HomeMy WebLinkAbout19-152 - Tukwila Community Coalition - Letter of Intent to Purchase19-152
Council Approval N/A
October 9, 2019
City of Tukwila
Attn: Ann Marie Soto
E-mail: annmarie@kenondisend.com
Re: Traveler's Choice Property
3747 S. 146th Street
Tukwila, WA Parcel No. 00400-00911
Offer Letter
Dear Ann Marie:
The members of the Tukwila Community Coalition ("Purchaser") propose the following terms and
conditions to be incorporated into a Purchase and Sale Agreement with the City of Tukwila, a
Washington municipal corporation ("Seller") pertaining to the above -referenced property
("Property"):
Settlement Agreements. Seller and each of the members of the Purchaser (each, a
"Member") signed various Settlement Agreement and Release of All Claims (each, a
"Settlement Agreement") pursuant to which each Member was required to vacate certain
properties they were leasing (the "Leased Properties") by March 31, 2019 (the "Vacation
Date") and Seller was entitled to acquire the property rights to such Leased Properties.
Seller is entering into this Offer Letter to memorialize certain terms and conditions for the
purchase of the Property by Purchaser from Seller in exchange for the Members' vacation
of the Leased Properties.
2. Purchase Price - The purchase price for the Property will be equal to the Property's fair
market value (the 'Purchase Price") which will be determined by Purchaser and Seller
according to the procedure set forth herein. Within ten (10) business days after the execution
of this Offer Letter, Seller will, at Seller's expense, appoint an independent and qualified third -
party MAI appraiser with experience in valuation of similar properties in King County,
Washington, to perform a valuation of the Property for the purpose of determining the
Property's fair market value (the "Seller Appraisal"). The Seller's appraiser will be required
to deliver the Seller Appraisal to Seller and Purchaser within thirty (30) days after
appointment. If Purchaser disagrees with the fair market value of the Property set forth in the
Seiler Appraisal, Purchaser may, within ten (10) business days after receipt of the Seller
Appraisal, submit a written notice to Seller (the "Seller Appraisal Dispute Notice") indicating
that Purchaser desires to have, at Purchaser's expense, an independent and qualified third -
party MAI appraiser with experience in valuation of similar properties in King County,
Washington perform a second valuation of the fair market value of the Property (the
"Purchaser Appraisal"). The Purchaser's appraiser will be required to deliver the Purchaser
Appraisal to Seller and Purchaser within thirty (30) days after delivery of the Seller Appraisal
Dispute Notice. If the higher of either the Purchaser Appraisal and the Seller Appraisal is
equal to or less than 105% of the lower of the Purchaser Appraisal and the Seller Appraisal,
then the average of the Purchaser Appraisal and the Seller Appraisal submitted shall be
deemed to be the Purchase Price. If the higher of either the Purchaser Appraisal and the
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Seller Appraisal is more than 105% of the lower of the Purchaser Appraisal and the Seller
Appraisal, then the Seller's appraiser and the Purchaser's appraiser will jointly select an
independent and qualified third -party MAI appraiser with experience in valuation of similar
properties (the "Joint Appraiser"), and the Joint Appraiser will select, within ten (10) business
days after appointment, either the Seller Appraisal or the Purchaser Appraisal as determinative
of the Purchase Price. The costs and expenses of the Joint Appraiser will be shared equally
by Purchaser and Seller. Seller and Purchaser will cooperate with the appraiser(s) and
promptly provide information reasonably necessary to complete the valuation(s). Except and
until a definitive agreement memorializing the terms of this Offer Letter is mutually executed
by both parties hereto, nothing in this Section 2 obligates Purchaser and Seller to purchase or
sell the Property or to continue the property transaction upon completion of the appraisal
process.
Earnest Money Deposit - Within two (2) business days after the execution of an
acceptable Purchase and Sale Agreement, Purchaser will make an earnest money deposit
in the amount of five percent (5.0%) of the Purchase Price with First American Title
Insurance Company. The earnest money deposit will become non-refundable at the
expiration of the Contingency Period (as defined in Section 5 below) except upon breach
by the Seller.
4. Financing Contin2eney - Purchaser's obligation to close on the purchase and sale of the
Property is contingent upon that Purchaser obtaining acquisition financing on
commercially reasonable terms acceptable to Purchaser in its sole and absolute
discretion. Purchaser will have the right, if necessary, upon written notice to Seller at least
five (5) days prior to any scheduled closing date to extend the closing date for an additional
sixty (60) day period to complete the financing for a total of up to three 60-day extensions.
5. Due Diligence - The Purchase and Sale Agreement will provide for a due diligence
contingency period for Purchaser to review certain materials and conduct a physical
inspection of the Property (the "Contingency Period"). The Contingency Period will be
for 120 calendar days following execution of the Purchase and Sale Agreement, and will
be necessary to complete due diligence with respect to Property information including, but
not limited to, litigation, governmental ordinances, building systems, and review of title,
survey and zoning matters. The Contingency Period shall not be extended except as
provided in Section 4.
6. Closing Date - The closing of the purchase and sale of the Property will be on the date
which is 30 days after the expiration of the Contingency Period (subject to the satisfaction
of the "Conditions to Closing" set forth in Section 6 below) (the "Closing").
7. Conditions to Closing - It will be a condition to Purchaser's obligation to close on the
purchase and sale of the Property that, in Purchaser's sole and absolute discretion, (a) the
"Financing Contingency" set forth in Section 4 above is deemed satisfied, and (b) the
"Entity Establishment and Development Contingency" (described below) is deemed
satisfied. The "Entity Establishment and Development Contingency" means that the
Members have reached agreement on the final terms of the operating agreement for the
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Purchaser entity, including the management, financing and equity investment, and the
development plan for the Property.
8. Closing Costs - Seller will pay (i) all state, county and local documentary excise and
transfer taxes , (ii) the base premium for an ALTA 2006 standard title insurance policy (the
"Title Policy"); (iii) 1/2 of any escrow fee; (iv) Seller's attorneysfees; (v) Seller's
appropriate share of any prorations; (vi) the cost of the Seller Appraisal; and (vii) 1/2 of
the cost of the Joint Appraiser (if applicable). Buyer will pay (A) the additional premium
for an extended coverage title policy, any endorsements to the Title Policy; (B) recording
fees; (C) the cost of obtaining the new survey; (D) 1 /2 of any escrow fee; (E) Buyer's
attorneys' fees; (F) Buyer's appropriate share of any prorations; (G) the cost of the
Purchaser Appraisal; and (H) 1/2 of the cost of the Joint Appraiser (if applicable). Any
other closing costs shall be paid in accordance with local custom.
9. Brokerage - There is no broker involved in the contemplated transaction.
10. Seller Documents - Upon request by the Purchaser and within a reasonable amount of time
after the date hereof, Seller will provide Purchaser with a copy of all documents related to
the Property in its possession or control, including any documents related to litigation,
claims, settlements or judgements involving the Property (if any), building systems, the
environmental condition of the Property and any title, survey and zoning matters.
11. Required Approvals - This offer is subject to approval by the Mayor of the City of
Tukwila; however, any Purchase and Sale Agreement shall be subject to formal approval
by the Tukwila City Council. Purchaser's offer is contingent upon the satisfactory review
and approval of due diligence.
12. Purpose and Intent - This Offer Letter is only a list of proposed points that may or may
not become part of an eventual Purchase and Sale Agreement. Except as provided in
paragraphs 13 and 14, this Offer Letter is not intended as, and does not constitute, a binding
agreement by any party, nor an agreement by any party to enter into a binding agreement,
but is merely intended to specify some of the proposed terms and conditions of the
transaction contemplated herein. Except as provided in paragraphs 13 and 14, neither party
may claim any legal rights against the other by reason of the signing of this Offer Letter or
by taking any action in reliance thereon. Both parties acknowledge that further
negotiations are required in order to finalize a legally binding agreement. However, neither
party is bound to continue such negotiations. Except as provided in paragraphs 13 and 14,
each party hereto fully understands that no party shall have any legal obligations to the
other, or with respect to the proposed transaction, unless and until all of the terms and
conditions of the proposed transaction have been negotiated and agreed to by all parties in
their respective sole discretion and set forth in a definitive agreement which has been
signed and delivered by all parties. Except as provided in paragraphs 13 and 14, the only
legal obligations that any party will have will be those contained in such signed and
delivered definitive purchase and sale agreement.
13. Confidentiality - Except as required by law, the parties will maintain the confidentiality
of the transaction terms, this Offer Letter and transaction documents, except that the
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Purchaser and Seller may disclose such matters as necessary in connection with due
diligence or consummation of this transaction.
14. Exclusive Negotiations - Seller agrees to negotiate exclusively with Purchaser regarding
a sale or other disposition of the Property.
Please call with any questions. We look forward to hearing from you soon.
Sincerely,
Purchaser:
HAVE A NICE DAY JEWELRY AND
PHONE CARD PLUS INC.,
a Washington corporation
By:
Name:
Its:
FOOS H. BARQADLE dba Foos Beauty Salon
Name: flk)(
pp-eso,-0)7.
MUNA GROCERY AND IMPORT LLC,
a Washington limited liability company
BAYVIEW MOTOR CLUB, LLC,
a Washington limited liability company
By:
Name:
Its: otj
[SIGNATURE PAGE CONT.]
57791-001 I Letter of Intent - Purchase of Property from
City(2486179.11)
10,01/19 12:21 PM
TAWAKAL MINI MARKET, CORP.,
a Washington corporation
By:
Name:
Its: CAw
AZ TRADING CO. LTD,
SALAMA FOR HAJJ AND UMRAII INC.,
a Washington corporation
By: /14.- AShooN,
Name: da"
Its:
LAI y\.1:),',1
Agreed to and accepted:
The City of Tukwila,
a Washington municipal corporation
By:
Name: ALLA
Its: _MA` -)DR,
Dated: 10/14-/E0
57791-001 \ Letier of Intent - Purchase of Property from
City(2486179.11)
10/1/14 12:21PM
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