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Costco (Lost Rapids) H-2018-0004 Corporate Guaranty Performance Surety and Warranty Surety DocuSign Envelope ID:6A40C4Dl-3482-4B93-9698-822AIE3FOEC5 l 1 i i i CORPORATE GUARANTY Performance Surety and Warranty Surety Lost Rapids(Costco Site)(H-2018-0004) This Corporate Guaranty (this "Guaranty") is made as of September 16, 2020 by Costco Wholesale Corporation, a Washington corporation ("Developer") for the benefit of City of Meridian, an Idaho municipal corporation("City"). i WHEREAS,Developer and City are parties to that certain Development Agreement(Lost Rapids (Costco Site)(H-2018-0004))dated July 24,2018 and recorded in the real property records of Ada County,Idaho as Instrument No.2018-069276,as amended(the"Development Agreement"); WHEREAS,Site Specific Condition 2.2.22 of the Development Agreement and Meridian City Code§ 8-6- 4.A require Developer to provide a performance surety in favor of City in an amount equal to 125% of the total construction cost for all incomplete sewer, water and reuse infrastructure work required under the Development Agreement prior to the City's final plat signature(the"125%Performance Surety"). WHEREAS,pursuant to other obligations from Developer to City, Developer must provide a performance surety in favor of City in an amount equal to 110%of the total construction cost for all incomplete infrastructure work other than water and sewer prior to issuance of an occupancy permit(the"110%Performance Surety"). WHEREAS,Site Specific Condition 2.2.23 of the Development Agreement and Meridian City Code§ 8-6- 4.13 require Developer to provide warranty surety in favor of City in an amount equal to 20%of the total construction cost for all completed sewer, water and reuse infrastructure work for a period of two (2) years from the date of acceptance by the City of the sewer, water and reuse infrastructure work under the Development Agreement(the "Warranty Surety"). WHEREAS,the Development Agreement and the Meridian City Code§ 8-6-3 requires that the Performance Surety and Warranty Surety method must be approved by the City in advance. WHEREAS, Developer is a publicly traded company with a net worth of over$12 billion, and Developer proposes to pledge the cash funds identified in this Guaranty to City as alternative"cash or cash equivalent"surety; and WHEREAS,City is willing to accept this Guaranty as alternative"cash or cash equivalent"security. NOW, THEREFORE, in order to induce City to accept this Guaranty as alternative security, Developer hereby agrees as follows: 1. Cash Funds. a. Developer hereby establishes an internal cash(or cash equivalent)fund in favor of City in the amount of Eieht Hundred Seventy-Five Thousand Seven Hundred Forty-Seven and 60/100ths Dollars $875,747.60)U.S.Currency(the"Performance Surety Fund"),which includes the combined amounts for the 125% Performance Surety and 110% Performance Surety, available for draft(s) presented to Developer on or before September 30,2021,covering Developer's proper and timely completion of required infrastructure work. b. Developer hereby establishes an internal cash(or cash equivalent)fund in favor of City in the amount of Eitlhty-Six Thousand Six Hundred Twelve and 40/100ths Dollars($86,612.40)U.S.Currency(the "Warranty Surety Fund") available for draft(s) presented to Developer on or before two (2) years after City's acceptance of the sewer, water and reuse infrastructure work under the Development Agreement, covering Developer's proper and timely completion of the Developer's warranty obligations with respect to the sewer,water and reuse infrastructure work required under the Development Agreement. 2. Draws. City may draw on the Performance Surety Fund or the Warranty Surety Fund (as appropriate)by delivery of the original Guaranty and a signed statement from City(on City letterhead)reading exactly as follows to Developer at Costco Wholesale Corporation, Attn: Peter Kahn, AVP, 999 Lake Drive, Issaquah, Washington 98027: "I, the undersigned duly authorized representative of City of Meridian, hereby certify that (a)Developer has failed to[complete the required infrastructure work]or[perform the warranty obligations with respect to the sewer, water and reuse infrastructure work required under the CORPORATE GUARANTY(PERFORMANCE SURETY AND WARRANTY SURETY) PAGE i OF 3 Lost Rapids(Costco Site)(H-2018-0004) DocuSlgn Envelope ID:5A40C4D1-3482-4B93-9698-822A1E3FOEC5 I Development Agreement];(b)City of Meridian is entitled(under the Development Agreement) to receive $ [state the precise amount] from Developer in order to [complete the required infrastructure work] or [perform the warranty obligations with respect to the sewer, water and reuse infrastructure work required under the Development Agreement]; and(c)the draft drawn under this Corporate Guaranty against the[Performance Surety Fund]or[Warranty Surety Fund]represents the amount of money required to[complete the required infrastructure work] or [perform its warranty obligations with respect to the sewer, water and reuse infrastructure work required under the Development Agreement]. City of Meridian requests that draft be deposited into City of Meridian's account by wire transfer in accordance with the following instructions: [state the precise wire instructions for the bank account held by City]." All drafts drawn under and in compliance with the terms of this Guaranty will be duly honored within five(5)business days of presentation and delivery of documents.All drawings will be governed by the Uniform Customs&Practice for Documentary Credits (2007 Revisions) International Chamber of Commerce Publication No. 600.Developer further waives and agrees not to assert or claim at any time any deductions to the amount drawn under this Guaranty for any claim of setoff,counterclaim,counter demand,recoupment or similar right. 3. Remedies. This Guaranty may be enforced from time to time, as often as occasion therefore may arise, and without any requirement that City must first exercise any other rights against Developer and without affecting or impairing in any way the liability of Developer hereunder. Developer waives any defense arising out of the absence,impairment or loss of any right of reimbursement,contribution or subrogation or any other right or remedy of Developer against City,whether resulting from such election by City or otherwise.Developer will pay all reasonable costs,expenses and damages incurred(including,without limitation,reasonable attorneys'fees and disbursements)in connection with the enforcement of the Fund. 4. Benefits of Guaranty.The provisions of this Guaranty are solely for the benefit of City.City may not assign,transfer or otherwise convey any rights under this Guaranty without Developer's prior written consent in each instance,which consent may be refused for any reason. 5. Unused Funds at Completion.If any funds are drawn on this Guaranty,then upon completion of the improvements and/or other work required under the Development Agreement, City will promptly return to Developer any funds that were drawn by City but not used for such completion. 6. Applicable Law. This Guaranty has been delivered to City and accepted by City in the State of Idaho, and will be governed and construed in accordance with the laws of the State of Idaho. If there is a lawsuit, Developer agrees upon City's request to submit to the jurisdiction of the courts of Ada County,State of Idaho. 7. Attorneys'Fees;Expenses.Developer agrees to pay upon demand all of City's costs and expenses, including reasonable attorneys'fees and legal expenses,incurred in connection with the enforcement of this Guaranty. City may pay someone else to help enforce this Guaranty, and Developer will pay the costs and expenses of the enforcement.Costs and expenses include City's reasonable attorneys'fees and legal expenses whether or not there is a lawsuit,including reasonable attorneys'fees and legal expenses for any appeals and any anticipated post judgment collection services.Developer also will pay all court costs and the additional fees as may be directed by the court. 8. General. The rights,powers and remedies of City hereunder are cumulative and in addition to all rights, powers and remedies provided under any and all agreements between Developer and City relating hereto, at law, in equity or otherwise.Neither any delay nor any omission by City to exercise any right,power or remedy will operate as a waiver thereof,nor will a single or partial exercise thereof preclude any other or further exercise thereof or any exercise of any other right,power or remedy.Any provision of this Guaranty that is prohibited or unenforceable in any jurisdiction will, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof or affecting the validity or enforceability of such provision in any other jurisdiction. The headings in this Guaranty are for convenience of reference only and will not affect the interpretation hereof. All capitalized terms not defined herein will have the same meaning as set forth in the Agreement. [end of text;signature page follows] CORPORATE GUARANTY(PERFORMANCE SURETY AND WARRANTY SURETY) PAGE 2 OF 3 Lost Rapids(Costco Site)(H-2018-0004) DocuSign Envelope ID:5A40C4D1-3482-4B93-9698-822A1E3FOEC5 j I i DATED as of the day and year first above written. i "Developer" COSTCO WHOLESALE CORPORATION, a Washington corporation i DocuSigned by: i i By: F!� 66, Name: Title: AVP 911812020 Date: Accepted by City: CITY OF MERIDIAN, an Idaho municipal corporation By: Name: . i 6C Title: C Date: ck I CORPORATE GUARANTY(PERFORMANCE SURETY AND WARRANTY SURETY) PAGE 3 OF 3 Lost Rapids(Costeo Site)(H-2018-0004)