryway, sidewalks, curbs, lighting, landscaping, and other improvements generally depicted and labeled as the "Existing Parking Lot" on the drawing attached as Exhibit A-2 (the "Existing Parking Lot") are included within the Leased Premises; provided, however, the Existing Parking Lot will remain under Landlord's control for general public use (e g., Chesterley Park users). Notwithstanding the foregoing, during the entire Term of this Lease, Tenant and Tenant's agents, independent contractors, employees, customers, suppliers, representatives, and invitees Ground Lease 6 will at all times (a) have access to and from the Leased Premises over the Existing Parking Lot and (b) be permitted the shared use of the Existing Parking Lot on a "first come/first served/non-reserved basis" in connection with their use of the facilities operated on the Leased Premises; provided, however, said use, during periods of construction on the Leased Premises shall not include Tenant's contractors utilizing part or all of the Existing Parking Lot for locating construction trailers, storing construction materials, and staging equipment or supplies, , or in any way substantially impacting the public access to and use of the Existing Parking Lots (instead, said uses activities must be confined to the remainder of the Leased Premises). During the Term, Landlord, at Landlord's expense (but subject to the terms of the Operating Agreement), will operate and keep and maintain the Existing Parking Lot and each of its existing amenities (e g , parking lot spaces, entryway to and from River Road, sidewalks (if any), landscaping, lighting, etc.) in good condition and in the customary manner as other paved and lighted public parking lots are maintained by Landlord, and in doing so, Landlord covenants to maintain the same number of parking spaces now contained within the Existing Parking Lot and at least half of the number of handicapped parking spaces needed to meet all legal requirements in connection with the Existing Parking Lot's use in connection with the Aquatic Center. Furthermore, Landlord, at Landlord's sole expense, is responsible for all ice and snow removal from the Existing Parking Lot's driveways, walkways, and parking area. Except when caused by the negligent act or omission or intentional misconduct of Tenant or Tenant's agent(s), employee(s), invitee(s), or representative(s), Landlord will indemnify, defend, and hold harmless Tenant and Tenant's directors, officers, employees, agents, and representatives from and against any and all injuries, deaths, claims, losses, damages, and/or other liabilities occurring on or about the Existing Parking Lot incurred in connection with or as a result of the public's presence on or use of the Existing Parking Lot. During the Term, with an insurer and in form and substance reasonably satisfactory to Tenant, Landlord, at Landlord's sole expense, will procure and maintain Commercial General Liability insurance covering the Existing Parking Lot that covers Bodily Injury, Property Damage and Personal Injury with limits of not less than $2,000,000 Each Occurrence; $4,000,000 General Aggregate. The insurance policy/policies required under this Section 6.3 will be endorsed to name Tenant as an additional insured on a primary and non-contributory basis. The insurance coverage values shall be subject to review and revision, to be consistent with current costs and values, no less than once every ten years from the beginning of the Lease Term until the Lease terminates. When requested by Tenant, Landlord will furnish Tenant with complete copies of the insurance policy/policies required under this Section 6.3 and certificates of insurance from the insurer(s) for said policy/policies that evidence that the insurance required under this Section 6.3 is in full force and effect, that Tenant has been and continues to be named as an additional insured thereon, and that the policy/policies may not be cancelled unless at least twenty (20) days' prior written notice of a contemplated cancellation has been given to Tenant at Tenant's above -written address. Notwithstanding the foregoing, it is acknowledged and confirmed that Tenant will have the exclusive use, responsibility for, and control of any additional parking lot constructed by Tenant on the remainder of the Leased Premises. Ground Lease 7 6.4 Compliance with Laws. Tenant's use of the Leased Premises will comply, at Tenant's expense (but subject to the terms of the Operating Agreement), with all applicable laws, regulations, and requirements. 6.5 Nuisance. Aside from the Permitted Uses allowed under Section 3.2 above, Tenant will not conduct nor permit any other activities on the Leased Premises that will create a public or private nuisance. 6.6 Supervision. Tenant will supervise Tenant's employees and use reasonable efforts to cause Tenant's agents, independent contractors, employees, customers, suppliers, representatives, and invitees to conduct their activities in such a manner as to comply with the requirements of this Lease. 6.7 Violations of Law. Landlord represents and warrants that Landlord is not aware of any violations of law that exist with regard to the Leased Premises, including, without limitation, laws pertaining to occupational hazards, environment violations (e.g., hazardous materials or substances, leaking underground storage tanks, etc.), or violations of the Americans With Disabilities Act (or any similar federal, state, or local law). Landlord will indemnify, defend, and hold harmless Tenant and Tenant's directors, officers, employees, agents, and representatives from any costs, expenses, attorneys' fees, or liabilities relating to any violation of law that existed with regard to the Leased Premises on the Possession Date and will be responsible for all expenses needed to correct or remedy the violation of law. 7. Utilities and Taxes. 7.1 Utilities. Except as set forth in Section 6.3 above, Tenant will pay, prior to delinquency, all charges for utilities and services supplied to the Leased Premises during the Term, including, without limitation, service charges for electricity, gas, telephone, internet, water, sewer, irrigation, and garbage collection. Landlord will not be liable for any failure or interruption of utilities or services to the Leased Premises, unless caused by the negligent act or omission or intentional misconduct of Landlord or Landlord's agent(s), employee(s), or representative(s). Tenant shall also be responsible for payment of all stormwater fees assessed by the City for stormwater costs resulting from any new parking facility constructed by Tenant on the Leased Premises. 7.2 Real Property Taxes. Landlord will pay, prior to delinquency, all real property taxes and other assessments assessed against and/or levied during the Term on the Leased Premises (to the extent the Leased Premises are not exempt from said taxation); provided, however, Tenant will pay, prior to delinquency, all real property taxes and other assessments assessed against and/or levied during the Term on real property improvements constructed on the Leased Premises by Tenant (to the extent said improvements are not exempt from said taxation). 7.3 Personal Property Taxes. Tenant will pay, prior to delinquency, all personal property taxes and other assessments assessed against and/or levied during the Term on machinery, equipment, trade fixtures, furnishings, and other personal property kept on the Leased Premises by Tenant (to the extent said property is not exempt from said taxation). When possible, Tenant will cause said machinery, equipment, trade fixtures, furnishings Ground Lease 8 and all other personal property to be assessed and billed separately from the Leased Premises. 8. Insurance and Indemnification. 8.1 Tenant's Insurance Obligations. During the Term, with an insurer and in form and substance reasonably satisfactory to Landlord, Tenant, at Tenant's expense (but subject to the terms of the Operating Agreement), will procure and maintain Commercial General Liability insurance over the Leased Premises that covers Bodily Injury, Property Damage and Personal Injury with limits of not less than $2,000,000 Each Occurrence; $4,000,000 General Aggregate. The insurance policy/policies required under this paragraph will be endorsed to name Landlord as an additional insured on a primary and non-contributory basis. The insurance coverage values shall be subject to review and revision, to be consistent with current costs and values, no less than once every ten years from the beginning of the Lease Term until the Lease terminates. When requested by Landlord, Tenant will furnish Landlord with complete copies of the insurance policy/policies required under this Section 8.1 and certificates of insurance from the insurer(s) for said policy/policies that evidence the insurance required under this Section 8.1 is in full force and effect, Landlord has been and continues to be named as an additional insured thereon, and that the policy/policies may not be cancelled unless at least twenty (20) days' prior written notice of a contemplated cancellation has been given to Landlord at Landlord's above -written address. During the Term, Tenant, at Tenant's expense (but subject to the terms of the Operating Agreement), will be solely responsible for insuring any and all personal property that is not part of the Leased Premises that is stored or otherwise kept in or on the Leased Premises by Tenant, whether said personal property is owned by Tenant or any other third party, and on all tenant improvements and betterments Tenant incorporates into the Leased Premises. 8.2 Waiver of Subrogation Rights. Tenant and Landlord each waive any and all rights of recovery against the other, or against the agents, independent contractors, employees, customers, suppliers, representatives, and invitees of each other, for loss of or damage to such waiving party, property, or property of others under its or their control, where such loss or damage is insured against under any insurance policy in force at the time of such loss or damage. Further, Landlord and Tenant will cause their respective insurers to waive said insurers' respective rights of subrogation/recovery against the other party pursuant to this provision and to provide one another, at their respective requests, with written notice of said waivers. 8.3 Indemnification by Tenant. Except when caused by the negligent act or omission or intentional misconduct of Landlord or Landlord's agent(s), employee(s), or representative(s), but subject to the provisions of Section 8.2 above, Tenant will indemnify, defend, and hold harmless Landlord and Landlord's elected and appointed officials, employees, agents, and representatives from and against any and all claims of third parties arising from Tenant's use of the Leased Premises, or from the conduct of Tenant's business, or from any activity, work, or things done, permitted, or suffered by Tenant in or about the Leased Premises; and, further, subject to the provisions of Section 8.2 above, Tenant will indemnify, defend, and hold harmless Landlord and Landlord's elected and appointed officials, employees, agents, and representatives from and against Ground Lease 9 any and all other injuries, deaths, claims, losses, damages, and/or other liabilities on or about the Leased Premises caused by the negligent act or omission or intentional misconduct of Tenant or Tenant's agent(s), employee(s), or representative(s). The liability of Tenant, and any indemnities provided by Tenant under this paragraph, will not extend to hazardous materials that were not placed in, on, or about the Leased Premises by Tenant, or by any of Tenant's agents, employees, representatives, or invitees. 8.4 Indemnification by Landlord Except when caused by the negligent act or omission or intentional misconduct of Tenant or Tenant's agent(s), employee(s), or representative(s), but subject to the provisions of Section 8.2 above, Landlord will be responsible for and indemnify, defend, and hold harmless Tenant and Tenant's directors, officers, employees, agents, and representatives from and against any and all claims arising from any breach of or default in the performance of any obligation of Landlord's part to be performed under the terms of this Lease; and, further, subject to the provisions of Section 8.2 above, Landlord will be responsible for and will indemnify, defend, and hold harmless Tenant and Tenant's directors, officers, employees, agents, and representatives from and against any all other injuries, deaths, claims, losses, damages, and/or other liabilities on or about the Leased Premises caused by the negligent act or omission or intentional misconduct of Landlord or Landlord's agent(s), employee(s), or representative(s). The liability of Landlord, and any indemnities provided by Landlord under this paragraph, will not extend to hazardous materials that were not placed in, on, or about the Leased Premises by Landlord, or by any of Landlord's elected or appointed officials, agents, employees, representatives, or invitees. 8.5 Additional Indemnification Provisions. Each party to this Lease ("Indemnfing Party") shall indemnify, defend, and hold harmless the other party to this Lease (the "Indemnified Party") from and against all claims asserted by persons not parties to this Lease arising from or relating to the Indemnifying Party's breach of this Lease, negligence, intentional misconduct, or violation of law. Notwithstanding the foregoing provisions of Sections 8.3, 8.4, and 8.5 above, in compliance with RCW 4.24.115 as in effect on the date of this Lease, in the event of the concurrent negligence of Landlord or Landlord's agent(s), employee(s), or representative(s), on the one hand, and that of Tenant or Tenant's agent(s), employee(s), or representative(s), on the other hand, which concurrent negligence results in claims occurring on or about the Leased Premises, either party's obligation to indemnify the other party as set forth in Sections 8.3, 8.4, and 8.5 above shall be limited to the extent of the negligence of such party or its agent(s), employee(s), or representative(s), including such party's proportional share of costs and attorneys' fees incurred in connection with such claims. In no event shall Landlord or Tenant be indemnified for its sole negligence or that of its agent(s), employee(s), or representative(s). 9. Condition, Maintenance, Repairs, and Alterations. 9.1 Condition of Leased Premises. Landlord represents and warrants to Tenant that on the Possession Date the Leased Premises will be free of structures, debris, and improvements aside from those that exist as of the Effective Date of this Lease (e.g., existing utilities and Existing Parking Lot improvements). Landlord represents and warrants to Tenant that on Opening Day the Exhibit Parking Lot will be in a condition suitable for public use in connection with the Aquatic Center and Other Facility and that within a reasonable period of time after Operating Day (but in no event longer than six months after Opening Ground Lease 10 Day) the City will fill all cracks, repair all curbs, and sealcoat all pavement within the Existing Parking Lot. If any warranty made in this Section 9.1 is violated, then it will be the obligation of Landlord, after notice from Tenant setting forth the nature of the violation, to promptly, at Landlord's expense, rectify such violation. Except as otherwise provided in this Lease, Tenant accepts the Leased Premises "AS IS" and in their condition existing as of the Possession Date. 9.2 Tenant's Obligations. Subject to the provisions of Sections 6.3 and 9.1 above and except for ordinary wear and tear, damage by fire or other casualty, and damage caused by the negligent acts or omissions or intentional misconduct of Landlord or Landlord's agent(s), employee(s), or representative(s), during the Term, Tenant, at Tenant's expense (but subject to the terms of the Operating Agreement), will keep the Leased Premises in good repair and proper working order. Furthermore, Tenant, at Tenant's expense (but subject to the terms of the Operating Agreement and Section 6.3 above), is responsible for all ice and snow removal from the Leased Premises' driveways, walkways, and parking area. 9.3 Alterations. Tenant shall have the right, without further consent or approval from Landlord, to construct facilities, conduct renovations, and make alterations to improvements located on the Leased Premises when and as determined by Tenant, provided said construction, renovations, and alterations (a) are not in violation of the Development Agreement or the Operating Agreement; (b) are for Permitted Uses under this Lease; (c) do not unreasonably impair the public use of the Aquatic Center in accordance with the terms of the Operating Agreement; and (d) are in compliance with all applicable laws, regulations, and requirements, including, without limitation, all zoning and construction permit requirements. Tenant will pay when due all claims for labor and materials furnished for or to Tenant for use in or on the Leased Premises. Except as expressly set forth in this Section 9.3, Tenant will not permit any mechanics' or materialmen's liens to be levied against the Leased Premises for any labor or materials furnished to Tenant or claimed to have been furnished to Tenant or Tenant's agents or contractors in connection with work of any character performed or claimed to have been performed on the Leased Premises by or at the direction of Tenant; provided, however, Tenant may, in good faith, contest any claim of lien so long as Tenant prevents foreclosure and, in such event, Tenant will defend and hold Landlord and the Leased Premises harmless from any consequences of such action, including, without limitation, costs and reasonable attorneys' fees incurred. Except as provided in the immediately preceding sentence, if Tenant fails to pay any such lien claim or to discharge any such lien within one hundred eighty (180) days following the filing of such lien, Landlord may do so and collect such amount as Additional Rent. Amounts paid by Landlord will bear interest and be repaid by Tenant as provided in Section 12.2 below. 9.4 Signage. Tenant, at Tenant's expense (but subject to the terms of the Operating Agreement), may install and maintain signs on the Leased Premises, provided such signs are installed and maintained in compliance with all applicable laws, regulations, and requirements. 9.5 Surrender of Leased Premises. On the last day of the Term, Tenant will surrender possession of the Leased Premises (and all improvements, renovations, and alterations constructed on the Leased Premises) to Landlord in their "AS IS" condition at said time. All improvements, renovations, and alterations constructed on the Leased Premises by or Ground Lease 11 on behalf of Tenant, including, but not limited to, the Aquatic Center and the Other Facility, shall be and remain Tenant's property until the expiration of the Term, at which time such improvements shall be surrendered by Tenant as part of the Leased Premises and Landlord will become the owner of said items. Notwithstanding the foregoing, at the end of the Term, Tenant's machinery, trade fixtures, furnishings, and equipment will remain the property of the Tenant and may be removed by Tenant from the Leased Premises, subject to Tenant's obligation to repair any damage to the Leased Premises caused by the removal of Tenant's machinery, trade fixtures, furnishings, and equipment, which repair will include the patching and filling of holes and repair of any structural damage; provided, however, it is hereby acknowledged Tenant may not remove any building or aquatic systems (e.g., HVAC, electrical, plumbing, filtration, heating, etc.) from the facilities constructed on the property. 9.6 Entry and Inspection. With reasonable prior notice to Tenant, Landlord and Landlord's authorized representatives may enter the Leased Premises and the Aquatic Center placed thereon (but not the non -aquatic center improvements placed on the Leased Premises) at any reasonable time for the purpose of confirming Tenant's compliance with this Lease; provided, however, when entering and inspecting the Leased Premises and Aquatic Center, Landlord may not unreasonably interfere with or disrupt any activities being conducted on the Leased Premises. 10. Assignment and Subletting. Tenant is permitted to sublease all or any portion of the Leased Premises with Landlord's prior written consent, which consent may not be unreasonably withheld, so long as the subtenants' use of said areas is within the Permitted Uses allowed under Section 6.2 above; provided, however, no such sublease will operate to release or otherwise alter any of Tenant's obligations under this Lease. Moreover, in the event Tenant subleases all or any portion of the Leased Property, unless Landlord agrees otherwise in writing, the expiration of this Lease or any permitted termination hereof will entitle Landlord to terminate any or all subleases of the Leased Property by Tenant and/or to assume any or all such subleases as the landlord with the subtenant(s) thereunder. 11. Other Rights and Obligations. 11.1 Mortgages and Estoppel Certificates. Landlord is not permitted to mortgage, grant a deed of trust in, or otherwise grant a security interest in the Leased Premises. Tenant shall have the right to grant mortgages and/or deeds of trust in Tenant's right, title, and interest in, to, and under this Lease (i.e., leasehold mortgages and/or leasehold deeds of trust) (each a "Leasehold Mortgage") and in connection with said leasehold mortgage(s) and/or deed(s) of trust, Landlord will consent to and execute documentation reasonably requested by Tenant and Tenant's lender(s) in connection therewith, which may include, but not necessarily be limited to, agreements that include standard leasehold mortgagee protection provisions, including non -disturbance provisions, lender notice requirements before exercise of remedies, bankruptcy protection, and lender cure opportunity provisions. In the event Tenant seeks to obtain or modify a Leasehold Mortgage, and the mortgagee for the Leasehold Mortgage requires amendments to this Section 11.1 or other parts of this Lease for the purpose of defining the mortgagee's rights in connection with the Leasehold Mortgage, then Landlord agrees to amend this Section 11.1 or other sections of this Lease to the extent requested by Tenant and the mortgagee, provided that the form and content of such amendments are reasonable and Ground Lease 12 that such proposed amendments do not materially or adversely affect the rights of Landlord hereunder or its interest in the Leased Premises. Moreover, within ten (10) days after Landlord's or Tenant's written request, the other party will deliver a written statement to the requesting party stating whether the requesting party is in compliance will all of said party's obligations under this Lease, the date to which the rent and other charges owed under this Lease have been paid, whether this Lease has been modified and is in full force and effect, and any other matters that may reasonably be requested by the requesting party concerning this Lease to the extent true and without waiving any rights of the answering party. 11.2 Landlord's Liability; Sale. In the event the original Landlord hereunder, or any successor owner of the Leased Premises, sells or conveys the Leased Premises, then from and after the date of such sale, transfer, or conveyance, the original Landlord, or such successor owner, shall have no liability to Tenant for liabilities or obligations arising or accruing under this Lease after the date of such sale, transfer, or conveyance, provided the assignee expressly assumes all liabilities and obligations under this Lease. Tenant agrees to attorn to such new owner. Notwithstanding the foregoing, Landlord and Tenant expressly acknowledge and agree that no sale, transfer, or conveyance of the Leased Premises will affect, eliminate, terminate, or otherwise reduce Landlord's obligations under the Development Agreement or Operating Agreement. 11.3 Eminent Domain. Any award for taking of all or any part of the Leased Premises under the power of eminent domain will be the property of Landlord; provided, however, nothing precludes Tenant from seeking and obtaining any award for (a) Tenant's lost use of the Leased Premises under this Lease; (b) any improvements owned by Tenant that are taken; (c) any loss of, damage to, or cost of removal of Tenant's improvements, trade fixtures, and removable personal property; and/or (d) damages for cessation or interruption of Tenant's business. Tenant shall have the right to negotiate directly with the condemnor for the portion of the award Tenant is entitled to hereunder. A sale by Landlord to any authority with power of eminent domain that adversely affects Tenant's use of the Leased Premises, either under threat of condemnation or while condemnation proceedings are pending, will be deemed a taking under the power of eminent domain under this Section 11.3. 12. Defaults, Remedies, and Dispute Resolution. This Lease is subject to the default, remedy, dispute resolution, and other provisions set forth in Sections 11.1, 11.2, and 11.3 of the Operating Agreement. In the event of a default of this Lease, said provisions of the Operating Agreement will control and should be consulted. 13. Miscellaneous Terms. 13.1 Amendments. This Lease may not be modified or amended except by written agreement signed and acknowledged by each of the parties hereto. 13.2 No Agency Relationship. Nothing contained in this Lease creates the relationship of principal and agent between the parties hereto and no provisions contained herein will be deemed to create any relationship other than that of landlord and tenant. 13.3 Time is of the Essence. Time is of the essence as to all terms of this Lease. Ground Lease 13 13.4 Notices. All notices under this Lease must be in writing and will be deemed given to the receiving party when (a) personally delivered to the City Manager for the City of Yakima (for notices to Landlord) or personally delivered to the CEO or President of the Yakima Family YMCA (for notices to Tenant) or (b) three days after being deposited in the United States Postal Service by certified mail (with return receipt requested) to the receiving party at the receiving party's last known address(es). 13.5 Exhibits. There are no attachments to this Lease except for the Exhibits expressly referenced in this Lease, each of which constitutes a part of this Lease as if set forth in full herein. 13.6 Headings; Construction. The captions and paragraph headings used in this Lease are inserted for convenience of reference only and are not intended to define, limit, or affect the interpretation or construction of any term or provision of this Lease. This Lease shall not be construed more strictly against one party than the other by virtue of the fact that one party drafted this Lease and/or certain clauses contained herein. It is hereby recognized that both parties to this Lease and their respective counsel have had a full and fair opportunity to negotiate and review all terms and provisions of hereof and to fully contribute to this Lease's substance and form. 13.7 Governing Law and Venue. This Lease will be interpreted, construed, and governed by the laws of the State of Washington. The exclusive venue for any legal action to interpret or enforce this Lease will be Yakima County, Washington. 13.8 Assignment; Binding Effect. Except as expressly provided otherwise herein, neither party hereto may assign any of its rights or obligations under this Lease unless the other party consents thereto in writing, which consent may be withheld for any reason. Subject to any limitations on assignments provided for in this Lease, all of the provisions of this Lease will inure to the benefit of and be binding on the successors and assigns of Landlord and Tenant. 13.9 Waivers. The failure of either party to seek redress for violation of or to insist upon the strict performance of any covenant or condition of this Lease will not prevent a subsequent act, which would have originally constituted a violation, from having the effect of an original violation. 13.10 Attorneys' Fees; Venue. In the event of any dispute arising out of or relating to this Lease, whether or not suit or other proceedings is commenced, and whether in mediation, in arbitration, at trial, on appeal, in administrative proceedings, or in bankruptcy (including, without limitation, any adversary proceeding or contested matter in any bankruptcy case), the prevailing party will be entitled to its costs and expenses incurred, including reasonable attorneys' fees. The sole venue for any dispute arising out of or relating to this Lease will be in Yakima County, Washington. 13.11 Quiet Enjoyment. Provided Tenant is not in default, Tenant will peaceably and quietly hold and enjoy the Leased Premises for the Term without interruption by Landlord or any of Landlord's assignees or any person or persons lawfully or equitably claiming by, through, or under Landlord or any of Landlord's assignees. 13.12 Counterparts and Copies. This Lease may be executed in any number of identical counterparts, with each counterpart having the same effect as if all parties to this Lease Ground Lease 14 had signed the same document. All executed counterparts of this Lease will be construed as and constitute one and the same instrument. A facsimile or electronic copy (e.g., a PDF copy) of an executed counterpart of this Lease will have the same effect as an original executed counterpart of this Lease. 13.13 Severability. If any provision of this Lease or the application thereof to any person or circumstances shall to any extent be held to be invalid or unenforceable, such provision shall not affect or invalidate the remainder of this Lease, and to this end the provisions of this Lease are declared to be severable. If such invalidity becomes known or apparent to the parties, the parties agree to negotiate promptly in good faith in an attempt to amend such provision as nearly as possible to be consistent with the intent of this Lease. 13.14 Recording. Neither Landlord nor Tenant will record this Lease. However, following the execution of this Lease, the parties, at Tenant's request, will execute a Memorandum of Lease that will be recorded by Tenant in the Yakima County Auditor's Office for the purpose of providing constructive notice to the public of the existence of this Lease and the length of the Term. Said Memorandum of Lease will not disclose any of the financial or other economic terms contained in this Lease. 13.15 Entire Agreement. This Lease, together with the associated Master Agreement, Development Agreement, and Operating Agreement, constitutes the entire understanding and agreement of the parties to this Lease with respect to its subject matter. All prior agreements, understandings, or representations with respect to this Lease's subject matter are hereby canceled in their entirety and are of no further force or effect. It is expressly acknowledged that there are no oral or other agreements which modify or affect this Lease. 13.16 Survival All representations, warranties, and indemnities set forth in or otherwise made pursuant to this Agreement shall survive and remain in effect following the expiration or earlier termination of this Lease; provided, however, that nothing herein is intended to extend the survival beyond any applicable statute of limitations period. 13.17 Authority. The execution, delivery, and performance by each party of this Lease has been duly authorized by their respective governing bodies (i.e., the YMCA's Board of Directors and the City Council for the City of Yakima) in accordance with their respective governing documents and applicable law, and no further action is necessary on the part of either party to this Lease or their respective governing bodies to make the execution, delivery, and performance of this Lease by the undersigned persons valid and binding upon the parties to this Lease. [Signatures on Following Page] Ground Lease 15 EFFECTIVE as of the Effective Date first written above. YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA Bob Romero, CEO CITY OF YAKIMA urke, City Manager � o ) 5 -a2.5 CITY CONTRAC r RESOLUTION NO. R- oZ 0 (5 - 1 2 a 8 Ground Lease 16 STATE OF WASHINGTON ) ss. COUNTY OF YAKIMA I certify that I know or have satisfactory evidence that BOB ROMERO 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 CEO for the YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA to be the free and voluntary act of such party for the uses and purposes mentioned in the instrument. DATED: (Vr/4 , - o2-] , 2015. Notary Public State of Washlogtos JOD11. STEPHENS MY COMMISSION EXPIRES August 11, 201S STATE OF WASHINGTON ) ss. COUNTY OF YAKIMA [PRINT NAME] Jc/ NOTARY PUBLIC for the....Stalf of Washin ton residing at /off- 1 �i va My appointment expires: ./g . I certify that I know or have satisfactory evidence that TONY O'ROURKE 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 CITY MANAGER for the CITY OF YAKIMA to be the free and voluntary act of such party for the uses and purposes mentioned in the instrument. DATED: ON- / , 2015. Notary Public State of Washington SONYA R CLAAR TEE MY COMMISSION EXPIRES OCTOBER 25, 2018 \.J [PRINT NAME] cci Y NOTARY PUBLIC for the State of Washington, residing at V- 04 My appointment expires: Ict< Ground Lease 17 EXHIBIT A-1 Leta] Description of the Leased Premises That portion of the Southwest quarter of the Northeast quarter of Section 15, Township 13 North, Range 18 East, W.M. described as follows: Beginning at the Northwest corner of said Subdivision; thence South 89°42'45" East, along the North line thereof, 75.00 feet to the Easterly right of way line of the Pacific Power and Light Company's canal; thence continuing South 89°42'45" East 104.00 feet to the True Point of Beginning; thence South 0°17'15" West 310.45 feet; thence South 30°52' West 4.06 feet; thence along the arc of a curve to the left having a radius of 145.00 feet, a central angle of 54°39' and a length of 138.30 feet; thence South 23°47' East 165.63 feet; thence North 66°13' East 13.05 feet; thence along the arc of a curve to the right having a radius of 4.00 feet, a central angle of 83°03' and a length of 5.80 feet; thence South 30°44' East 11.24 feet; thence along the arc of a curve to the left having a radius of 53.00 feet, a central angle of 167°26' and a length of 154.89 feet; thence North 18°10' West 12.40 feet; thence along the arc of a curve to the right having a radius of 4.00 feet, a central angle of 84°23' and a length of 5.89 feet; thence North 66°13' East 13.19 feet; thence North 89°26'10" East 265.00 feet; thence North 56°04' East 80.00 feet; thence North 89°26' 10" East 170.00 feet; thence North 0°33'50" West 486.42 feet to the North line of said Subdivision; thence North 89°42'45" West, along said North line, 680.56 feet to the True Point of Beginning; EXCEPT that portion lying Northerly of the following described line: Beginning at the Northwest corner of said Subdivision; thence South 89°42'45" East, along the North line thereof, 75.00 feet to the Easterly right of way line of the Pacific Power and Light Company's canal; thence continuing South 89°42'45" East 104.00 feet; thence South 0°17'15" West 78.18 feet to the True Point of Beginning; thence North 89°26' 10" East 165.00 feet; thence North 0°33'50" West 15.00 feet; thence North 89°26'10" East to the East line of said Subdivision and the terminus point of the herein described line. Situated in Yakima County, Washington. Parcel contains 326,692 SQ. FT./7.50 acres EXHIBIT A-1 EXHIBIT A-2 General Depiction of the Leased Premises [See Attached] EXHIBIT A-2 N K La. Elk t 1316 f MOM di gi MAO 4[ X66 5 0073 50' E 40.133 VTC }..«._.. A -s NE CORNER, SW 1/4, NE 1/4.. SEC. 15,'T-13 N, R-18-E.WIL' 5/8' REBAR FOUND! RIGHT OF WAY'THAT • NEEDS TO BE DEEDED FOR EXISTING ' 1"--:;_r____*___ V3 1382' I 8976'10' 10- E 168.00' 334 42' "+ ER ROAD 7.441c4 c'' — R=4 00' 0=83 .3 L=5.• N 1810' W- 8=4 DC' D=84'23' L=5.89' N 6613' E 13.05' S' 24 R=53 00' D=167'26' >�,. �L=154.89' it 11fti'OI-g-T-,(ate(7.•.:}at, W 60 0 -, 60 FEET SCALE. 1" = 50 EXHIBIT 2 Development Agreement [See Attached] EXHIBIT 2 PARTIES: FIRST AMENDMENT TO GROUND LEASE EFFECTIVE DATE: May 1, 2018 CITY OF YAKIMA, a Washington municipal corporation 129 North 2nd Street Yakima, Washington 98901 (referred to in this Amendment as "Landlord") YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA (d/b/a YAKIMA FAMILY YMCA), a Washington nonprofit corporation 5 North Naches Avenue Yakima, Washington 98901 (referred to in this Amendment as "Tenant") GROUND LEASE. The term "Ground Lease," when used in this Amendment, means and refers to the Ground Lease dated October 27, 2015, by and among Landlord and Tenant pertaining to Tenant's lease from Landlord of a portion of Chesterley Park in Yakima, Washington. BACKGROUND. To better facilitate the arrangements between the City of Yakima (i.e., Landlord) and the Yakima Family YMCA (i.e., the Tenant) for the construction and operation of the Aquatic Center, the undersigned parties have mutually agreed to amend the timing and financing of Landlord's financial obligations under the Operating Agreement through the first ten years of the Aquatic Center's operations and the manner and timing in which the City's Financial Contribution under the Development Agreement and certain other financial obligations under the Operating Agreement are met. In general terms, Landlord has requested to eliminate Landlord's obligation to reimburse Tenant for Pre -Opening Expenses, Operating Deficits, and Capital Improvement Expenditures under the Operating Agreement until the tenth anniversary of the Opening Date in exchange for Landlord's agreement to increase the City's Financial Contribution under the Development Agreement from $4,500,000.00 to $8,000,000.00. Subject to and in accordance with the terms of this Amendment and the below -described Related Amendments, Tenant has agreed to accommodate said requests by Landlord. This Amendment and the below -described Related Amendments are now executed for the purpose of memorializing the amendments made to the Development Agreement, Operating Agreement, and Ground Lease in connection with said agreement. Moreover, the Development Agreement, Operating Agreement, and Ground Lease are also executed for the purpose of confirming the satisfaction of the Due Diligence, RCO, and Funding Contingencies and to memorialize the Possession Date and commencement of the Initial Term. Finally, the Ground Lease is amended to expressly acknowledge that Tenant, in connection with financing a portion of the construction of the Aquatic Center and Other Facility through New Markets Tax Credits, may seek Landlord's consent to the assignment of certain rights under the Ground Lease to a newly formed nonprofit corporation, the purpose of which is to qualify as a "supporting organization" within the meaning of Internal Revenue Code Section 509(a)(3) for the support and benefit of Tenant and to serve as a "qualified active low-income community business" or` "QALICB" as defined in Section 45D of the Internal Revenue Code. AMENDMENT. FOR GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND ADEQUACY ACKNOWLEDGED, THE UNDERSIGNED PARTIES AGREE AND AMEND THE GROUND LEASE AS FOLLOWS: 1. Effect of Amendment. This Amendment amends, supplements, and is made part of the Ground Lease. In the event of a conflict between the provisions of this Amendment and the Ground Lease, Amendment to Ground Lease (2018) 1 the provisions of this Amendment will control. Nevertheless, except as expressly amended or supplemented by this Amendment, the provisions of the Ground Lease remain in full force and effect. 2. Capitalized Terms. Except when the context clearly requires another meaning and for capitalized terms defined in this Amendment, all capitalized terms used in this Amendment have the same meaning given to said terms in the Ground Lease. 3. Agreed Possession Date. For the purpose of facilitating an orderly transition of the possession of the Leased Premises from Landlord to Tenant under the Ground Lease, Section 3.1 of the Ground Lease is amended such that the Possession Date (i.e , the commencement date for the Initial Term and the date on which Tenant will take physical possession of the Leased Premises) will be May 2, 2018. 4. Completion of Landlord's Title Obligation Under Section 6.1. Landlord will, on or before May 2, 2018, satisfy Landlord's obligation under Section 6.1 of the Ground Lease to cause the instrument recorded on or about August 12, 1976, under Yakima County Auditor's File No. 2431304 to be released from the Leased Premises so that it no longer encumbers the Leased Premises. 5. NMTC. Tenant intends to finance a portion of the construction costs for the Aquatic Center and Other Facility using New Markets Tax Credits ("NMTC") in accordance with Section 45D of the Internal Revenue Code of 1986 (as amended) (the "Code"). In connection with obtaining NMTC financing it may be necessary or appropriate, in order to maximize the amount of subsidy available in connection with the construction of the Aquatic Center and Other Facility, for Tenant to assign some or all of its rights and obligations under the Ground Lease to a newly formed nonprofit corporation, the purpose of which is to qualify as a "supporting organization", within the meaning of Section 509(a)(3) of the Code for the support and benefit of Tenant and to serve as a "qualified active low-income community business" or "QALICB" as defined in Section 45D of the Code. In light of said circumstances, Landlord expressly acknowledges and understands that Tenant may request Landlord's consent under Section 10 of the Ground Lease to sublease all or a portion of the Leased Premises to the QALICB formed in connection with the NMTC financing sought by Tenant. 6. Acknowledgment of the Satisfaction of the Contingencies. The undersigned parties hereby expressly acknowledge the Due Diligence, RCO, and Funding Contingencies are satisfied. 7. Related Amendments. The provisions of this Amendment are interwoven with and dependent upon the provisions set forth and agreed to in the First Amendment to Development Agreement and First Amendment to Operating Agreement with "Effective Dates" even with the Effective Date of this Amendment (collectively the "Related Amendments"). Accordingly, the provisions of this Amendment will become binding and enforceable only upon the full execution of this Amendment and the Related Amendments by both Landlord and Tenant. 8. Counterparts and Copies. This Amendment may be executed in any number of identical counterparts, with each counterpart having the same effect as if all parties to this Amendment had signed the same document. All executed counterparts of this Amendment will be construed as and constitute one and the same instrument. A facsimile or electronic copy (e.g., a PDF copy) of an executed counterpart of this Amendment will have the same effect as an original executed counterpart of this Amendment. Amendment to Ground Lease (2018) 2 9. Authority. The execution, delivery, and performance by each party of this Amendment has been duly authorized by their respective governing bodies (i.e., the YMCA's Board of Directors and the City Council for the City of Yakima) in accordance with their respective governing documents and applicable law, and no further action is necessary on the part of either party to this Amendment or their respective governing bodies to make the execution, delivery, and performance of this Amendment by the undersigned persons valid and binding upon the parties to this Amendment. [Signatures on Following Page] Amendment to Ground Lease (2018) 3 EFFECTIVE as of the Effective Date first written above. YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA By: CITY OF YAKIMA By: ob Romero, CEO Cliff M , City Manager STATE OF WASHINGTON ) ss. COUNTY OF YAKIMA CITY CONTRACT NO: 7pil),� �' /Midi RESOLUTION NO: /k 2 i3 -J2E3 certify that I know or have satisfactory evidence that BOB ROMERO 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 CEO for the YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA to be the free and voluntary act of such party for the uses and purposes mentioned in the instrument. DATED: , 2018 DAWN SCIARA `NOTARY PUBLIC STATE OF WASHINGTON COMMISSION EXPIRES MAY 19, 2020 STATE OF WASHINGTON ) ss. COUNTY OF YAKIMA [PRINT NAME] `� J �fit�0�1 Jc 1� NOTARY PUBLIC for the State of Washington, residing at U lI`t My appointment expires: 5 /! -1 / J 2'0 I certify that I know or have satisfactory evidence that CLIFF MOORE 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 CITY MANAGER for the CITY OF YAKIMA to be the free and voluntary act of such party for the uses and purposes mentioned in the instrument. DATED: ' ' C , 2018. Notary Public State of Washington SONYA R CLAAR TEE MY COMMISSION EXPIRES OCTOBER 25, 2018 U [PRINT NAME] `,U ►tiGi Ifo NOTARY PUBLIC for the State of Washington, residing at I/la Kl j '' My appointment expires: 1 0- Amendment to Ground Lease (2018) 4 Development Agreement PARTIES: DEVELOPMENT AGREEMENT EFFECTIVE DATE: _a 7 52015 CITY OF YAKIMA, a Washington municipal corporation 129 North 2nd Street Yakima, Washington 98901 (referred to in this Agreement as the "City") YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA (d/b/a YAKIMA FAMILY YMCA), a Washington nonprofit corporation 5 North Naches Avenue Yakima, Washington 98901 (referred to in this Agreement as the "YMCA") BACKGROUND. See the Recitals set forth in the Master Agreement. AGREEMENT. FOR GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND ADEQUACY ACKNOWLEDGED, THE UNDERSIGNED PARTIES AGREE AS FOLLOWS: 1. Definitions. Unless the context clearly indicates another meaning and except for terms defined in this Agreement, all capitalized terms used in this Agreement have the same meaning given to said terms in the Operating Agreement and Ground Lease. The following terms, when used in this Agreement, have the following meanings, unless the context clearly indicates another meaning: 1.1 "Aquatic Center" has the meaning given to said words in Section 2 below. 1.2 "City's Financial Contribution" has the meaning given to said words in Section 3 below. 1.3 "Construction Contracts" has the meaning given to said words in Section 5 below. 1.4 "Due Diligence Contingency" has the meaning given to said words in Section 2.1 of the Ground Lease. 1.5 "Funding Contingency" has the meaning given to said words in Section 2.2 of the Ground Lease. 1.6 "Ground Lease" means and refers to the Ground Lease dated even herewith by and between the City as "Landlord" and the YMCA as "Tenant" for the YMCA's lease of the Leased Premises and all future amendments to said Ground Lease (if any). 1.7 "Leased Premises" has the meaning given to said words in Section 1.7 of the Ground Lease. 1.8 "Master Agreement" means and refers to the Master Agreement dated even herewith by and between the City and the YMCA and all future amendments to said Master Agreement (if any). This Lease is entered into pursuant to the Master Agreement and the Development Agreement 1 recitals and all other terms set forth in the Master Agreement are part of, incorporated into, and constitute a part of this Agreement as if set forth in full herein. 1.9 "Operating Agreement" means and refers to the Operating Agreement dated even herewith by and between the City and the YMCA in connection with the operations and management of the Aquatic Center to be constructed by Tenant on a portion of the Leased Premises under this Agreement and all future amendments to said Operating Agreement (if any). 1.10 "Other Facility" has the meaning given to said words in Section 2 below. 1.11 "Possession Date" has the meaning given to said words in Section 3 of the Ground Lease. 1.12 "RCO Contingency" has the meaning given to said words in Section 2.3 of the Ground Lease. 1.13 "Required Specifications" has the meaning given to said words in Section 2 below. 2. Aquatic Center. Subject to the Due Diligence, Funding, and RCO Contingencies, the YMCA will construct an aquatic center on the Leased Premises (the "Aquatic Center"). The Aquatic Center will be connected to a separate facility (including additions/expansions) also constructed on the Leased Premises by the YMCA for non -aquatic YMCA activities (the "Other Facility"). Both the Aquatic Center and the Other Facility will be solely owned by the YMCA and will be subject to the terms and conditions of this Agreement and the Ground Lease and Operating Agreement. Unless the City and the YMCA agree otherwise in writing, the Aquatic Center will be constructed in accordance with the minimum required specifications set forth on attached Exhibit B (the "Required Specifications"). 3. City's Financial Contribution. The City will contribute Four Million Five Hundred Thousand and No/100 U.S. Dollars ($4,500,000.000) toward the construction of the Aquatic Center (the "City's Financial Contribution"). The City's Financial Contribution will be paid out when and as required under this Agreement. The YMCA will be responsible for procuring all other funds needed to construct the Aquatic Center, as well as all funds needed to construct the Other Facility. 4. Design and Engineering Phase. Subject to the Required Specifications, the Aquatic Center's design and engineering (including, without limitation, layout, building plans, specifications, and site plan) will be determined by the YMCA in consultation with the architect(s), engineer(s), contractor(s), and other construction consultant(s) hired in connection with the development of the Aquatic Center. Notwithstanding the foregoing, before commencing construction on the Aquatic Center, the Aquatic Center's layout, building plans, specifications, and site plan will be presented to the City Manager for the City to confirm the Aquatic Center's design is in compliance with the Required Specifications. In the interest of initiating construction of the Aquatic Center as soon as reasonably possible after the satisfaction of the Due Diligence, Funding, and RCO Contingencies, it is expressly confirmed that the Aquatic Center's design and engineering (including, without limitation, layout, building plans, specifications, and site location) will commence and be prepared when and as determined by the YMCA after the satisfaction of the Due Diligence Contingency. The YMCA and the City will share equally in and timely pay when due all design and engineering costs in connection with Development Agreement 2 the development of the Aquatic Center; provided, however, it is expressly confirmed that all amounts paid by the City under this paragraph for Aquatic Center design and engineering costs will come from and be paid out of the City's Financial Contribution under Section 3 above. It is further provided and expressly confirmed that all such costs paid by the City for design and engineering shall be reimbursed to the City by the YMCA in the event the Funding Contingency is not satisfied and the project fails to be developed as set forth herein. 5. Construction Contracts. Subject to the provisions of this Section 5, the City and the YMCA will jointly conduct a standard RFP process to request proposals for the architectural and engineering design of the Aquatic Center and Other Facility. Once proposals have been obtained from prospective architects and engineers, the YMCA shall be responsible, in accordance with applicable public contracting requirements, for interviewing and selecting the architects and engineers that will be used in connection with the development and construction of the Aquatic Center and the Other Facility. The YMCA shall cooperate with the City's procurement professionals to negotiate all construction and professional service agreements associated with the architectural and engineering design that will be used for the development and construction of the Aquatic Center and the Other Facility and that will be included in the RFP documents presented to prospective proposers during the RFP process. It is expressly confirmed that all architects and engineers hired in connection with the development and construction of the Aquatic Center and the Other Facility shall be hired by and provide independent contractor services for the YMCA (and not by or for the City) and that all construction and professional service agreements will be by and between the third party professional service providers and the YMCA (and not with the City). The contracts for the actual construction of the Aquatic Center and the Other Facility shall be performed as a public works project and all construction bid advertisements, bidding processes, and contract awards and close-outs associated therewith shall be performed in accordance with Washington public works bidding and performance requirements. The City and the YMCA will jointly conduct the complete construction bidding process and shall prepare and award the contracts in accord with these requirements and the City's standard bidding and contracting practices. All construction and professional service agreements associated with the architectural and engineering design and construction that will be used for the development and construction of the Aquatic Center and the Other Facility are collectively referred to as the "Construction Contracts" under this Agreement. The Parties agree that contract elements providing for adequate and proper insurance coverage during the performance of the contracts, as well as those deemed necessary to protect the City's interests as the owner of the property, shall be included in all of the construction contracts and subcontracts and shall be reviewed and approved by the City prior to the contracts being executed. Subject to the Required Specifications, all change orders to any Construction Contract must be approved by the YMCA in writing. Moreover, it is expressly confirmed that with exception to the City's obligations under this Agreement, the Ground Lease, and the Operating Agreement, the YMCA is solely responsible for all costs necessary for the development and construction of the Aquatic Center, including, without limitation, all Construction Contract cost overruns and added expense from any change orders thereto. Development Agreement 3 6. Construction Phase. The construction contracting processes described in Section 5 above', as well as the actual construction of the Aquatic Center, will commence as soon as reasonably possible after the satisfaction of each of the Due Diligence, RCO, and Funding Contingencies under Sections 2.1, 2.2, and 2.3 of the Ground Lease (unless the City and the YMCA mutually agree in writing on some earlier or later date). Upon the Possession Date, the City will timely pay all costs incurred under the Aquatic Center design, engineering, and construction performance contracts until the City's Financial Contribution is exhausted (i.e., until the City has contributed a total of $4,500,000.00 under the Construction Contracts for design/engineering costs under Section 4 above and construction costs under this Section 6). Thereafter, the YMCA will be responsible for all additional costs under the Construction Contracts necessary for the development and construction of the Aquatic Center. It is expressly confirmed that aside from the design and engineering costs described in Section 5 above, which will be paid in equal proportion by the City and the YMCA as set forth in Section 4 above, no construction costs will be incurred with respect to the Aquatic Center until the Possession Date. During all phases of construction of the Facilities, the YMCA shall be responsible to provide security fencing around the construction site to protect the safety of the public and the project. The YMCA shall be responsible for maintaining a clean and workmanlike construction site throughout the construction process and shall keep all construction debris, waste and trash contained and properly disposed of within the site. 7. Zoning, Offsite Improvements, and Site Preparation. 7.1 Zoning. The City represents and warrants that the Leased Premises at the time of the Possession Date and through the Term of the Ground Lease will be appropriately zoned for the Aquatic Center described herein and the Permitted Uses allowed under Section 6.2 of the Ground Lease. The City, at the City's expense and with no reduction to the City's Financial Contribution under Section 3 above, will take all action necessary to ensure compliance with the provisions of this paragraph prior to the Possession Date. 7.2 Offsite Improvements. To the extent any traffic or other improvements outside of the Leased Premises are required by the City or any other applicable government authority as a result of the construction of the Aquatic Center and Other Facility on the Leased Premises, the City, at the City's expense and with no reduction to the City's Financial Contribution under Section 3 above, will make all such improvements, to the extent practicable, within one hundred twenty (120) days of the Possession Date. 8. Naming Rights. It is expressly confirmed that all naming rights with regard to the Aquatic Center will belong solely to the YMCA and the discretion of the YMCA's Board of Directors; provided, however, the Aquatic Center's name must include the word "Yakima." 9. Contingencies. 9.1 Contingencies. The YMCA's and the City's respective obligations under this Agreement are each contingent on and subject to the satisfaction of the Due Diligence, RCO, and ' It is expressly acknowledged and confirmed that the architectural and engineering design contracting process may commence after the satisfaction of the Due Diligence Contingency as set forth in Sections 4 and 5 above. Development Agreement 4 Funding Contingencies. Subject to the provisions of Section 10.16 below (i.e., the "Survival" clause) and the reimbursement obligations set forth in Section 4 above (if any), and except as otherwise expressly provided in this Agreement, in the event the Ground Lease is terminated as permitted under Section 2.1, 2.2, or 2.3 of the Ground Lease as a result of the non -satisfaction of the Due Diligence Contingency, Funding Contingency, or RCO Contingency, this Agreement will automatically terminate when the Ground Lease terminates, and neither party to this Agreement will have any further rights, duties, and obligations hereunder. 9.2 Ground Lease and Operating Agreement. This Agreement is subject to and together with the terms of the Ground Lease and Operating Agreement and the undersigned parties' respective rights and obligations thereunder. In the event of a conflict between the provisions of said three documents, the terms of the Operating Agreement shall prevail. 9.3 Survival of Existing Obligations. In the event this Agreement is terminated under Section 9.1 above, the YMCA will be responsible for all of the design and engineering costs incurred under Section 4 above prior to the termination of this Agreement. 10. Miscellaneous Terms. 10.1 Amendments. This Agreement may not be modified or amended except by written agreement signed and acknowledged by each of the parties hereto. 10.2 No Agency Relationship. Nothing contained in this Agreement creates the relationship of principal and agent between the parties hereto. 10.3 Time is of the Essence. Time is of the essence as to all terms of this Agreement. 10.4 Notices. All notices under this Agreement must be in writing and will be deemed given to the receiving party when (a) personally delivered to the City Manager for the City of Yakima (for notices to the City) or personally delivered to the CEO or President of the Yakima Family YMCA (for notices to the YMCA) or (b) three days after being deposited in the United States Postal Service by certified mail (with return receipt requested) to the receiving party at the receiving party's last known address(es). 10.5 Points of Contact. The City and the YMCA shall each provide a dedicated contact person to be the point of contact for their respective party hereto for any communication or contact that is necessary between the Parties. The City's initial contact person shall be Scott Schafer, Director of Public Works, and the YMCA's contact person shall be Bob Romero, YMCA Executive Director. Either party may change its contract person under this Section 10.5 by giving the other party notice of the change. 10.6 Exhibits. There are no attachments to this Agreement except for the Exhibits expressly referenced in this Agreement, each of which constitutes a part of this Agreement as if set forth in full herein. 10.7 Headings; Construction. The captions and paragraph headings used in this Agreement are inserted for convenience of reference only and are not intended to define, limit, or affect the interpretation or construction of any term or provision of this Agreement. This Agreement shall not be construed more strictly against one party than the other by virtue Development Agreement 5 of the fact that one party drafted this Agreement and/or certain clauses contained herein. It is hereby recognized that both parties to this Agreement and their respective counsel have had a full and fair opportunity to negotiate and review all terms and provisions of hereof and to fully contribute to this Agreement's substance and form. 10.8 Governing Law. This Agreement will be interpreted, construed, and governed by the laws of the State of Washington. 10.9 Assignment; Binding Effect. Except as expressly provided otherwise herein, neither party hereto may assign any of its rights or obligations under this Agreement unless the other party consents thereto in writing, which consent may be withheld for any reason. Subject to any limitations on assignments provided for in this Agreement, all of the provisions of this Agreement will inure to the benefit of and be binding on the successors and assigns of the City and the YMCA. 10.10 Waivers. The failure of either party to seek redress for violation of or to insist upon the strict performance of any covenant or condition of this Agreement will not prevent a subsequent act, which would have originally constituted a violation, from having the effect of an original violation. 10.11 Attorneys' Fees; Venue. In the event of any dispute arising out of or relating to this Agreement, whether or not suit or other proceedings is commenced, and whether in mediation, in arbitration, at trial, on appeal, in administrative proceedings, or in bankruptcy (including, without limitation, any adversary proceeding or contested matter in any bankruptcy case), the prevailing party will be entitled to its costs and expenses incurred, including reasonable attorneys' fees. The sole venue for any dispute arising out of or relating to this Agreement will be in a court of competent jurisdiction in Yakima County, Washington. 10.12 Defaults, Remedies, and Dispute Resolution. This Agreement is subject to the default, remedy, dispute resolution, and other provisions set forth in Sections 11.1, 11.2, and 11.3 of the Operating Agreement. In the event of a default of this Agreement, said provisions of the Operating Agreement will control and should be consulted. 10.13 Counterparts and Copies. This Agreement may be executed in any number of identical counterparts, with each counterpart having the same effect as if all parties to this Agreement had signed the same document. All executed counterparts of this Agreement will be construed as and constitute one and the same instrument. A facsimile or electronic copy (e.g., a PDF copy) of an executed counterpart of this Agreement will have the same effect as an original executed counterpart of this Agreement. 10.14 Severability. If any provision of this Agreement or the application thereof to any person or circumstances shall to any extent be held to be invalid or unenforceable, such provision shall not affect or invalidate the remainder of this Agreement, and to this end the provisions of this Agreement are declared to be severable. If such invalidity becomes known or apparent to the parties, the parties agree to negotiate promptly in good faith in an attempt to amend such provision as nearly as possible to be consistent with the intent of this Agreement. 10.15 Entire Agreement. This Agreement, together with the associated Master Lease, Ground Lease, and Operating Agreement, constitutes the entire understanding and agreement of Development Agreement 6 the parties to this Agreement with respect to its subject matter. All prior agreements, understandings, or representations with respect to this Agreement's subject matter are hereby canceled in their entirety and are of no further force or effect. It is expressly acknowledged that there are no oral or other agreements which modify or affect this Agreement. 10.16 Survival. All representations, warranties, and indemnities set forth in or otherwise made pursuant to this Agreement shall survive and remain in effect following the expiration or earlier termination of this Lease; provided, however, that nothing herein is intended to extend the survival beyond any applicable statute of limitations period. 10.17 Authority. The execution, delivery, and performance by each party of this Agreement has been duly authorized by their respective governing bodies (i.e , the YMCA's Board of Directors and the City Council for the City of Yakima) in accordance with their respective governing documents and applicable law, and no further action is necessary on the part of either party to this Agreement or their respective governing bodies to make the execution, delivery, and performance of this Agreement by the undersigned persons valid and binding upon the parties to this Agreement. [Signatures on Following Page] Development Agreement 7 EFFECTIVE as of the Effective Date first written above. YOUNG MEN'S CHRISTIAN CITY OF YAKIMA ASSOCIATION OF YAKIMA Bob Romero, CEO Tony O'R urke, City Manager CITY C •' TRACT NO: RESOLUTION N0: '' Z2l5-128 Development Agreement 8 STATE OF WASHINGTON ) ss. COUNTY OF YAKIMA I certify that I know or have satisfactory evidence that BOB ROMERO 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 CEO for the YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA to be the free and voluntary act of such party for the uses and purposes mentioned/in the instrument. en DATED: VG4 &— 4=9-7 , 2015. Notary Public State off Washington JODI L STEPHENS MY COMMISSION EXPIRES August 11, 2018 STATE OF WASHINGTON ) ss. COUNTY OF YAKIMA NOTARY PUBLIC for the State of Was ington, residing at /? // My appointment expires: I certify that I know or have satisfactory evidence that TONY O'ROURKE 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 CITY MANAGER for the CITY OF YAKIMA to be the free and voluntary act of such party for the uses and purposes mentioned in the instrument. DATED: Notary Public State of Washington SONYA R CLAAR TEE MY COMMISSION EXPIRES OCTOBER 25, 2018 , 2015. Dionti _gyp [PRINT NAME] �U itL{,{ %`� P /i -70Q NOTARY PUBLIC1for the State of Washington, residing at Uhlx/1,CZ( My appointment expires: Development Agreement 9 EXHIBIT A Required Specifications 1. Minimum eight lane 25 yard lap pool 2. Therapy pool area 3. Multiuse pool area for water walking and family/youth recreation EXHIBIT A FIRST AMENDMENT TO DEVELOPMENT AGREEMENT PARTIES: EFFECTIVE DATE: May 1, 2018 CITY OF YAKIMA, a Washington municipal corporation 129 North 2nd Street Yakima, Washington 98901 (referred to in this Amendment as the "City") YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA (d/b/a YAKIMA FAMILY YMCA), a Washington nonprofit corporation 5 North Naches Avenue Yakima, Washington 98901 (referred to in this Amendment as the "YMCA") DEVELOPMENT AGREEMENT. The term "Development Agreement," when used in this Amendment, means and refers to the Development Agreement dated October 27, 2015, by and among the City and the YMCA pertaining to the development and construction of a new YMCA facility and aquatic center at Chesterley Park in Yakima, Washington. BACKGROUND. To better facilitate the arrangements between the City and the YMCA for the construction and operation of the Aquatic Center, the undersigned parties have mutually agreed to amend the timing and financing of the City's financial obligations under the Operating Agreement through the first ten years of the Aquatic Center's operations and the manner and timing in which the City's Financial Contribution under the Development Agreement and certain other financial obligations under the Operating Agreement are met. In general terms, the City has requested to eliminate the City's obligation to reimburse the YMCA for Pre -Opening Expenses, Operating Deficits, and Capital Improvement Expenditures under the Operating Agreement until the tenth anniversary of the Opening Date in exchange for the City's agreement to increase the City's Financial Contribution under the Development Agreement from $4,500,000.00 to $8,000,000.00. Subject to and in accordance with the terms of this Amendment and the below -described Related Amendments, the YMCA has agreed to accommodate said requests by the City. This Amendment and the below -described Related Amendments are now executed for the purpose of memorializing the amendments made to the Development Agreement, Operating Agreement, and Ground Lease in connection with said agreement. Moreover, the Development Agreement, Operating Agreement, and Ground Lease are also executed for the purpose of confirming the satisfaction of the Due Diligence, RCO, and Funding Contingencies and to memorialize the Possession Date and commencement of the Initial Term. AMENDMENT. FOR GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND ADEQUACY ACKNOWLEDGED, THE UNDERSIGNED PARTIES AGREE AND AMEND THE DEVELOPMENT AGREEMENT AS FOLLOWS: 1. Effect of Amendment. This Amendment amends, supplements, and is made part of the Development Agreement. In the event of a conflict between the provisions of this Amendment and the Development Agreement, the provisions of this Amendment will control. Nevertheless, except as expressly amended or supplemented by this Amendment, the provisions of the Development Agreement remain in full force and effect. Amendment to Development Agreement (2018) 1 2. Capitalized Terms. Except when the context clearly requires another meaning and for capitalized terms defined in this Amendment, all capitalized terms used in this Amendment have the same meaning given to said terms in the Development Agreement. 3. Amending the City's Financial Contribution. Section 3 of the Development Agreement is amended to increase the City's Financial Contribution from Four Million Five Hundred Thousand and No/100 U S. Dollars ($4,500,000.00) to Eight Million and No/100 U.S. Dollars ($8,000,000.00). Accordingly, all references in the Development Agreement, Ground Lease, Operating Agreement, and Master Agreement to the "City's Financial Contribution" now refer to the City's $8,000,000.00 obligation under this paragraph, rather than the $4,500,000.00 originally set forth in Section 3 of the Development Agreement. 4. Correcting Exhibit Reference. The second paragraph of Section 2 of the Development Agreement incorrectly references "Exhibit B" of the Development Agreement (which does not exist) when referring to the location of the Required Specifications in the Development Agreement. The Required Specifications are actually listed in Exhibit A of the Development Agreement. For the purpose of correcting this inadvertent scrivener's error, the "Exhibit B" reference in the second paragraph of Section 2 of the Development Agreement is hereby amended to now refer to "Exhibit A" of the Development Agreement. 5. Acknowledgment of the Satisfaction of the Contingencies. The undersigned parties hereby expressly acknowledge the Due Diligence, RCO, and Funding Contingencies are satisfied. 6. Related Amendments. The provisions of this Amendment are interwoven with and dependent upon the provisions set forth and agreed to in the First Amendment to Ground Lease and First Amendment to Operating Agreement with "Effective Dates" even with the Effective Date of this Amendment (collectively the "Related Amendments"). Accordingly, the provisions of this Amendment will become binding and enforceable only upon the full execution of this Amendment and the Related Amendments by both the City and the YMCA. 7. Counterparts and Copies. This Amendment may be executed in any number of identical counterparts, with each counterpart having the same effect as if all parties to this Amendment had signed the same document. All executed counterparts of this Amendment will be construed as and constitute one and the same instrument. A facsimile or electronic copy (e g., a PDF copy) of an executed counterpart of this Amendment will have the same effect as an original executed counterpart of this Amendment. 8. Authority. The execution, delivery, and performance by each party of this Amendment has been duly authorized by their respective governing bodies (i.e., the YMCA's Board of Directors and the City Council for the City of Yakima) in accordance with their respective governing documents and applicable law, and no further action is necessary on the part of either party to this Amendment or their respective governing bodies to make the execution, delivery, and performance of this Amendment by the undersigned persons valid and binding upon the parties to this Amendment. [Signatures on Following Page] Amendment to Development Agreement (2018) 2 EFFECTIVE as of the Effective Date first written above. YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA By: o Romero, CEO STATE OF WASHINGTON COUNTY OF YAKIMA ) ss. CITY OF YAKIMA By: (ifs CEff M e, City Manager CITY CONTRACT NO' 3 .ZZy /V✓7Je/ RESOLUTION NO' g - —704C-428 I certify that I know or have satisfactory evidence that BOB ROMERO 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 CEO for the YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA to be the free and voluntary act of such party for the uses and purposes mentioned in the instrument. DATED: til 1-1 2, 411 DAWN SCIARA NOTARY PUBLIC STATE OF WASHINGTON COMMISSION EXPIRES MAY 19, 2020 STATE OF WASHINGTON ) ss. COUNTY OF YAKIMA 2018. C.� cc.1_cci [PRINT NAME] ►— • n J c I el-- NOTARY vNOTARY PU LIC for the State of Washington, residing at Uie.A.i My appoit merit expires: 5) H/ 2C Z0 I certify that I know or have satisfactory evidence that CLIFF MOORE 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 CITY MANAGER for the CITY OF YAKIMA to be the free and voluntary act of such party for the uses and purposes mentioned in the instrument. DATED: Notary Public State of Washington SONYA R CLAAR TEE MY CQMMlSCION E=XPIRES OCTO BE i 25, 221 , 2018. t,) [PRINT NAME] 0 A kjA Oa_ 7=0-e- 3 - NOTARY PU LIC for the State of Washington, residing at Qti> . My appointment expires:kJ(, 7 ii ,)1 t 'd -c y '' . Amendment to Development Agreement (2018) 3 EXHIBIT 3 Operating Agreement [See Attached] EXHIBIT 3 Operating Agreement PARTIES: OPERATING AGREEMENT EFFECTIVE DATE: 00 �7 , 2015 CITY OF YAKIMA, a Washington municipal corporation 129 North 2nd Street Yakima, Washington 98901 (referred to in this Agreement as the "City") YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA (d/b/a YAKIMA FAMILY YMCA), a Washington nonprofit corporation 5 North Naches Avenue Yakima, Washington 98901 (referred to in this Agreement as the "YMCA") BACKGROUND. See the Recitals set forth in the Master Agreement. AGREEMENT. FOR GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND ADEQUACY ACKNOWLEDGED, THE UNDERSIGNED PARTIES AGREE AS FOLLOWS: 1. Definitions. Unless the context clearly indicates another meaning and except for terms defined in this Agreement, all capitalized terms used in this Agreement have the same meaning given to said terms in the Development Agreement and Ground Lease. The following terms, when used in this Agreement, have the following meanings, unless the context clearly indicates another meaning: 1.1 "Annual Capital Improvements Budget" means and refers to the annual Capital Improvement budget jointly approved by the YMCA and the City under Section 7.2 below for the estimated annual Capital Improvement Expenditures for the Aquatic Center. 1.2 "Annual Operating Budget" means and refers to the annual operating budget jointly approved by the YMCA and the City under Section 7.2 below for the estimated annual Gross Operating Revenue and Gross Operating Expenses for the Aquatic Center. 1.3 "Applicable Laws" means and refers to all statutes, regulations, ordinances, and other laws applicable to the operation of the Aquatic Center. 1.4 "Aquatic Center" means and refers to the "Aquatic Center" described in Section 2 of the Development Agreement. 1.5 "Capital Improvements" means and refers to (a) all additions to and replacements of the Aquatic Center's FF&E; (b) all repairs, restorations, and alterations to the Aquatic Center facility and the Aquatic Center's FF&E that have a useful life equal to or greater than three (3) years; (c) fifty percent (50%) of all additions to and replacements of the Common Areas' FF&E; and (d) fifty percent (50%) of all repairs, restorations, and alterations to the Common Area facilities and the Common Areas' FF&E that have a useful life equal to or greater than three (3) years. Operating Agreement 1 1.6 "Capital Improvement Expenditures" means and refers to the cost of all Capital 1 mprovements. 1.7 "Capital Improvement Reserve Funds" has the meaning given to said words in Section 7.4(c) below. 1.8 "Common Areas" means and refers to the Other Facility's public entryways (both interior and exterior), reception desk, lobby area, public restrooms, and the locker rooms and parking lot(s) (except for the Existing Parking Lot) that jointly serve the Aquatic Center and Other Facility, all of which will be commonly used for access, reception services, program registration/payments, locker room uses, gathering/waiting, and parking by persons who use the Aquatic Center and/or the Other Facility. 1.9 "City Manager" means and refers to the duly appointed City Manager for the City of Yakima. 1.10 "Development Agreement" means and refers to the Development Agreement dated even herewith by and between the City and the YMCA in connection with the development of the Aquatic Center to be constructed by Tenant on a portion of the property leased under the Ground Lease and all future amendments to said Development Agreement (if any). 1.11 "Due Diligence Contingency" has the meaning given to said words in Section 2.1 of the Ground Lease. 1.12 "Existing Parking Lot" has the meaning given to said words in Section 6.3 of the Ground Lease. 1.13 "FF&E" means and refers to furniture; furnishings; computer, entertainment, and other equipment; finishes; wall and floor coverings; tiling, piping; and fixtures. 1.14 "Funding Contingency" has the meaning given to said words in Section 2.2 of the Ground Lease. 1.15 "Fiscal Year" means and refers to the time period running from September 1st through August 31st, which constitutes the YMCA 's existing fiscal year time period. 1.16 "Gross Operating Expenses" means and refers to all expenses incurred by the YMCA in the management and operation of the Aquatic Center during the Term of this Agreement, including, but not limited to, the following: (a) Labor for the operation of the Aquatic Center, including, but not limited to, salaries (including for the Aquatic Center's Aquatic Director), wages, employee benefits, retirement plans, payroll taxes, training costs, and other reasonable employment expenses; (b) Labor needed to staff the Common Area reception area with an employee during all hours of Aquatic Center operation, including, but not limited to, salaries, wages, employee benefits, retirement plans, payroll taxes, training costs, and other reasonable employment expenses; (c) Inventories and supplies consumed in the operation of the Aquatic Center, including, without limitation, chemicals and office supplies; Operating Agreement 2 (d) Cleaning costs, whether by YMCA staff or third party contractors; (e) Promotional costs for the Aquatic Center, including, without limitation, brochures, printing costs, and advertising; (0 Utility charges for the Aquatic Center; (g) Insurance costs for the coverage required under this Agreement; (h) The cost of all applicable and required taxes, and licenses, permits; (i) The cost of (a) maintaining the Aquatic Center and its FF&E and (b) all repairs and alterations to the Aquatic Center and its FF&E that have a useful life less than three (3) years; (j) Technical consultants, operational experts, and professional services for specialized services in connection with non -routine Aquatic Center work; (k) A reasonable reserve for uncollectible accounts receivable; (1) Fifty percent (50%)' of the expenses incurred by the YMCA in the management and operation of the Common Areas, including, but not limited to, costs incurred by the YMCA in operating, maintaining, and repairing (i) the Common Areas' publicly accessible parking lot(s) and exterior entryway/walkway surfaces, striping, lighting, security, signage, and landscaping that jointly serve the Aquatic Center and Other Facility; and (ii) the locker rooms, interior entryways/walkways, reception desk, lobby area, and public restrooms and that jointly serve the Aquatic Center and Other Facility; (m) Fifty percent (50%) of the cost of (a) maintaining the Common Areas and its FF&E and (b) all repairs and alterations to the Common Areas and its FF&E that have a useful life less than three (3) years; and (n) An administrative charge equal to fifteen percent (15%) of all other Gross Operating Expenses to cover the estimated cost of executive and other overhead charges associated with the operation and management of the Aquatic Center. 1.17 "Gross Operating Revenue" means and refers to all revenue received from the following sources of income: (a) The fees charged by the YMCA for public use of the Aquatic Center; (b) The fees charged by the YMCA for public and/or YMCA member participation in the Aquatic Center's programs (e.g., swim lessons, lifeguard trainings, aquatic exercise classes, pool rentals, and birthday pool parties); (c) One percent (1%) of all YMCA member dues; and (d) Proceeds from business interruption insurance. The undersigned parties expressly confirm that the term "Gross Operating Revenue" excludes all other revenue, including, without limitation, revenue from the sale of concessions and merchandise in or about Common Areas, charitable donations to the YMCA, YMCA membership dues, and rent from the sublease of any portions of the Other Facility. Moreover, "Gross Operating Revenue" shall be net of rebates, credits, and/or refunds. 1.18 "Ground Lease" means and refers to the Ground Lease dated even herewith by and between the City as "Landlord" and the YMCA as "Tenant" for the YMCA's lease of the ' The City and the YMCA intend for the City to be responsible for twenty-five percent (25%) of the costs associated with the management and operation of the Common Areas. Accordingly, half of said costs are included as Gross Operating Expenses, which in turn are split equally between the YMCA and the City under Section 7.3 below. Operating Agreement 3 property on which the YMCA intends to construct the Aquatic Center under the Development Agreement and all future amendments to said Ground Lease (if any). 1.19 "Initial Budget" means and refers to the initial budget jointly approved by the YMCA and the City under Section 7.1 below for the estimated (a) Pre -Operating Expenses for the Aquatic Center and (b) Gross Operating Revenue and Gross Operating Expenses for the Aquatic Center from the Opening Date through the first occurring August 31st following the Opening Date. 1.20 "Master Agreement" means and refers to the Master Agreement dated even herewith by and between the City and the YMCA and all future amendments to said Master Agreement (if any). This Lease is entered into pursuant to the Master Agreement and the recitals and all other terms set forth in the Master Agreement are part of, incorporated into, and constitute a part of this Agreement as if set forth in full herein. 1.21 "Monthly CAPEX Reports" has the meaning given to said words in Section 7.4(b) below. 1.22 "Monthly Financial Reports" has the meaning given to said words in Section 7.3(b) below. 1.23 "Opening Date" means and refers to the date on which the Aquatic Center opens for public use. 1.24 "Operating Deficit" means and refers to the amount of Gross Operating Expenses in excess (if any) of Gross Operating Revenue for each calendar month during the Term of this Agreement after the Opening Date. 1.25 "Operating Surplus" means and refers to the amount of Gross Operating Revenue in excess (if any) of Gross Operating Expenses for each calendar month during the Term of this Agreement after the Opening Date. 1.26 "Operating Standards" has the meaning given to said words in Section 5.2 below. 1.27 "Other Facility" means and refers to the "Other Facility" described in Section 2 of the Development Agreement. 1.28 "Pre -Opening Expenses" has the meaning given to said words in Section 7.1 below. 1.29 "Proposed Budgets" has the meaning given to said words in Section 7.2(a) below. 1.30 "Purpose" has the meaning given to said word in Section 3 below. 1.31 "RCO Contingency" has the meaning given to said words in Section 2.3 of the Ground Lease. 1.32 "Term" has the meaning given to said word in Section 4 below. 1.33 "YMCA/City Agreement" means and refers to this Agreement (i.e., the Operating Agreement), the Development Agreement, the Ground Lease, and the Master Lease. 2. Contingencies and Other Agreements. Operating Agreement 4 2.1 Contingencies. The YMCA's and the City's respective obligations under this Agreement are each contingent on and subject to the satisfaction of the Due Diligence, Funding, and RCO Contingencies. Subject to the provisions of Section 12.14 below (i.e., the "Survival" clause), and except as otherwise expressly provided in this Agreement, in the event the Ground Lease is terminated as permitted under Section 2.1, 2.2, or 2.3 of the Ground Lease as a result of the non -satisfaction of the Due Diligence Contingency, Funding Contingency, or RCO Contingency, this Agreement will automatically terminate when the Ground Lease terminates, and neither party to this Agreement will have any further rights, duties, and obligations hereunder. 2.2 Development Agreement and Ground Lease. This Agreement is subject to and together with the terms of the Development Agreement and Ground Lease and the undersigned parties' respective rights and obligations thereunder. In the event of a conflict between the provisions of said three documents, the terms of this Operating Agreement shall prevail. 3. Purpose. During the Term of this Agreement, the YMCA and the City intend for the Aquatic Center to serve as a safe, fun, and healthy destination for the entire Yakima community that provides a host of recreational, fitness, and therapeutic opportunities and programs through new aquatic facilities and programming that will be offered therein (the Aquatic Center's "Purpose"). 4. Term. The undersigned parties intend for the relationship, rights, and obligations established in this Agreement to apply and be in effect during the entire "Term" under the Ground Lease, including, without limitation, the "Initial Term" and each "Extended Term" under the Ground Lease. Accordingly, subject to the Due Diligence, Funding, and RCO Contingencies, the "Term" of this Agreement will be concurrent with and equal to the "Term" of the Ground Lease as set forth in Sections 3.1, 3.2, and 3.3 of the Ground Lease. 4.1 Effect of Expiration. Unless the YMCA and the City agree otherwise in writing, upon the expiration of the Term of this Agreement (i.e., the expiration of the "Term" of the Ground Lease), this Agreement will terminate and the improvements associated with the Aquatic Center and the Other Facility shall revert to the City as described in the Ground Lease. 4.2 Pre -Expiration Discussions. Notwithstanding the foregoing, but without committing either party to any particular action, before the expiration of the Term of this Agreement (i.e., the expiration of the "Term" of the Ground Lease), the YMCA and the City will discuss and consider their respective interests in and the possibility of extending the Term of this Agreement and the Ground Lease for an additional period of time and/or entering into new agreements for the continued lease of the premises and joint management and operation of the Aquatic Center or some new similar facility. 5. Management and Operations. During the Term of this Agreement, the Aquatic Center will be managed and operated by the YMCA in accordance with the following, and all other, provisions of this Agreement: 5.1 Managerial Discretion. Except as otherwise provided in this Agreement (e.g., see Sections 6.1 and 6.2 below), the YMCA will have discretion and control in all matters relating to the management and operation of the Aquatic Center, including, without limitation, staffing decisions, employment policies, procurement of and payment for Operating Agreement 5 inventories, supplies, services, repairs, and maintenance decisions. The City and the YMCA shall cooperatively coordinate and determine appropriate Aquatic Center programming and use as more fully described in Sections 6.1 and 6.2, below. 5.2 Operating Standards. The YMCA will operate and maintain the Aquatic Center in accordance with its Purpose and the following "Operating Standards": (a) In a commercially clean, attractive, first rate, safe, and habitable condition; (b) In good repair and proper working order; (c) In compliance with all Applicable Laws; (d) In a manner intended to prevent and minimize closures; (e) In a manner consistent with industry standards for facilities of similar size and scope to the Aquatic Center that are located elsewhere in Washington state; provided, however, the YMCA, from time -to -time, may reasonably adjust the Aquatic Center's manner of operations away from applicable industry standards based on (i) the demand for services at the Aquatic Center and (ii) when needed to promote the efficient use and operation of the Aquatic Center and/or the Aquatic Center's Purpose; and (f) Subject to holidays and closures necessary for repairs, maintenance, safety, acts of God, emergencies, and other similar circumstances, the Aquatic Center will maintain the following minimum normal hours of operation (subject to the YMCA's right, in the YMCA's discretion, to expand to additional hours of operation): Monday through Friday 6.00 a.m. - 9.00 p in. Saturday 7.00 a.m. - 7.00 p m. Sunday 12.00 p m. - 6:00 p.m. 5.3 Maintenance, Repair, and Replacement. During the Term of this Agreement, the YMCA (subject to the YMCA's and the City's obligations under this Agreement with regard to Capital Improvement Expenditures and operating expenses and the City's obligations under the Ground Lease with regard to the Existing Parking Lot) will maintain the Aquatic Center and Common Areas in accordance with the Operating Standards set forth in Section 5.2 above and will make all maintenance and repairs thereto that are reasonably necessary for said purpose in accordance with a written maintenance and repair schedule, including, but not limited to, the following: • Maintain the Common Areas' parking lot(s) and exterior entryway/walkway surfaces, striping, lighting, security, signage, and landscaping; • Maintain the interior entryways/walkways, reception desk, lobby area, and public restrooms; • Maintain the pools, public locker rooms, and other aquatic facilities; and • Maintain the Aquatic Center's and Common Areas' equipment and HVAC, filtration, and other building systems. Operating Agreement 6 Notwithstanding the foregoing, when and as said equipment and other components and FF&E of the Aquatic Center and Common Areas become worn out or obsolete, or if it is not commercially reasonable to continue to maintain and/or repair said items, said equipment and other components and FF&E will be replaced by the YMCA (subject to the YMCA's and the City's shared obligations under this Agreement with regard to Capital Improvement Expenditures and operating expenses). 5.4 Insurance. (a) Insurance Coverage. Subject to the YMCA's right to purchase and maintain additional insurance coverage the YMCA reasonably deems necessary in connection with the operation and management of the Aquatic Center, during the Term of this Agreement, the YMCA will purchase and maintain the following minimum insurance coverage: • Commercial General Liability insurance that insures against claims for bodily injury, personal injury, death, and property damage occurring in, on, or about the Aquatic Center, with limits of not less than $2,000,000 per occurrence and $4,000,000 general aggregate. The insurance policy required under this paragraph must be endorsed to name the City as an additional insured on a primary basis without the right of contribution. • "Special Form" property insurance on the Aquatic Center and its contents for their full replacement value, together with business interruption coverage. Unless the YMCA and the City agree otherwise in writing, any proceeds from the insurance policy required under this paragraph will be used to repair, restore, and/or replace the Aquatic Center and its contents. • Business Auto Liability insurance covering all owned, hired, and non - owned automobiles for bodily injury, personal injury, death, and property damage with limits of liability not less than $1,000,000 Combined Single Limit. The insurance policy required under this paragraph must be endorsed to name the City as an additional insured on a primary basis without the right of contribution. • Employer's Liability/Washington Stop Gap insurance with a limit of liability not less than $1,000,000 each accident, each employee, and by disease. (b) Policies and Certificates of Insurance. The YMCA will furnish the City with copies of the insurance policies required under this Section 5.4 and certificates of insurance for said policies that evidence (i) said insurance has been purchased and is in full force and effect as required hereunder and (ii) said insurance policies may not be cancelled or amended unless twenty (20) days' prior written notice of the proposed cancellation or amendment has been given to the City at the City's designated address for notices under this Agreement. (c) Waiver of Subrogation Rights. The YMCA and the City each waive any and all rights of recovery against the other, or against the directors, officers, Operating Agreement 7 employees, and agents of the other, for all losses of or damage to such waiving party, property, or property of others under its control, where such Toss or damage is insured against under any insurance policy in force at the time of such loss or damage. The YMCA will, upon obtaining the policies of insurance required hereunder, give notice to the insurance carriers of the mutual waiver of subrogation contained in this paragraph. (d) Gross Operating Expenses. During the Term of this Agreement, the cost of insurance purchased and maintained for coverage on and in connection with the Aquatic Center portion of the premises and any deductible the YMCA becomes obligated to pay in connection therewith in the event of a claim, loss, or damage associated with the Aquatic Center that triggers a defense and/or coverage under such insurance will constitute a Gross Operating Expense under this Agreement and be included in and subject to the reimbursement obligations set forth in Section 7.3 below. 5.5 Delegation. The YMCA is permitted to delegate to or subcontract with third parties for the performance of duties that are ancillary to the YMCA's management obligations under this Agreement. 5.6 Utility Meters. All utilities will be separately metered between the Aquatic Center and the Other Facility. 6. Use and Programming. 6.1 Use of Aquatic Center. During the Term of this Agreement, the Aquatic Center during all times of operation and for all programs conducted therein will be made available for use and participation by the public on a fee -per -use basis in accordance with the same rules, policies, and hours of use as the Aquatic Center and its programs are made available by the YMCA for the YMCA's members. The fees charged by the YMCA for public (i.e , non -YMCA member) use of the Aquatic Center and participation in the Aquatic Center's programs will be set by the YMCA after consultation with the City and must be commercially reasonable in amount and generally consistent with the fees for public use charged by facilities of similar size and scope to the Aquatic Center that are located elsewhere in Washington state for the corresponding use and program participation. 6.2 Programming. Prior to April 1st of each calendar year during the Term of this Agreement, the City shall submit to the YMCA the City's reasonably requested programs, special events, and schedule dates for general public use of the Aquatic Center for addition to the Aquatic Center's program calendar for the following calendar year. The YMCA shall consider and address the City's requested Aquatic Center program use schedule when preparing the upcoming calendar year's program schedule. The City shall have the opportunity to review and comment on the final proposed annual program schedule to ensure public access and use of the Aquatic Center is a primary objective and that public availability and participation requirements under Section 6.1 above are met. The Aquatic Center shall be managed and operated as a not-for-profit institution available to the general public without discrimination as to age, race, creed, religion, sex, marital status, national origin, political affiliation, physical handicap, or ancestry. 7. Financial Terms. Operating Agreement 8 7.1 Pre -Opening Expenses and the Initial Budget. (a) Pre -Opening Expenses. The City acknowledges that in addition to the construction costs incurred by the YMCA in the development and construction of the Aquatic Center, the YMCA will also incur certain non -construction operational expenses in preparing the Aquatic Center for the Opening Date. Said expenses include, but are not necessarily limited to, salary and benefits for the Aquatic Center's Aquatic Director (who will need to be hired at a reasonable period of time in advance of the Opening Date); recruitment, wages and training for Aquatic Center staff; purchasing chemicals, supplies, and program equipment; calibrating and testing the Aquatic Center's water, equipment, and systems; utility charges; pre -opening promotional costs; and other costs incidental to the preparation and organization of the Aquatic Center's operations prior to the Opening Date. The City will share equally with the YMCA in all reasonable non -construction operational expenses incurred in preparing and organizing the Aquatic Center for the Opening Date (the "Pre -Opening Expenses") and will reimburse the YMCA for fifty percent (50%) of the same in accordance with procedures substantially similar to the post -Opening Date reimbursements under Section 7.3 below. (b) Initial Budget. Within ninety (90) days of the satisfaction of the Due Diligence, Funding, and RCO Contingencies, the YMCA will prepare and submit to the City Manager a proposed Initial Budget. The proposed Initial Budget must (1) set forth the YMCA's forecast of anticipated Pre -Opening Expenses and Gross Operating Revenue, Gross Operating Expenses, and Capital Improvement Expenditures for the Aquatic Center for the period running from the Opening Date through the first occurring July 31st after Opening Date; and (2) be prepared in accordance with (i) the YMCA's internal planning and budgeting process and (ii) a commercially reasonable degree of detail and specificity. Following the YMCA's submission of the proposed Initial Budget to the City Manager, representatives designated by the YMCA and the City Manager who are familiar and involved with the YMCA's and the City's respective budgeting processes will meet to discuss and review the proposed Initial Budgets when and as needed to reach joint approval of final Initial Budget for the Aquatic Center at least nine (9) months before the anticipated Opening Date. The YMCA and the City will confer in good faith to reconcile all differences with regard to said budgeting process. 7.2 Budgets. (a) Annual Budgeting Process. With exception to the Initial Budget described in Section 7.1 above, each year on or before July 1st, the YMCA will prepare and submit to the City Manager a proposed Annual Operating Budget and a proposed Annual Capital Improvements Budget for the Aquatic Center for the upcoming Fiscal Year (i.e., September 1st through August 31st) (collectively the "Proposed Budgets"). The Proposed Budgets must (1) set forth the YMCA's forecast of anticipated Gross Operating Revenue, Gross Operating Expenses, and Capital Improvement Operating Agreement 9 Expenditures for the Aquatic Center for the upcoming Fiscal Year; and (2) be prepared in accordance with (i) the YMCA's internal planning and budgeting process and (ii) a commercially reasonable degree of detail and specificity. Each year, following the YMCA's submission of the Proposed Budgets to the City Manager, representatives designated by the YMCA and the City Manager who are familiar and involved with the YMCA's and the City's respective budgeting processes will meet to discuss and review the Proposed Budgets. The City and the YMCA will reach joint approval of final Annual Operating and Capital Improvements Budgets for the Aquatic Center at least fifteen (15) days before the commencement of each Fiscal Year. The YMCA and the City will confer in good faith to reconcile all differences with regard to the annual budgeting process. It is acknowledged and confirmed that the Initial Budget and each Annual Budget thereafter must include, contemplate, and provide for the payment of expenses, including, without limitation, Capital Improvement Expenditures, sufficient to cover and satisfy the Operating Standards and all other obligations for the management and operation of the Aquatic Center under this Agreement in accordance with the Aquatic Center's anticipated usage. In the event the YMCA and the City are unable to timely approve the Initial Budget or an Annual Operating Budget and/or an Annual Capital Improvements Budget under this Section, either party may compel the other party to participate in mediation for the purpose of resolving the budgetary impasse. The mediator for any such mediation must be mutually agreed upon and jointly appointed by the YMCA and the City, with the mediator's cost to be shared equally by the two parties. The mediation will be held in Yakima, Washington and conducted as soon as reasonably possible after mediation is compelled with attention given to the time -sensitive nature of the budgetary impasse. In the event the parties are unable to agree upon a mediator, a mediator will be appointed by the Presiding Judge for the Superior Court of Yakima County. Until a new Annual Budget is approved, the YMCA will continue to operate and manage the Aquatic Center in its customary manner in keeping with the Aquatic Center's historical and ordinary practices and activities, with use of the Aquatic Center's most recently approved Annual Operating Budget as a guide until the contested budget(s) is/are jointly approved by the YMCA and the City under this Section. (b) Budget Variances. The YMCA and the City acknowledge that the Initial Budget and each subsequent Annual Operating and Capital Improvement Budget will only represent estimates for the Aquatic Center's annual revenues and expenses from year -to year and that the Aquatic Center's actual revenues and expenses may vary from the Initial and Annual Operating and Capital Improvement Budgets for reasons beyond the reasonable control of the YMCA. Nevertheless, the YMCA will act in good faith at all times in the operation of the Aquatic Center and shall use commercially reasonable efforts to operate the Aquatic Center in accordance with the approved Initial and Annual Operating and Capital Improvement Budgets, and shall only stray from such budgets when required by emergency, unexpected events, or to satisfy the YMCA's Operating Operating Agreement 10 Standards and other obligations under this Agreement. Accordingly, while the YMCA will use commercially reasonable efforts to adhere to the Initial and Annual Operating and Capital Improvement Budgets, variances in the Aquatic Center's estimated revenues and expenses are anticipated and the City will remain obligated to participate in and contribute toward the City's obligations when and as set forth in this Agreement even if said contributions are larger than contemplated in the applicable budget. 7.3 Operations. (a) Generally. The YMCA is obligated to operate the Aquatic Center in accordance with the terms and conditions set forth in this Operating Agreement. The City is obligated to reimburse the YMCA for fifty percent (50%) of all annual Operating Deficits under this Agreement in connection with the Aquatic Center incurred by the YMCA during each Fiscal Year during the Term of this Agreement. (b) Invoice and Payment Procedures. After the Opening Date, within thirty (30) days after the end of each calendar month, the YMCA will submit financial reports to the City that summarize the Gross Operating Revenue and Gross Operating Expenses incurred by the YMCA in the operation and management of the Aquatic Center during the preceding calendar month (the "Monthly Financial Reports"). The Monthly Financial Reports will set forth and compare the Aquatic Center's actual revenues and expenses with the budgeted revenues and expenses for the applicable time period on both monthly and year-to-date bases. The Monthly Financial Reports will be accompanied by an invoice from the YMCA for 50% of any Operating Deficit incurred by the YMCA during the applicable month. The City will remit full payment for all such invoices within twenty (20) days of receipt. In the event of an Operating Surplus for a particular month, 50% of the Operating Surplus would be credited to the YMCA's required operating reserve and 50% would be credited to the City's required operating reserve. (d) Operating Reserve Fund. Throughout the Term of this Agreement, the YMCA and the City shall each separately maintain operating reserve funds to prepare for and offset periods when operating expenditures exceed anticipated revenue for the Aquatic Center. 7.4 Capital Improvements. (a) Generally. The City is obligated to reimburse the YMCA for fifty percent (50%) of all annual Capital Improvement Expenditures (as defined under Section 1.6 above) incurred by the YMCA during each Fiscal Year during the Term of this Agreement. Except when needed to keep the Aquatic Center safe, habitable, in good repair and proper working order, and in compliance with all Applicable Laws, the City will not be obligated to reimburse the YMCA for any Capital Improvement Expenditure not included in the Initial Budget or an Annual Budget unless and until the Capital Improvement Expenditure is approved by the City. (b) Invoice and Payment Procedures. After the Opening Date, within thirty (30) days after the end of each calendar month, the YMCA will submit financial Operating Agreement 11 reports to the City that summarize the Capital Improvement Expenditures incurred by the YMCA in the operation and management of the Aquatic Center during the preceding calendar month (the "Monthly CAPEX Reports"). The Monthly CAPEX Reports will set forth and compare the Aquatic Center's actual Capital Improvement Expenditures with the budgeted Capital Improvement Expenditures for the applicable time period on both monthly and year-to-date bases. The Monthly CAPEX Reports will be accompanied by an invoice from the YMCA for 50% of all Capital Improvement Expenditures incurred by the YMCA during the applicable month. The City will remit full payment for all such invoices to the extent due and owing under this Agreement within twenty (20) days of receipt. (c) Capital Replacement/Refurbishing Plan. The YMCA shall develop a capital replacement and refurbishing plan for all FF&E and major systems for the Aquatic Center and Common Areas that will be subject to review and approval from time to time by the City as part of the budgeting processes set forth in this Agreement. The capital replacement and refurbishing plan will outline the YMCA's and the City's joint priorities and plans for Capital Improvements over the upcoming years, serve as guide during the Annual Capital Improvements Budgeting process, and aid the City and the YMCA in making timely Capital Improvements to ensure the Aquatic Center and Common Areas remain in compliance with the Operating Standards set forth in Section 5.2 above. Commencing in the fifth (5th) year after the Opening Date and again on a periodic basis no less frequently than every five (5) years, the YMCA, as a Gross Operating Expense, will hire a professional consultant experienced in inspecting and assessing aquatic center facility FF&E and major systems to produce a report in which the consultant will make recommendations concerning the Aquatic Center and Common Areas' then -current and anticipated upcoming Capital Improvement needs in order to remain in compliance with the Operating Standards set forth in Section 5.2 above. Said report will guide the YMCA and the City in the preparation and maintenance of the above-described replacement and refurbishing plan. (d) Capital Improvement Reserve Funds. In anticipation of Capital Improvements that will be needed to maintain the Aquatic Center and Common Areas in compliance with the Operating Standards set forth in Section 5.2 above and to ensure both the YMCA and the City have a source of readily available funds to pay Capital Improvement obligations as they become needed, the YMCA and the City will each create and maintain separate Capital Improvement Reserve Funds into which they will each annually contribute $40,000.00 until such time as their respective Funds hold $1,000,000.00 (in which event additional funds will not have to be placed in the respective Capital Improvement Reserve Funds except to fill the funds back up to the $1,000,000.00 cap when and as money is drawn out of the Funds to cover Capital Improvement costs). The money held in the separate Capital Improvement Reserve Funds will remain owned and controlled by the separate parties; provided, however, each party may withdraw money from said Funds only when and as needed to meet and pay for Capital Improvement obligations under this Agreement. Upon request, each party will provide the other party with reasonable written evidence of the establishment of said party's Capital Improvement Reserve Fund and compliance with the requirements of this paragraph (e.g., the annual deposit of $40,000.00 into the Fund and the Operating Agreement 12 withdrawal of money from the Fund only when and as needed to pay for Capital Improvement obligations under this Agreement). Eachparty will deposit its first $40,000.00 into its separate Capital Improvement Reserve Fund on or before the first annual anniversary of the Opening Date and again annually on or before each subsequent annual anniversary of the Opening Date. It is expressly acknowledged and agreed that each party's obligation to pay its share of Capital Improvements under this Agreement is in no way limited by the amount of money held in said party's Capital Improvement Reserve Funds, but instead that the Capital Improvement Reserve Funds required under this paragraph are merely intended to serve as a planning tool to aid the parties in preparing for their Capital Improvement obligations as they arise under this Agreement. 7.5 Quarterly Reports. No more frequently than four times per year (quarterly, unless the YMCA agrees otherwise), on dates and at times mutually convenient for the YMCA and the City Manager, the YMCA will meet with the City Manager and provide written report summaries and in-person updates on the status of the Aquatic Center's financial performance, usage, and programs. 7.6 Books & Records; Audit Rights. The YMCA shall keep and maintain books and records that reflect the YMCA's management and operation of the Aquatic Center under this Agreement, including, without limitation, copies of purchase orders, invoices, correspondence, receipts, vouchers, memoranda, and other documentation that memorialize the Gross Operating Revenue, Gross Operating Expenses, and Capital Improvement Expenditures incurred by the YMCA hereunder and used to calculate Operating Surpluses and Deficits. All such books and records must be kept and be available at the YMCA's administrative offices, and may be kept in paper and/or electronic form; provided, however, the YMCA is not required to keep or maintain any books or records under this paragraph (either in paper or electronic form) for longer than six (6) years after their respective creation. The City, at the City's sole expense and at all times throughout the Term of this Agreement and for the six (6) years following the termination of this Agreement, has the right to audit, examine, and take copies during normal working hours at the YMCA's administrative offices of all books and records the YMCA is obligated to keep and maintain under the preceding paragraph. 7.7 Audited Financial Statements. Each year during the Term of this Agreement, within one hundred eighty (180) days of the close of the YMCA's Fiscal Year, the YMCA will prepare and submit to the City an annual financial statement. The annual financial statement must be prepared in accordance with generally accepted accounting principles and include a supplemental schedule, sufficient in detail to permit a reasonable determination by the City of the annual Gross Operating Revenue, Gross Operating Expenses, and Capital Improvement Expenditures of the Aquatic Center. The annual financial statement, at the YMCA's sole expense, must be audited by a licensed or certified public accountant selected by the YMCA. The scope of the audit, as it relates to the Aquatic Center, must be sufficient for the accountant to issue the following opinion: "The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and is fairly stated in all material respects in relation to the basic financial statements taken as a whole." Operating Agreement 13 8. Entry and Inspection. With reasonable prior notice to the YMCA, the City and the City's authorized representatives may enter and inspect the Aquatic Center during the Aquatic Center's hours of operation for the purpose of confirming the YMCA's compliance with this Agreement; provided, however, when entering and inspecting the Aquatic Center, the City may not unreasonably interfere with or disrupt the activities being conducted in the Aquatic Center. It is expressly confirmed that the YMCA may keep locked desks and secure files at the Aquatic Center. 9. Additional/Future Aquatic Facilities. This Agreement pertains to the Aquatic Center described in Section 2 of the Development Agreement and no other facilities. Should the parties wish to expand this Agreement to include additional facilities, including, without limitation, an outdoor pool, the terms of said expansion would have to be negotiated, agreed upon, and set forth in a signed and acknowledged written amendment to this Agreement. 10. Trade Names. The names "Young Men's Christian Association of Yakima," "Young Men's Christian Association," "Yakima Family YMCA," "YMCA," "The Y," and any other trade names used by the YMCA may not be used by the City unless approved by the YMCA and when used alone or in connection with another work or works and/or the YMCA trademarks, service marks, symbols, logos, and designs will in all events remain the exclusive property of the YMCA and nothing contained herein will confer on the City the right to use any of the same. 11. Defaults, Remedies, and Dispute Resolution. 11.1 YMCA Default. In the event the YMCA materially breaches the terms of this Agreement, the Development Agreement, and/or the Ground Lease and said breach is not, in whole or in part, caused by the wrongful actions or omissions of the City, the City may elect and proceed with one of the following EXCLUSIVE remedies, but only if the City has first given the YMCA written notice of the specific default(s) alleged by the City and the default(s) is/are not cured by the YMCA within sixty (60) days after said notice is given (provided, however, if the nature of the default is such that more than sixty (60) days are required for performance, the City may not act under this Section 11.1 so long as the YMCA commences performance within said sixty (60) day period and thereafter diligently prosecutes the same to completion): (a) Specific Performance. The subject matters of this Agreement, the Development Agreement, and/or the Ground Lease are unique and, for this reason, it is stipulated that in the event of an actionable default of this Agreement, the Development Agreement, and/or the Ground Lease under Section 11.1 above, the City will have the right to seek equitable relief in the form of specific performance of this Agreement's, the Development Agreement's, and/or the Ground Lease's provisions. (b) Termination. In lieu of seeking specific performance under Section 11.1(a) above, in the event of an actionable default of this Agreement, the Development Agreement, and/or the Ground Lease under Section 11.1 above by the YMCA, the City, with an additional ninety (90) days' prior written notice to the YMCA of the termination after the expiration of the cure period under Section 11.1 above, is permitted to terminate all (but not less than all) of the YMCA/City Agreements to the extent any obligations remain owed thereunder. It is acknowledged and agreed that the City may not terminate one or two of the YMCA/City Agreements and leave one or two of the YMCA/City Agreements in Operating Agreement 14 effect (i.e., if one YMCA/City Agreement is terminated, all of the YMCA/City Agreements must be terminated), in which event the provisions of Section 4.1 above will apply just the same as they would upon the expiration of the Term and the YMCA would have no obligation to reimburse the City for any of the City's Financial Contribution made under Section 3 of the Development Agreement. Notwithstanding the foregoing provisions of this Section 11.1(b), if the City gives the YMCA written notice that this Agreement, the Development Agreement, and the Ground Lease are terminated under this Section 11.1(b), the City refuses to rescind the alleged termination within twenty (20) days after written request by the YMCA, and it is later ruled by a court of competent jurisdiction that the City was not entitled to terminate this Agreement, the Development Agreement, and the Ground Lease under this Section 11.1(b) (e.g., it is determined that the YMCA had not materially breached the terms of this Agreement, the Development Agreement, and/or the Ground Lease; it is determined that the YMCA had cured the breach within the allowed cure period; etc.) (a "Wrongful City Termination"), the YMCA will likely suffer damage to the YMCA's reputation and other harms that will be difficult or impossible to quantify. Therefore, in the event of a Wrongful City Termination, the City, in addition to paying the YMCA all costs and attorneys' fees awarded to the YMCA in the proceeding, will also be obligated to immediately pay the YMCA (as a fair approximation of the likely harm the YMCA would suffer from the Wrongful City Termination) liquidated damages in the amount of One Million and No/100 U.S. Dollars ($1,000,000.00) plus an amount equal to the percentage increase in the CPI from September 30, 2015, through the September 30th immediately preceding the date of termination under this Section 11.1(b) multiplied by $1,000,000.00; provided, however, in no event will an amount due under this paragraph in the event of a Wrongful City Termination be less than $1,000,000.00. For example, in the event of a Wrongful City Termination under this paragraph, if the CPI percentage increase between September 30, 2015, and the September 30th immediately preceding the date of termination was 10%, the liquidated damages due under this paragraph would be $1,100,000.00 (i.e., $1,000,000.00 plus $100,000 based on the 10% CPI increase). For purposes of this Section 11.1(b) and Section 11.2(b) below, the term "CPI" means and refers to the Consumer Price Index for All Urban Consumers (West Urban - Size B/C) published by the Bureau of Labor and Statistics of the United States Department of Labor (Base is 1982-84=100). In the event said Index is not published at the time it is needed under the terms of this paragraph, the parties will mutually agree upon a substitute index which is comparable to the Index referred to above. If the parties are unable to agree on a substitute, comparable index, then the matter of an appropriate substitute and comparable index to be used to implement the intent of this Section 11.1(b) will be determined by a court of competent jurisdiction. 11.2 City Default. In the event the City materially breaches the terms of this Agreement, the Development Agreement, and/or the Ground Lease and said breach is not, in whole or in part, caused by the wrongful actions or omissions of the YMCA, the YMCA may elect and proceed with one of the following EXCLUSIVE remedies, but only if the YMCA has first given the City written notice of the specific default(s) alleged by the YMCA and the default(s) is/are not cured by the City within sixty (60) days after said notice is given Operating Agreement 15 (provided, however, if the nature of the default is such that more than sixty (60) days are required for performance, the YMCA may not act under this Section 11.2 so long as the City commences performance within said sixty (60) day period and thereafter diligently prosecutes the same to completion): (a) Specific Performance. The subject matters of this Agreement the Development Agreement, and/or the Ground Lease are unique and, for this reason, it is stipulated that in the event of an actionable default of this Agreement, the Development Agreement, and/or the Ground Lease under Section 11.2 above, the YMCA will have the right to seek equitable relief in the form of specific performance of this Agreement's, the Development Agreement's, and/or the Ground Lease's provisions. (b) Termination. In lieu of seeking specific performance under Section 11.2(a) above, in the event of an actionable default of this Agreement, the Development Agreement, and/or the Ground Lease under Section 11.2 above by the City, the YMCA, with an additional ninety (90) days' prior written notice to the City of the termination after the expiration of the cure period under Section 11.2 above, is permitted to terminate all (but not less than all) of the YMCA/City Agreements to the extent any obligations remain owed thereunder. It is acknowledged and agreed that the YMCA may not terminate one or two of the YMCA/City Agreements and leave one or two of the YMCA/City Agreements in effect (i.e., if one YMCA/City Agreement is terminated, all of the YMCA/City Agreements must be terminated), in which event the provisions of Section 4.1 above will apply just the same as they would upon the expiration of the Term; provided, however, the City would be obligated to pay the YMCA an amount equal to the fair market value of the Other Facility and other facilities constructed on the Leased Premises under the Ground Lease and fifty percent (50%) of the Aquatic Center to compensate the YMCA for the loss of said assets as a result of the early termination of this Section 11.2(b). Said amounts will be due and owing by the City to the YMCA within ninety (90) days of the date of termination under this paragraph. In the event of termination under this Section 11.2(b), the YMCA would have no obligation to reimburse the City for any of the City's Financial Contribution made under Section 3 of the Development Agreement. Notwithstanding the foregoing provisions of this Section 11.2(b), if the YMCA gives the City written notice that this Agreement, the Development Agreement, and the Ground Lease are terminated under this Section 11.2(b), the YMCA refuses to rescind the alleged termination within twenty (20) days after written request by the City, and it is later ruled by a court of competent jurisdiction that the YMCA was not entitled to terminate this Agreement, the Development Agreement, and the Ground Lease under this Section 11.2(b) (e.g., it is determined that the City had not materially breached the terms of this Agreement, the Development Agreement, and the Ground Lease; it is determined that the City had cured the breach within the allowed cure period; etc.) (a "Wrongful YMCA Termination"), the City will likely suffer damage to the City's reputation and other harms that will be difficult or impossible to quantify. Therefore, in the event of a Wrongful YMCA Termination, the YMCA, in addition to paying the City all costs and attorneys' fees awarded to the City in the proceeding, will also be obligated to immediately pay the City (as a fair approximation of the likely harm the City would suffer from the Wrongful YMCA Operating Agreement 16 Termination) liquidated damages in the amount of One Million and No/100 U.S. Dollars ($1,000,000.00) plus an amount equal to the percentage increase in the CPI from September 30, 2015, through the September 30th immediately preceding the date of termination under this Section 11.2(b) multiplied by $1,000,000.00; provided, however, in no event will an amount due under this paragraph in the event of a Wrongful YMCA Termination be Less than $1,000,000.00. 11.3 Mediation. In the event of a dispute between the YMCA and the City with respect to the interpretation, implementation, or performance of any obligation under this Agreement, the Development Agreement, and/or the Ground Lease, the YMCA and the City will attempt to resolve the dispute through a mediation process before taking action under Section 11.1(a) -(b) or 11.2(a) -(b) above. The mediator for any such mediation must be mutually agreed upon and jointly appointed by the YMCA and the City, with the mediator's cost to be shared equally by the two parties. The mediation will be held in Yakima, Washington and conducted as soon as reasonably possible after mediation is compelled, with attention given to the time -sensitive nature of the dispute. In the event the parties are unable to agree upon a mediator, a mediator will be appointed by the Presiding Judge for the Superior Court of Yakima County. 12. Miscellaneous Terms. 12.1 Amendments. This Agreement may not be modified or amended except by written agreement signed and acknowledged by each of the parties hereto. 12.2 No Joint Venture. Nothing contained in this Agreement creates the relationship of principal and agent or of joint venture between the parties hereto. 12.3 Time is of the Essence. Time is of the essence as to all terms of this Agreement. 12.4 Notices. All notices under this Agreement must be in writing and will be deemed given to the receiving party when (a) personally delivered to the City Manager for the City of Yakima (for notices to the City) or personally delivered to the CEO or President of the Yakima Family YMCA (for notices to the YMCA) or (b) three days after being deposited in the United States Postal Service by certified mail (with return receipt requested) to the receiving party at the receiving party's last known address(es). 12.5 Exhibits. There are no attachments to this Agreement except for the Exhibits expressly referenced in this Agreement, each of which constitutes a part of this Agreement as if set forth in full herein. 12.6 Headings; Construction. The captions and paragraph headings used in this Agreement are inserted for convenience of reference only and are not intended to define, limit, or affect the interpretation or construction of any term or provision of this Agreement. This Agreement shall not be construed more strictly against one party than the other by virtue of the fact that one party drafted this Agreement and/or certain clauses contained herein. It is hereby recognized that both parties to this Agreement and their respective counsel have had a full and fair opportunity to negotiate and review all terms and provisions of hereof and to fully contribute to this Agreement's substance and form. Operating Agreement 17 12.7 Governing Law. This Agreement will be interpreted, construed, and governed by the laws of the State of Washington. 12.8 Assignment; Binding Effect. Except as expressly provided otherwise herein, neither party hereto may assign any of its rights or obligations under this Agreement unless the other party consents thereto in writing, which consent may be withheld for any reason. Subject to any limitations on assignments provided for in this Agreement, all of the provisions of this Agreement will inure to the benefit of and be binding on the successors and assigns of the City and the YMCA. 12.9 Waivers. The failure of either party to seek redress for violation of or to insist upon the strict performance of any covenant or condition of this Agreement will not prevent a subsequent act, which would have originally constituted a violation, from having the effect of an original violation. 12.10 Attorneys' Fees; Venue. In the event of any dispute arising out of or relating to this Agreement, whether or not suit or other proceedings is commenced, and whether in mediation, in arbitration, at trial, on appeal, in administrative proceedings, or in bankruptcy (including, without limitation, any adversary proceeding or contested matter in any bankruptcy case), the prevailing party will be entitled to its costs and expenses incurred, including reasonable attorneys' fees. The sole venue for any dispute arising out of or relating to this Agreement will be in a court of competent jurisdiction in Yakima County, Washington. 12.11 Counterparts and Copies. This Agreement may be executed in any number of identical counterparts, with each counterpart having the same effect as if all parties to this Agreement had signed the same document. All executed counterparts of this Agreement will be construed as and constitute one and the same instrument. A facsimile or electronic copy (e.g., a PDF copy) of an executed counterpart of this Agreement will have the same effect as an original executed counterpart of this Agreement. 12.12 Severability. If any provision of this Agreement or the application thereof to any person or circumstances shall to any extent be held to be invalid or unenforceable, such provision shall not affect or invalidate the remainder of this Agreement, and to this end the provisions of this Agreement are declared to be severable. If such invalidity becomes known or apparent to the parties, the parties agree to negotiate promptly in good faith in an attempt to amend such provision as nearly as possible to be consistent with the intent of this Agreement. 12.13 Entire Agreement. This Agreement, together with the associated Master Agreement, Ground Lease, and Development Agreement, constitutes the entire understanding and agreement of the parties to this Agreement with respect to its subject matter. All prior agreements, understandings, or representations with respect to this Agreement's subject matter are hereby canceled in their entirety and are of no further force or effect. It is expressly acknowledged that there are no oral or other agreements which modify or affect this Agreement. 12.14 Survival. All representations, warranties, covenants, agreements, and indemnities set forth in or otherwise made pursuant to this Agreement shall survive and remain in effect following the expiration or earlier termination of this Agreement; provided, however, that Operating Agreement 18 nothing herein is intended to extend the survival beyond any applicable statute of limitations period. 12.15 Authority. The execution, delivery, and performance by each party of this Agreement has been duly authorized by their respective governing bodies (i.e., the YMCA's Board of Directors and the City Council for the City of Yakima) in accordance with their respective governing documents and applicable law, and no further action is necessary on the part of either party to this Agreement or their respective governing bodies to make the execution, delivery, and performance of this Agreement by the undersigned persons valid and binding upon the parties to this Agreement. [Signatures on Following Page] Operating Agreement 19 EFFECTIVE as of the Effective Date first written above. YOUNG MEN'S CHRISTIAN CITY OF YAKI A ASSOCIATION OF YAKIMA By: o Romero, CEO Operating Agreement ourke, City Manager CITY CONTRAC r N0: 2°15 - 2. 13 RESOLUTION NO: R LO 15- 128 20 STATE OF WASHINGTON COUNTY OF YAKIMA 1 certify that I know or have satisfactory evidence that BOB ROMERO 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 CEO for the YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA to be the free and voluntary act of such party for the uses and purposes mentioned in the instrument. - DATED: 7c7< 2 / 7 , 2015. Notary Public State of Washington JODI L STEPHENS MY COMMISSION EXPIRES August 11, 2018 STATE OF WASHINGTON COUNTY OF YAKIMA NOTARY P BLIC for the State o Washingto residing at /2-1? My appointment expires: rnjn l/; z' I certify that I know or have satisfactory evidence that TONY O'ROURKE 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 CITY MANAGER for the CITY OF YAKIMA to be the free and voluntary act of such party for the uses and purposes mentioned in the instrument. f n �] DATED: 1 V )``/ Notary Public State of Washington SONYA R CLAAR TEE MY COMMISSION EXPIRES OCTOBER 25, 2018 , 2015. iceioV [PRINT NAME] u 4 -(110 - NOTARY -V IV I NOTARY PUBLIC or the State of Washington, residing at i,Q O My appointor ne t expires: I C / �( . Operating Agreement 21 FIRST AMENDMENT TO OPERATING AGREEMENT PARTIES: EFFECTIVE DATE: May 1, 2018 CITY OF YAKIMA, a Washington municipal corporation 129 North 2nd Street Yakima, Washington 98901 (referred to in this Amendment as the "City") YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA (d/b/a YAKIMA FAMILY YMCA), a Washington nonprofit corporation 5 North Naches Avenue Yakima, Washington 98901 (referred to in this Amendment as the "YMCA") OPERATING AGREEMENT. The term "Operating Agreement," when used in this Amendment, means and refers to the Operating Agreement dated October 27, 2015, by and among the City and the YMCA pertaining to the operation of a new aquatic center to be developed, constructed, and operated at Chesterley Park in Yakima, Washington. BACKGROUND. To better facilitate the arrangements between the City and the YMCA for the construction and operation of the Aquatic Center, the undersigned parties have mutually agreed to amend the timing and financing of the City's financial obligations under the Operating Agreement through the first ten years of the Aquatic Center's operations and the manner and timing in which the City's Financial Contribution under the Development Agreement and certain other financial obligations under the Operating Agreement are met. In general terms, the City has requested to eliminate the City's obligation to reimburse the YMCA for Pre -Opening Expenses, Operating Deficits, and Capital Improvement Expenditures under the Operating Agreement until the tenth anniversary of the Opening Date in exchange for the City's agreement to increase the City's Financial Contribution under the Development Agreement from $4,500,000.00 to $8,000,000.00. Subject to and in accordance with the terms of this Amendment and the below -described Related Amendments, the YMCA has agreed to accommodate said requests by the City. This Amendment and the below -described Related Amendments are now executed for the purpose of memorializing the amendments made to the Development Agreement, Operating Agreement, and Ground Lease in connection with said agreement. Moreover, the Development Agreement, Operating Agreement, and Ground Lease are also executed for the purpose of confirming the satisfaction of the Due Diligence, RCO, and Funding Contingencies and to memorialize the Possession Date and commencement of the Initial Term. AMENDMENT. FOR GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND ADEQUACY ACKNOWLEDGED, THE UNDERSIGNED PARTIES AGREE AND AMEND THE OPERATING AGREEMENT AS FOLLOWS: 1. Effect of Amendment. This Amendment amends, supplements, and is made part of the Operating Agreement. In the event of a conflict between the provisions of this Amendment and the Operating Agreement, the provisions of this Amendment will control. Nevertheless, except as expressly amended or supplemented by this Amendment, the provisions of the Operating Agreement remain in full force and effect. Amendment to Operating Agreement (2018) 1 2. Capitalized Terms. Except when the context clearly requires another meaning and for capitalized terms defined in this Amendment, all capitalized terms used in this Amendment have the same meaning given to said terms in the Operating Agreement. 3. Relief from Pre -Opening Expenses. Section 7.1(a) of the Operating Agreement is amended to eliminate the City's obligation to reimburse the YMCA for the City's fifty percent (50%) share of the Pre -Opening Expenses. 4. Implementation of the Operating Deficit Reimbursements and Additional Credits. Sections 7.3(a) and 7.3(b) of the Operating Agreement are amended to: (a) Eliminate the City's obligation under Sections 7.3(a) and 7.3(b) of the Operating Agreement to reimburse the YMCA for the City's fifty percent (50%) share of the annual Operating Deficits until the first day of the first calendar month immediately following the ten- (10-) year anniversary after the Opening Date (the "Reimbursement Obligation Commencement Date"); and (b) Grant the City the following annual credits against the City's Operating Deficit reimbursement obligations under Sections 7.3(a) and 7.3(b) of the Operating Agreement during the eleventh (11th), twelfth (12th), thirteenth (13th), fourteenth (14th), and fifteenth (15th) years following the Opening Date: Year Following the Opening Date Operating Deficit Reimbursement Credit Against the First Funds Owed For the Corresponding Year Year 11 $50,000.00 Year 12 $40,000.00 Year 13 $30,000.00 Year 14 $20,000.00 Year 15 $10,000.00 For example and illustration purposes only, if the Opening Date is October 20, 2019, the City will be relieved of the City's obligation under Sections 7.3(a) and 7.3(b) of the Operating Agreement to reimburse the YMCA for the City's 50% share of Operating Deficits from October 20, 2019, through October 31, 2029, and the City's obligation to commence reimbursing the YMCA under Sections 7.3(a) and 7.3(b) of the Operating Agreement for the City's 50% share of the Operating Deficits would commence on November 1, 2029, which date would be the Reimbursement Obligation Commencement Date; provided, however, the City would receive a credit against and not have to reimburse the YMCA for (1) the first $50, 000.00 of the City's Operating Deficit reimbursement obligation under Sections 7 3(a) and 7.3(b) of the Operating Agreement for the period running from November 1, 2029, through October 31, 2030; (2) the first $40, 000.00 of the City's Operating Deficit reimbursement obligation under Sections 7.3(a) and 7 3(b) of the Operating Agreement for the period running from November 1, 2030, through October 31, 2031; (3) the first $30,000.00 of the City's Operating Deficit reimbursement obligation under Sections 7.3(a) and 7.3(b) of the Operating Agreement for the period running from November 1, 2031, through October 31, 2032; (4) the first $20, 000.00 of the City's Operating Deficit reimbursement obligation under Sections 7.3(a) and 7 3(b) of the Operating Agreement for the period running from November 1, 2032, through October 31, 2033; and (5) the first $10,000 00 of the City's Amendment to Operating Agreement (2018) 2 Operating Deficit reimbursement obligation under Sections 7 3(a) and 7.3(b) of the Operating Agreement for the period running from November 1, 2033, through October 31, 2034 5. Implementation of the Capital Improvement Expenditure Reimbursements and Reserve Fund Contributions. Sections 7.4(a), 7.4(b), and 7.4(d) of the Operating Agreement are amended to: (a) Eliminate the City's obligation under Sections 7.4(a) and 7.4(b) of the Operating Agreement to reimburse the YMCA for the City's fifty percent (50%) share of the annual Capital Improvement Expenditures until the Reimbursement Obligation Commencement Date (i.e., first day of the first calendar month immediately following the ten- (10) year anniversary after the Opening Date); and (b) Eliminate the City's obligation under Section 7.4(d) of the Operating Agreement to make annual $40,000.00 contributions into the City's Capital Improvement Reserve Fund account until the Reimbursement Obligation Commencement Date (i.e., first day of the first calendar month immediately following the ten- (10-) year anniversary after the Opening Date). For example and illustration purposes only, if the Opening Date is October 20, 2019, the City will be relieved of the City's obligation under Sections 7.4(a), 7.4(b), and 7 4(d) of the Operating Agreement to (1) reimburse the YMCA for the City's 50% share of Capital Improvement Expenditures from October 20, 2019, through October 31, 2029, and the City's obligation to commence reimbursing the YMCA under Sections 7 4(a) and 7 4(b) of the Operating Agreement for the City's 50% share of the Capital Improvement Expenditures would commence on November 1, 2029, which date would be the Reimbursement Obligation Commencement Date; and (2) make annual $40,000.00 contributions into the City's Capital Improvement Reserve Fund account until November 1, 2029 6. Budgeting and Reports. As a result of the Pre -Opening Expense, Operating Deficit, and Capital Improvement Expenditure relief provided to the City under Sections 3, 4, and 5 above, the Operating Agreement is amended to: (a) Eliminate (i) the YMCA's obligation under Section 7.1(b) of the Operating Agreement to prepare and submit a proposed Initial Budget to the City and (ii) the process by which the City and the YMCA will meet to discuss and review the proposed Initial Budget and agree on the final Initial Budget. Instead, the Initial Budget will be prepared and approved solely by the YMCA; provided, however, once the Initial Budget is prepared and approved by the YMCA, the YMCA will submit a copy of the Initial Budget to the City, with said submission occurring no later than the Opening Date; (b) Amend Section 7.2(a) of the Operating Agreement to extend the date on which annual Proposed Budgets are to be prepared and submitted by the YMCA to the City from July 1st of each year to August 1st of each year. For example and illustration purposes only, if the Opening Date is October 20, 2019, the YMCA, not later than September I, 2020, will provide Proposed Budgets to the City for the first (1st) complete Fiscal Year after the Opening Date (i.e., September 1, 2020 - August 31, 2021), and the budgeting process for said Fiscal Year will continue in the manner set forth in Section 7.2(a) of the Operating Agreement, with said process to repeat on an annual basis for each subsequent Fiscal Year; Amendment to Operating Agreement (2018) 3 (c) Eliminate the YMCA's obligation under Section 7.3(b) of the Operating Agreement to submit Monthly Financial Statements and invoices to the City until the expiration of the first eight (8) complete Fiscal Years after the Opening Date; (d) Eliminate the YMCA's obligation under Section 7.4(b) of the Operating Agreement to submit Monthly CAPEX reports and invoices to the City until the expiration of the first eight (8) complete Fiscal Years after the Opening Date; (e) Eliminate the YMCA's obligation under Section 7.5 of the Operating Agreement to meet and provide quarterly reports to the City Manager until the first quarter of the sixth (6th) complete Fiscal Year after the Opening Date; provided, however, during the first five (5) complete Fiscal Years after the Opening Date, the YMCA, on a semiannual basis (i.e., twice -a -year), will meet with the City Manager, on dates and at times mutually convenient for the YMCA and the City Manager, and provide written report summaries and in-person updates on the status of the Aquatic Center's financial performance, usage, and programs; and (f) Eliminate the YMCA's obligation under Section 7.7 of the Operating Agreement to prepare and submit to the City the annual financial statements required thereunder until the ninth (9th) complete Fiscal Year after the Opening Date, with the financial statement for said ninth (9th) Fiscal Year to be provided no later than one hundred eighty (180) days following the close of the ninth (9th) complete Fiscal Year after the Opening Date. 7. Acknowledgment of the Satisfaction of the Contingencies. The undersigned parties hereby expressly acknowledge the Due Diligence, RCO, and Funding Contingencies are satisfied. 8. Related Amendments. The provisions of this Amendment are interwoven with and dependent upon the provisions set forth and agreed to in the First Amendment to Development Agreement and First Amendment to Ground Lease with "Effective Dates" even with the Effective Date of this Amendment (collectively the "Related Amendments"). Accordingly, the provisions of this Amendment will become binding and enforceable only upon the full execution of this Amendment and the Related Amendments by both the City and the YMCA. 9. Counterparts and Copies. This Amendment may be executed in any number of identical counterparts, with each counterpart having the same effect as if all parties to this Amendment had signed the same document. All executed counterparts of this Amendment will be construed as and constitute one and the same instrument. A facsimile or electronic copy (e.g , a PDF copy) of an executed counterpart of this Amendment will have the same effect as an original executed counterpart of this Amendment. 10. Authority. The execution, delivery, and performance by each party of this Amendment has been duly authorized by their respective governing bodies (i.e., the YMCA's Board of Directors and the City Council for the City of Yakima) in accordance with their respective governing documents and applicable law, and no further action is necessary on the part of either party to this Amendment or their respective governing bodies to make the execution, delivery, and performance of this Amendment by the undersigned persons valid and binding upon the parties to this Amendment. [Signatures on Following Page] Amendment to Operating Agreement (2018) 4 EFFECTIVE as of the Effective Date first written above. YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA By: o Romero, CEO STATE OF WASHINGTON COUNTY OF YAKIMA ) ss. CITY OF YAKIMA By: iff M CITY CONTRACT NO' -249/.5----22.34me'f l RESOLUTION NO' e"..70/37-126 1 certify that I know or have satisfactory evidence that BOB ROMERO 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 CEO for the YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA to be the free and voluntary act of such party for the uses and purposes mentioned in the instrument. DATED: DAWN SCIARA NOTARY PUBLIC STATE OF WASHINGTON COMMISSION EXPIRES MAY 19, 2020 STATE OF WASHINGTON ) ss. COUNTY OF YAKIMA , 2018. [PRINT NAME] ,,,14/ A CA rr 11'4— NOTARY ' — NOTARY PUBLIC for the State of Washington, residing at \J My appointment expires: 5/1'i I certify that I know or have satisfactory evidence that CLIFF MOORE 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 CITY MANAGER for the CITY OF YAKIMA to be the free and voluntary act of such party for the uses and purposes mentioned in the instrument. DATED: Notary Public State of Washing -ton SONYA R CLAAR TEE MY COMMISSION EXPIRES OCTOBER 25, 2518 , 2018. [PRINT NAME] NOTARY PUB IL residing at My appointment IC for the State of Washington, etti rka p 0069,A�'T SO/ expires: Amendment to Operating Agreement (2018) 5 '1111111 1, nun 11,1:1141r10 BUSINESS OF THE CITY COUNCIL YAKIMA, WASHINGTON AGENDA STATEMENT Item No. 4. For Meeting of: October 27, 2015 ITEM TITLE: Resolution authorizing Aquatic Center, associated Ground Lease, Development and Operating Agreements with the Yakima Family YMCA at Chesterley Park SUBMITTED BY: Jeff Cutter, City Attorney SUMMARY EXPLANATION: The City and the YMCA have been cooperatively working together to reach agreement on the construction of an Aquatic Center on a portion of the Chesterley Park property. The Aquatic Center proposed in the attached Agreements would provide beneficial use of a premier aquatic facility to all of the citizens of the City of Yakima. The attached and incorporated Agreements provide the specific terms and conditions under which the City would participate financially and with the provision of property for the location of such a facility. The City's participation in this development would be funded by a portion of the general funds that were reserved by voters through an amendment to the City Charter for the express purpose of developing capital improvements and rehabilitating existing park and recreation improvements for the provision of park and recreation activities to the citizens of Yakima. Resolution: X Ordinance: Other (Specify): Contract: X Contract Term: Start Date: End Date: Item Budgeted: Yes Amount: Funding Source/Fiscal Impact: Strategic Priority: Improve the Built Environment Insurance Required? No Mail to: Phone: APPROVED FOR SUBMITTAL: City Manager RECOMMENDATION: City Council requested final documents be provided. ATTACHMENTS: Description Upload Date D Aquatic (:nter Summery Memo 10/23/2015 D Resgutnon-Master Aquatic C.:enter Agreement 10/23/2015 D Master Aquatic (:nter Agreement 10/23/2015 D ground °ease 10/23/2015 D map 10/23/2015 D Aquatic Center -Development Agreement 10/23/2015 D Aquatic Center -Operating Agreement 10/23/2015 Type Cover Memo Resgution Contract Cover Memo Cover Memo IBack up Materna° IBack up Materna° MEMORANDUM To: Honorable Mayor and Members of the Yakima City Council cc: Parks and Recreation Commission From: Tony O'Rourke, City Manager Date: September 25, 2015 RE: YMCA Aquatics and Fitness Agreements Attached for City Council review, in preparation of the October 27 study session, is a Master Aquatic Center Agreement that incorporates a Ground Lease, a Development Agreement and an Operating Agreement between the City of Yakima and Yakima Family YMCA, a Washington non-profit corporation. These documents represent an intent to collaborate in the design, development, and operation of an Aquatics Center at Chesterley Park consisting of a lap pool, therapy pool, and family/children's pool. Independently, the YMCA will also construct and operate a $9 million dollar Fitness Center, which like the Aquatic Center will be open to the entire community on a daily or monthly pass basis. The Yakima Family YMCA Board tentatively approved these agreements on September 22, 2015, subject to final review by the City Council. The final review and proposed execution of these agreements is scheduled for the City Council's October 27, 2015 study session. The Yakima Family YMCA is a Yakima -based, non-profit that has been committed to building a healthy spirit, mind, and body among individuals, families, and businesses of Yakima since 1906. In collaboration with the City of Yakima, they have the experience, ability, and resources to design, develop, maintain, and operate this proposed Aquatics Center. The proposed agreements do not constitute a joint venture. Each party has their own independent responsibilities and rights. The agreements to design, build, and operate an Aquatic Center are subject to three contingencies. The first is a due diligence contingency of 90 days to inspect and test soils at Chesterley Park before entering into a ground lease. The second requires the City to complete a land conversion process with the Washington Recreation and Conservation Office and National Parks to replace approximately 7.5 acres at Chesterley Park since it was paid for with state and federal grants. The third requirement is that the YMCA has to raise approximately $15 million or 80% of the construction cost of the aquatic and fitness center by December 31, 2017. Currently the City has only one year-round pool at Lions Park and a summer outdoor pool at Franklin Park. In addition, both pools are nearly 45 years old and are reaching the end of their functional life unless significant capital investments are made to extend their functionality. Highlights of the proposed agreement include: TERM The initial term of the proposed ground lease for approximately 7.5 acres at Chesterley Park for the YMCA Aquatics Center and Fitness Center is for a term of 40 years commencing upon the opening of the facilities, with the option of the YMCA to extend the initial 40 -year term for three (3) additional ten (10) year terms. SITE The proposed location of the Aquatics Center and Fitness Center is on approximately 7.5 acres of land in the northwest corner of Chesterley Park (see site plan attached to the Ground Lease as Exhibits A-1 and A-2). This site is zoned R2 and recreational uses are a permitted use under a Class 2 Review. Because Chesterley Park was purchased with State of Washington Recreation and Conservation Office (RCO) and National Parks Scenic (NPS) grants the City is required to provide replacement property for the existing RCO/NPS Chesterley Park property in order to use the approximately 7.5 acres for the proposed Aquatics/Fitness Center. The replacement conversion process is lengthy. The RCO/NPS property conversion requirements provide a summary of the process involved in gaining RCO/NPS approval of a conversion. The City will be required to undergo a "yellow book" appraisal of both the Chesterley Park site, the proposed replacement site, which at this time is being considered on the second 60 -acre SOZO parcel. In addition to the appraisals, NEPA environmental impact assessment, archeological assessment, and recreational suitability analysis of each parcel must be completed. Successful completion of this property conversion requirement is necessary to consummate this YMCA -City Agreement. FACILITY/FEATURES The proposed Aquatic Center has a projected cost of $9 million and will be a joint City of Yakima/YMCA facility. The state-of-the-art facility will feature multi-level glass walls to make it highly visible and attractive both inside and out. The facility will total approximately 72,000 square feet of which 34,000 square feet will be dedicated to the Aquatic Center. The Aquatics Center will feature three bodies of water: a lap pool, a family/children's recreation pool and a warm water therapy pool. Plans call for the family/children's recreation pool to include a slide, spray and splash elements and a lazy river. The pool deck includes a hot tub and steam rooms. The two facilities will share a common lobby space and locker rooms. The YMCA Fitness Center includes group fitness studios, cardio equipment, circuit weights, free weights, a gymnasium, child watch area, drop-in youth room, community classrooms and a teaching kitchen. If feasible, a future outdoor pool could be built adjacent to the Aquatic Center. ACCESS The facility will have shared access to the existing 185 Chesterley Park parking spaces, as well as exclusive access to 120 additional spaces to be built. The facility is open to the entire community. Day and monthly passes will be available for access to both facilities for either the Aquatics Center or the YMCA Fitness Center. The YMCA will also offer standard membership options. The YMCA provides opportunities for youth and families with limited resources to have access to the YMCA facilities and programs. The facility will be open seven days a week. PROGRAMMING 2 Aquatics Center: programming for the Aquatics Center will include water aerobics classes, swim lessons, masters swim instruction, private swim lessons, senior water aerobics classes, arthritis and therapy group classes, birthday parties, lifeguard training certification, swim meets, open lap swimming, aqua dance, water walking classes and other group fitness, as well as recreational opportunities. YMCA: Programming will include youth outreach programs, group fitness classes, community health programming in diabetes and obesity prevention, aerobics classes, personal training, cycling classes, basketball leagues, Zumba and a wide range of personal fitness opportunities. COST The estimated cost of the Aquatic Center is $9 million, of which the City will contribute a not to exceed amount of $4,500,000. The annual debt service on the City's contribution of $4.5 million non -tax exempt debt is approximately $360,000 annually starting in 2018. The YMCA will be responsible for all additional costs of completion. The City and YMCA will equally share in the operating cost of the Aquatics Center. The Fitness Center will also cost approximately $9 million, of which the YMCA will pay 100%. Highlights of the proposed Aquatic Center Development Agreement, Operating Agreement, and Ground Lease include: YMCA Development Agreement • YMCA shall construct an aquatics center consisting of lap pool, therapy pool, and family/children's pool. • The City shall contribute a total of $4,500,000 for design, engineering, and construction costs related solely to the aquatics center upon satisfaction of the Due Diligence Contingency. It is expressly confirmed that all costs paid by the City for design and engineering shall be reimbursed to the City by the YMCA in the event the Financing Contingency is not satisfied and the project fails to be developed. • YMCA shall construct a fitness facility, exclusively at their cost • The YMCA will solely own the aquatics center and fitness center. At the end of the ground lease these facilities will revert to the City. • The YMCA shall have sole responsibility for the design, building plans, engineering, site plan, and construction of the aquatics center, subject to review by the City manager to confirm the aquatic center design is in compliance with required specifications. • The City shall be reimbursed for its pro -rata design and engineering costs if the Aquatics Center fails to be developed, provided the city successfully completes all RCO requirements to make the Chesterley Park site available. • The City shall conduct a complete public works project bidding process for construction of the Aquatics Center development in accordance with Washington Public Works requirements. The YMCA shall be responsible for selecting and contracting the architects, and engineers that will be used to construct the aquatic and fitness facilities. 3 • The YMCA is solely responsible for all costs necessary for development and construction of the aquatics center, including any construction cost overruns and change orders. • Any off site traffic or other improvements outside of the YMCA's leased space required by the City as a result of the aquatics center and other facilities on the leased premises are the responsibility of the City and with no reduction to the City's $4,500,000 aquatic center contribution. • Any on site improvements within the leased space shall be shared equally between the City and the YMCA. The City's share will come from its $4,500,000 contribution. • The naming rights of the aquatics center will belong solely to the YMCA, provided, however, the aquatics center name must include the word "Yakima". YMCA Ground Lease • The YMCA will lease from the City approximately 7.5 acres at Chesterley Park for the YMCA aquatics center and fitness center (see Ground Lease Exhibits) for an initial term of forty (40) years commencing upon the opening date of the facilities. The YMCA will have the option to extend the initial 40 -year term for three (3) additional ten (10) year terms under the same terms and conditions. • The YMCA's lease is contingent on satisfactory due diligence of the leased premises on or before 90 days of the effective date of the lease. • The YMCA's obligation to lease the Chesterley site and construct the Aquatic Center, and the City's obligation to make a $4.5 million contribution, is contingent on the YMCA securing 80% of the funding needed to construct the Aquatics Center and fitness facility by December 31, 2017. • The City's and YMCA's respective obligation to lease space in Chesterley Park is financially contingent on the YMCA's ability to fund the construction and operation of the aquatics center and fitness center, as well as successful completion of the RCO conversion. If the financial contingency or RCO conversion is not satisfied on or before December 31, 2017, either the City or YMCA may terminate this entire Agreement after 60 days written notice period for the Parties to satisfy the contingencies. • The Lease Agreement is subject to the terms of the Development Agreement and Operating Agreement. • The YMCA may share the use of existing Chesterley Park parking areas, however, they will have exclusive use of any additional parking they construct. • The YMCA is permitted to sublease all or any portion of the leased premises with City approval. • The YMCA and City have 60 days to cure any defaults. YMCA Operatinq Aqreement 4 • The aquatics center will be managed, operated, and maintained by the YMCA in accordance with operating standards consistent with industry and mutually agreed upon standards. • Minimal operating hours: o Monday through Friday 6:00 a.m. to 9:00 p.m. o Saturday 7:00 a.m. to 7:00 p.m. o Sunday 12:00 p.m. to 6:00 p.m. • The YMCA will maintain commercial general liability insurance not less than $2,000,000 per occurrence and $4,000,000 general aggregate. • The aquatics center shall be available for use by the general public and fees charged by the YMCA for public use will be set in consultation with the City and must be commercially reasonable with fees charged by facilities of similar size and scope in the State of Washington. • Prior to April 1 of each calendar year, the City shall submit the City's requested program schedule for general public use of the aquatics center to the YMCA. The YMCA shall consider and address the City's requested program schedule while preparing the annual aquatics center schedule. The YMCA shall manage the aquatics center to ensure general public access and use is a primary objective in program scheduling. • The City shall share equally with the YMCA all reasonable pre -opening, staffing, and operational costs in preparing and organizing the aquatics center for its opening date. • The YMCA shall submit to the City Manager, at least 9 months before opening day, a proposed initial budget for the period from opening day through July 31St of the year of opening. • The aquatics center budget year shall commence on September 1St annually. The YMCA shall submit a proposed annual operating budget and annual capital budget for the aquatics center for the upcoming fiscal year (September 1St through August 31St) to the City Manager by July 1St of each year. Review, reconciliation and approval of the annual aquatics center budget shall be jointly approved at least 15 days prior to September 1St of each year. In the event the YMCA and City are unable to approve the initial or annual budget the parties will submit to mediation to resolve the budget impasse. • The City is obligated to reimburse the YMCA for 50% of all annual aquatics center operating deficits. • The YMCA and City shall maintain an operating reserve fund to offset budget variances and cash-flow timing. • The City is obligated to reimburse the YMCA for 50% of all annual aquatics center capital expenditures. • A Capital Improvement Reserve Fund shall be established separately by the City and YMCA for asset repairs and replacements. Beginning on the first anniversary of the facility opening date the City and YMCA shall each deposit $40,000 annually into the capital improvement 5 reserve fund until each reserve fund reaches a value of $1,000,000 to ensure routinely scheduled funding and replacement of the aquatics center's capital assets. As expenditures are deducted from the total balance of the reserve funds, the Parties shall make additional deposits to restore and maintain the $1,000,000 reserve fund balance. • The YMCA shall submit quarterly written reports to the City Manager on the status of the aquatics center financial performance, usage and programs. • The City shall have the right to audit the YMCA's aquatics center finances annually. • In the event the YMCA or City materially breach the terms of this agreement, the YMCA or City shall provide notice of the specific default(s), and if not cured within 60 days, the YMCA or City shall seek equitable relief or terminate this agreement. If either party wrongfully terminates the agreement, the offending party is obligated to pay the other party's costs and attorney's fees and liquidated damages in the amount of $1,000,000. • An unsuccessful "conversion process" will not constitute a breach of the terms of this Agreement and/or cause for the YMCA to seek damages from the City. SUMMARY The approval of these agreements represents the City's willingness and ability to enter into public/private partnerships to enhance the overall quality of life for Yakima citizens while also reducing the public's capital and operating cost contributions by 50% to gain a new aquatic center for the Yakima community. The Aquatics Center addresses a significant need for another year-round pool in Yakima and builds upon the City Council's recent decision with SOZO for the development of a 19 field sports complex to enrich the recreational and economic vitality of Yakima. These agreements would not have been possible without the great cooperation and efforts of the YMCA representatives, Bob Romero, Dustin Yeager, Mark Smith, and Paul Larsen. In addition, City Attorney Jeff Cutter and Public Works Director Scott Schafer were invaluable in representing the City and achieving this mutually beneficial partnership. 6 RETURN TO: STOKES LAWRENCE VELIKANJE, MOORE & SHORE Attention: Dustin E. Yeager 120 N. Naches Avenue Yakima, Washington 98901-2757 MEMORANDUM OF LEASE Grantor(s): (1) CITY OF YAKIMA Grantee(s): (1) YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA (dba YAKIMA FAMILY YMCA) Abbreviated Legal Description: Ptn. SW 1/4 NE 1/4 S15, T13N, R18EWM. Complete legal description is on ExhibitA of this•document. Assessor's Tax Parcel ID No(s).: Ptn. of 181315-13002; Ptn. of 181310-31003; Ptn. of 181315-13005; Ptn. of 181315-13006 This Memorandum of Lease is made effective the 1st day of May, 2018, by and between the CITY OF YAKIMA, a Washington municipal corporation ("Landlord"), and the YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA (dba YAKIMA FAMILY YMCA), a Washington nonprofit corporation ("Tenant"). RECITALS A. The Yakima County, Washington, real property described on attached Exhibit A is referred to in this Memorandum as the "Leased Premises." B. Landlord and Tenant entered into a Ground Lease dated October 27, 2015, (the "Ground Lease") under which Landlord leased the Leased Premises to Tenant. C. Landlord and Tenant desire to execute and record this Memorandum for the purpose of providing constructive notice of the Ground Lease to all third parties. MEMORANDUM Public notice is hereby given of the existence of the Ground Lease and the following provisions of said instrument: 1 1. Ground Lease. 1.1 Term. The Initial Term of the Ground Lease (as defined in the Ground Lease) commenced on May 2, 2018, and will expire forty (40) years after the date on which the aquatic center to be constructed on the Leased Premises by Tenant opens for public use. The Initial Term of the Ground Lease will automatically extend for three (3) extensions of ten (10) years each unless Tenant elects to not extend the Ground Lease's Term in accordance with the provision of Section 3.2 of the Ground Lease. 1.2 Other Terms and Conditions. All other terms and conditions of the Ground Lease are as set forth in the Ground Lease. 2. Successors. All successors -in -interest to the Leased Premises will take the Leased Premises subject to the rights and obligations set forth in the Ground Lease. 3. No Amendment or Alteration. This Memorandum is intended to only give public notice of the Ground Lease and certain provisions included therein and in no way amends or otherwise alters the intent or effect of any of the Ground Lease's terms or conditions. EXECUTED as of the date and year first above written. LANDLORD: CITY OF YAKIMA By: Cliff oore, City Manager STATE OF WASHINGTON ) ) ss. COUNTY OF YAKIMA TENANT: YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA By: Bob Romero, CEO CITY CONTRACT NO: 2t2/h "C ' RESOLUTION NO: A 20/5 -7 2-8 On riA..6 \ s 2018, CLIFF MOORE ("Signer"), who is personally known to me or proved by satis`factory evidence to be the Signer, personally appeared before me and acknowledged that Signer executed -the above -stated Memorandum of Lease ("Instrument") as Signer's free and voluntary act and deed for the uses and purposes stated in the Instrument and that Signer is authorized to execute the Instrument in the following capacity: ® As City Manager for CITY OF YAKIMA, a Washington municipal corporation Notary Public State of Washington, SONYA R CI_AAR TEE I I MY COMMISSION EXPIRES OCTOBER 25, 2018 C C—) (print name)"' ‘01/1 (J) f (1 /4/112_17-6--:.c NOTARY PUBLIC in and for the state of Washington My appointment expires 1 () " � t. X 2 STATE OF WASHINGTON ) ) ss. COUNTY OF YAKIMA ) On-ivA-LA , 2018, BOB ROMERO ("Signer"), who is personally known to me or proved by safsfactory evidence to be the Signer, personally appeared before me and acknowledged that Signer executed the above-stated Memorandum of Lease ("Instrument") as Signer's free and voluntary act and deed for the uses and purposes stated in the Instrument and that Signer is authorized to execute the Instrument in the following capacity: As CEO for YOUNG MEN'S CHRISTIAN ASSOCIATION OF YAKIMA, a Washington nonprofit corporation DAWN SCIARA t4OTARY PUBLIC STATE OF VltASHWI QVCZ COMMISSION WW1 S1 MAY 19, 2020 tititi�l; (print name) NOTARY PUBLIC in and for the state of Washington My appointment expires rJ / 161 /"2---c) 25 3 EXHIBIT A Legal Description of the Leased Premises That portion of the Southwest 1/4 of the Northeast 1/4 of Section 15, Township 13 North, Range 18 E.W.M., records of Yakima County, Washington, described as follows: BEGINNING at the Northwest corner of said Subdivision; thence South 89°42'45" East, along the North line thereof, 75.00 feet to the Easterly right-of-way line of the Pacific Power and Light Company's canal; thence continuing South 89°42'45" East 104.00 feet to the True Point of Beginning; thence South 0°17'15" West 310.45 feet; thence South 30°52' West 4.06 feet; thence along the arc of a curve to the left having a radius of 145.00 feet, a central angle of 54°39' and a length of 138.30 feet; thence South 23°47' East 165.63 feet; thence North 66°13' East 13.05 feet; thence along the arc of a curve to the right having a radius of 4.00 feet, a central angle of 83°03' and a length of 5.80 feet; thence South 30°44' East 11.24 feet; thence along the arc of a curve to the left having a radius of 53.00 feet, a central angle of 167°26' and a length of 154.89 feet; thence North 18°10' West 12.40 feet; thence along the arc of a curve to the right having a radius of 4.00 feet, a central angle of 84°23' and a length of 5.89 feet; thence North 66°13' East 13.19 feet; thence North 89°26'10" East 265.00 feet; thence North 56°04' East 80.00 feet; thence North 89°26'10" East 170.00 feet; thence North 0°33'50" West 486.42 feet to the North line of said subdivision; thence North 89°42'45" West, along said North line, 680.56 feet to the true point of beginning; EXCEPT that portion lying Northerly of the following described line: Beginning at the Northwest corner of said subdivision; thence South 89°42'45" East, along the North line thereof, 75.00 feet to the Easterly right-of-way line of the Pacific Power and Light Company's canal; thence continuing South 89°42'45" East 104.00 feet; thence South 0°17'15" West 78.18 feet to the true point of beginning; thence North 89°26'10" East 165.00 feet; thence North 0°33'50" West 15.00 feet; thence North 89°26' 10" East to the East line of said subdivision and the terminus point of the herein described line. Situated in Yakima County, Washington._ 4 For City of Yakima Use Only: Contract No Project No Resolution No. SOQ No AGREEMENT BETWEEN CITY OF YAKIMA, WASHINGTON AND WIDENER & ASSOCIATES FOR PROFESSIONAL SERVICES THIS AGREEMENT, made and entered into on this 7—"day of ;, 2016, by and between the City of Yakima, Washington, a municipal corporation with its princ pal 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 for the Recreation and Conservation Office (RCO) Conversion process under this Agreement for the Indoor Aquatic/Fitness Center project to be constructed at Chesterley Park on behalf of the City of Yakima, Project No , herein referred to as the "PROJECT " WITNESSETH: RECITALS 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 "Chesterley Park RCO Conversion Process" (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 23 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 31 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 32 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 33 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 34 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 35 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 41 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 51 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 511 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 Forty -Five Thousand Dollars ($45,000) 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, ENGINEERshall 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 32nd 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 911-(12).-11 Cliffoor Printed Name .CIA (i 144(4? -67 Title City Manager Date Printed Name Ross Widener Title Vice President Attes City CI City Contract No Resolution No 2016- - 2oI5-f Page 11 STATE OF WASHINGTON ) ss COUNTY OF YAKIMA I certify that I know or have satisfactory evidence that, 7 S //U(C2'evrs 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. Dated 4/—/—%6 Seal or Stamp Notary Public State of Washington JODI L STEPHENS MY COMMISSION EXPIRES August 11, 2018 Title Printed Name My commission expires a,„ Page 12 (01. ezAp- STATE OF WASHINGTON ) ss COUNTY OF YAKIMA I certify that I know or have satisfactory evidence that Cfi I I DOre 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 (f� / AL„ r- of JI��,y,�t to be the free and voluntary act of such party for the uses anti purposes menti ned in the instrument. Dated 1- 7 r / 4 Seal or Stamp Notary Public State of Washington KAARRE ALLYN MY COMMISSION EXPIRES January 12, 2020 • Title Printed Name V7 Azt My commission expires / / - 0 2 0 Page 13 EXHIBIT A CHESTERLEY PARK RCO CONVERSION PROCESS SCOPE OF WORK The City of Yakima, in agreement with the YMCA, is planning the construction of an Indoor Aquatic/Fitness Center to replace a portion of Chesterley Park, which was constructed with Recreation and Conservation Office (RCO) funds. The Scope of Work is intended to complete the NEPA documentation required for the RCO conversion process. The environmental documentation for this project will be completed under RCO/DOE NEPA procedures. It is anticipated that the following environmental permits and documentation will be required: • Section 106 • Biological Assessment • NEPA Documentation The NEPA will be completed by March 31, 2017. Based on the environmental documentation identified during the preliminary design, the CONSULTANT will then pursue and obtain the permits or agency approvals required. Anticipated permits and documentation are identified below. State Historic Preservation Officer, Section 106 Consultation The CONSULTANT will prepare the appropriate cultural resources documentation required for the project to meet both Washington State and federal requirements. Biological Assessments The CONSULTANT will prepare the Biological Assessment for submittal by the lead federal agency. It is assumed that the nature of this project will allow for a "May Affect but not likely to Adversely Affect" determination. National Environmental Policy Act (NEPA) The CONSULTANT will prepare the NEPA environmental assessment for submittal and approval by the lead agency. It is assumed that the nature of this project will require a draft Environmental Assessment (EA), final EA, public meeting and a Finding of No Significant Impact (FONSI). This work will follow the outline provide by Federal Emergency Management Agency (FEMA). Products and Deliverables: • Section 106 Report • SHPO approval • Biological Assessment • NEPA EA/FONSI Exhibit Projeet;} Project. Client ( ()MakEl. Sheffield Date;.: � I/3 _1201 6; - -- —. —�Prrojecl Manager Project Biologist — -. _ Task 1: Cultural Resources APE 4 8 Coordination 12 4 Task 2: Biological Assessment Draft 8 24 Final 4 8 Coordination 8 2 Task 3: NEPA Compliance Documentation Draft 24 120 Final 14 80 Public Meeting 8 4 FONSI 8 24 Totals 90 274 Summary Hours Rate Cost Project Manager 90 $154.00 $13,860.00 Project Biologist 274 $86.80 $23.783.20 Cultural Resources $5,000 TOTAL ESTIMATED COST $42,643.20 ,.. ,, r Witien%r.+� SOrdia'te EXHIBIT "C" SCHEDULE OF RATES Position Hourly Rate Project Manager $154 00 Project Biologist 86 80 Page 16 For City of Yakima Use Only: Contract No Project No Resolution No SOQ No AGREEMENT BETWEEN CITY OF YAKIMA, WASHINGTON AND HLA ENGINEERING & LAND SURVEYING FOR PROFESSIONAL SERVICES THIS AGREEMENT, made and entered into on th•is qday of Q, 2017, 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 HLA Engineering and Land Surveying, Inc , with its principal office at 2803 River Road, Yakima, WA 98902, hereinafter referred to as "CONSULTANT", said corporation is licensed and registered to do business in the State of Washington, and will provide surveying services under this Agreement for the Aquatic/Fitness Center at Chesterley Park on behalf of the City of Yakima, Project No 2442, herein referred to as the "PROJECT " WITNESSETH: RECITALS WHEREAS, CITY desires to retain the CONSULTANT to provide consulting services for design and construction of the PROJECT, as described in this Agreement and subsequent Amendments thereto, and WHEREAS, CONSULTANT 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 CONSULTANT 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 CONSULTANT agrees to perform those services described hereafter Unless modified in writing by both parties, duties of CONSULTANT shall not be construed to exceed those services specifically set forth herein 2 0.2 CONSULTANT shall use its best efforts to maintain continuity in personnel and shall assign, Eric Herzog, as Principal -in -Charge throughout the term of this Agreement unless other personnel are approved by the CITY 2 1 Basic Services CONSULTANT agrees to perform those tasks described in Exhibit A, entitled "Boundary Survey for Yakima County Tax Parcel No 181319-13003" (WORK) which is attached hereto and made a part of this Agreement as if fully set forth herein 2 2 Additional Services CITY and CONSULTANT agree that not all WORK to be performed by CONSULTANT 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 CONSULTANT to revise portions of the PROJECT WORK previously completed in a satisfactory manner, delete portions of the PROJECT, or request that the CONSULTANT perform additional WORK beyond the scope of the PROJECT WORK. Such changes hereinafter shall be referred to as "Additional Services " Page 1 2 2 1 If such Additional Services cause an increase or decrease in the CONSULTANT'S cost of, or time required for, performance of any services under this Agreement, a contract price 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 CONSULTANT according to the provisions set forth in Exhibit B — Schedule of Hourly Billing Rates, attached hereto and incorporated herein by this reference, and if so authorized, shall be considered part of the PROJECT WORK. The CONSULTANT shall not perform any Additional Services until so authorized by CITY and agreed to by the CONSULTANT in writing 2 3 The CONSULTANT must assert any claim for adjustment in writing within thirty (30) days from the date of the CONSULTANT's receipt of the written notification of change SECTION 3 CITY'S RESPONSIBILITIES 3 1 CITY -FURNISHED DATA. The CITY will provide to the CONSULTANT all technical data in the CITY'S possession relating to the CONSULTANT'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 CONSULTANT as required for CONSULTANT'S performance of its services and will provide labor and safety equipment as reasonably required by CONSULTANT for such access 3 3 TIMELY REVIEW. The CITY will examine the CONSULTANT'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 CONSULTANT 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 CONSULTANT shall be entitled to reasonably rely on such instructions made by the CITY'S Representative unless otherwise directed in writing by the CITY, but CONSULTANT shall be responsible for bringing to the attention of the CITY'S Representative any instructions which the CONSULTANT believes are inadequate, incomplete, or inaccurate based upon the CONSULTANT'S knowledge 3 5 Any documents, services, and reports provided by the CITY to the CONSULTANT are available solely as additional information to the CONSULTANT and will not relieve the CONSULTANT of its duties and obligations under this Agreement or at law The CONSULTANT 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 CONSULTANT 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 51 COMPENSATION ON A LUMP SUM BASIS For the services described in Exhibit A, compensation shall be made by lump sum once all of the items listed in Exhibit A have been completed Page 2 5 2 Unless specifically authorized in writing by the CITY, the total budgetary amount for this PROJECT shall not exceed One Thousand Three Hundred ($1,300) The CONSULTANT 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 CONSULTANT is not obligated to incur costs beyond the indicated budget, as may be adjusted, nor is the CITY obligated to pay the CONSULTANT beyond these limits. When any budget has been increased, the CONSULTANT'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 CONSULTANT 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 CONSULTANT 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 CONSULTANT promptly if any problems are noted with the invoice CITY may question any item in an invoice, noting to CONSULTANT the questionable item(s) and withholding payment for such item(s) The CONSULTANT may resubmit such item(s) in a subsequent invoice together with additional supporting information required 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 CONSULTANT pursuant to the terms of RCW 39 76 020(4) 5 5 Final payment of any balance due the CONSULTANT 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 CONSULTANT 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 CONSULTANT 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 CONSULTANT 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 CONSULTANT to satisfactorily perform the PROJECT WORK as required under this Agreement. SECTION 6 RESPONSIBILITY OF CONSULTANT 6 1 The CONSULTANT 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 CONSULTANT under this Agreement. The CONSULTANT shall, without additional compensation, correct or review any errors, omissions, or other deficiencies in its plans, designs, drawings, specifications, reports, and other services The CONSULTANT shall perform its WORK according to generally accepted consulting 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 CONSULTANT 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 Page 3 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 CONSULTANT 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 CONSULTANT 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 CONSULTANT shall be solely responsible for any claims for wages or compensation by CONSULTANT employees, agents, and representatives, including subconsultants and subcontractors, and shall save and hold CITY harmless therefrom 6 4 INDEMNIFICATION (a) CONSULTANT agrees to defend, indemnify, and hold harmless the CITY, its elected and appointed officials, agents, officers, employees, 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 consultant'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 CONSULTANT, the CONSULTANT shall at once cause the same to be dissolved and discharged by giving bond or otherwise (b) CITY agrees to indemnify and hold the CONSULTANT 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 CONSULTANT 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 CONSULTANT 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 CONSULTANT, 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 CONSULTANT or a subcontractor under workers' or workmens' compensation acts, disability benefit acts, or other employee benefit acts The CONSULTANT specifically and expressly waives its immunity under the Industrial Insurance Act, Title 51, RCW Such waiver has been mutually negotiated by the CONSULTANT and the CITY 6 6 It is understood that any consulting or inspection provided by CONSULTANT 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 CONSULTANT 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 CONSULTANT'S officers, principals, employees, agents and representatives, as additional insureds on contractor's insurance policies covering PROJECT, exclusive of insurance for CONSULTANT professional liability Page 4 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 CONSULTANT, to the extent that CONSULTANT 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 CONSULTANT 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 CONSULTANT, 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 CONSULTANT 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 CONSULTANT shall submit to the CITY'S Representative a copy of the current schedule and a written narrative description of the WORK accomplished by the CONSULTANT and subconsultants on 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 CONSULTANT 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 CONSULTANT, which shall not be unreasonably withheld and will be at the CITY's sole risk. The CITY agrees to indemnify the CONSULTANT 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 CONSULTANT will not be indemnified for such claims, damages, losses, and costs including, without limitation, litigation expenses and attorney fees were caused by the CONSULTANT's own negligent acts or omissions 8 2 The CONSULTANT 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 CONSULTANT (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 CONSULTANT, and CONSULTANT does not grant CITY any right or license to such Intellectual Property SECTION 9 AUDIT AND ACCESS TO RECORDS 9 1 The CONSULTANT, 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 Page 5 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 CONSULTANT'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 CONSULTANT agrees to the disclosure of all information and reports resulting from access to records pursuant to this section provided that the CONSULTANT 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 CONSULTANT 9 4 The CONSULTANT shall ensure that the foregoing paragraphs are included in each subcontract for WORK on the Project. 9 5 Any charges of the CONSULTANT paid by the CITY which are found by an audit to be inadequately substantiated shall be reimbursed to the CITY SECTION 10. INSPECTION AND PRODUCTION OF RECORDS 10 1 The records relating to the WORK shall, at all times, be subject to inspection by and with the approval of the CITY, but the making of (or failure or delay in making) such inspection or approval shall not relieve CONSULTANT of responsibility for performance of the WORK in accordance with this Agreement, notwithstanding the CITY'S knowledge of defective or non -complying performance, its substantiality or the ease of its discovery CONSULTANT shall provide the CITY sufficient, safe, and proper facilities and equipment for such inspection and free access to such facilities CONSULTANT'S records relating to the WORK will be provided to the CITY upon the CITY'S request. 10.2 CONSULTANT shall promptly furnish the CITY with such information and records which are related to the WORK of this Agreement as may be requested by the CITY Until the expiration of six (6) years after final payment of the compensation payable under this Agreement, or for a longer period if required by law or by the Washington State Secretary of State's record retention schedule, CONSULTANT shall retain and provide the CITY access to (and the CITY shall have the right to examine, audit and copy) all of CONSULTANT'S books, documents, papers and records which are related to the WORK performed by CONSULTANT under this Agreement. 10 3 All records relating to CONSULTANT'S WORK under this Agreement must be made available to the CITY, and also produced to third parties, if required pursuant to the Washington Public Records Act, Chapter 42 56 RCW or by law All records relating to CONSULTANT'S WORK under this Agreement must be retained by CONSULTANT for the minimum period of time required pursuant to the Washington State Secretary of State's record retention schedule SECTION 11 INSURANCE 11 1 At all times during performance of WORK, CONSULTANT shall secure and maintain in effect insurance to protect the CITY and the CONSULTANT from and against all claims, damages, losses, and expenses arising out of or resulting from the performance of this Agreement. CONSULTANT 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 If CONSULTANT carries higher coverage limits than the limits stated below, such higher limits shall be shown on the Certificate of Insurance and Endorsements and CONSULTANT shall be named as an additional insured for such higher limits. Commercial General Liability Insurance. Before this Agreement is fully executed by the parties, CONSULTANT 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 Page 6 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 Agreement. The policy shall name the City, its elected and appointed 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 Subcontractors' If subcontractors will be used, the same terms and limits of coverage will apply and a certificate will be required per the instructions above In lieu of a certificate, contractor may provide confirmation in writing from their insurance broker that their insurance policy does not contain a subcontract exclusion or one relating to the work of others. 11 1 2 Commercial Automobile Liability Insurance. a. If CONSULTANT owns any vehicles, before this Agreement is fully executed by the parties, CONSULTANT 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 CONSULTANT 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 Agreement, which is Section 11 1 1 entitled "Commercial General Liability Insurance" c. Under either situation described above in Section 11 1 2 a. and Section 11 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 Agreement. The policy shall name the CITY, its elected and appointed 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 11 1 3 Statutory workers' compensation and employer's liability insurance as required by state law 11 1 4 Professional Liability Coverage. Before this Agreement is fully executed by the parties, CONSULTANT 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 Agreement. 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 Agreement. 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 and appointed officials, Page 7 officers, principals, employees, representatives, volunteers and agents shall have no obligation for payment of premiums because of being named as additional insureds under such insurance 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 12 SUBCONTRACTS 12 1 CONSULTANT shall be entitled, to the extent determined appropriate by CONSULTANT, to subcontract any portion of the WORK to be performed under this Agreement. 12 2 Any subconsultants or subcontractors to the CONSULTANT 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 CONSULTANT shall be responsible for the architectural and engineering performance, acts, and omissions of all persons and firms performing subcontract WORK. 12 3 CITY does not anticipate CONSULTANT subcontracting with any additional persons or firms for the purpose of completing this Agreement. 12 4 The CONSULTANT 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 13 ASSIGNMENT 13 1 This Agreement is binding on the heirs, successors and assigns of the parties hereto This Agreement may not be assigned by CITY or CONSULTANT 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 14 INTEGRATION 14 1 This Agreement represents the entire understanding of CITY and CONSULTANT 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 15 JURISDICTION AND VENUE 15 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 16 EQUAL EMPLOYMENT and NONDISCRIMINATION 16 1 During the performance of this Agreement, CONSULTANT and CONSULTANT'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, or 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. CONSULTANT agrees to comply with the applicable Page 8 provisions of State and Federal Equal Employment Opportunity and Nondiscrimination statutes and regulations SECTION 17 SUSPENSION OF WORK 17 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. CONSULTANT may suspend, in writing by certified mail, all or a portion of the WORK under this Agreement if unforeseen circumstances beyond CONSULTANT's control are interfering with normal progress of the WORK. CONSULTANT 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 18 SECTION 18 TERMINATION OF WORK 18 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. 18 2 In addition to termination under subsection 18 1 of this Section, CITY may terminate this Agreement for its convenience, in whole or in part, provided the CONSULTANT 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 18 3 If CITY terminates for default on the part of the CONSULTANT, 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 CONSULTANT 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 CONSULTANT'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 CONSULTANT 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 18 4 If the CONSULTANT 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 CONSULTANT reasonably incurs relating to commitments which had become firm before the termination, unless CITY determines to assume said commitments 18 5 Upon receipt of a termination notice under subsections 18 1 or 18 2 above, the CONSULTANT 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 CONSULTANT or its subconsultants may have accumulated or prepared in performing this Agreement, whether completed or in progress, with the CONSULTANT retaining copies of the same Page 9 18 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 CONSULTANT shall have no responsibility to prosecute further WORK thereon 18 7 If, after termination for failure of the CONSULTANT to fulfill contractual obligations, it is determined that the CONSULTANT 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 18 4 of this Section 18 8 If, because of death, unavailability or any other occurrence, it becomes impossible for any key personnel employed by the CONSULTANT in PROJECT WORK or for any corporate officer of the CONSULTANT to render his services to the PROJECT, the CONSULTANT 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 18 3 of this Section SECTION 19 DISPUTE RESOLUTION 19 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 Agreement, 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 SECTION 20 NOTICE 20 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 2nd Street Yakima, WA 98901 Attn Brett Sheffield CONSULTANT HLA Engineering and Land Surveying 2803 River Road Yakima, WA 98902 Attn Eric Herzog Page 10 SECTION 21 SURVIVAL 21 1 The foregoing sections of this Agreement shall survive the expiration or termination of this Agreement in accordance with their terms. 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 Cliff Moore Printed Name . Q.N-A'F'F Ys/NQL-,,ctia Title City Manager Date 1Q -Z-1-1 Attest Signature Printed Name C7.3-- - G Title Date \/ Cc `- e,J-c , Q City Clerk!J cm CONTRACT No: d al 7./1149 RESOLUTIONNO:R • (2,01S-1229 Page 11 EXHIBIT A Scope of Work During the term of this Agreement, HLA Engineering and Land Surveying, Inc. (HLA), shall perform professional services in connection with the following project: Boundary Survey for Yakima County Tax Parcel No. 181319-13003 This scope of work shall include the furnishing of all services, labor, materials, equipment, supplies, and incidentals necessary to conduct and complete the work for the above referenced project as described hereafter. 1. HLA will field survey the boundaries of the above referenced parcel. 2. HLA will prepare a property exhibit map showing the property boundaries and any encroachments 3. HLA will provide six (6) paper copies of the survey and an AutoCAD file Initial: CLIENT HLA. End of Exhibit A G.\PROPOSALS\2017\2017-09-11 City of Yakima Survey docx Initial: CLIENT HLA. EXHIBIT B Schedule of Hourly Billing Rates Effective January 1, 2017, through December 31, 2017 Senior Principal Engineer $196 00 per hour Licensed Principal Land Surveyor $191 00 per hour Licensed Principal Engineer $175 00 per hour Licensed Professional Engineer $160.00 per hour Other Licensed Professional $160.00 per hour Licensed Professional Land Surveyor $146 00 per hour Project Engineer $131.00 per hour Contract Administrator $120 00 per hour CAD Technician $115 00 per hour Resident Engineer/Inspector $109 00 per hour Senior Engineering Technician $109.00 per hour Surveyor $109 00 per hour Surveyor on Two Man Crew $104.00 per hour Surveyor on Three Man Crew $92 00 per hour Engineering Technician $77 00 per hour Word Processing Technician $77.00 per hour Vehicle Mileage $0 535 per mile G \PROPOSALS\2017\2017-09-11 City of Yakima Survey.docx