053-18 - Waterman Investment Partners, LLC - Contract Amendment Addendum 4Addendum to No. 4 to Contract No. 053-18
REAL ESTATE PURCHASE AND SALE AGREEMENT
THIS ADDENDUM NO. 4 to the Real Estate Purchase and Sale Agreement for the
property located at 640 Bay Street, Port Orchard, Kitsap County, Washington, is executed by
and between Waterman Investment Partners, LLC, a Washington Limited Liability Company
hereafter ("Buyer") and the City of Port Orchard, a municipal corporation organized under the
laws of the State of Washington (hereafter "seller").
WHEREAS, Buyer and Seller entered into the above referenced Real Estate Purchase and
Sale Agreement, dated July 10, 2018, which is attached hereto and incorporated herein by this
reference ("Agreement"); and
WHEREAS, Buyer and Seller entered into Addendum No. 1 to the Agreement, dated
December 11, 2018, to amend certain provisions of the Agreement, including the Closing Date,
which is attached hereto and incorporated herein by this reference ("Addendum No. I"); and
WHEREAS, Buyer and Seller entered into Addendum No. 2 to the Agreement, dated June
11, 2019, to extend the Closing Date in exchange for a payment from the Buyer, which is attached
hereto and incorporated herein by this reference ("Addendum No. 2"); and
WHEREAS, Buyer and Seller entered into Addendum No. 3 to the Agreement, dated
December 17, 2019, to extend the Closing Date, which is attached hereto and incorporated herein
by this reference ("Addendum No. 3"); and
WHEREAS, Section 16 of the Agreement provides that it may be amended or modified
by a written instrument executed by Buyer and Seller; and
WHEREAS, Section 6.1 of the Agreement sets forth the Closing Date requirements of the
parties, and provides that the parties may agree in writing to a later closing date than the originally
anticipated closing date of December 31, 2018; and
WHEREAS, via Addendum No. 1, the parties extended the closing date to June 30, 2019;
and
WHEREAS, via Addendum No. 2, the parties extended the Closing Date to December 31,
2019; and
WHEREAS, via Addendum No. 3, the parties extended the Closing Date to March 31,
2020; and
WHEREAS, the parties agree that it is in the best interests of both to further extend the
closing date to March 31, 2022 and to amend certain provisions of the Agreement in exchange for
a payment from Buyer that will go toward closing or be forfeited if closing does not occur; and
WHEREAS, the parties wish to memorialize their agreement to amend the closing,
payment and other provisions of the Agreement;
NOW, THEREFORE, Buyer and Seller agree as follows:
1. Section 2.1 of the Agreement is hereby amended to read as follows:
Deposit. Within five (5) business days after the date on which the
last party executes this Agreement (the "Effective Date"), Buyer
shall execute and deliver to Land Title Company of Kitsap in Port
Orchard, Washington ("Title Company"), BS escrow agent for the
closing of this transaction, a promissory note (the "Earnest Money
Note") in the amount of Fifteen Thousand Dollars ($ 15,000.00).
The Earnest Money Note will be converted to cash upon the
expiration of the Due Diligence Period (as defined in Section 5.2.1)
(the "Deposit") and will be paid or delivered as earnest money (the
"Earnest Money") in part payment for the purchase price of the
Property no later than January 4, 2019.
Within five (5) business days after the date on which the last party
executes Addendum No. 2 to this Agreement, Buyer shall deposit
with Title Company, as escrow agent for the closing of this
transaction, a payment ("Closing Date Extension Payment") in the
amount of Ten Thousand Dollars ($10,000.00). The Closing Date
Extension Payment will be paid or delivered to Seller in part
payment for the purchase price of the Property upon closing. If the
parties do not close this transaction, the Closing Date Extension
Payment will be forfeited by Buyer and paid or delivered to Seller.
Within five (5) business days after the date on which the last party
executes Addendum No. 4 to this Agreement, Buyer shall deposit
with Title Company, as escrow agent for the closing of this
transaction, a payment ("Closing Date Extension Payment") in the
amount of Fifteen Thousand Dollars ($15,000.00). The Closing
Date Extension Payment will be paid or delivered to Seller in part
payment for the purchase price of the Property upon closing. If the
parties do not close this transaction, the Closing Date Extension
Payment will be forfeited by Buyer and paid or delivered to Seller.
2. Section 2.2 of the Agreement is hereby amended to read as follows:
Purchase price. The purchase price for the Property (the "Purchase
Price") shall be set as follows: within 90 day of the Closing Date,
Seller shall obtain an independent appraisal of the Property, and the
Purchase Price shall be the appraised value, provided that the
Purchase Price shall not be less than Two Hundred and Nineteen
Thousand Five Hundred and Thirty Four Dollars ($219,534.00).
3. Section 4.1 of the Agreement is hereby stricken, and the following sections are
renumbered accordingly.
4. Section 5.5 of the Agreement is hereby amended to read as follows:
Seller's contingency. In addition to any conditions provided in
other provisions of this Agreement, Seller's obligation to sell the
Property is subject to the fulfillment prior to Closing of each of the
following conditions:
5.5.1 Project Phasing and Application. Buyer intends to improve
the Property via development of a mixed -use community utilizing
the Property and contiguous parcels owned by the Buyer, as
described in the Buyer's Proposal, as amended and attached hereto
as Exhibit C (the "Project"). As depicted on Exhibit C, Buyer
intends to develop the Project in phases (each a "Phase"). Buyer
agrees that prior to closing, buyer will submit counter complete
applications for the first Phase of the development (consisting of
Land Disturbing Activity Permit, Building Permit, SEPA Checklist,
Etc.) within the area described on Exhibit C, for a Phase including
at least 40,000 square feet of residential, nonresidential, and/or
structured parking. The City authorizes the Buyer to submit permit
applications for the 640 Bay Street property prior to the Closing
Date, and this property must be included in Phase 1 of the project.
Prior to the Closing Date, Buyer shall have submitted a substantially
complete application for building permits and any other required
and necessary permits (collectively, "Building Permits") enabling
Buyer to proceed with construction commencement of Phase I of the
Project.
5.5.2 Compliance by Buyer. Buyer shall have performed and
complied with all of the covenants, agreements, obligations and
conditions required hereunder to be performed and complied with
by Buyer on or before the Closing Date.
5.5.3 Correctness of Representations and Warranties. The
representations and warranties of Buyer stated in this Agreement
shall be true and correct on and as of the Closing Date with the same
force and effect as if such representations and warranties had been
made on and as of the Closing Date, unless Buyer shall have
provided written notice to Seller to the contrary and has given Seller
the opportunity to terminate or withdraw from this transaction at or
prior to Closing).
5.5.4 Buyer's Deliveries. Buyer shall have delivered all of
Buyer's Deliveries to Escrow Agent on or before the Closing Date.
5.5.5 City Council Approval. The Port Orchard City Council shall
have approved the execution, delivery and performance of this
Agreement.
5. Section 5.6 of the Agreement is hereby amended to read as follows:
Satisfaction/waiver of Seller's contingency. The Seller's
contingencies are solely for the benefit of the Seller. If the
contingencies are not timely satisfied, the Seller will have the right
at its sole election either to waive the contingency in writing and
proceed with the purchase or to terminate this Agreement. If Seller
elects to terminate this Agreement, the escrow will be terminated,
the Deposit must immediately be returned to Buyer, all documents
and other funds will be returned to the party who deposited them,
and neither party will have any further rights or obligations under
this Agreement, except as otherwise provided in this Agreement,
and except that each party shall pay one-half (1/2) of the cost of
terminating the escrow.
6. Section 6.1 of the Agreement is hereby amended to read as follows:
Closing date. This transaction will be closed in escrow by Title
Company acting as escrow agent ("Escrow Agent"). The closing
will be held at the offices of Title Company no later than March 31,
2022 (the "Closing Date"). If closing does not occur on or before
the Closing Date, or any later date mutually agreed to in writing by
Seller and Buyer, Escrow Agent will immediately terminate the
escrow, forward the Deposit to the party entitled to receive it as
provided in this Agreement and return all documents to the party
that deposited them.
7. Section 6.2.2 of the Agreement is hereby amended to read as follows:
Buyer's escrow deposits. On or before the Closing Date, Buyer
shall deposit into escrow the following:
(a) Cash or immediately available funds in an amount sufficient
to pay the Purchase Price, plus Buyer's share of closing costs; and
(b) A duly executed and completed Real Estate Excise Tax
Affidavit; and
(c) Any other documents or instruments Buyer is obligated to
provide pursuant to this Agreement (if any) in order to close this
transaction; and
(d) A certificate reaffirming as of the Closing Date that all of
Buyer's representations and warranties under this Agreement are
true and accurate.
8. Section 6.3.1 of the Agreement is hereby amended to read as follows:
Seller's costs. Seller shall pay the cost of the appraisal provided for
in Section 2.2, State of Washington real estate excise taxes
applicable to the sale, and one-half of Title Company's escrow fee.
9. Section 6.3.2 of the Agreement is hereby amended to read as follows:
Buyer's costs. Buyer shall pay the premium for a standard coverage
policy of title insurance in the full amount of the Purchase Price, the
additional premium, if any, attributable to the extended coverage
policy of title insurance (if elected by Buyer) and any endorsements
required by Buyer, the cost of recording the Deed and one-half of
Title Company's escrow fee.
10. Section 14 of the Agreement is hereby amended to read as follows:
Seller: City of Port Orchard
ATTN: Mayor Robert Putaansuu
216 Prospect Street
Port Orchard, WA 98366
With a copy to: Office of the City Attorney
Charlotte Archer
Inslee Best Doezie Ryder PS
10900NE 4t" Street
Suite 1500
Bellevue, WA 98004
Buyer: Waterman Investment Partners, LLC
P.O. Box 376
Burley, WA 98322
with a copy to: Ron Templeton
Templeton Horton Weibel
3212 NW Byron Street, #104
Silverdale, WA 98383
11. New Exhibit C. New Exhibit C, referenced in amended Section 5.5.1 herein and
attached hereto, is hereby adopted by reference and incorporated into the Purchase
and Sale Agreement. This Exhibit is intended to illustrate the proposed Project (by
identified Blocks, each of which constitutes a proposed Phase of the Project, with
phasing to begin with the Block identified on Exhibit C as B I. Exhibit C has not
been reviewed by the City of Port Orchard for compliance with the Port Orchard
Municipal Code, including the City's development regulations.
12. In all other respects, the Agreement between the parties, as amended by Addendum
No. 1, Addendum No. 2, and Addendum No. 3 shall remain in full force and effect, further
amended as set forth herein, but only as set forth herein.
IN WITNESS WHEREOF, the parties have executed this Addendum No. 4 this;; 0diay of
March 2020.
WATERMAN INVESTMENT
PARTNERS, LLC (BUYER):
Steve Sego, Sole Me r
CITY OF PORT ORCHARD
(SELLER):
Robert Putaansuu, Mayor
ATTEST/AUTHENTICATED:
Brandy nearson, MMC, City Clerk
OVED AS T
Charlotte Archer, City Attorney
EXHIBIT C to Addendum No. 4, Contract No. 053-18
Proposed Block Plan
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