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HomeMy WebLinkAboutR-2023-075 Resolution authorizing an agreement with All American Investment Group for repayment of SIED loan to reconstruct Russell Lane Project 2650A RESOLUTION RESOLUTION NO. R-2023-075 authorizing a development agreement with All American Investment Group to pay the loan costs associated with a Supporting Investments in Economic Development (SIED) grant to reconstruct Russell Lane, Project 2650. WHEREAS, the Yakima City Council has established that development of commercial properties and increasing jobs for residents of the City of Yakima (City) is an Economic Development priority for the City; and WHEREAS, All American Investment Group proposes to develop the property located at 2018 S. 1st Street into a fast food establishment and other commercial buildings resulting in added jobs for the community; and WHEREAS, Russell Lane needs to be realigned to provide a safe and efficient access to the site; and WHEREAS, Yakima County has established the Supporting Investments in Economic Development (SIED) funds to assist the growth of business; and WHEREAS, The City requested and was approved for funding from the Yakima County "Supporting Investments in Economic Diversification" (SIED) Board a $416,000 grant and a $416,000 loan for improvements to the intersection of S. 1st Street and Russell Lane; and WHEREAS, All American Investment Group agrees to repay the loan proceeds from the SIED Fund to the City through a written agreement; and WHEREAS, the City Council deems it to be in the best interest of the City of Yakima and its residents to accept the Yakima County SIED funding for the realignment project associated with Russell Lane; now, therefore BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA: The City Manager is hereby authorized to accept and execute the Developer Agreement with All American Investment Group for Project 2650 — Russell Lane Realignment, attached hereto. ADOPTED BY THE CITY COUNCIL this 6th day of June, 2023. ATTEST: Janice Deccio, Mayor Rosalinda Ibarra, City CI 04,1MA SEA O, "gSHICP SIED LOAN AGREEMENT SIED Contract No YC-RLR-22 I. PARTIES BORROWER: ALL AMERICAN INVESTMENT GROUP, L.L.C., a Washington limited liability company whose address is: 2318 South First Street Yakima, Washington 98903 LENDER: CITY OF YAKIMA, a Washington municipal corporation and first class city, whose address is: 129 North Second Street Yakima, Washington 98901 II. PURPOSE A. The purpose of this Agreement is to provide for the construction of certain infrastructure improvements at the intersection of South 1st Street and Russell Lane in Yakima, Washington (hereinafter referred to as the "PROJECT") utilizing in part loan and grant funds received from the Supporting Investments In Economic Diversification ("SIED") program administered by Yakima County, Washington. The PROJECT includes re -constructing approximately 380 lineal feet of Russell Lane to the proposed development site at the corner of South 1st Street and Russell Lane. Construction will include realigning the northern end of Russell Lane to align the public road with the existing traffic signal at South 1st Street. The realignment will require revisions to the traffic signal in the form of constructing an additional leg and constructing Russell Lane to City of Yakima Standards. The PROJECT will also include the necessary re -striping of South 1st Street. The newly constructed utilities within right-of-way will be owned and maintained by the CITY. Borrower assisted in the preparation of the SIED Application and provided information regarding job creation and project development. B. The CITY has received proceeds from the SIED program for design and construction of the PROJECT. The proceeds include two (2) separate components: (i) a grant in the sum of Four Hundred Sixteen Thousand Dollars ($416,000.00); and (ii) a loan in the principal sum of Four Hundred Sixteen Thousand Dollars ($416,000.00). The proceeds will be deposited in an interest - bearing account and shall be applied to project costs as determined appropriate by CITY. C. The purpose of this agreement is to confirm responsibility and terms for construction of the PROJECT, cash portion due, and repayment of loan principal and interest. III. BACKGROUND The Borrower, All American Investment Group, L.L.C., is the owner of certain real property within the city limits of the City of Yakima upon which it wishes to improve infrastructure to its property, specifically the intersection of South First Street and Russell Lane. Currently there is a three-legged signalized intersection servicing the Home Depot entrance off South 1st Street that prevents direct access to the proposed development. Adding a fourth leg to the signal, creating a signalized entrance into the restaurant was investigated. However, the south edge of the signal is also only 50 feet from the north edge of Russell Lane, which creates a traffic safety concern with the overlapping turn pockets. Therefore, the northern portion of Russell Lane will be relocated to align the public road with the existing traffic signal. The realignment will require revisions to the traffic signal for an additional leg and constructing Russell Lane to City of Yakima Standards. The property currently encompasses one 1.11-acre parcel that was previously a used car lot. The development will bring new retail restaurant establishments to the City of Yakima, including the development of a 24-seat, 2,600 square foot Popeye's quick service restaurant with an eating patio, drive-thru, and 37 parking spaces. The property is served by South 1st Street, a principal arterial to the East, and Russell Lane, a local access road to the South. The property needs the proposed improvements listed above to be developed. The CITY and Borrower have reviewed alternatives and found the proposed Russell Road realignment to be optimal and the most cost-effective solution. The proposed signal and Russell Lane improvements will rectify the existing traffic safety concerns, provide the ability to redevelop an existing vacant commercial lot and allow much needed economic development opportunity in this undeveloped area. IV. AGREEMENT The parties of this Agreement acknowledge the mutual covenants and commitments contained herein and agree as follows: A. The PROJECT shall be constructed as a public facility improvement by the CITY in accordance with applicable law, rules, and regulations. Anticipated work to be done and estimated costs are attached hereto as Exhibit A, which is information that was provided as part of the SIED grant application. B. Amount and Terms of the Loan 1. The City agrees on the terms and conditions herein set forth to make a loan (the "Loan") to the Borrower on the date of this Loan Agreement in the principal amount of Four Hundred Sixteen Thousand and 00/100ths dollars ($416,000.00). 2. The Borrower shall pay interest to the Lender on the outstanding and unpaid principal amount of the Loan made under this Loan Agreement at a rate per annum equal to the interest rate charged under the Yakima County SIED Agreement (5.81 %). Any change in the interest rate resulting from a change in the rate charged under the Yakima County SIED Agreement shall become effective as of the opening of business on the day on which such change in the Yakima County SIED Agreement interest rate shall become effective. Interest shall be calculated in a manner consistent with the terms of the Yakima County SIED Agreement. 3. Any principal amount not paid when due (at maturity, by acceleration, or otherwise) shall bear interest thereafter until paid in full, payable on demand, at the highest rate allowed by law, as of the day immediately after the payment due date. 4. The Borrower's obligation to repay the Loan shall be evidenced by its promissory note (the "Note") in substantially the form of Exhibit B attached hereto with blanks appropriately filed in where necessary and payable to the order of the Lender. The Note shall be dated the date of this Loan Agreement and the principal of the Loan shall be repaid in ten (10) equal, consecutive annual installments, with the first installment due on June 1, 2025, with nine (9) subsequent installments due on the same day of each year thereafter to and including June1, 2034, provided, however, that the last such installment shall be the amount necessary to repay in full the unpaid amount of the Loan. 5. The Borrower may prepay the Note in whole or in part with accrued interest to the date of such prepayment on the amount prepaid, provided that each partial prepayment shall be in a principal amount of not less than the next due annual payment and shall be applied to the principal installments of the Note in the inverse order of their maturities. 6. The Borrower shall make each payment under this Loan Agreement and under the Note on the date when due in lawful money of the United States to the Lender at its Principal Office in immediately available funds. Whenever any payment to be made under this Loan Agreement or under the Note shall be stated to be due on a day other than a business day, such payment shall be made on the next succeeding business day, and such extension of time shall in such case be included in the computation of payment of interest. 7. The proceeds of the Loan hereunder shall be used by the Borrower to improve infrastructure of its property, as outlined in Section 2 (Purpose) and Section 3 (Background), above. The Borrower will not, directly or indirectly, use any part of such proceeds for any purpose not consistent with said infrastructure improvements. 8. In the event the cost of the improvements exceeds Eight Hundred Thirty -Two Thousand and 00/100ths dollars ($832,000.00), Borrower agrees to pay the excess amount, and such excess amount shall become part of this Loan Agreement. Borrower agrees to execute an additional Promissory Note and Deed of Trust for the excess amount within ten (10) business days of notice from the Lender that the costs exceeded the amount of SIED loan and grant. 9. In the event the project is not completed by the City, the City will return the property deeded by All American Investment Group to the City for the project via Quit Claim Deed. B. Borrower, per the SIED application, predicts the total number of permanent, full- time employment positions created and/or retained with respect to this public facility and infrastructure project and attendant development will be approximately 23 first year employment positions — and 30 employment positions created by year three. C. Borrower, or Borrower's designee, shall provide to CITY such employment and investment data as may be requested by Yakima County SIED Board. D. Private and/or public contributions to this public facility improvement project also include, but are not limited to, the following: 1. Private contribution of public right-of-way for public facility improvements including construction of Russell Lane by Borrower. 2. Private cash contribution required for completion of the public facility improvement project by Borrower. 3. Repayment of loan component from SIED funding in accordance with terms and conditions more particularly set forth in loan documents by Borrower. F. CITY and Borrower agrees to cooperate in good faith in the performance of obligations hereunder for the purpose of constructing the public facility improvement project and developing the proposed project site. V. CONDITIONS PRECEDENT The obligation of the Lender to make the Loan to Borrower is subject to the conditions precedent that the Lender shall have received on or before the day of such Loan each of the following, in form and substance satisfactory to the Lender and its counsel: A. The Note duly executed by the Borrower. B. A Deed of Trust in substantially the form of Exhibit C attached hereto with blanks appropriately filled in, granting the Lender a second position security interest in the Borrower's real estate described therein. Borrower shall provide title insurance documenting said second position. Until the SIED loan is repaid, Lender shall never be in a position worse than second position. C. The Lender shall have received such other approvals, opinions, or documents as the Lender may reasonably request. VI. REPRESENTATIONS AND WARRANTIES The Borrower represents and warrants to the Lender that: A. This Loan Agreement, the Note and the Deed of Trust, and any other necessary documents hereunder, when delivered under this Loan Agreement will be legal, valid, and binding obligations of Borrower and be enforceable against the Borrower in accordance with their respective terms, except to the extent that such enforcement may be limited by applicable bankruptcy, insolvency, and other similar law affecting creditors' rights generally. B. There is no pending or threatened action or proceeding against or affecting the Borrower before any court, governmental agency, or arbitrator, which may, in any one case or in the aggregate, materially adversely affect the financial condition, operations, properties, or business of the Borrower or the ability of the Borrower to perform their obligations under the loan documents to which they are a party. C. Borrower has title to all assets assigned or pledged to Lender as security for repayment of the Note. D. Borrower agrees that as partial consideration for the City making SIED loan resources available to it for infrastructure improvements serving Borrower's property, Borrower agrees to develop the property pursuant to the Yakima Municipal Code standards. All applicable City of Yakima development standards shall be included on Borrower's submitted site development plans and also incorporated in Borrower's construction designs and specifications for all development proposals submitted for City review for Borrower's project site, including but not limited to City of Yakima Municipal Code Title 12: Development Standards. E. Borrower has duly complied with, and its businesses, operations, assets, equipment, property, leaseholds, or other facilities are in compliance with, the provisions of all federal, state, and local environmental, health, and safety laws, codes and ordinances, and all rules and regulations promulgated thereunder. Borrower has not received notice of, nor know of, or suspect, facts which might constitute any violations of any federal, state, or local environmental, health, or safety laws, codes or ordinances, and any rules or regulations promulgated thereunder with respect to its businesses, operations, assets, equipment, property, leaseholds, or other facilities. Borrower has no indebtedness, obligation, or liability, absolute or contingent, matured or not matured, with respect to the storage, treatment, cleanup, or disposal of any solid wastes, hazardous wastes, or other toxic or hazardous substances (including without limitation any such indebtedness, obligation, or liability with respect to any current regulation, law, or statute regarding such storage, treatment, cleanup or disposal) which is not disclosed herein. VII. AFFIRMATIVE COVENANTS So long as the Note shall remain unpaid, the Borrower will: A. Preserve and maintain its company existence and good standing in Washington state. B. Keep adequate records and books of account reflecting all financial transactions of the Borrower. C. Maintain, keep, and preserve all of its properties (tangible and intangible) necessary or useful in the proper conduct of its business in good working order and condition, ordinary wear and tear excepted. D. Continue to engage in an efficient and economical manner in a business of the same general type as not conducted by it on the date of this Loan Agreement. E. Comply in all respects with all applicable laws, rules, regulations, and orders, such compliance to include, without limitation, paying before the same become delinquent all taxes, assessments, and governmental charges imposed upon them or upon their property. F. Be and remain in compliance with all provisions of all federal, state, and local environmental, health, and safety laws, codes and ordinances, and all rules and regulations issued thereunder; notify the Lender immediately of any notice of a hazardous discharge or environmental complaint received from any governmental agency or any other party; notify the Lender immediately of any hazardous discharge from or affecting their premises; immediately contain and remove the same, in compliance with all applicable laws; promptly pay any fine or penalty assessed in connection therewith; permit the Lender to inspect the premises, to conduct tests thereon, and to inspect all books, correspondence, and records pertaining thereto; and at the Lender's request, and at the Borrower's expense, provide a report of a qualified environmental engineer or expert, satisfactory in scope, form, and content to the Lender, and such other and further assurances reasonably satisfactory to the Lender that the condition has been corrected. VIII. NO LIENS So long as the Note shall remain unpaid, the Borrower shall not create, incur, assume, or suffer to exist any Lien upon or with respect to any of its assets assigned or pledged to Lender to secure payment under the Note and performance of all obligations under this Loan Agreement, now or hereafter acquired. IX. EVENTS OF DEFAULT A. Borrower shall be in default if any of the following events shall occur: 1. The Borrower should fail to pay the principal of, or interest on, the Note, or any fee, as and when due and payable. 2. Any representation or warranty made or deemed made by the Borrower in this Loan Agreement, the Deed of Trust, or the Note shall prove to have been incorrect, incomplete, or misleading in any material respect on or as of the date made or deemed made. 3. The Borrower shall fail to perform or observe any term, covenant, or agreement contained in this Loan Agreement. 4. The Borrower (a) shall generally not pay, or shall be unable to pay, or shall admit in writing their inability to pay their debts as such debts become due; or (b) shall make an assignment for the benefit of creditors, or petition or apply to any tribunal for the appointment of a custodian, receiver, or trustee for it or a substantial part of its assets; or (c) shall commence any proceeding under bankruptcy, reorganization under bankruptcy, reorganization, arrangement, readjustment of debt, dissolution, or liquidation law or statute of any jurisdiction, whether now or hereafter in effect; or (d) shall have had any such petition or application filed or any such proceedings commenced against it in which an order for relief is entered or an adjudication or appointment is made, and which remains undismissed for a period of one hundred and eighty (180) days or more; or (e) shall take any action indicating its consent to, approval of, or acquiescence in any such petition, application, proceeding, or order for relief or the appointment of a custodian, receiver, or trustee for all or any substantial part of its properties; or (f) shall suffer any such custodianship, receivership, or trusteeship to continue undischarged for a period of one hundred and eighty (180) days or more. 5. The Lender otherwise deems itself unsecure. B. Upon the occurrence of any event of default, the Lender may, by notice to the Borrower, declare the Note, all interest thereon, and all other amounts payable under this Loan Agreement to be forthwith due and payable, whereupon the Note, all such interest, and all such amounts shall become and be forthwith due and payable, without presentment, demand, protest, or further notice of any kind, all of which are hereby expressly waived by the Borrower. X. MISCELLANEOUS A. All notices and other communications provided for under this Loan Agreement and under the other loan documents to which the Borrower is a party shall be in writing and mailed, certified mail return receipt requested, or delivered, If to Borrower All American Investment Group, L.L.C., at its address at: All American Investment Group, L.L.C. 2318 South First Street Yakima, Washington 98903 If to Lender, at its address at: City of Yakima Attention: Bill Preston 129 North Second Street Yakima, WA 98901 Or, as to each party, at such other address as shall be designated by such party, in a written notice to the other party complying as to delivery with the terms of this section. Except as otherwise provided in this Loan Agreement, all such notices and communications shall be effective three business days after the date the notice is deposited in the mail or the date the notice is delivered, except that notices to the Lender under Section IV(B) shall not be effective until received by the Lender. B. Borrower may not assign any interest in this Loan Agreement and shall not transfer any interest in this Loan Agreement (whether by assignment, notation, or execution) without prior written consent of the Lender which may be withheld for any reason deemed reasonable or appropriate by Lender in the exercise of its sole discretion. Written notice of any proposed assignment or transfer shall be furnished to Lender not less than sixty (60) days prior to commencement of any undertakings or operations under this Loan Agreement. This Loan Agreement shall be binding upon and inure to the benefit of the Borrower and the Lender and their respective successors and assigns authorized by Lender. C. The failure or delay of either party to insist upon strict performance of any provision of this Loan Agreement or to exercise any right based upon a breach thereof or the acceptance of any performance during such breach shall not constitute a waiver of any right under this Loan Agreement. The rights and remedies provided herein are cumulative, and are not exclusive of any other rights, powers, privileges, or remedies, now or hereafter existing, at law or in equity or otherwise. D. It is mutually agreed and understood that no amendment, modification, or waiver of any clause or condition of this Loan Agreement is binding upon either party unless such amendment, modification, or waiver is in writing and executed by Lender and Borrowers. F. This Loan Agreement and the loan documents (the Note and Deed of Trust) contain all terms and conditions agreed to by Lender and Borrowers as they relate to the subject matter hereof and supersede all oral statement(s) and prior writing(s) with respect thereto. G. The Borrower agrees to release, indemnify, defend and hold harmless the City of Yakima, its elected and appointed officials, officers, employees, agents, representatives, insurers, attorneys, and volunteers from all liabilities, losses, damages, and expenses related to all claims, suits, arbitration actions, investigations, and regulatory or other governmental proceedings arising from or in connection with this Loan Agreement or the acts, failures to act, errors or omissions of the Borrower, or any of the Borrower's agents or subcontractors, in performance of this Loan Agreement, except for claims caused by the sole negligence of the City of Yakima. This indemnity shall survive termination of this Loan Agreement. H. All questions of the validity, construction, and application of this Agreement shall be governed by the laws of the State of Washington. Venue for any suit between the parties arising out of this Agreement shall be the Superior Court of Yakima County, Washington. I. Any provision of any loan document (this Loan Agreement, the Note, or the Deed of Trust) is held invalid or unenforceable by a court, such invalidity shall not affect the validity or operation of any other term or provision of the loan document, and such invalid term or provision shall be deemed to have been severed from the loan document. J. Final adoption of this Agreement is subject to review and approval by the Yakima City Council. DISCLOSURE ORAL AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT, OR FORBEAR FROM ENFORCEING REPAYMENT OF A DEBT ARE NOT ENFORCEABLE UNDER WASHINGTON LAW. IN WITNESS WHEREOF, the parties have caused this Loan Agreement to be executed by their respective officers thereunto duly authorized. DATED this )"( day of riA. 0 , 2023. BORROWER: ALL AMERICAN INVESTMENT GROUP, L.L.C. By: Nasser Awad Title: Member ALL AMERICAN INVESTMENT GROUP, L.L.C. By: Mohammad Taha Title: Member LENDER: CITY OF YAKIMA By: Robert Harrison City Manager City Clerk ATTEST: ' CITY CONTRACT NO: RESOLUTION NO: OVe�—�"� STATE OF WASHINGTON ) ss. County of Yakima I certify that I know or have satisfactory evidence that Nasser Awad and Mohammad Taha are the persons who appeared before me, and said persons acknowledged that they are the members of ALL AMERICAN INVESTMENT GROUP, L.L.C., have authority to sign this document on its behalf, and signed this instrument and acknowledged it to be their free and voluntary act for the uses and purposes mentioned in this instrument. DATED this 2."P day of All Al 2023. ovi ,,i \w" —_ a — 17. e 2 ' Iv F Op W Pg�W� � STATE OF W1A HINGTON ) ) ss. County of Yakima ) Notary Public in and for the tate of Washington, residing at A.eAmo• My commission expires: 03 •23 -202(P I certify that I know or have satisfactory evidence that Bob Harrison is the person who appeared before me, and said person acknowledged that they are the City Manager of the City of Yakima and have authority to sign this document on its behalf, and signed this instrument and acknowledged it to be their free and voluntary act for the uses and purposes mentioned in this instrument. DATED this V day of3/..„..,n.e, , 2023. xSSION NO 10i265 _ .. (P.'. ljUBt Y c* 1 Notary Puin and for the State of Washington, residing at L4ti My commission expires: Exhibit A Popeyes Road Improvements Public Project Civil Cost Estimate - June 7, 2022 HLA Project No. . Engineering Inc. 1114 EIIA and Land Surreying, ITEM NO. ITEM UNIT APPROX QUANTITY UNIT PRICE DOLLARS OVERALL COST SITE & ROAD PREPARATION 1 Mobilization (10%) LS 1 $51,600.00 $51,600.00 2 Mantenence & Protection of Traffic LS 1 $15,000 00 $15,000.00 3 SPCC Plan LS 1 $2,000.00 $2,000 00 4 Erosion /Water Pokution Plan LS 1 $5.000 00 $5,000 00 5 Clearing & Grubbing LS 1 $3,000.00 $3.000 00 6 Unclassified Ex, Including Haul CY 1,000 $50 00 $50,000 00 7 HMA CL 1I2" PG 64-28 (Heavy 4" Thick) TON 500 $130 00 $65,000.00 8 Crushed Surfacing Base Course (Heavy 8" Thick) TON 800 $45 00 $36,000 00 9 Cement Concrete Curb & Gutter LF 800 $34 00 $27,200.00 10 Cement Concrete Sidewalk - 4" Thick SY 900 $70 00 $63,000 00 11 Cement Concrete Handicap Curb Ramp EA 6 $3,000.00 $18,000 00 12 Commercial Road Approach ES 2 $6,500.00 $13,000 00 STORM DRAIN SYSTEM 13 Catch Basin Type 1 / 1L EA 4 $2,500.00 $10,000 00 14 Catch Basin Type 2 EA 1 $5,000.00 $5,000 00 15 PVC Drain Pipe, 12" Dia LF 200 $55.00 $11,000.00 16 Underground Infikration Trenches LF 100 $150.00 $15,000 00 ELECTRICAL, 17 Signal Pole Complete LF 1 $150,000.00 $150,000 00 18 (2) Schedule 40 PVC Electrical Conduit, 2" Dia (Electrical) LF 380 $40.00 $15,200 00 19 Electncal Transformer Box EA 1 $3,000 00 $3.000.00 20 Junction Box EA 2 $400.00 $800 00 21 Illumination EA 2 $4,500.00 $9,000 00 Estimate prepared by: Construction Developer 50%SIED Subtotal $567,800.00 Contingency (15%) $85,200.00 Total $653,000.00 Civil PS&E (15%) $98,000 00 Administration (15%) ... $98.000 00 Right -Of -Way Acquisition $150,00000 PROJECT TOTAL.... $1,000,000.00 Michael R. Heit, PE Date HLA Engineering and Land Surveying, Inc. Private Match Requirement (20%) $200,000.00 Right -of -Way Contribution . Square -Feet Pnce/SF 9,886 I 915 17 j $150,000 00 Cash Contribution .... $50,000.00 SIED Loan Request.... $800.000.00 LOAN PROJECT TOTAL.... $400,000.00 DEVELOPER PROJECT TOTAL .... $450,000.00 G 1PROJECTSi2022122062E12022-06-07 Popeyes Cost Estimate.xlsx EXHIBIT B PROMISSORY NOTE FORM PROMISSORY NOTE $416,000.00 a' , 2023 Yakimal, Washington 1. Promise to Pay. All American Investment Group, L.L.C., a Washington limited liability company, (referred to as "Maker" herein), hereby promise to pay to the order of�i_Itil The City of Yakima, Washington, a Washington municipal corporation, ("Holder" herein), at Yakima, Washington or at such other place as the Holder may designate in writing, in (stv lawful money of the United States of America, the principal sum of Four Hundred Sixteen 7 Thousand and 00/100ths dollars ($416,000.00), at five point fi 4 percent (5.81 %) g►50 °ne interest, on the terms and conditions set forth herein. The funds being loaned here under are from the Yakima County SIED funding provided to the City of Yakima, Washington via contract no. YC-RLR-22, which funding is being used to construct signal and street realignment and improvements rectifying public safety concerns in accessing the Maker's property located at 2018 South 1st Street, Yakima Avenue, Yakima, Washington. 2. Payment. Maker shall make ten annual installment payments of $41,600.00 plus accrued interest commencing on the first day June, 2025 and annual payments shall be due on June 1 of each year with the final payment of all outstanding and remaining amounts due and owing under this Note due on June 1, 2034. The City of Yakima may invoice the Maker one month in advance of each payment being due to the City of Yakima. Interest begins accruing as of the date of this Note. Failure to invoice does not relieve Maker from making timely payment to the City of Yakima under this Note. 3. Prepayment. Maker may prepay this Note in full or in part at any time without the prior approval of Holder. In the event of payment by Maker to the City of any one or more installments, or of the entire loan balance, before June 1, 2034, interest shall accrue on such installment(s) or balance until, but not beyond, the June 1 next succeeding the date of such payment(s). If more than one installment is paid during any repayment year, then the repayment period recited above shall be correspondingly shortened and the schedule of payments shall be correspondingly advanced. 4. Application of Payments. Payments made hereunder may be applied in any order to payments of costs, interest or principal due hereunder, at the option of the Holder. 5. Security. In the event of default by the Maker, this Note shall be secured with the generally described following property under a Deed of Trust, executed contemporaneously with this Note: That portion of the Southeast '/4 of the Northeast ' of Section 31, Township 13, Range 19 E.W.M. described as follows: Beginning at the point of intersection of the South line of the North 644.6 feet of the SE '/4 of the NE 1/4 of said Section and the West right of way line of State Highway No. 3, thence Northwesterly along said right of way line 170.9 feet, thence West to a point 670 feet East of the West line of said SE IA of the NE 'A, thence South 00°37'00" East to a point West of the True Point of Beginning, thence East to the True Point of Beginning, EXCEPT the West 150 feet, AND EXCEPT the South 20 feet for road. Yakima County Tax Assessor Parcel No.: 191331-14040 Address: 2018 South 1st Street, Yakima, Washington 6. Interest Due in the Event of Default. In the event Maker fails to pay the Note in full on or before the due date, the unpaid principal shall accrue interest at the maximum rate allowed by law until the Maker is no longer in default. 7. Default. This Note shall be in default if payment of any installment is not made when due, or failure to pay when due any other instrument evidencing, securing or relating to any other indebtedness of Maker to the Holder (whether direct or indirect), and such default continues after any notice from the Holder to Maker and the expiration of any period granted to Maker for curing such default as provided for in any such instrument. 8. Acceleration. If the Maker is in default under this Note and such default is not cured within the minimum allotted time after written notice of such default, then the Holder may, at its option, declare all outstanding sums owed on this Note to be immediately due and payable. This includes any actions under the Deed of Trust and Security described in Section 5 above. 9. Late Payment Charge - Curing of Monetary Defaults. If any payment is not delivered to Holder within five days after the payment due date, then a late payment fee of $250.00 will be charged and immediately payable. An additional $250.00 late payment fee will be charged for each subsequent thirty (30) day period the payment remains unpaid. A default in payment of any amount due hereunder may be cured only by payment in full of such amount plus the applicable fees and charges, plus any attorneys' fees incurred by the Holder by reason of such default. 10. Nonwaiver. Failure to exercise any right the Holder may have or be entitled to in the event of any default hereunder shall not constitute a waiver of such right or any other right in the event of any subsequent default. 11. Waiver of Presentment. The Maker and all guarantors and endorsers hereof hereby severally waive presentment for payment, protest and demand, notice of protest, demand, dishonor and nonpayment of this Note; and consent that the Holder may, at its sole discretion, extend the time of payment or otherwise modify the terms of payment of any part of the whole of the debt evidenced by this Note. 12. Execution. Each and every party signing or endorsing this Note binds itself as a principal and not as a surety. In any action or proceeding to recover any sum herein provided for, no defense of adequacy of security or that resort must first be had to security or to any other person shall be asserted. This Note shall bind the undersigned and its or their successors and assigns, jointly and severally. 13. Collection Costs. Maker agrees to pay all costs, including reasonable attorneys' fees, incurred by the Holder in any suit, action or appeal therefrom, or without suit, in connection with collection hereof or enforcement of Holder's rights hereunder. 14. Business Purpose. The undersigned warrants and represents that all funds advanced under this Note shall be applied and are intended solely for business or commercial purposes. 15. Notice. Any demand or notice to be made or given under the terms hereof or any instrument now or hereafter securing this Note by the Holder to Maker shall be effective when mailed to the following addresses: All American Investment Group, L.L.C. Attn: Nick Awad 2318 South 1st Street Yakima, WA 98903 City of Yakima Attn: Bill Preston 129 North 2nd Street Yakima, WA 98901 16. Venue: In the event any suit or action is commenced to collect all or any part of this note, the venue of any such action shall lie in Yakima County, Washington. 17. Severability. In the event that any provision herein is determined to be void or unenforceable for any reason, such determination shall not affect the validity or enforceability of any other provision, all of which shall remain in full force and effect. 18. Modification. This Note may not be modified or amended except by the written agreement of all parties. ORAL AGREEMENTS OR ORAL COMMITMENTS TO LOAN MONEY, EXTEND CREDIT, OR TO FORBEAR FROM ENFORCING REPAYMENT OF A DEBT ARE NOT ENFORCEABLE UNDER WASHINGTON LAW. ALL AMERICAN INVESTMENT GROUP, L.L.C. By: NASSER AWAD Title: MEMBER Date: PA A.4% a a 02_2, ALL AMERICAN INVESTMENTPGROUP, By: MOHAMMED TAHA Date: Title: MEMBER EXHIBIT C DEED OF TRUST FORM DEED OF TRUST (For use in the State of Washington only) THIS DEED OF TRUST, made this Z,Npday of MAI between: , 2023, ALL AMERICAN INVESTMENT GROUP, L.L.C., a Washington limited liability company, as GRANTOR, whose address is: and FIDELITY TITLE COMPANY as TRUSTEE, whose address is: and CITY OF YAKIMA, a municipal corporation and first class city in the state of Washington, as BENEFICIARY, whose address is: 129 North Second Street Yakima, Washington 98901 WITNESSETH: Grantor hereby bargains, sells, and conveys to Trustee in trust, with power of sale, the following described real property in Yakima County, Washington: That portion of the Southeast IA of the Northeast IA of Section 31, Township 13, Range 19 E.W.M. described as follows: Beginning at the point of intersection of the South line of the North 644.6 feet of the SE IA of the NE '/4 of said Section and the West right of way line of State Highway No. 3, thence Northwesterly along said right of way line 170.9 feet, thence West to a point 670 feet East of the West line of said SE '/4 of the NE '/4, thence South 00°37'00" East to a point West of the True Point of Beginning, thence East to the True Point of Beginning, EXCEPT the West 150 feet, AND EXCEPT the South 20 feet for road. Yakima County Tax Assessor Parcel No.: 191331-14040 Address: 2018 South 1st Street, Yakima, Washington which real property is not used principally for agricultural or farming purposes, together with all the tenements, hereditaments, and appurtenances now or hereafter thereunto belonging or in any wise appertaining, and the rents, issues, and profits thereof. This Deed of Trust is for the purpose of securing performance of each agreement of Grantor contained in this Deed of Trust, and payment of the sum of FOUR HUNDRED SIXTEEN THOUSAND AND 00/100THS DOLLARS ($416,000.00) with interest, in accordance with the terms of a promissory note of even date herewith, payable to Beneficiary or order, and made by Grantor, and all renewals, modifications, and extensions thereof, and also such further sums as may be advanced or loaned by Beneficiary to Grantor, or any of Grantor's partners, developers, successors or assigns, together with interest thereon at such rate as shall be agreed upon. DUE DATE: The entire balance of the promissory note secured by this Deed of Trust, together with any and all interest accrued thereon, shall be due and payable in full on June 1, 2034. To protect the security of this Deed of Trust, Grantor covenants and agrees: 1. To keep the property in good condition and repair; to permit no waste thereof; to complete any building, structure, or improvement being built or about to be built thereon; to restore promptly any building, structure, or improvement thereon which may be damaged or destroyed; and to comply with all laws, ordinances, regulations, covenants, conditions, and restrictions affecting the property. 2. To pay before delinquent all lawful taxes and assessments upon the property; to keep the property free and clear of all other charges, liens, or encumbrances impairing the security of this Deed of Trust. 3. To keep all buildings now or hereafter erected on the property described herein continuously insured against loss by fire or other hazards in an amount not less than the total debt secured by this Deed of Trust. All policies shall be held by the Beneficiary, and be in such companies as the Beneficiary may approve and have loss payable first to the Beneficiary, as its interest may appear, and then to the Grantor(s). The amount collected under any insurance policy may be applied upon any indebtedness hereby secured in such order as the Beneficiary shall determine. Such application by the Beneficiary shall not cause discontinuance of any proceedings to foreclose this Deed of Trust. In the event of foreclosure, all rights of the Grantors in insurance policies then in force shall pass to the purchaser at the foreclosure sale. 4. To defend any action or proceeding purporting to affect the security hereof or the rights or powers of Beneficiary or Trustee, and to pay all costs and expenses, including cost of title search and attorney's fees in a reasonable amount, in any such action or proceeding, and in any suit brought by Beneficiary to foreclose this Deed of Trust. 5. To pay all costs, fees, and expenses in connection with this Deed of Trust, including the expenses of the Trustee incurred in enforcing the obligation secured hereby and Trustee's and attorney's fees actually incurred, as provided by statute. 6. Should Grantor fail to pay when due any taxes, assessments, insurance premiums, liens, encumbrances, or other charges against the property hereinabove described, Beneficiary may pay the same, and the amount so paid, with interest at the rate set forth in the note secured hereby, shall be added to and become a part of the debt secured in this Deed of Trust. 7. DUE ON SALE: The property described in this security instrument may not be sold or transferred without the Beneficiary's consent. Upon breach of this provision, Beneficiary may declare all sums due under the note and Deed of Trust immediately due and payable, unless prohibited by applicable law. Grantors initials Beneficiary initials 8. NO FURTHER ENCUMBRANCES: Subject to the Subordination language found below, as an express condition of Beneficiary making the loan secured by this Deed of Trust, Grantor shall not further encumber, pledge, mortgage, hypothecate, place any lien, charge or claim upon, or otherwise give as security the property or any interest therein nor cause or allow by operation of law the encumbrance of the Trust Estate or any interest therein without the written consent of a Beneficiary even though such encumbrance may be junior to the encumbrance created by this Deed of Trust. Encumbrance of the property contrary to the provisions of this provision shall constitute a default and Beneficiary may, at Beneficiary's option, declare the entire balance of principal and interest immediately due and payable, whether the same be created by Grantor or an unaffiliated third party asserting a judgment lien, mechanic's or materialmen's hen or any other type of encumbrance or title defect. Grantors initials Beneficiary initials IT IS MUTUALLY AGREED THAT: 1. In the event any portion of the property is taken or damaged in an eminent domain proceeding, the entire amount of the award or such portion as may be necessary to fully satisfy the obligation secured by this Deed of Trust shall be paid to Beneficiary to be applied to said obligation. 2. By accepting payment of any sum secured by this Deed of Trust after its due date, Beneficiary does not waive its right to require prompt payment when due of all other sums so secured or to declare default for failure to so pay. 3. The Trustee shall reconvey all or any part of the property covered by this Deed of Trust to the person entitled thereto, on written request of the Grantor and the Beneficiary, or upon satisfaction of the obligation secured and written request for reconveyance made by the Beneficiary or the person entitled thereto. 4. Upon default by Grantor in the payment of any indebtedness secured by this Deed of Trust or in the performance of any agreement contained in this Deed of Trust, all sums secured hereby shall immediately become due and payable at the option of the Beneficiary subject to any cure period provided in the note secured by this Deed of Trust. In such event and upon written request of Beneficiary, Trustee shall sell the trust property, in accordance with the Deed of Trust Act of the State of Washington, at public auction to the highest bidder. Any person except Trustee may bid at Trustee's sale. Trustee shall apply the proceeds of the sale as follows: (1) to the expense of the sale, including a reasonable Trustee's fee and attorney's fee; (2) to the obligation secured by this Deed of Trust; and (3) the surplus, if any, shall be distributed to the persons entitled thereto. 5. Trustee shall deliver to the purchaser at the sale its deed, without warranty, which shall convey to the purchaser all right, title and interest in the real and personal property which Grantor had or had the power to convey at the time of the execution of this Deed of Trust, and such as Grantor may have acquired thereafter. Trustee's deed shall recite the facts showing that the sale was conducted in compliance with all the requirements of law and of this Deed of Trust, which recital shall be prima facie evidence of such compliance and conclusive evidence thereof in favor of bona fide purchaser and encumbrancers for value. 6. The power of sale conferred by this Deed of Trust and by the Deed of Trust Act of the State of Washington is not an exclusive remedy; Beneficiary may cause this Deed of Trust to be foreclosed as a mortgage. Beneficiary may also choose to utilize any other remedy at law available to it to collect the amounts due and owing under the Promissory Note. 7. In the event of the death, incapacity, disability, or resignation of Trustee, or at the discretion of the Beneficiary, Beneficiary may appoint in writing a successor trustee, and upon the recording of such appointment in the mortgage records of the county in which this Deed of Trust is recorded, the successor trustee shall be vested with all powers of the original trustee. The trustee is not obligated to notify any party hereto of pending sale under any other Deed of Trust or of an action or proceeding in which Grantor, Trustee, or Beneficiary shall be a party unless such action or proceeding is brought by the Trustee. 8. This Deed of Trust applies to, inures to the benefit of, and is binding not only on the parties hereto, but on his/her/their heirs, devisees, legatees, administrators, executors, and assigns. The term Beneficiary shall mean the holder and owner of the note secured hereby, whether or not named as Beneficiary herein. SUBORDINATION The parties agree that in the event Grantor enters into a deed of trust, mortgage, or lien agreement which makes full payment on the Deed of Trust dated January 12, 2021, and recorded January 13, 2021 under Yakima County Auditor's File No. 8083351, wherein the Grantor is All American Investment Group, LLC, and the beneficiary is Russell Lane, LLC, then the City of Yakima will enter into an agreement which subordinates this Deed of Trust to that instrument as long as the City of Yakima's interest under this Deed of Trust remains a second in priority encumbrance on the real property which secures this instrument. EXECUTED this ALL AMERICAN INVESTMENT GROUP, L.L.C. BY: NASSER AWAD 2023 BY: IVIIIIIHAMMAD TANA ITS: Member ITS: Member STATE OF WASHINGTON ) ss. County of I certify that I know or have satisfactory evidence that Nasser Awad and Mohammad Taha are the persons who appeared before me, and said persons acknowledged that they are the members of ALL AMERICAN INVESTMENT GROUP, L.L.C., have authority to sign this document on its behalf, and signed this instrument and acknowledged it to be their free and voluntary act for the uses and purposes mentioned in this instrument. DATED this 61° day of tiff Soo 4:4 BL6- Zor* A 10,0seeop w , 2023. Notary Public in and for the State of Washington, residing at My commission expires: 1 ITEM TITLE: SUBMITTED BY: BUSINESS OF THE CITY COUNCIL YAKIMA, WASHINGTON AGENDA STATEM ENT Item No. 6.F. For Meeting of: June 6, 2023 Resolution authorizing an agreement with All American I nvestment Group for repayment of S I E D loan to reconstruct Russell Lane Project 2650 Scott Schafer, Director of Public Works *Bill Preston, City Engineer (509) 576-6754 SUMMARY EXPLANATION: The City of Yakima (City) received funding from Yakima County Supporting Investments in Economic Development (S I E D) for the Russell Lane Realignment Project 2650. The project will realign and upgrade Russell Lane to allow for required revisions to the traffic signal for an additional leg to the current three-legged signal. This realignment will allow for the development of a 1.11- acre parcel for a restaurant development. A total of five acres will be supported for future commercial development. The total grant award from Yakima County to the City is $416,000 in the form of a grant and $416,000 in a loan, and $168,000 local match. The property owners agree to repay the loan proceeds and provide the local match. The attached Developer Agreement assigns the responsibility of the S I E D loan repayment to the Developer. ITEM BUDGETED: NA STRATEGIC PRIORITY: Economic Development APPROVED FOR SUBMITTAL BY THE CITY MANAGER RECOMMENDATION: Adopt resolution. ATTACHMENTS: Description Upload Date Type D Resolution 5/26/2023 Corer Memo D Developer agreement 5/3/2023 Contract D Promissory Note - Example 5/3/2023 Backup Material 2 D Deed of Trust - Example 5/3/2023 Backup Material