EAST VILLAGETALUS DEVELOPMENT AGREEMENT (FORMERLY KNOWN AS COUGAR MOUNTAIN EAST VILLAGE) Between CITY OF ISSAQUAH, WASHINGTON. and

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1 EAST VILLAGETALUS DEVELOPMENT AGREEMENT (FORMERLY KNOWN AS COUGAR MOUNTAIN EAST VILLAGE) Between CITY OF ISSAQUAH, WASHINGTON and COUGAR MOUNTAIN EAST VILLAGE PARTNERSHIPTALUS MANAGEMENT SERVICES Original date: December 6, 1999 Updated 2009

2 EAST VILLAGETALUS DEVELOPMENT AGREEMENT 1.0 East VillageTALUS Project Description Definition Current Comprehensive Plan and Zoning Designations 1.2 Purpose of Urban Village Zoning District 1.3 Definition of East VillageTALUS Project 2.0 Restrictions on Development Planning Goals Urban Village Design Guidelines East VillageTALUS Project Elements Acreage Chart 5.2 Adjustment of Development Parcels 5.3 Required East VillageTALUS Project Elements 6.0 Open Space, Critical Areas, Noncritical Open Space, and NGPA East VillageTALUS Property North of West Fork Tibbetts Creek Slope 6.2 East VillageTALUS Property South of West Fork Tibbetts Creek Slope 6.3 Conveyance to City of NGPA South of West Fork Tibbetts Creek 7.0 Land Use Development Standards; Incorporation of Appendices Expansion Areas Notice by Master Developer 8.2 Ownership or Control of Property or Agreement 8.3 Environmental Review 8.4 Comprehensive Plan Amendment 8.5 UV Rezone 9.0 Allowable Development Mix of Allowable Development 9.2 Public and Quasi-Public Service Uses Not Counted Toward Maximum 9.3 No Increase in Allowable Development if East VillageTALUS Expands 10.0 Conversion of Commercial to Residential Affordable Housing Surface and Ground Water Critical Area Standards Platting Standards; Extension of Plat Life East VillageTALUS Water Service East VillageTALUS Sewer Service Schools Police Services Fire Protection Services Adequacy of Facilities Additional Voluntary Mitigation Financing Plan Capital Facilities Financing 22.2 Tax Revenues 23.0 Environmental Mitigation and Other Project Requirements...28 Revised 2009 Adopted December Final Document

3 24.0 Flexibility and Modifications of East VillageTALUS Project Elements, Development Standards, and Other Mitigations by the City Flexibility Objectives 24.2 Modifications to East VillageTALUS Project Permitted 25.0 City Processing and Review City Review Procedures and Standards 25.2 SEPA Compliance 26.0 Vesting of Development Standards and Mitigation During Buildout Period 26.2 After Buildout Period 26.3 Application and Processing Fees 26.4 Replacement Regulations 27.0 Other Development Standards Declaration of CC&Rs; Owners Associations, Architectural Review Committee; and Urban Village Commission Master Developer s Declaration of Covenants 28.2 Owners Associations 28.3 Architectural Review Committee 28.4 Urban Village Commission 29.0 Joint Transportation Improvements and Phasing Phasing of Road Improvements in East VillageTALUS Project 29.2 Road Standards for East VillageTALUS Project 29.3 Master Transportation Financing Agreement 29.4 Mitigation of Traffic Impacts 30.0 Public-Private Partnership for Creation of East VillageTALUS Project Partnership s Participation as Master Developer s Participation 30.2 City s Continuing Involvement in East VillageTALUS Development 31.0 General Provisions Governing Law 31.2 Agreement Binding on Successors; Respective Obligations of Master Developer and Parcel Builders; Release of Partnership s Master Developer s Liability upon Transfer to Master Developer Transferee 31.3 Recording 31.4 Interpretation; Severability 31.5 Authority 31.6 Amendment 31.7 Exhibits and Appendices Incorporated 31.8 Headings 31.9 Time of the Essence Entire Agreement Dispute Resolution Default and Remedies Relief Against Defaulting Party or Portion of East VillageTALUS Property Term Revised 2009 Adopted December Final Document

4 31.15 No Third-Party Beneficiary Interpretation Notice Delays Dispute Resolution Process Indemnification 32.0 Definitions Administrative Approval Standard 32.2 Administrative Minor Modifications 32.3 Agreement 32.4 Allowable Development 32.5 Applicant 32.6 Buildout Period 32.7 City 32.8 Commercial 32.9 Comprehensive Monitoring Plan Critical Areas Declaration Designated Official Development Parcels Development Standards District East VillageTALUS Project East VillageTALUS Property Expansion Areas Flexibility Objectives Force Majeure Gross Square Feet Implementing Approvals Implementing Plat Master Developer Master Developer Transferee Master Plat Master Trails Plan Native Growth Protection Areas Noncritical Open Space Open Space Parcel Builder Recreational Areas Recreational Area Requirement Receiving Parcel Retail Residential units Sending Parcel Revised 2009 Adopted December Final Document

5 32.38 Transfer UGA or Urban Growth Area Urban Village Commission Urban Village Design Guidelines Utility Tracts Exhibits: Exhibit 1 Exhibit 2 Exhibit 3 Exhibit 4 Appendices: Appendix A Appendix B Appendix C Appendix D Appendix E Appendix F Appendix G Appendix H Appendix I Appendix J Appendix K Appendix L Appendix M Appendix N Appendix O Appendix P Appendix Q Appendix R Appendix S Appendix T Vicinity Map of East VillageTALUS Project Legal Description of East VillageTALUS Property and East VillageTALUS Expansion Areas Cougar Mountain East VillageTALUS Development Area Exhibit Bianco Mine Tailings Exhibit Planning Goals Urban Village Design Guidelines Permitted Land Uses and Densities Surface Water Management Standards Critical Areas Regulations Public and Private Street Standards SEPA Compliance for Implementing Approvals Master Transportation Financing Agreement Capital Facilities Processing of Implementing Approvals Elections and Modifications Parks, Plazas, and Informal Gathering Area Standards Affordable Housing Water Service Sewer Service Parking Standards Landscape Standards Urban Trails Standards Sign Standards Environmental Mitigation and Other Project Requirements Revised 2009 Adopted December Final Document

6 THIS DEVELOPMENT AGREEMENT (Agreement) is entered into effective as of the 6 th day of December, 1999, by and between the CITY OF ISSAQUAH, a Washington municipal corporation (City), COUGAR MOUNTAIN EAST VILLAGE PARTNERSHIP (now owned by Talus Management Services), a Washington general partnership (the Partnership), and those persons and entities owning portions of the East Village Property (renamed TALUS as hereafter defined) who are signatories at the end of this Agreement (collectively, Owners). RECITALS A. The City is a noncharter Optional Municipal Code city incorporated under the laws of the State of Washington. The City has authority to enact laws and enter into agreements to promote the health, safety and welfare of its citizens and thereby to control the use and development of the East VillageTALUS Property (as hereafter defined) and specify zoning and development standards for areas within the City. The City has the authority to enter into development agreements with those who own or control property within its jurisdiction, pursuant to the Development Agreement Statutes, RCW 36.70B.170 through 36.70B.210. This Agreement is intended to constitute a development governed by the terms and conditions of the Development Agreement Statute. B. The Owners collectively own approximately 627 acres of land ( the East VillageTALUS Property ) located within the City limits, adjacent to State Route 900, as shown on the vicinity map attached hereto as Exhibit 1, and as legally described in Exhibit 2, attached hereto. The East VillageTALUS Property was annexed to the City in As set forth in the Definitions of this Agreement, the East VillageTALUS Property does not at present include any of the East VillageTALUS Expansion Areas, as hereafter defined. Pursuant to written agreements with the Owners, the Partnership Master Developer has the right to purchase the Owners respective interests in the East Village TALUS Property. C. The Partnership Master Developer wishes to purchase the East VillageTALUS Property and to develop the East VillageTALUS Property over time as an urban village type of master planned community, and the City is willing to approve an urban village master plan for the East VillageTALUS Property under the terms and conditions set forth herein. The East VillageTALUS master planned community will be a hillside pedestrian-oriented urban village providing a variety of distinctive housing types, styles, and densities with a cohesive and unified overall community identity. East VillageTALUS will use topographic and environmental constraints of the site to define the limits of its development areas. East VillageTALUS will have an integrated circulation system of streets, sidewalks and trails that link its various development areas and serve vehicles, cyclists, and pedestrians. East VillageTALUS will provide a village center, shops, offices, high-, medium-, and low-density residences, and community facilities. East VillageTALUS will Revised 2009 Adopted December Final Document

7 integrate development areas with natural features and will reserve approximately 73% of the original site as permanent open space. As set forth hereafter, there are significant advantages to a master planned community, which are in the public interest. D. An urban village master plan for the East VillageTALUS Property promotes and implements a number of Washington State and City growth management and planning goals and objectives. Such goals and objectives are in the public interest and include the following: 1. Growth Management Act Goals. An urban village master plan for the East VillageTALUS Property promotes and achieves the following planning goals of Washington s Growth Management Act, RCW 36.70A.020, which goals are themselves consistent with, and have guided the development of, the City s Comprehensive Plan and development regulations: a. Creates urban growth in an appropriate location: It will constitute development in an urban area where adequate public facilities and services can be provided in an efficient manner. b. Reduces sprawl: It will reduce the inappropriate conversion of undeveloped land into sprawling, low-density development. c. Promotes efficient transportation: It will promote efficient multi-modal transportation systems that are based on regional priorities and coordinated with the City s adopted Comprehensive Plan. d. Creates affordable housing: It will develop and make available housing that is affordable to various economic segments of the population of this state and region, and it will promote a variety of residential densities and housing types. e. Creates desirable economic development: It will create economic development that is consistent with the City s adopted Comprehensive Plan and will create economic opportunity for citizens of this region, within the capacities of the area s natural resources, public services, and public facilities. Revised 2009 Adopted December Final Document

8 f. Retains valuable open space: It will retain large amounts of open space for both active and passive uses and will develop recreational opportunities, conserve and protect fish and wildlife habitat, will increase access to natural resources lands, and will develop parks. g. Protects the environment: It will protect the environment, including air and water quality, and enhance the City s high quality of life. h. Promotes citizen participation: It has been formulated collaboratively, with the continuing close involvement and support of local citizens and affected jurisdictions, throughout the East VillageTALUS planning process. i. Ensures concurrent public facilities and services: Its development will be conditioned on adequate public facilities and services necessary to support its development being available when each phase of development is ready for occupancy and use, without decreasing current service levels below the City s established minimum standards. 2. City s Planning Goals and Objectives. In addition to the foregoing, an urban village master plan for the East VillageTALUS Property promotes and achieves the following desirable planning goals and objectives of the City, in furtherance of objectives and policies in the City s adopted Comprehensive Plan: a. Creates reasonably-priced housing: Creates reasonably-priced housing, including housing affordable to families at or below median household income. (Objective H-2, Policy H-2.1) b. Protects environmental quality: Provides an innovative and sensitive development of land that clusters development, promotes and protects environmental quality, open space, and wildlife habitat, preserves sensitive areas and buffers, and preserves extensive areas of contiguous natural open space as a wildlife corridor. (Objective P-1, Policy P-1.3) c. Preserves large contiguous open space area: Preserves a large contiguous native-growth open space area that will encourage native biological diversity, bring visual relief and tranquility to mitigate the impacts of the urban environment, and Revised 2009 Adopted December Final Document

9 retain the area s natural beauty and ecology. (Objectives P-1, P-2, and P-7; Policies P-1.4.1, P-1.5, P-2.1, P-2.2, and P-7.1) d. Encourages innovative housing designs: Establishes a framework that encourages innovative and creative single-family and multifamily housing designs that result in reasonably-priced housing, including criteria for flexibility in site design, bulk, and building standards, linked by pedestrian sidewalks and trails. (Objective H-1, Policies H-1.1, H-1.3, H-1.4, H-1.6, and H-1.9) e. Meets City surface water standards: Employs surface water retention-detention and water quality treatment methods that meet the City s current standards and those of the 1998 King County Surface Water Design Manual, in order to mitigate adverse environmental impacts. (Objective U-4, Policies U4.1, U4.2, U4.4, and U4.6) f. Provides major improvements to public facilities: Includes capital facilities funding for affected public infrastructure and provides for major improvements to public facilities, including major improvements to State Route 900 and the City s water system. (Objectives U2, U3, U5, U6 and EV-3; Policies U2.1 through U2.3, U2.5, U3.1, U5.1, U5.3, U6.1, U6.4, U6.6, T-3.3, EV-3.1.1, 3.1.2, and 3.1.4) g. Employs creative solutions to water and traffic issues: Employs creative solutions to issues of water conservation and other natural resources, and to traffic demand management. (Objective U2, Policies U2.6.3, T-2.2.5, T , T-5.1) h. Provides an appropriate mix of desirable uses: Provides an appropriate mix of desirable residential and commercial uses and creates a community that maintains and enhances Issaquah s quality of life. (Objectives H-1, EV-1, EV-2, and EV-3; Policy H-1.6) i. Preserves a large viewshed: Preserves a viewshed of a large portion of the East VillageTALUS Property site as viewed from the valley floor by establishing vegetative buffers, by preserving the area south of West Fork Tibbetts Creek, as undeveloped property to be conveyed to the City, and by transferring the development density attributable to such area to the northerly portion of the site. (Objectives P-2, P-3, Revised 2009 Adopted December Final Document

10 P-5, P-6, P-7, and P-8; Policies P-2.1, P-2.2, P-3.1, P-5.1, P-6.1, P-6.2, P-6.3, P-6.5, P-7.1, and P-8.1) E. The East VillageTALUS Property is located within an Urban Growth Area, is appropriate for urban development pursuant to the Growth Management Act and the City s adopted Comprehensive Plan, and the City should provide urban services to the East VillageTALUS Property. F. In cooperation with the PartnershipMaster Developer, representatives of interested environmental groups, and other interested citizens, the City has planned for appropriate master-planned urban land uses, required infrastructure, and large expanses of undisturbed open space for the East VillageTALUS Property, consistent with the City s Comprehensive Plan. G. As tthe Master Developer, the Partnership shall, after the date of this Agreement, be eligible to apply to the City and receive implementing permits and approvals for the urban and open space uses set forth herein for the East VillageTALUS Property. H. There are also approximately 13.7 acres of additional land, located adjacent to the East VillageTALUS Property, that the Master Developer may wish to be developed from time to time consistent with the East VillageTALUS Project (defined below) in accordance with this Agreement and the Growth Management Act, RCW ch A. Such additional lands are defined herein as the East VillageTALUS Expansion Areas. The East VillageTALUS Expansion Areas are also legally described in Exhibit 2. The Partnership Master Developer does not presently own or control all the East VillageTALUS Expansion Areas. The City is willing to permit the East VillageTALUS Expansion Areas to be developed consistent with the East VillageTALUS Project. A vicinity map, showing the location and vicinity of both the TALUSEast Village Property and the TALUSEast Village Expansion Areas, is attached hereto as Exhibit 1. I. The parties intend that neither shall unreasonably withhold requests for information, approvals or consents provided for in this Agreement. The parties intend that they shall take further actions and execute further documents, either jointly or within their respective powers and authority, necessary or appropriate to implement the intent of this Agreement. The parties intend to work to achieve the mutually agreeable goals as set forth in this Agreement, subject to the City s independent exercise of judgment. J. This Agreement is based upon the City s police power, contracting power and other authority, including those provisions codified as RCW 36.70B.170 through 36.70B.210, and general law. Contemporaneous with its approval of this Agreement, the City Council is adopting an ordinance applying the UV zoning classification to the TALUSEast Village Property and through this Agreement is Revised 2009 Adopted December Final Document

11 establishing development standards for subsequent permits and approvals consistent therewith. Actual construction of the TALUSEast Village Project will require issuance of subsequent City permits, which will be issued in accordance with the standards and procedures in this Agreement, as well as other agency permits. NOW, THEREFORE, in consideration of the mutual agreements contained herein, as well as other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the City, the Owners, and the Partnership Master Developer hereby agree as follows: AGREEMENTS 1.0 TALUSEast Village Project Description and Definition 1.1 Current Comprehensive Plan and Zoning Designations The City designated the TALUSEast Village Property Low Density Residential / Urban Village in its 1995 Comprehensive Plan, as amended. Under its Land Use Code (constituting the development regulations required to be adopted pursuant to its Comprehensive Plan), the City has classified (zoned) the TALUSEast Village Property in the Conservancy/Residential (C-Res) zone district. The C-Res zoning district (IMC (A)) permits one dwelling unit per five acres. The City s Comprehensive Plan provides for implementation of an Urban Village plan designation through rezoning to the Urban Village (UV) Zone in conjunction with a development agreement, i.e., this Agreement. 1.2 Purpose of Urban Village Zoning District Contemporaneously with and contingent upon its entry into this Agreement, the City is rezoning the East VillageTALUS Property to the Urban Village (UV) Zone. As set forth in the City s Land Use Code, IMC , the purpose of the Urban Village (UV) zoning district is to encourage innovative uses, sites and comprehensive planning of large (15 acres or more) land parcels. Master planning and development of larger parcels provides the opportunity for reasonably priced housing, enhanced public services and concurrency, infrastructure solutions and improvements, and allows creative land development through clustering, permanent preservation of wetlands and other natural areas, integration of recreational facilities and phasing of infrastructure. 1.3 Definition of East VillageTALUS Project The master-planned urban village to be developed on the East VillageTALUS Property in accordance with the terms and conditions of this Agreement is called the East VillageTALUS Project Includes East VillageTALUS Property As used in this Agreement, the term TALUSEast Village Project means the uses, densities, maximum numbers of dwelling units, maximum amount of Revised 2009 Adopted December Final Document

12 commercial and retail square footage, amount of open space and recreational areas, and other uses and appurtenances, set forth in the remainder of this Agreement for the TALUSEast Village Property Includes TALUSEast Village Expansion Areas The term TALUSEast Village Project also means and includes any future development in accordance with this Agreement on any of the East VillageTALUS Expansion Areas. Uses, densities, maximum numbers of dwelling units, maximum amount of commercial and retail square footage, amount of open space and recreational areas, and other uses and appurtenances applicable to any of the East VillageTALUS Expansion Areas, are established in this Agreement consistent with those for the remainder of the East VillageTALUS Project. 2.0 Restrictions on Development The East VillageTALUS Project, conceptually envisioned as shown on Exhibit 3 ( Cougar Mountain East VillageTALUS Development Area Exhibit ), will be developed under the jurisdiction of the City pursuant to the terms and conditions of this Agreement. The Owners jointly and severally agree to subject their respective portions of the East VillageTALUS Property to the terms and conditions of this Agreement. The Owners further jointly and severally agree that so long as an Owner owns a portion of the TALUSEast Village Property, the Partnership Master Developer is authorized to pursue development of thetalus East Village Project on behalf of such Owner, and that the Partnership Master Developer shall be the exclusive agent of such Owner in pursuing development of the TALUSEast Village Project and in making application for any implementing permit or approval for the TALUSEast Village Project. The City and the Partnership Master Developer hereby establish the elements, development standards, mitigation measures, and other conditions of development for the TALUSEast Village Project (collectively, the Development Standards ). Construction of the TALUSEast Village Project elements is subject to, and may be limited by, conditions of adequate water supply in accordance with Appendix N (Water Service) and conditions of adequate transportation facilities in accordance with Appendix H (Master Transportation Financing Agreement). As set forth more fully in such appendices (which shall control in case of conflict with this Section 2), TALUSEast Village Project construction may be limited as follows: If at the time of application for a building permit for a building in the TALUSEast Village Project, the Master Developer is not then in substantial compliance with the terms and conditions of Appendix N (Water Service) and Appendix H (Master Transportation Financing Agreement), and if the occupancy of that building would cause the TALUSEast Village Project to exceed the permissible limits of a development phase under Appendix N (Water Service) or Appendix H (Master Transportation Financing Agreement), then the City will not accept such application. However, in that event the City will nevertheless process and issue decisions on applications for Implementing Approvals for the TALUSEast Village Project (such as preliminary and final plat applications and site development permit applications). Revised 2009 Adopted December Final Document

13 3.0 Planning Goals The Planning Goals set forth in Appendix A are the policy guide and the foundation that have been used to develop the design guidelines for the TALUSEast Village Project that are adopted in Section 4 (Urban Village Design Guidelines) and to develop the TALUSEast Village Development Standards. As set forth in Appendix K (Elections and Modifications), both the Planning Goals and the Urban Village Design Guidelines set forth in Appendix B shall also be used in the evaluation of any future proposed modifications to the TALUSEast Village Project not presently authorized herein. 4.0 Urban Village Design Guidelines The design guidelines set forth in Appendix B (Urban Village Design Guidelines) are hereby adopted and shall govern and control all development in the TALUSEast Village Project, unless and until modified in accordance with Appendix K (Elections and Modifications). 5.0 TALUSEast Village Project Elements The TALUSEast Village Project has been master planned for a mix of public and private uses in an urban village setting that preserves significant amounts of natural open space. The TALUSEast Village master planned community will be a hillside pedestrian-oriented urban village providing a variety of distinctive housing types, styles, and densities with a cohesive and unified overall community identity. TALUSEast Village will use topographic and environmental constraints of the site to define the limits of its development areas. TALUSEast Village will have an integrated circulation system of streets, sidewalks and trails that link its various development areas and serve vehicles, cyclists, and pedestrians. TALUSEast Village will provide a village center, retail businesses, offices, high-, medium- and low-density residences, and community facilities. The TALUSEast Village Project will integrate development areas with natural features and will preserve approximately 73% of the original site as permanent open space. The TALUSEast Village Project will be composed of the major use components generally depicted on the Cougar Mountain East VillageTALUS Development Area Exhibit attached hereto as Exhibit 3, subject to the limitations on maximum allowable development set forth in Section 9 (Allowable Development) below. 5.1 Acreage Chart The TALUSEast Village Project acres reflected in the following chart are estimates based on a geographic information system and are subject to correction following more detailed survey: Revised 2009 Adopted December Final Document

14 Project Area Subtotal Acreage Area Acreage Total Acreage I. VILLAGE SUBAREAS (Development Parcels) A. Devel. Parcel 1 B. Devel. Parcel 2 C. Devel. Parcel 3 D. Devel. Parcel 4 E. Devel. Parcel 5 F. Devel. Parcel 6 G. Devel. Parcel 7 H. Devel. Parcel 8 I. Devel. Parcel 9 J. Devel. Parcel 10 K. Devel. Parcel 11 L. Devel. Parcel 12 M. Devel. Parcel 13 N. Devel. Parcel 14 O. Devel. Parcel 15 P. Devel. Parcel 16 Q. Devel. Parcel II. POTENTIAL TALUSEAST VILLAGE EXPANSION AREAS A. Devel. Parcel 18 B. Devel. Parcel 19 C. Devel. Parcel 20 D. Devel. Parcel III. OPEN SPACE AREAS A. Open Space North of West Fork Tibbetts Creek B. NGPA South of West Fork Tibbetts Creek IV. ARTERIAL ROADWAYS AND UTILITY TRACTS A. Arterial Roadways B. Utility Tracts A - E GRAND TOTAL PROJECT AREA, WITH EXPANSION AREAS GRAND TOTAL PROJECT AREA, W/O EXPANSION AREAS Arterial roadway acreage calculated from right-of-way shown on Exhibit 3. Revised 2009 Adopted December Final Document

15 5.2 Adjustment of Development Parcels Portions of the TALUSEast Village Property north of West Fork Tibbetts Creek, and of the TALUSEast Village Expansion Areas north of West Fork Tibbetts Creek, are presently designated as Critical Areas, or as required buffer therefor. If through further study any portion of such a designated Critical Area or the required buffer therefor is determined not to be a Critical Area or required buffer, then its Critical Area or required buffer designation will be deleted, and it will be redesignated as part of a Development Parcel or as Noncritical Open Space, through an Administrative Minor Modification as set forth in Appendix K (Elections and Modifications). If the Partnership Master Developer desires to include Noncritical Open Space in a Development Parcel (whether in one of the Development Parcels conceptually shown on Exhibit 3, TALUSCougar Mountain East Village Development Area Exhibit, or in a newly-created Development Parcel), then the Partnership Master Developer may elect to redesignate the Noncritical Open Space so included as part of a Development Parcel, as an authorized election as set forth in Appendix K (Elections and Modifications). 5.3 Required TALUSEast Village Project Elements The following elements are required to be incorporated and preserved as part of the development of the TALUSEast Village Project: SR 900 Buffer A vegetative buffer not less than 100 feet wide shall be preserved on the east side of the TALUSEast Village Property adjacent to the existing westerly right-of-way line of State Route 900, from the northerly property line to the TALUSEast Village Project roadway entrance (excepting lands that are not part of the TALUSEast Village Property); and, on the east side of Approved TALUSEast Village Expansion Areas abutting State Route 900, except that drainage retention/detention facilities approved by the City in accordance with Appendix D (Surface Water Management) and trails and entry features approved by the City may be constructed and maintained within such buffer Westerly Buffer A vegetative buffer not less than 50 feet wide shall be preserved on the westerly boundary of the TALUSEast Village Property north of West Fork Tibbetts Creek, except that trails and water utility crossings, approved by the Designated Official, may be constructed and maintained within such buffer Existing Trail Connections North of West Fork Tibbetts Creek, connections to existing trails west of the TALUSEast Village Property shall be established and maintained on the TALUSEast Village Property. Revised 2009 Adopted December Final Document

16 6.0 Open Space, Critical Areas, Noncritical Open Space, and NGPA The TALUSEast Village Project shall contain both active and passive open space, parks, and trails, and shall protect Critical Areas, as follows. Urban development in the TALUSEast Village Project will be limited to the area north of West Fork Tibbetts Creek, and such urban development will include parks and other open space areas as specified below. The area south of West Fork Tibbetts Creek, will be left in its native state except for limited development of trails and accessory uses, as specified below, and except for any TALUSEast Village Project mitigation that is required to be located south of West Fork Tibbetts Creek, by this Agreement, including its appendices. 6.1 TALUSEast Village Property North of West Fork Tibbetts Creek Slope Parties Intent Regarding Provision of Parks and Open Space It is the intent of the parties that there be a public-private partnership between the City and the Partnership Master Developer in the provision of parks and open space facilities benefiting residents and tenants of the TALUSEast Village Project. North of West Fork Tibbetts Creek, such public-private partnership will be implemented as follows, and as set forth in greater detail in the remaining subsections of this Subsection 6.1: The City shall provide larger major public park and recreation facilities within the City but outside the TALUSEast Village Project for the benefit and use of City residents, including residents of the TALUSEast Village Project. To mitigate the impact of the TALUSEast Village Project on City parks facilities, the Master Developer and/or the Parcel Builders will contribute toward these larger major public facilities elsewhere in the City through payment to the City of per-unit park fees in accordance with the terms and conditions of Appendix I (Capital Facilities). Within the TALUSEast Village Project, the Master Developer and/or the Parcel Builders shall develop appropriately-sized tracts on the Development Parcels or Noncritical Open Space as Recreational Areas (e.g., as active or passive parks, plazas, trails, informal gathering areas, and the like), to be owned and maintained either by the TALUSEast Village Homeowners Association or, at the Master Developer s request and at the Designated Official s option, by the City or an organization approved by the Designated Official. The Master Developer or Parcel Builder is eligible to receive full or partial credit for some or all of the Recreational Areas that it develops, also in accordance with the terms and conditions of Appendix I (Capital Facilities) Definition of Open Space Terms As used in this Agreement, the following terms shall have the meanings specified below, and as identically defined in Section 32: Open Space means areas north of the top of the slope defining the north bank of West Fork Tibbetts Creek that are located outside of Development Revised 2009 Adopted December Final Document

17 Parcels or Utility Tracts. The Open Space areas consist of Critical Areas and their buffers and Noncritical Open Space. The Open Space areas are shown in bright green on Exhibit 3 ( Cougar Mountain East VillageTALUS Development Area Exhibit ) Critical Areas and their buffers are defined in Appendix E (Critical Areas Regulations) Noncritical Open Space means the Open Space areas outside of Critical Areas and their buffers. Unless Noncritical Open Space is redesignated as part of a Development Parcel as provided in Subsection 5.2, Noncritical Open Space shall be used and maintained for active and passive recreation for the benefit of owners, residents, and tenants in the TALUSEast Village Project as hereafter provided Recreational Areas means active and passive parks, plazas, trails, informal gathering areas, community gardens, and other like facilities and areas, developed by the Master Developer or Parcel Builders on and in Development Parcels or Noncritical Open Space, including the land segregated for such uses and all equipment, appurtenances, facilities, and other improvements thereon related thereto Provision of Recreational Areas Within TALUSEast Village A minimum of 100 square feet of Recreational Area shall be provided for every dwelling unit developed in the TALUSEast Village Project ( the Recreational Area Requirement ). The Recreational Area Requirement includes not only the requirements to develop active and passive parks, plazas, trails, informal gathering areas, community gardens, and indoor and outdoor recreational areas, in accordance with Appendix L (Parks, Plazas, and Informal Gathering Areas), but also the requirement to develop trails in accordance with Appendix R (Urban Trails Standards). The Recreational Area Requirement shall be fulfilled on Development Parcels or Noncritical Open Space, as set forth below in this Subsection 6.1. Critical Areas and their buffers shall not be used to satisfy the Recreational Area Requirement, except that if a trail is located within a Critical Area buffer and additional buffer has been provided as compensation, then the tread portion of the trail may count toward satisfying the Recreational Area Requirement. Any location of trails within a Critical Area buffer shall be in accordance with the provisions of Appendix E (Critical Areas Regulations). A Development Parcel that will not satisfy the Recreational Area Requirement within its boundaries is called the Sending Parcel herein, and adjacent Noncritical Open Space or a Development Parcel that will be responsible for Revised 2009 Adopted December Final Document

18 fulfilling the Recreational Area Requirement of the Sending Parcel is called the Receiving Parcel herein. The Receiving Parcel, and the Sending Parcel s Recreational Area Requirement assigned thereto, shall be specifically identified as conditions of Implementing Plat approval of the plat or plats containing both the Sending and Receiving Parcels. A Receiving Parcel shall continue to be responsible for providing its own Recreational Area Requirement, in addition to the Recreational Area Requirement transferred from the Sending Parcel For residential Development Parcels that are two acres or more in size, the Recreational Area Requirement shall be provided in the following descending order of preference: (1) within that particular Development Parcel; (2) in adjacent Noncritical Open Space between that Development Parcel and another Development Parcel; and (3) on an adjacent Development Parcel For residential Development Parcels that are less than two acres in size, the Recreational Area Requirement shall be provided on one or more of the following, in no order of preference: (1) within that particular Development Parcel; (2) in adjacent Noncritical Open Space between that Development Parcel and another Development Parcel; and (3) on another Development Parcel Before the City may approve the Master Developer s application for preliminary Master Plat approval, the Designated Official must review and approve both a Master Recreational Area Plan and a Master Trails Plan (both to be prepared and submitted by the Master Developer with text, drawings, or both, and revised as necessary in response to the Designated Official s review). The Master Recreational Area Plan shall be a planning-level document that specifies the various options of equipment and facilities that may be provided to fulfill the Recreational Area Requirement (e.g., tot lots and their typical equipment, basketball courts, etc.), their general geographical locations, the identification of each potential Sending Parcel, and the identification of one or more potential Receiving Parcels for each potential Sending Parcel, both as defined in this Subsection The Master Trails Plan shall comply with the requirements of Appendix R (Urban Trails Standards). Approval of the Master Plat shall include conditions for implementing the Recreational Area Requirement consistent with this Agreement and in accordance with the approved Master Recreational Area Plan and Master Trails Plan. Revised 2009 Adopted December Final Document

19 The Recreational Area Requirement of this section and the standards in Appendix L (Parks, Plazas, and Informal Gathering Area Standards) shall be applied to each Development Parcel of the TALUSEast Village Project as it is considered for preliminary Implementing Plat approval or other site development approval. The Implementing Plat approval or other site development approval shall include conditions for development of the Recreational Area (specified as either public or private) required for the Development Parcel in question, in accordance with this Agreement and consistent with the approved Master Recreational Area Plan and Master Trails Plan. Development of required Recreational Areas shall be completed (or acceptable security posted assuring completion thereof within one year) before issuance of a Certificate of Occupancy for, or final inspection of, the first building on the Development Parcel responsible for the Recreational Area Requirement in question Ownership and Maintenance of Noncritical Open Space; Time of Conveyance All Recreational Areas shall be owned and maintained in good condition by the TALUSEast Village Homeowners Association or the TALUSEast Village Commercial Association, unless the Designated Official specifically agrees that one or more of the foregoing may be dedicated or conveyed to the City or other organization as approved by the Designated Official. Conveyance or dedication of Recreational Areas to the applicable entity, as above, shall occur at the time of final Implementing Plat approval or other final site development approval of the Development Parcel responsible for providing the Recreational Area Requirement in question. Ownership and conveyance or dedication of Critical Areas and their buffers shall be as provided in Appendix E (Critical Areas Regulations) Trail System Linking Development Parcels In addition, the Development Parcels shall be linked by one or more trail systems, as shown on the approved Master Trails Plan prepared in accordance with Appendix R (Urban Trail Standards), as feasible. The preliminary Master Plat approval shall contain specific conditions for phased construction of such trail system as each Development Parcel is developed. The Master Trails Plan in Appendix R (Urban Trails Standards) may be subsequently modified in accordance with the provisions of Appendix K (Elections and Modifications) Credits Against City Park Fees for Recreational Areas Open to the Public Any Recreational Areas developed to fulfill the Recreational Area Requirement applicable to a specific Development Parcel that are designated for use by members of the general public shall receive a credit against the City s parks fee Revised 2009 Adopted December Final Document

20 that would otherwise apply to the Development Parcel in question in accordance with Appendix I (Capital Facilities). The amount of such credit shall be the total of the fair market value of the land used to fulfill the Recreational Area Requirement (excepting any lands north of West Fork Tibbetts Creek, that are shown on Exhibit 3, TALUSCougar Mountain East Village Development Area Exhibit, as Open Space), and the cost of all improvements thereto. Recreational Areas that are designated for use only by some or all of the residents or tenants of the TALUSEast Village Project, and not by members of the general public, shall similarly receive a credit against City parks fees in accordance with Appendix I (Capital Facilities). The amount of such credit shall be one-half of the total of the fair market value of the land used to fulfill the Recreation Area Requirement, and the cost of all improvements thereto, and in accordance with the review process described in Appendix I (Capital Facilities) Permitted Uses in Noncritical Open Space Uses shall be permitted in Noncritical Open Space as provided in Appendix C (Land Use). 6.2 TALUSEast Village Property South of West Fork Tibbetts Creek Slope The portion of the TALUSEast Village Property south of the top of the slope defining the north bank of West Fork Tibbetts Creek shall be designated as a Native Growth Protection Area ( NGPA ) on the TALUSEast Village Master Plat, as generally shown on Exhibit 3 ( TALUSCougar Mountain East Village Development Area Exhibit ). Such Master Plat shall include language restricting such Native Growth Protection Area substantially as set forth below Protection of Critical Areas as NGPAs All Critical Areas and their buffers, as defined in Appendix E (Critical Areas Regulations) hereto, south of the top of the slope defining West Fork Tibbetts Creek, shall be included within Native Growth Protection Areas; provided, however, that notwithstanding the provisions of this Agreement regarding Native Growth Protection Areas. Such Critical Areas shall be eligible for approval of alterations pursuant to the Critical Areas Development Standards for the TALUSEast Village, which are set forth in Appendix E (Critical Areas Regulations) hereto Prohibited Development in Native Growth Protection Areas No development shall occur or be permitted to remain in the Native Growth Protection Area, except trails and uses accessory thereto approved by the City as part of the Master Trails Plan for the TALUSEast Village Project, and accessory utilities. Only minor utility services directly related to and necessary for the TALUSEast Village Development Parcels will be allowed. This provision does not allow for locating or routing within the NGPA major utilities, access roads, Revised 2009 Adopted December Final Document

21 gas pipelines, etc. Reclamation of coal mine hazard areas and abandoned roads and unsafe trails shall not be deemed to constitute development Restrictions on Vegetation Removal in Native Growth Protection Areas NGPA Clearing or Improvement Restricted Native Growth Protection Areas shall be left permanently in a native, undisturbed vegetated state and shall not be cleared or improved, except as necessary (1) to prune or remove dead or diseased trees or other vegetation reasonably adjacent to developed areas of the TALUSEast Village Property, (2) to remove invasive or exotic vegetation, (3) to prune or remove trees or other vegetation presenting a reasonable threat to life or safety or growing over roadways, trails, or other corridors that must be kept clear, (4) to construct, install, plant, or otherwise provide TALUSEast Village Project mitigation that is required to be located south of West Fork Tibbetts Creek, by this Agreement, including its appendices, or (5) clearing activities allowed under Subsection of this Agreement. Such limited vegetation pruning or removal may be undertaken only by the City or the Master Developer, as authorized in Subsection (Master Developer and City Permitted to Remove Limited Vegetation). The Master Developer shall include provisions in the Declaration of Covenants, Conditions, and Restrictions, to be imposed on the TALUSEast Village Property at the outset of development, that prohibit clearing or improvement of Native Growth Protection Areas in accordance with the provisions of this Subsection of this Agreement and Subsection 11.9 of Appendix Q (Landscape Standards), that impose procedures for dealing with violation of such provisions by residents or tenants of the TALUSEast Village Project, and that empower the TALUSEast Village Homeowners Association to enforce such provisions and impose financial and other penalties on residents or tenants of the TALUSEast Village Project for such violations until the NGPA is owned by the City. Such penalties shall include but not be limited to payment of the cost of enforcement, including reasonable attorneys fees Master Developer and City Permitted to Remove Limited Vegetation In the Native Growth Protection Area not yet owned by the City, no pruning or removal of vegetation permitted under Subsection (NGPA Clearing or Improvement Restricted) shall be undertaken except by the City or by the Master Developer of the TALUSEast Village Project after approval by the City. All work shall be conducted in accordance with Subsection 11.9 of Appendix Q (Landscape Standards). 6.3 Conveyance to City of NGPA South of West Fork Tibbetts Creek Timing of Conveyance Revised 2009 Adopted December Final Document

22 The Partnership Master Developer shall either dedicate to the City the Native Growth Protection Area, generally defined by the top of the slope defining the north bank of West Fork Tibbetts Creek, subject to the Native Growth Protection Area restrictions contained herein, on the Master Plat; or, shall convey the Native Growth Protection Area to the City before issuance of the first building permit for the first building in the TALUSEast Village Project Concerns regarding Hazardous Substances A portion of the NGPA south of West Fork Tibbetts Creek and east of SR 900 contains the Bianco Mine Tailings, near the bank of West Fork Tibbetts Creek, which tailings are the unburnt residue of coal mining; and possibly other previous non-approved activities that may have adversely impacted the soil in this location. Such portion consists of approximately 5 acres, more or less, as shown on Exhibit 4 (Bianco Mine Tailings Exhibit). The City is concerned that Hazardous Substances, as that term is defined in the Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. sec et seq.) or the Model Toxic Control Act (Chapter D RCW) may be present in, on, underneath, or migrating from the Bianco Mine Tailings Site. The City is further concerned that Hazardous Substances may be present in, on, underneath, or migrating from, portions of the NGPA south of West Fork Tibbetts Creek, other than the Bianco Mine Tailings Site City s Option to Decline Conveyance of NGPA Portions with Hazardous Substances If at the time of conveyance or dedication of the NGPA, south of West Fork Tibbetts Creek, established by this Subsection 6.3, the City has substantial evidence (see sampling and testing Implementation, Appendix T Environmental Mitigation and Project Requirements, Section 3.0) that any Hazardous Substances are then present on either the Bianco Mine Tailings Site, or on any other portion of the NGPA, south of West Fork Tibbetts Creek; and, if the City concludes that any such Hazardous Substances pose a substantial risk of liability to the City if the City were to become the owner thereof, then in those events the City may, at its sole option, decline to accept the dedication or conveyance of such portions of the NGPA to, in the City's opinion, eliminate the risk of liability from Hazardous Substances. Such option declining an affected NGPA portion shall be exercised by the Designated Official in writing, delivered to the then owners thereof and to the Master Developer no later than forty-five (45) days following the results of the soil exploration identified by this Agreement. In the event the Option is exercised, the City shall cooperate with the Owner or Owners of the affected NGPA portion in obtaining any required lot line adjustment or other approvals necessary to segregate the affected NGPA portion as a separate lot. Further, in the event the Option is exercised, the City shall cooperate with the Owner or Owners of the affected NGPA portion to explore the conveyance of such affected NGPA portion Revised 2009 Adopted December Final Document

23 to other transferees who shall hold the parcel as open space in perpetuity; or, for other uses consistent with conveyance or dedication of the remainder of the NGPA to the City NGPA Grantors to Furnish Assurances Regarding Hazardous Substances at Time of Conveyance As part of the instrument or document dedicating or conveying all of any portion of the NGPA south of West Fork Tibbetts Creek, the Owner or Owners as grantor thereof (or, if the Partnership Master Developer is then the owner of the NGPA portion then being conveyed or dedicated, then the Partnership Master Developer as grantor thereof) shall include express representations acceptable to the City of such grantor s actual knowledge of the generation, storage, release, or disposal of any Hazardous Substance in, on, underneath or migrating from such portion, by the then owner and any previous owner thereof. Such grantor shall further expressly include provisions acceptable to the City wherein the grantor shall indemnify and defend the City and hold the City harmless from claims, demands, and damages pertaining to or arising out of or in connection with the release or threatened release of any Hazardous Substances in, on, underneath, or migrating from the portion of such NGPA portion then being conveyed or dedicated Reduction of Open Space Credit if City Declines NGPA Conveyance If the City declines to accept dedication or conveyance of one or more portions of the NGPA south of West Fork Tibbetts Creek because of the presence of any Hazardous Substances, as set forth above, then in that event the value of the NGPA credited against the TALUSEast Village Property s contribution to parks as set forth in Appendix I- Capital Facilities (i.e. $5, per acre) shall be reduced pro rata, using that per acre value multiplied by the number of acres the City declines to accept because of Hazardous Substances, and in that event the net Parks Obligation Fee of the TALUSEast Village Property as set forth in Appendix I-Capital Facilities shall be likewise increased by the amount of such reduction. 7.0 Land Use Development Standards; Incorporation of Appendices The land uses and density standards permitted for development on the East VillageTALUS Property shall be those set forth in Appendix C (Land Use). Development Standards for other elements of the East VillageTALUS Project and Approved East VillageTALUS Expansion Areas are set forth in the various Appendices A through S, inclusive, as listed at the end of the Table of Contents hereto. 8.0 Expansion Areas Upon meeting certain conditions, described hereafter, any or all of the East VillageTALUS Expansion Areas may be developed from time to time during the Buildout Period with land uses and densities consistent with the East VillageTALUS Project, as shown on Exhibit 3 ( Cougar Mountain East VillageTALUS Development Area Exhibit ). Any East VillageTALUS Expansion Area that meets those conditions is termed an Approved East VillageTALUS Expansion Area herein. An East Village TALUS Expansion Area shall be deemed an Approved Revised 2009 Adopted December Final Document

24 East VillageTALUS Expansion Area after it meets all of the following conditions of this Section 8.0 and complies with all of such conditions of this Agreement. The City shall confirm whether an East VillageTALUS Expansion Area complies with these criteria in accordance with the procedures identified in Appendix K (Elections and Modifications). 8.1 Notice by Master Developer Written notice by the Master Developer to the City of its intention to develop the East VillageTALUS Expansion Area(s) in question in a manner consistent with this Agreement, including its appendices. 8.2 Ownership or Control of Property or Agreement Ownership or control of the East VillageTALUS Expansion Area(s) in question by the Master Developer or the agreement (in a form acceptable to the City) by the Master Developer and the owner(s) of the East VillageTALUS Expansion Area(s) in question, to subject such area to the terms of this Agreement. 8.3 Environmental Review Completion of any additional environmental analysis beyond that covered in the 1998/1999 EIS for the development proposed for the East VillageTALUS Project, as required by the State Environmental Policy Act (SEPA), its implementing regulations, or other applicable laws and ordinances. 8.4 Comprehensive Plan Amendment Amendment of the City s Comprehensive Plan, as necessary, to designate the East VillageTALUS Expansion Area(s) in question along with the East VillageTALUS Property as Low Density Residential / Urban Village, or any successor comprehensive plan designation that recognizes and plans for development consistent with this Agreement. 8.5 UV Rezone Reclassification (rezoning) of the expansion area(s) in question to the City s UV zoning district, or any successor zoning designation that permits development consistent with this Agreement. Revised 2009 Adopted December Final Document

25 9.0 Allowable Development 9.1 Mix of Allowable Development The allowable development of the East VillageTALUS Project (including development of any Approved East VillageTALUS Expansion Areas) shall not exceed the following maximum uses (Allowable Development): 1,735 residential units; 800,000 Gross Square Feet of commercial office uses; and 50,000 Gross Square Feet of retail uses as well as up to 100 Accessory Dwelling Units (ADUs), as permitted in Appendix C (Land Use). Gross Square Footage shall be calculated in accordance with Appendix C (Land Use). This mix of Allowable Development may be modified through conversion under Section 10 ( Conversion of Commercial to Residential ). Except for limitations on the development of Critical Areas imposed in Appendix E (Critical Areas Regulations), 100 % of each Development Parcel and Noncritical Open Space may be cleared and graded. 9.2 Public Service and Quasi-Public Uses Not Counted Toward Maximum The gross square footage of any Public and Quasi-Public Services uses developed in the East VillageTALUS Project shall not be counted against the Allowable Development, so long as they do not create an unanticipated impact on peak-hour traffic or peak water consumption. Public Services and Quasi-Public uses are defined and further regulated in Appendix C (Land Uses). 9.3 No Increase in Allowable Development if East VillageTALUS Expands Addition of an Approved East VillageTALUS Expansion Area to the East VillageTALUS Project shall not result in any increase in the allowable development of the East VillageTALUS Project. While the maximum number of residential units and maximum Gross Square Feet of commercial and retail uses established in Subsection 9.1 ( Mix of Allowable Development ) shall remain unchanged by such additional area, the Master Developer shall be permitted to allocate the Allowable Development throughout the entire East VillageTALUS Project, and as enlarged by any Approved East VillageTALUS Expansion Area, provided that all residential, commercial, and retail uses must be located in accordance with Exhibit C-1 (Land Use Categories), or as modified in accordance with Appendix K (Elections and Modifications) Conversion of Commercial to Residential The Partnership Master Developer may elect to increase the maximum number of residential units authorized on the East VillageTALUS Property by up to 250 units, through a reduction in the total gross square feet authorized for commercial uses, at an exchange ratio of one (1) residential unit for each 1,200 Gross Square Feet of authorized commercial office use. If the maximum conversion is elected by the PartnershipMaster Developer, the overall maximum Allowable Development shall not exceed the following maximum uses: 1,985 residential units; 500,000 Gross Square Feet of commercial office uses; and 50,000 Gross Square Feet of retail uses. The conversion shall be part of the Partnership s Master Developer s elections under Appendix K (Elections and Modifications) and shall be permitted at the Partnership s Master Developer s sole election, so long as the densities and other provisions are consistent with the Revised 2009 Adopted December Final Document

26 permitted land uses and densities in Appendix C (Land Use). Prior to conversion, the Master Developer shall demonstrate that the conversion of uses allowed in this Section of this Agreement does not result in additional traffic impacts. This finding shall be made in accordance with IMC (Concurrency Review) and will be documented and attached to the Transportation Concurrency Certificate for the East VillageTALUS Project. Should additional impacts result, additional Concurrency review shall be required and the conversion allowed only if adequate mitigating measures are implemented to achieve concurrency Affordable Housing Affordable housing requirements applicable to the East VillageTALUS Project are set forth in Appendix M (Affordable Housing) Surface and Ground Water The stormwater and ground water standards applicable to the East VillageTALUS Project are set forth in Appendix D (Surface Water Management Standards) Critical Area Standards The Critical Area regulations, boundaries, and uses allowed in Critical Areas within the East VillageTALUS Project are set forth in Appendix E (Critical Areas Regulations) Platting Standards 14.1 Extension of Plat Life Except as modified by this Agreement (including but not limited to Appendix J, Processing), the Applicant shall submit plat applications using MDRT application forms and procedures designed to implement this Agreement, unless otherwise agreed by the City and the Master Developer. Upon the Master Developer s request, the period of validity of preliminary plats within the East VillageTALUS Project may be extended up to the end of the Buildout Period, and the City may authorize extended plat life by ordinance to the extent necessary to implement this Agreement Plat Connections Concurrent with Preliminary Plat (or Site Development Permit) applications, the City shall evaluate whether a street connection shall occur to adjacent, non-east VillageTALUS property. The decision to connect shall be based on consideration of: topography; anticipated compatibility of use of the adjoining parcel; other alternatives for access; public safety; and, whether the connection would result in adverse impacts to either of the property owners. Should a connection be conditioned with the plat (or Site Development Permit) approval, the adjoining property shall pay all Latecomer s fees, for which the Master Developer is eligible East VillageTALUS Water Service The City shall provide water to the East VillageTALUS Project sufficient for the Allowable Development. Water service shall be provided to the East VillageTALUS Project in accordance with Appendix N (Water Service). If the City has undertaken good-faith efforts to increase water Revised 2009 Adopted December Final Document

27 supply and/or adopt conservation measures in order to provide adequate water service for the Allowable Development, then the City s obligation to provide water, in accordance with Appendix N (Water Service), is subject to Force Majeure events. The Partnership Master Developer shall provide water facilities at its cost and incorporate water conservation measures for the East VillageTALUS Project as set forth in the East VillageTALUS Water Conservation Standards East VillageTALUS Sewer Service The City shall provide sanitary sewer service to the East VillageTALUS Project sufficient for the Allowable Development. Sanitary sewer service shall be provided to the East VillageTALUS Project in accordance with Appendix O (Sewer Service). The Partnership Master Developer shall provide at its cost sanitary sewer facilities to serve the East VillageTALUS Project consistent with Appendix O (Sewer Service) Schools The Master Developer shall provide mitigation of the impacts of the East VillageTALUS Project on public schools in accordance with an agreement between the Master Developer and the Issaquah School District. The Master Developer s compliance with that school agreement shall be deemed to constitute full concurrency and compliance with any school concurrency/adequacy/impact fee ordinance adopted by the City. Should the Master Developer and School District fail to execute a separate agreement for the payment of school fees, fees shall be collected by the City consistent with other locations in the City Police Services The Master Developer s obligations for facilities necessary to support police services are set forth in Appendix I (Capital Facilities) Fire Protection Services The Master Developer s obligations for facilities necessary to support fire protection services are set forth in Appendix I (Capital Facilities) Adequacy of Facilities The Master Developer s compliance with the Development Standards and performance of its obligations contained in this Agreement, including but not limited to the transportation and capital facilities described in Appendices H (Master Transportation Financing Agreement) and I (Capital Facilities), respectively, shall constitute the financing and provision of adequate and sufficient public facilities and services for the East VillageTALUS Project, and such performance satisfies all applicable concurrency and level of service requirements of the City with respect to all components of the Allowable Development Additional Voluntary Mitigation This Agreement, including the obligations to pay fees and perform mitigation, is undertaken voluntarily by the PartnershipMaster Developer. The Partnership Master Developer acknowledges that its obligations in this Agreement, including all appendices, for mitigations and Revised 2009 Adopted December Final Document

28 fees are reasonably related to and are a direct result of the impacts from the East VillageTALUS Project. The parties have spent considerable time and effort to calculate the impacts. The Partnership Master Developer is satisfied that the methodologies used and the results obtained are correct. To the extent that the mitigations and fees set forth in this Agreement are deemed to be in excess of what could be required of the PartnershipMaster Developer, the Partnership Master Developer acknowledges and agrees that, pursuant to WAC (1)(d), it is agreeing to additional voluntary mitigation. The Partnership Master Developer agrees that the City is justified in relying upon the promise to perform mitigations and pay the fees agreed to in this Agreement. The Partnership Master Developer waives and disclaims for itself and its successors and assigns any right or claim for refund or other modification of the fees and mitigation set forth herein, whether based upon constitutional or statutory claims Financing Plan 22.1 Capital Facilities Financing The City and the Partnership Master Developer set forth in Appendix I (Capital Facilities) capital facilities financing requirements for parks, police, fire protection, schools, and general government purposes, including operational equipment Tax Revenues As part of the financing plans approved under this Agreement, the Partnership Master Developer may fund any gap in public capital facilities or maintenance and operation of public facilities or services prior to the City s receipt of tax revenues from the East VillageTALUS Project. Further, upon mutual agreement between the Master Developer and the City, the Master Developer may advance funds to provide City facilities or services to handle any delay between the requirement for needed services or facilities and the delayed receipt of tax revenues. The parties shall cooperate in financing such shortfall or advance payment through issuance of bonds, collection of latecomer fees or other arrangements Environmental Mitigation and Project Requirements The Partnership Master Developer agrees to implement the environmental mitigating measures for the TALUSEast Village Project set forth in Appendix T (Environmental Mitigation and Other Obligations), which have been identified to mitigate the impacts of the TALUSEast Village Project in the 1999 final environmental impact statement (EIS) for the TALUSEast Village Project, and to implement the obligations of the Master Developer created in this Agreement Flexibility and Modifications of TALUSEast Village Project Elements, Development Standards, and Other Mitigations by the City Flexibility Objectives The TALUSEast Village Project described in this Agreement, including the exhibits, provides the desired initial definition and certainty of the TALUSEast Village Project concept. However, the parties acknowledge modifications to the TALUSEast Village Revised 2009 Adopted December Final Document

29 Project will occur during the Buildout Period of the TALUSEast Village Property to achieve a number of Flexibility Objectives, including: incorporating new information; responding to changing community and market needs; encouraging reasonably priced housing; and encouraging modifications that provide comparable benefit or functional equivalence with no significant reduction of public benefits, environmental protection, or increased material cost to the TALUSEast Village Project (collectively Flexibility Objectives ) Modifications to TALUSEast Village Project Permitted The criteria and conditions for review and approval of modifications to this Agreement, its exhibits and appendices, and to the TALUSEast Village Project, are described and defined in Appendix K (Elections and Modifications). The TALUSEast Village Project, including the Development Standards for the TALUSEast Village Project, may be modified pursuant to the process and standards established in Appendices J and K (Processing and Elections and Modifications, respectively). Nothing in this Agreement authorizes any modification of state-imposed mandatory concurrency requirements under the Growth Management Act, as amended City Processing and Review 25.1 City Review Procedures and Standards The City s application and review processes for the TALUSEast Village Implementing Approvals are set forth in Appendix J (Processing) SEPA Compliance Prior SEPA Documents The parties acknowledge the urban development within the TALUSEast Village Project area has been addressed and analyzed in prior environmental documents, including but not limited to environmental impact documents prepared for King County s 1994 Comprehensive Plan, the City s Comprehensive Plan, and the EIS accompanying King County s Newcastle Community Plan TALUSEast Village Project EIS The parties intend that the 1998 and 1999 EIS analyzing the impacts of the TALUSEast Village Project shall constitute compliance to the fullest extent possible under SEPA for all Implementing Approvals and requested modifications under Section 24 (Flexibility and Modifications of TALUSEast Village Project Elements, etc.) and Appendix K (Elections and Modifications) during the Buildout Period Further SEPA Review Limited Since this Agreement sets forth the mitigations and other TALUSEast Village Project Regulations to be applied during the Buildout Period, the City may, Revised 2009 Adopted December Final Document

30 pursuant to the procedures and standards set forth in SEPA, RCW ch C., the SEPA Rules, WAC ch , and Appendix G (SEPA Compliance), require a supplemental EIS, EIS addendum, DNS or MDNS requiring mitigation measures beyond those in this Agreement, only to the extent: An Implementing Approval or requested modification exceeds the Project Envelope (as defined in Appendix G, SEPA) and governing Development Standards, or the City concludes, pursuant to the SEPA Rules, WAC (3)(b), that substantial changes have been made to the TALUSEast Village Project so that it is likely to have significant adverse impacts not previously analyzed in a SEPA environmental document; or the City concludes, pursuant to the SEPA Rules, WAC (3)(b), that there is new information indicating probable significant adverse environmental impacts of the TALUSEast Village Project not previously analyzed in a SEPA environmental document Vesting of Development Standards and Mitigation All development within the TALUSEast Village Project shall be governed by the Development Standards in this Agreement and the applicable provisions of the Issaquah Municipal Code in effect as of the date of this Agreement. All development within the TALUSEast Village Project shall be implemented through plats, short plats, site development permits, building permits and other permits and approvals ( Implementing Approvals ) issued by the City. A Buildout Period of fifteen (15) years following first final Master Plat approval is established for the development and construction of uses for the TALUSEast Village Project, as authorized in RCW 36.70B.170(3)(i). In accordance with RCW 36.70B.180, during the Buildout Period the City shall not modify or impose new or additional Development Standards except as set forth in this Agreement, provided, however, that the TALUSEast Village Project elements and other Development Standards may be modified during the Buildout Period in accordance with the procedures established in Appendix J (Processing), Appendix K (Elections and Modifications), and Section 27 of this Agreement (Other Development Standards). To the extent this Agreement does not establish Development Standards, process, procedures, or similar elements covering a certain subject, element or condition, then the TALUSEast Village Project shall be governed by the City codes and City Council-adopted standards in effect upon the date of this Agreement, except as follows: 26.1 During Buildout Period During the Buildout Period, the Development Standards may be modified as follows: Revised 2009 Adopted December Final Document

31 Serious Threat The City Council may modify one or more Development Standards during the Buildout Period to the extent required to avoid a serious threat to the public health or safety Updated Uniform Codes Apply Notwithstanding the foregoing, the Uniform Building Code, Uniform Fire Code, and other construction codes in effect in the State of Washington on the date of filing a complete building permit application or other construction application for a building in the TALUSEast Village Project, shall apply, except that no changes to such codes taking effect after the date of this Agreement shall require redesign or modification of then-existing TALUSEast Village Project utilities, facilities or other infrastructure that were installed in accordance with this Agreement unless redesign or modification are required to avoid a serious threat to the public health or safety Surface Water Standards The surface water standards stated in Appendix D (Surface Water Management) may be reviewed and revised at the end of the fifth year following the recording of the first final plat and each five years thereafter, until completion of buildout, to the extent that the revised standards meet all of the following criteria: are generally applied and proven effective in either the City, unincorporated King County, or another city or special-purpose district within King County; are required to solve an unanticipated water quality or quantity problem; are not the result of inadequate regional or area-wide facilities; do not preclude the implementation of the overall East VillageTALUS Project or its divisions consistent with this Agreement, do not preclude the Partnership s Master Developer s ability to obtain commercially reasonable financing, and do not render the remaining East VillageTALUS Project or divisions financially infeasible by imposing costs which are unreasonable in light of the remaining authorized development; and provide equivalent or better protection for aquatic resources. Revised 2009 Adopted December Final Document

32 Disputes Regarding Emergencies and Revised Water Standards The parties shall use their best efforts through informal dispute resolution to resolve a disagreement over the existence of the applicable criteria justifying modification of the Development Standards pursuant to this Section 26.1 and its subsections. If the parties fail to reach agreement within 30 days after the first such dispute resolution meeting, then either party deeming itself aggrieved may thereafter pursue any judicial remedy available at law or in equity. Notwithstanding any disagreement by the Master Developer over a proposed modification of the Development Standards pursuant to this Section 26.1, if in the City s reasonable judgment there exists a serious imminent threat to public health or safety that warrants immediate application of a modified Development Standard and the undertaking of immediate corrective action pursuant to that modified Development Standard, then such immediate corrective action shall be taken as directed by the City Resolution of Conflicts Between City Standards and East VillageTALUS Goals, Guidelines, and Standards If a City standard adopted by ordinance is applied to the East VillageTALUS Project because this Agreement has not established an applicable Development Standard, and if such City standard conflicts with an adopted East VillageTALUS Planning Goal or Urban Design Guideline, or other TALUSEast Village Project Development Standards, then the City shall propose a Development Standard in lieu of the City standard that responds to and integrates or consolidates the City standard with the conflicting TALUSEast Village Planning Goal, Urban Design Guideline, or other TALUSEast Village Project Development Standard, unless modification of the City standard would compromise public health or safety. In that event, the Master Developer or relevant Applicant and the Designated Official shall work together and seek to resolve through consensus any difference of opinion they may have regarding the Designated Official s proposal After Buildout Period The Development Standards shall continue to apply to all applications for Implementing Approvals submitted after expiration of the Buildout Period, except either party may terminate this Agreement, and the zoning and development regulations may be modified, as provided in Section (Term) Application and Processing Fees The application and processing fees for all Implementing Approvals shall be established under Appendix J (Processing) Replacement Regulations During and after the Buildout Period, the Master Developer, as an alternative to using one or more of the Development Standards for particular subject matters specified in this Revised 2009 Adopted December Final Document

33 Agreement, may request City approval to use new code provisions or generally-applicable standards for that subject adopted after the execution of this Agreement, pursuant to the procedures set forth in Appendix K (Elections and Modifications). After the Buildout Period, new standards also may be adopted as provided in Section (Term) Other Development Standards The City and Partnership Master Developer acknowledge that there may be a need to review and modify, where appropriate, City codes and regulations governing new categories of Development Standards not otherwise adopted by other portions of this Agreement. For any new categories of Development Standards that are not adopted in this Agreement, new Development Standards shall be proposed by the Master Developer, tailored as appropriate to the East VillageTALUS Project, and processed pursuant to Appendix J (Processing). The Partnership Master Developer shall also comply with any applicable Development Standards imposed by state or federal law and their implementing regulations Declaration of CC&Rs; Owners Associations, Architectural Review Committee; and Urban Village Commission 28.1 Master Developer s Declaration of Covenants At the time of recording of the first final Master Plat of the East VillageTALUS Property, the Master Developer shall file a Declaration of Covenants, Conditions, and Restrictions ( Declaration ) for recording against the TALUSEast Village Property in the King County Division of Records and Elections. The Declaration shall be consistent with the terms and conditions of this Agreement, shall govern and control development of the TALUSEast Village Project, and shall by its terms be subject to amendment during the Buildout Period only by the declarant thereunder (i.e., the Master Developer) or a Master Developer Transferee. Before filing the Declaration for recording, the Master Developer shall submit it to the Designated Official for review and approval, which shall not be unreasonably withheld Owners Associations The Master Developer shall establish two principal associations for the TALUSEast Village Project as nonprofit corporations: an TALUSEast Village Homeowners Association, and an TALUSEast Village Commercial Owners Association. Every owner of a dwelling unit in the TALUSEast Village Project shall be a member of the TALUSEast Village Homeowners Association, and every owner of commercial or retail property in the TALUSEast Village Project shall be a member of the TALUSEast Village Commercial Owners Association. The Declaration filed by the Master Developer at the time of first final Master Plat approval shall include appropriate provisions for these associations, including but not limited to provisions for their funding of the Architectural Review Committee after the initial development period established by the Declaration. In order that the Designated Official may communicate efficiently with each association, each association shall, from time to time, designate a single contact person who is a member of its association. Each association shall promptly notify the Designated Official Revised 2009 Adopted December Final Document

34 of the name, address, and telephone number of its contact person after he or she is designated Architectural Review Committee The Master Developer s Declaration must establish an Architectural Review Committee (ARC) before the City shall approve the Final Master Plat for the Project. Provisions regarding the composition and procedures of the ARC are outlined in Appendix J (Processing), and such provisions must be substantially included in the Declaration. The ARC will be responsible, among other things, for reviewing those applications for Implementing Approvals specified in Appendix J (Processing) as subject to ARC review, before any such application is submitted for City review and processing. The City may refuse to process any such application that has not received prior written approval by the ARC. The ARC must adopt written architectural standards, guidelines, and regulations before the first application for a building permit or site development permit in the TALUSEast Village Project is filed with the City. Such standards, guidelines, and regulations must be consistent with this Agreement. The ARC shall transmit its proposed architectural standards, guidelines, and regulations to the City Designated Official for review and comment at least 90 days before ARC adoption. The Designated Official shall transmit his/her comments to the ARC within 60 days after receiving the ARC s proposal. The Master Developer shall deliver three sets of the adopted ARC standards, guidelines, and regulations to the Designated Official immediately after their adoption. Such sets shall be used for reference and informational purposes only and shall not be subject to any further City review or approval Urban Village Commission The City s Development Commission shall not review any matters related to the TALUSEast Village Project. In lieu of the City s Development Commission, the City will consider establishing an Urban Village Commission to review new categories of Development Standards and Urban Village Design Guidelines and to review certain applications for Implementing Approvals for the TALUSEast Village Project, as provided in this Agreement and for other properties in the City approved for development under the City s Urban Village (UV) zone district. Additional Development Standards and Urban Village Design Guidelines needed for the TALUSEast Village Project shall be adopted as provided in Appendix J (Processing) Joint Transportation Improvements and Phasing 29.1 Phasing of Road Improvements in TALUSEast Village Project The phasing of road improvements for the TALUSEast Village Project is set forth in the Master Transportation Financing Agreement (Appendix H) Road Standards for TALUSEast Village Project The road standards applicable to the TALUSEast Village Project are set forth in Appendix F (Street Standards). Any modification of such standards for roads within the Revised 2009 Adopted December Final Document

35 TALUSEast Village Project shall be determined by the City pursuant to the procedures in Appendix K (Elections and Modifications) Master Transportation Financing Agreement The parties hereby adopt and approve the Master Transportation Financing Agreement (MTFA), which is set forth as Appendix H. The MTFA includes a description of major transportation improvements and contains provisions consistent with this Agreement for offsets and credits in favor of the Partnership Master Developer for road improvements undertaken by the Partnership Master Developer that exceed the impacts of the East VillageTALUS Project Mitigation of Traffic Impacts The East VillageTALUS Project DEIS issued by the City in 1998 and the FEIS and SEIS in 1999 have studied in reasonable detail the projected adverse impacts of the TALUSEast Village Project on affected transportation facilities throughout the region, and the MTFA, Appendix H, agreed to by the parties, represents reasonable mitigation of such adverse impacts. The MTFA outlines commitments made by the City and the Partnership Master Developer to resolve transportation problems caused by development of the East VillageTALUS Project Public-Private Partnership for Creation of East VillageTALUS Project The parties recognize that an urban village community like the East VillageTALUS Project cannot be created as a successful and livable mixed-use project without long-term cooperation between the developer of the East VillageTALUS Project and the City Partnership s Participation as Master Developer s Participation The Partnership Parties recognizes and agrees that the East VillageTALUS Project must have the continuing active participation of an overall Master Developer in order to ensure that the various Development Parcels of the East VillageTALUS Project are ultimately developed into a harmonious community, rather than as a series of disconnected development enclaves. Accordingly, this Agreement, in Subsection 31.2, contains provisions for the continuing presence and participation of a Master Developer for the TALUSEast Village Project throughout the Buildout Period, even though the parties recognize that individual Development Parcels are likely to be sold to and developed by a number of Parcel Builders different from the Master Developer. The Partnership will be the initial Master Developer, unless and until its duties as Master Developer are transferred to a Master Developer Transferee as provided herein. By way of example only, the duties of the Master Developer include: (unless and until its duties as Master Developer are transferred to a Master Developer Transferee as provided herein): Assignment of Uses The assignment of land uses to various Development Parcels (subject to the City s approval); Revised 2009 Adopted December Final Document

36 Distribution of Density and GSF The distribution of residential density and commercial and retail Gross Square Footage among Development Parcels; Determination of Suitable Neighboring Uses The determination of the suitability of proposed adjacent land uses (subject to the City s approval); Impervious Surface Limitations The establishment of impervious surface limitations for Development Parcels (subject to the terms and conditions of Appendix D, Surface Water Management) and applicable City regulations; and, Implementing Goals and Design Guidelines Taking action and providing guidance to Parcel Builders that is consistent with and that implements the spirit of Appendix A (Planning Goals) and Appendix B (Urban Village Design Guidelines); provided, however, that the duties and obligations of the Parcel Builders established in this Agreement shall not be deemed assumed by or delegated to the Master Developer by the foregoing provision City s Continuing Involvement in East VillageTALUS Development The City recognizes that it has an important continuing role to play in the ongoing development of the East VillageTALUS Project, and not merely in the initial establishment of Development Standards through this Agreement. As set forth more fully in Appendix J (Processing), the City s Designated Official will be involved in the review of Implementing Approvals for the East VillageTALUS Project, and the Urban Village Commission will review new categories of Urban Village Design Guidelines or Development Standards and certain applications for Implementing Approvals for the TALUSEast Village Project. The Designated Official shall work closely with both the Master Developer and the Parcel Builders in order that the TALUSEast Village Project be a well-designed and well-planned urban village with recreational, pedestrian, and social amenities that make it an attractive asset to the Issaquah community General Provisions 31.1 Governing Law This Agreement shall be governed by and interpreted in accordance with the laws of the State of Washington Agreement Binding on Successors; Respective Obligations of Master Developer and Parcel Builders; Release of Partnership s Master Developer s Liability upon Transfer to Master Developer Transferee Revised 2009 Adopted December Final Document

37 Binding Nature of Agreement; Master Developer s Non-Delegable Obligations This Agreement shall be binding upon and shall inure to the benefit of the heirs, successors and assigns of the Owners and the PartnershipMaster Developer, and upon the City, except as limited and conditioned in this Subsection The Partnership s Master Developer general duties and obligations under this Agreement as Master Developer of the East VillageTALUS Project are not intended to be delegated to Parcel Builders unless a particular duty or obligation, specifically and directly related to the Parcel in question, is expressly imposed by the City as a term or condition of an Implementing Approval for that Parcel It is the intent of this Agreement that this Agreement and the Development Standards and Design Guidelines adopted and incorporated herein shall continue to apply to a Development Parcel in the East VillageTALUS Project or an Approved East VillageTALUS Expansion Area after its Transfer to a Parcel Builder. It is further the intent of this Agreement that the following overall obligations and duties herein of the Master Developer to construct and develop infrastructure and amenities applicable to the East VillageTALUS Project as a whole shall not be assigned or delegated to Parcel Builders but shall remain the obligation of the Master Developer even after Transfer of a Development Parcel to a Parcel Builder: A. The obligation to construct all arterial streets generally depicted on Exhibit 3 ( Cougar Mountain East VillageTALUS Development Area Exhibit ) and to maintain them in good condition until they have been dedicated to and accepted by the City; B. The obligation to build the on-site and off-site general surface water drainage facilities and appurtenances set forth in Appendix D (Surface Water Management) that are not specific to any particular Development Parcel, and to maintain them in good condition until they have been dedicated to and accepted by the City; C. The obligation to build the water storage reservoirs, tanks, and appurtenances to serve the East VillageTALUS Project and to maintain them in good condition until they have been dedicated to and accepted by the City; Revised 2009 Adopted December Final Document

38 D. The obligation to construct sanitary sewer and water mains and lines from termini outside the East VillageTALUS Property to the TALUSEast Village Property, and to each Development Parcel within the TALUSEast Village Property and within any Approved TALUSEast Village Expansion Area; E. The obligation to oversee the inclusion of trails and individual trail improvements and ensure appropriate trail connectivity in accordance with the approved Master Trails Plan is the responsibility of the Master Developer, and to maintain them in good condition until maintenance responsibility is transferred to the City or the TALUSEast Village Homeowners Association or other perpetual entity; F. The obligations of the Master Developer set forth in Appendix H (Master Transportation Financing Agreement) and Appendix I (Capital Facilities); G. The Master Developer s obligations established in Appendix D (Surface Water Management) for protection of water resources, including but not limited to temporary erosion and sedimentation control plans (TESCP) and the Monitoring Plan as described therein; H. The Master Developer s mitigation and project requirements established in Appendix T (EIS Mitigation and Project Requirements); I. The Obligations of the Master Developer identified in Appendix M (Affordable Housing); J. In order to encourage the development of a harmonious community that fulfills the vision for the TALUSEast Village Project as set forth in the Planning Goals, the Urban Village Urban Design Guidelines, and the TALUSEast Village Development Standards, the obligations to: (i) (ii) Fulfill the Master Developer s obligations to implement the public-private partnership for creation of the TALUSEast Village Project recognized in Section 30 ( Public-Private Partnership for Creation of TALUSEast Village Project ); Educate and inform the Parcel Builders of the TALUSEast Village Project s vision, character, and development process; Revised 2009 Adopted December Final Document

39 (iii) Assign specific land uses and densities to each Development Parcel in accordance with this Agreement and require the Parcel Builder of such Development Parcel to comply therewith; (iv) Create, fund, educate, and inform the Architectural Review Committee about the TALUSEast Village Goals, the TALUSEast Village Urban Design Guidelines, the TALUSEast Village Development Standards, and the TALUSEast Village Project s vision, character, and development process; and (v) Review and direct the design of all development that is subject to an Implementing Approval (whether undertaken by the Master Developer or a Parcel Builder), in order to promote the above-described vision for the TALUSEast Village Project; and K. Any other similar obligations of the Master Developer that apply to and benefit the TALUSEast Village Project as a whole, rather than a single Development Parcel The City has authority to require the Master Developer to post bonds or other acceptable security for performance and maintenance obligations directly related to the Master Developer s obligations, both under this Agreement and through plat or other Implementing Approvals Parcel Builders Obligations; Notice to City re Parcel Builder; Declaration of Covenants for TALUSEast Village Project The parties acknowledge that development of the TALUSEast Village Project will likely involve Transfer of undeveloped or partially-developed Development Parcels in the TALUSEast Village Property or Approved TALUSEast Village Expansion Areas to one or more Parcel Builders. Those Parcel Builders will in turn own, develop and/or occupy portions of the TALUSEast Village Property and buildings thereon as part of the TALUSEast Village Project. Parcel Builders shall be obligated with respect to all conditions of Implementing Approvals applicable to their respective Development Parcels, unless such an obligation is specifically identified in Subsection above or in the Implementing Approval as that of the Master Developer. By way of example only, a Parcel Builder, and not the Master Developer, shall have the obligation to construct streets, sidewalks, and utilities within a particular Development Parcel, and to develop and improve any recreational area required by the City as a condition of Implementing Approval for that particular Development Parcel Within 30 days after the date the Master Developer and a Parcel Builder execute a purchase and sale agreement for a Development Parcel or other Revised 2009 Adopted December Final Document

40 binding instrument for Transfer thereof, the Master Developer shall give the Designated Official the following information in writing: A. The date of the purchase and sale agreement for a Development Parcel or other binding instrument for Transfer thereof, the identity of the parties thereto (including name, address, contact person, address, and telephone and fax numbers), and the Development Parcel or Parcels affected thereby; B. The land use or uses required of the Parcel Builder by the Master Developer to be developed on the affected Development Parcel or Parcels; C. The density category specified by the Master Developer to the Parcel Builder for any residential development intended to be developed on the affected Development Parcel, calculated as directed by the MDRT; D. The minimum and maximum number of any residential units to be developed by the Parcel Builder on the affected Development Parcel; E. The minimum and maximum amount of commercial or retail square footage to be developed by the Parcel Builder on the affected Development Parcel; F. Any affordable housing requirements of the TALUSEast Village Project that are to be implemented on the affected Development Parcel; G. Any existing conditions of an TALUSEast Village Project Implementing Approval regarding the development of parks, open space, trails, or other amenities, that are to be the obligation of the Parcel Builder; and, H. The identification of the affected Development Parcel as a sending or receiving parcel, if applicable If particular duties or obligations, specifically and directly related to the Development Parcel in question, are expressly imposed by the City as a term or condition of an Implementing Approval for that Development Parcel, then from and after the date of Transfer of a Development Parcel to a Parcel Builder, the Master Developer shall have no further liability or obligation under this Agreement as to those particular duties or Revised 2009 Adopted December Final Document

41 obligations, and the Parcel Builder shall perform any obligations of the Master Developer under this Agreement for that Development Parcel; provided, however, that the obligations of the Master Developer set forth in Subsection above, shall not be delegated to a Parcel Builder If after such a release of the Partnership s Master Developer s liability a default occurs relating to the transferred Parcel, such default shall neither constitute a default by the Partnership Master Developer nor be a default as to any other portion or Development Parcel of the TALUSEast Village Property not subject to the defaulted obligation A Parcel Builder shall have no right or power to seek to alter or amend the Land Use Development Standards or Design Standards set forth in Appendix C (Land Uses) or any other provision of this Agreement The City has authority to require Parcel Builders to post bonds or other acceptable security for performance and maintenance directly related to a Parcel Builder s Parcel obligations, both under this Agreement and through plat or other permit approvals granted pursuant to the Issaquah Municipal Code As part of Site Development Permit and Building Permit Applications, the Applicant shall identify the amount of impervious surface to be created on its Development Parcel, as allocated by the Master Developer Master Developer Transferee The parties acknowledge that development of the TALUSEast Village Project may involve Transfer of all or substantially all of the Partnership s Master Developer s then-remaining interest and estate in the TALUSEast Village Property and the TALUSEast Village Project to a Master Developer Transferee that will thereafter act as the Master Developer of the TALUSEast Village Project pursuant to this Agreement. The provisions of this Section 31.2 are intended to apply to such a Transfer, and to all such subsequent Transfers by that successor Master Developer to another successor Master Developer. The original Master Developer was Intracorp; who transferred into OLY/ Intracorp who then transferred into OLY/Cougar who now sold the ownership to Talus Management Services The Partnership Master Developer shall have the right to Transfer its respective interest, rights, and obligations under this Agreement or in the Revised 2009 Adopted December Final Document

42 East VillageTALUS Project to a Master Developer Transferee. Consent by the City shall not be required for any such Transfer Upon a Transfer under this Section , the Master Developer Transferee shall be entitled to all interests and rights and shall be subject to all obligations under this Agreement, but the Partnership Master Developer shall not be released of liability unless the conditions of Section (Release of Liability) are met Release of Liability The Partnership Master Developer (but no Parcel Builder, as a successor or assign of the PartnershipMaster Developer) shall be automatically released of all liabilities and obligations under this Agreement if the conditions of both Sections and are met, if one of the conditions of Section is met, and if such conditions are confirmed by the City as an Authorized Modification pursuant to Appendix K (Elections and Modifications): the Partnership Master Developer has provided notice to the City of the proposed assignment; the Master Developer Transferee has assumed in writing all obligations and liability therefor under this Agreement, and under any separate agreements entered into with the Designated Official, for payment of services to implement this Agreement one of the following exists: A. the Partnership Master Developer retains a fifty percent (50%) or more equitable interest in the entity constituting the Master Developer Transferee, and the Partnership Master Developer is the managing entity or actively involved in development of the East VillageTALUS Project; or B. the Master Developer Transferee has provided the City with satisfactory evidence of a financial net worth that equals or exceeds at least twice the amount of outstanding financial obligations, at the time of the assignment, allocable to the portion of the East VillageTALUS Property proposed for assignment; or C. substantially all of the on-site and off-site Master Developer mitigations (as contrasted with Parcel Builder mitigations) directly Revised 2009 Adopted December Final Document

43 attributable to the Master Developer Transferee s portion of the East VillageTALUS Property have been completed or adequate security therefor has been provided in a form acceptable to the City (including the bonding and security which the City will require as part of plat approval or other Implementing Approvals); or D. the City consents, which consent shall not be unreasonably withheld If the conditions for release under this Section are met, then from and after the date of Transfer, the Partnership Master Developer shall have no further liability or obligation under this Agreement, and the Master Developer Transferee shall exercise the rights and perform the obligations of the Partnership Master Developer under this Agreement for the portion of the TALUSEast Village Property acquired by the Master Developer Transferee, subject to the following: A. If after release of liability a default occurs relating to the Transferred portion of the TALUSEast Village Property, such default shall not constitute a default by the released party nor be a default as to any other portion of the TALUSEast Village Property not subject to the defaulted obligation. B. Notwithstanding any other provision hereof, the Partnership Master Developer or any Master Developer Transferee whose interest has been transferred through foreclosure or deed in lieu thereof shall be released of all liability, from and after the effective date of transfer through foreclosure or deed in lieu thereof Agreement Not Binding on Certain TALUSEast Village Purchasers A purchaser of fewer than five (5) undeveloped lots in a residential Development Parcel, or of less than 5,000 Gross Square Feet of a commercial Development Parcel, shall be subject to the terms and conditions of this Agreement and the Declaration, except that such purchaser shall be automatically released from and shall not be subject to any duties or obligations of the Master Developer or Parcel Builders created herein. The Master Developer or any Master Developer Transferee, or the Parcel Builder for that Development Parcel, shall remain responsible for the performance of their respective duties and obligations for such Development Parcel. Upon request by the Master Developer or a Parcel Builder, the City agrees to execute in recordable form and deliver to the requesting person or entity any additional documents the requesting person or entity reasonably deems necessary or advisable to effectuate the recognition of such automatic release and its effect on title. Revised 2009 Adopted December Final Document

44 31.3 Recording A memorandum of this Agreement shall be recorded against the East VillageTALUS Property as a covenant running with the land and shall be binding on the Partnership Master Developer and Owners, their heirs, successors and assigns Interpretation; Severability Interpretation The parties intend this Agreement to be interpreted to the full extent authorized by law as an exercise of the City s authority to enter development agreements pursuant to RCW 36.70B.170 et seq., and this Agreement shall be construed to exclude from the scope of this Agreement and to reserve to the City, only that police power authority which is prohibited by law from being subject to a mutual agreement with consideration. If an East VillageTALUS Development Standard conflicts with an otherwise applicable provision of the Issaquah Municipal Code, the East VillageTALUS Development Standard shall control Severability If any provisions of this Agreement are determined to be unenforceable or invalid in a final decree or judgment by a court of law, then all of the following shall apply: If the final decree or judgment is pursuant to a claim or cause of action brought by the Master Developer or a Master Developer Transferee, then upon entry of the final decree or judgment (or, in case of an appeal to a higher court, upon entry of the appellate court mandate), this Agreement shall be deemed void and of no further force or effect If the final decree or judgment is pursuant to a claim or cause of action brought by a person or entity that is neither the City, the Master Developer, or a Master Developer Transferee, then the remainder of this Agreement not decreed or adjudged unenforceable or invalid shall remain unaffected and in full force and effect. In that event, this Agreement shall thereafter be modified, as provided immediately hereafter, to implement the intent of the parties to the maximum extent allowable under law. The parties shall diligently seek to agree to modify the Agreement consistent with the final court determination, and no party shall undertake any actions inconsistent with the intent of this Agreement until the modification to this Agreement has been completed. If the parties do not mutually agree to modifications within forty-five (45) days after the final court determination, then either party may initiate the dispute resolution proceedings in Section Revised 2009 Adopted December Final Document

45 (Dispute Resolution Process) for determination of the modifications that will implement the intent of this Agreement and the final court decision Authority Each party respectively represents and warrants that it has the power and authority, and is duly authorized, to enter in this Agreement on the terms and conditions herein stated, and to deliver and perform its obligations under this Agreement Amendment The East VillageTALUS Project and its Development Standards may be modified as provided in Section 24 (Flexibility and Modifications of East VillageTALUS Project Elements, etc.), Appendix K (Elections and Modifications) and other provisions of this Agreement. Except for Major Modifications as determined under Appendix K (Elections and Modifications), other modifications of the Development Standards as established in Appendix J (Processing) shall not require execution of any specific written amendment to this Agreement. Except for modifications pursuant to Appendix J (Processing) and Appendix K (Elections and Modifications), this Agreement shall not otherwise be modified or amended without the express written approval of the City and the PartnershipMaster Developer, or the Partnership s Master Developer Transferee Exhibits and Appendices Incorporated Exhibits 1 through 4 and Appendices A through T are incorporated herein by this reference as if fully set forth Headings The headings in this Agreement are inserted for reference only and shall not be construed to expand, limit or otherwise modify the terms and conditions of this Agreement Time of the Essence Time is of the essence of this Agreement and of every provision hereof. Unless otherwise set forth in this Agreement, the reference to days shall mean calendar days. If any time for action occurs on a weekend or legal holiday in the State of Washington, then the time period shall be extended automatically to the next business day Entire Agreement This Agreement represents the entire agreement of the parties with respect to the subject matter hereof. There are no other agreements, oral or written, except as expressly set forth herein Dispute Resolution If any dispute arises between the parties relating to this Agreement (except disputes covered by Section 31.19, Dispute Resolution Process, which shall be governed by that section rather than this Section 31.11), then the parties shall meet in order to seek to resolve the dispute in good faith, within ten (10) days after a party s request for such a Revised 2009 Adopted December Final Document

46 meeting. The City shall send the Designated Official and persons with information relating to the dispute, and the Partnership Master Developer shall send an owner s representative and any consultant or other person with technical information or expertise related to the dispute. No party shall give a notice of default to the other before such meeting occurs, or if the parties fail to meet within the required seven-day period, until after the expiration of that seven-day period Default and Remedies Cures Taking More Than Thirty Days No party shall be in default under this Agreement unless it has failed to perform as required under this Agreement for a period of thirty (30) days after written notice of default from any other party. Each notice of default shall specify the nature of the alleged default and the manner in which the default may be cured satisfactorily. If the nature of the alleged default is such that it cannot be reasonably cured within the thirty (30) day period, then commencement of the cure within such time period and the diligent prosecution to completion of the cure shall be deemed a cure Rights of Non-Defaulting Party A party not in default under this Agreement shall have all rights and remedies provided by law or equity, including without limitation damages, specific performance, or writs to compel performance or require action consistent with this Agreement Attorneys Fees In any judicial action to enforce or determine a party s rights under this Agreement, the prevailing party (or the substantially prevailing party, if no one party prevails entirely) shall be entitled to reasonable attorneys fees and costs, including fees and costs incurred in the appeal of any ruling of a lower court Relief Against Defaulting Party or Portion of East VillageTALUS Property In recognition of the anticipated transfers by the Partnership Master Developer of parcels of the East VillageTALUS Property to Parcel Builders, remedies under this Agreement shall be tailored to the East VillageTALUS Property or parties as provided below in this Section Relief Limited to Affected Parcel After the transfer of portions of the East VillageTALUS Property for which the release of liability provisions apply under Section (Release of Liability), any claimed default shall relate as specifically as possible to the portion or Parcel of the East VillageTALUS Property involved, and any remedy against any party shall be limited to the extent possible to the owners of such portion or Parcel of the East VillageTALUS Property. Revised 2009 Adopted December Final Document

47 Relief Limited to Affected Owner To the extent possible, the City shall seek only those remedies which do not adversely affect the rights, duties or obligations of any other nondefaulting owner of portions of the East VillageTALUS Property under this Agreement, and shall seek to utilize the severability provisions set forth in this Agreement No City Liability if Acting in Good Faith The City shall have no liability to any person or party for any damages, costs or attorneys fees under this Section so long as the City exercises reasonable and good faith judgment in seeking remedies against appropriate parties or portions of the Property Other Provisions Not Affected. Nothing in this Section modifies the liability or release thereof for the Partnership Master Developer as provided in Section (Release of Liability) or releases the Partnership s Master Developer s joint and several liability to the extent established in Appendix D (Surface Water Management), Appendix H (Master Transportation Financing Agreement), or Appendix I (Capital Facilities) Term The term of this Agreement shall continue at a minimum through the Buildout Period, and shall continue after the Buildout Period unless and until either the City or the Partnership Master Developer (or successor owners which own at least fifty-one percent (51%), excluding all City-owned land, within the East VillageTALUS Project) gives notice of termination Procedures for City s Notice of Termination The City s notice of termination shall use the same notice procedures that would apply to a zoning classification (rezone) of the East VillageTALUS Project at the time of the proposed termination Distribution of City s Notice The City shall mail notice to the Partnership Master Developer under Section (Notice) and to any business or homeowner association or community groups which the City in its sole discretion determines should receive notice, but the failure to provide notice pursuant to this sentence shall not affect the validity of the City s termination notice using rezone procedures nor subject the City to any liability Partnership s Master Developer s Notice to the City Notice by the Partnership Master Developer (or successors) shall be delivered to the City as provided in Section (Notice) of this Agreement. Revised 2009 Adopted December Final Document

48 City Procedures After Termination No sooner than six (6) months after the notice of termination, the City shall hold public hearings and shall adopt zoning and related development standards for the TALUSEast Village Property, or portions thereof as determined appropriate by the City. Upon such adoption, this Agreement shall terminate and thereafter the TALUSEast Village Property shall be governed by the adopted City zoning and related development regulations No Third-Party Beneficiary This Agreement is made and entered into for the sole protection and benefit of the parties hereto and their successors and assigns. No other person shall have any right of action based upon any provision of this Agreement Interpretation This Agreement has been reviewed and revised by legal counsel for both parties, and no presumption or rule construing ambiguity against the drafter of the document shall apply to the interpretation or enforcement of this Agreement Notice All communications, notices, and demands of any kind that a party under this Agreement requires or desires to give to any other party shall be in writing and either (i) delivered personally, (ii) sent by facsimile transmission with an additional copy mailed first class, or (iii) deposited in the U.S. mail, certified mail postage prepaid, return receipt requested, and addressed as follows: If to the City: with copy to: City of Issaquah th Avenue NW P. O. Box 1307 Issaquah, Washington Attn: Mayor s Office Ogden Murphy & Wallace 2100 Westlake Center Tower 1601 Fifth Avenue Seattle, Washington Attn: Wayne D. Tanaka If to the PartnershipMaster Develoepr: Cougar Mountain East Village Partnership c/o Intracorp Real Estate, L.L.C. Talus Management Services Southeast 231st Maple Valley, WA Attn: Dan Hayes Revised 2009 Adopted December Final Document

49 2505 Second Avenue, Suite 300 Seattle, Washington Attn: David MacDuff with a copy to: Hillis Clark Martin & Peterson, P.S. 500 Galland Building 1221 Second Avenue Seattle, Washington Attn: Richard R. Wilson Notice by hand delivery or facsimile shall be effective upon receipt. If deposited in the mail, notice shall be deemed delivered forty-eight (48) hours after deposited. Any party at any time by notice to the other party may designate a different address or person to which such notice or communication shall be given Delays If either party is delayed in the performance of its obligations under this Agreement due to Force Majeure, then performance of those obligations shall be excused for the period of delay Dispute Resolution Process Matters Covered by Dispute Resolution Process This Section shall govern any disagreements between the City and the Partnership Master Developer over the following: any proposal by the City to revise Development Standards under Subsection 26.1 (During Buildout Period) based upon its determination that a serious threat to public health or safety exists or that surface or ground water standards should be changed at the end of the five-year periods based on the applicable criteria set forth in that section; or the scope, design or other details of any capital facility projects or equipment described under Section 1 of Appendix I (Capital Facilities); or, disputes over modification of this Agreement after a court determination of invalidity under Subsection (Severability) Process for Dispute Resolution If any dispute covered by this Section arises, then the parties shall meet in good faith to settle the dispute within ten (10) days after either party requests such Revised 2009 Adopted December Final Document

50 a meeting, or within forty-five (45) days after a court ruling under Subsection (Severability). If the parties are unable to settle the dispute at that meeting, then the parties shall settle the matter by arbitration, made by a single arbitrator, and judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction thereof Selection of Arbitrator The parties during the settlement meeting will seek to agree upon a single arbitrator, if the parties do not voluntarily settle the dispute at the meeting. If the parties cannot agree on a single arbitrator, then the arbitration will be referred to the Judicial Dispute Resolution, L.L.C. (JDR) in Seattle, Washington, but if JDR is not in existence or not able to hear the matter, then either the City or the Partnership Master Developer may apply to the Washington Superior Court for appointment of a single arbitrator pursuant to RCW Costs and Procedures for Arbitration The arbitrator shall establish the procedures and allow presentation of written and oral information, but shall render its final decision within thirty (30) days after the matter is referred to arbitration. The parties shall pay equally the cost of the arbitration, but each party shall pay its own attorney s fees Arbitrator s Decision in Writing The arbitrator s decision shall be in writing and specifically find, as applicable: whether or not the criteria for modifying development regulations are present under Subsection 26.1 (During Buildout Period), the scope, design or other details of the specific capital facilities to be provided under Appendix I (Capital Facilities), or what modifications implement the parties intent consistent with the court invalidation decision under Subsection (Severability) Dispute Resolution Process as Exclusive Remedy Dispute resolution on the subjects covered by this Section is the exclusive remedy of the parties, and the City shall have no liability for damages if dispute resolution is complied with under this Section Revised 2009 Adopted December Final Document

51 31.20 Indemnification General Indemnity Except as otherwise specifically provided elsewhere in this Agreement and any exhibits hereto, each party shall protect, defend, indemnify and hold harmless the other party and their officers, agents, and employees, or any of them, from and against any and all claims, actions, suits liability, loss, costs, expenses, and damages of any nature whatsoever, which are caused by or result from any negligent act or omission of the party s own officers, agents, and employees in performing services pursuant to this agreement. In the event that any suit based upon such a claim, action, loss, or damage is brought against a party, the party whose negligent action or omissions gave rise to the claim shall defend the other party at the indemnifying party s sole cost and expense; and if final judgment be rendered against the other party and its officers, agents, and employees or jointly the parties and their respective officers, agents, and employees, the parties whose actions or omissions gave rise to the claim shall satisfy the same; provided that, in the event of concurrent negligence, each party shall indemnify and hold the other parties harmless only to the extent of that party s negligence. The indemnification to the City hereunder shall be for the benefit of the City as an entity, and not for members of the general public Additional Indemnity Without limitation of the foregoing provisions of Subsection , if any person brings suit or counterclaim against the City challenging the provisions of or the City s authority to enter into this Agreement and/or seeking recovery of any monies paid pursuant to this Agreement, then the Master Developer agrees to indemnify, defend and hold the City harmless from any judgment and shall pay for the City s (and its officers, agents, employees and contractors) costs of suit, pre- or post-judgment interest, consequential damages and reasonable attorneys fees, expert witness fees, staff time, consultants fees and all other directly related out-of-pocket expenses and reimbursement of any monies paid pursuant to this Agreement. Notwithstanding the preceding sentence, if the basis of the person s claim or cause of action is the City s negligence, intentional misconduct or breach of this Agreement, then the City shall indemnify the Master Developer to the same extent and for the same costs as specified in the preceding sentence. References to the City and the Master Developer include their respective officers, agents, and employees. In the event of concurrent negligence, including RCW , each party shall indemnify and hold the other harmless only to the extent of that party s negligence. The indemnifying party shall have the option but not obligation to defend the indemnified party in any such suit, but if the indemnifying party elects not to defend, then it shall reimburse the indemnified party on a monthly basis for the costs described in this section. Notwithstanding any other provision in this Agreement, to the extent a court of competent jurisdiction determines that the City is precluded from collecting any fees, costs, or other monies under this Agreement, then the City shall be under no further obligation to pay said precluded sums to the Master Developer. It is further specifically and expressly understood that the indemnification provided herein constitutes each party s waiver of immunity, as between themselves, under Industrial Insurance, Title 51 RCW, solely for Revised 2009 Adopted December Final Document

52 32.0 Definitions the purposes of this indemnification. This waiver has been mutually negotiated by the parties. The provisions of this Subsection shall survive the expiration or termination of this Agreement Administrative Approval Standard means the criteria to administratively approve East VillageTALUS Project modifications which are consistent with the Flexibility Objectives in Section 24 (Flexibility and Modifications of TALUSEast Village Project Elements, etc.) and will not result in significant adverse environmental impacts, taking into account mitigation measures. See Appendix K (Elections and Modifications) Administrative Minor Modifications means those modifications to the TALUSEast Village Project meeting the standards and procedures for an administrative minor modification in Appendix K (Elections and Modifications), processed and approved pursuant to Appendix J (Processing) Agreement means this development agreement for the TALUSEast Village Project entered into by the parties herein, together with its Exhibits and Appendices Allowable Development means the overall number of residential units and commercial and retail uses specified in Section 9.1 (Mix of Allowable Development), as the same may be modified in accordance with that Section 10 (Conversion of Commercial to Residential) Applicant means either the Master Developer or a Parcel Builder as the submitter of an application to the City to develop or improve one or more Development Parcels or (in the case of the Master Developer) as the submitter of an application to develop or improve general facilities, infrastructure, or amenities for the TALUSEast Village Project Buildout Period means the fifteen (15)-year period following recording of the first final implementing plat or issuance of the first commercial, retail, or residential building permit (whichever comes first) for the TALUSEast Village Project under this Agreement and during which Development Standards shall not be modified except as provided in Section 26 (Vesting of Development Standards and Mitigation) City means the City of Issaquah, an Optional Municipal Code city. Revised 2009 Adopted December Final Document

53 32.8 Commercial means those office and other general commercial uses described as permitted uses in Appendix C (Land Use) Comprehensive Monitoring Plan means the plan for monitoring storm water quantity and quality and for protecting downstream receiving waters, as set forth in Appendix D (Surface Water Management) Critical Areas means Critical Areas as defined in Appendix E (Critical Areas Regulations) Declaration means the Declaration of Covenants, Conditions, and Restrictions (Declaration) filed for recording against the TALUSEast Village Property by the Master Developer at the time of recording of the first final Master Plat of the TALUSEast Village Property Designated Official means the person, appointed by the Mayor, empowered, authorized, and charged with the duty to administer, interpret, process and approve plans as described in Appendix J (Processing) Development Parcels means the Development Parcels 1 through 21 as conceptually shown on Exhibit 3 ( TALUS Cougar Mountain East Village Development Area Exhibit ) and as further defined in Appendix C (Land Uses) which are authorized for development pursuant to the pre-approved uses, densities and other Development Standards established in this Agreement Development Standards means collectively, the TALUSEast Village Project elements, standards, mitigation measures, and other requirements and conditions of development set forth in this Agreement, the exhibits, and appendices thereto. The term also includes but is not limited to all standards, elements, and items included in the definition of Development Standards set forth in RCW 36.70B.170(3), part of the state statute authorizing development agreements such as this Agreement District means Issaquah School District No TALUSEast Village Expansion Areas means the approximately 13.7 acres of land presently outside of the TALUSEast Village Property (Parcels 18 through 21, inclusively), some or all of which may be approved for development consistent with the TALUSEast Village Project as provided in Section 8 Revised 2009 Adopted December Final Document

54 (Expansion Areas). The Expansion Areas are shown on Exhibit 3 ( TALUS Cougar Mountain East Village Development Area Exhibit ) TALUSEast Village Project means the uses, densities, maximum numbers of dwelling units, maximum amount of commercial and retail square footage, amount of open space and recreational areas, and other uses and appurtenances, set forth in this Agreement, including its appendices, for the TALUSEast Village Property and the TALUSEast Village Expansion Areas TALUSEast Village Property means the real property described on Exhibit 2 (Legal Description of TALUSEast Village Property and TALUSEast Village Expansion Areas). The definition of TALUSEast Village Property does not include any of the TALUSEast Village Expansion Areas unless and until an TALUSEast Village Expansion Area is approved for development consistent with the TALUSEast Village Project pursuant to Section 8 (Expansion Areas) Flexibility Objectives means the public purposes of modifying various TALUSEast Village Project elements or other Development Standards for the TALUSEast Village Project, as further described in Section 24 (Flexibility and Modifications of TALUSEast Village Project Elements, etc.) and Appendix K (Elections and Modifications), in order to incorporate new information, respond to changing community and market needs, encourage reasonably-priced housing, and encourage modifications that provide comparable benefit or functional equivalence with no significant reduction of public benefits, environmental protection, or increased material cost to the TALUSEast Village Project Force Majeure means extraordinary natural elements or conditions, war, riots, labor disputes, or other causes beyond the reasonable control of the obligated party Gross Square Feet means the number of square feet of total floor area bounded by the inside surface of the exterior walls of the structure as measured at the floor line, excluding parking and mechanical floors or areas and outside balconies that do not exceed a projection of six feet beyond the exterior walls of the building Implementing Approvals means land use approvals or permits subsequent to execution of this Agreement which implement or otherwise are consistent with this Agreement, including but not limited to plats, short plats, binding site plans, site development permits, building permits, and utility permits. Revised 2009 Adopted December Final Document

55 32.23 Implementing Plat means a preliminary and final replat of a portion of the TALUSEast Village Property, following recording of the final Master Plat, that creates individual residential, retail, or commercial lots on a Development Parcel Master Developer means the Partnershipresponsible operating of ownership party, so long as the Partnership owns any then-undeveloped Development Parcel in of the East VillageTALUS Project, or any Master Developer Transferee. Upon a Transfer from the Partnership Master Developer to a Master Developer Transferee, all references in this Agreement to the Partnership Master Developer shall be deemed to be references to such Master Developer Transferee, or its successors as Master Development Transferee, except for references to the Partnership in Subsection (Release of Liability) Master Developer Transferee means a person or entity other than the Partnership Master Developer acquiring an interest or estate (except for security purposes only) in all or substantially all of the East VillageTALUS Property or the East VillageTALUS Expansion Areas then owned by the Partnership, including the then-undeveloped portions thereof, and including Transfer of all interests through foreclosure (judicial or nonjudicial) or by deed in lieu of foreclosure. Master Developer Transferee also means any successive person or entity similarly acquiring such an interest or estate from a previous Master Developer Transferee Master Plat means the first preliminary and final plat of the entire East VillageTALUS Property which shall subdivide the TALUSEast Village Property substantially into the Development Parcels and open space areas shown on Exhibit 3 ( TALUSCougar Mountain East Village Development Area Exhibit ) and shall create the arterial road system shown thereon, but which shall not create individual residential, retail, or commercial lots on any Development Parcel. Such individual lots shall be created via subsequent Implementing Plats Master Trails Plan means the plan for development of trails in the TALUSEast Village Project prepared in accordance with Appendix R (Urban Trail Standards) Native Growth Protection Areas means the portion of TALUSEast Village Property south of the top of the slope defining the north bank of West Fork Tibbetts Creek, that is protected from development pursuant to Subsection Noncritical Open Space means the Open Space areas outside of Critical Areas and their buffers. Unless Noncritical Open Space is redesignated as part of a Development Parcel as provided in Revised 2009 Adopted December Final Document

56 Subsection 5.2, Noncritical Open Space shall be used and maintained for active and passive recreation for the benefit of owners, residents, and tenants in the TALUSEast Village Project Open Space means areas north of the top of the slope defining the north bank of the West Fork Tibbetts Creek that are located outside of Development Parcels or Utility Tracts. The Open Space areas consist of Critical Areas and their buffers and Noncritical Open Space. The Open Space areas are generally shown in bright green on Exhibit 3 ( TALUSCougar Mountain East Village Development Area Exhibit ) Parcel Builder means an owner of all or a portion of a Development Parcel in the TALUSEast Village Project, as successor or assign of the Master Developer, who develops and/or occupies portions of the TALUSEast Village Property or an Approved TALUSEast Village Expansion Area, or develops and/or occupies buildings thereon as part of the TALUSEast Village Project. The term Parcel Builder also means an owner of a Development Parcel in the TALUSEast Village Project that does not itself develop or occupy the Development Parcel but that Transfers it in turn to another Parcel Builder Recreational Areas means active and passive parks, plazas, trails, informal gathering areas, community gardens, and other indoor or outdoor recreational areas, developed by the Master Developer or Parcel Builder on and in Development Parcels or Noncritical Open Space, including the land segregated for such uses and all equipment, appurtenances, facilities, and other improvements thereon related thereto Recreational Area Requirement means the requirement to provide a minimum of 100 square feet of Recreational Area on and in Development Parcels or Noncritical Open Space, for each dwelling unit developed in the TALUSEast Village Project, as described in Subsection Receiving Parcel means a Development Parcel that is designated as responsible for fulfilling the Recreational Area Requirement of a Sending Parcel Retail means those retail uses described as permitted uses in Appendix C (Land Use) Residential Units means single-family detached and attached units and multifamily units whether condominiums, rental or other forms of ownership. Revised 2009 Adopted December Final Document

57 32.37 Sending Parcel means a residential Development Parcel whose Recreational Area Requirement is to be fulfilled on a Receiving Parcel Transfer means the sale, assignment, or other conveyance or transfer (including but not limited to transfer via judicial or nonjudicial foreclosure or via probate or intestacy) of one or more undeveloped or partially-developed Development Parcels in the TALUSEast Village Property or Approved TALUSEast Village Expansion Areas to persons or entities other than the then Master Developer UGA or Urban Growth Area means the Urban Growth Area designated in the King County Comprehensive Plan, as amended to the date of this Agreement Urban Village Commission means the development commission created in the UV zoning ordinance and referenced in Section 28 (Architectural Review Committee and Urban Village Commission) to review design guidelines and approvals within the TALUSEast Village Project Urban Village Design Guidelines means the design guidelines for the TALUSEast Village Project set forth in Appendix B (Urban Village Design Guidelines), as they may hereafter be modified in accordance with Appendix K (Elections and Modifications) Utility Tracts means the Utility Tracts A through E as conceptually shown on Exhibit 3 ( TALUSCougar Mountain East Village Development Area Exhibit ) or other areas of the TALUSEast Village Project created on the Master Plat or an Implementing Plat that are eligible to be improved with utility facilities and appurtenances, including but not limited to surface water retention/detention facilities or appurtenances, water storage tanks, pump stations, facilities, or appurtenances, electrical substations, facilities, or appurtenances, or other facilities or appurtenances necessary or appropriate for the transmission of electricity, natural gas, telephone, cable television, electronic data, stormwater, or other utilities, to or from the TALUSEast Village Project. IN WITNESS WHEREOF, the parties have caused this Agreement to be executed, effective on the day and year set forth on the first page hereof. CITY: Revised 2009 Adopted December Final Document

58 CITY OF ISSAQUAH, a Washington municipal corporation By Ava Frisinger Its Mayor Date: Revised 2009 Adopted December Final Document

59 PARTNERSHIP: Formatted: Normal, Tab stops: Not at 1.88" COUGAR MOUNTAIN EAST VILLAGE PARTNERSHIP, a Washington general partnership By: CMEV Management LLC, a Washington limited liability company Its Managing General Partner By: Intracorp Real Estate LLC, a Wyoming limited liability company Its Member By Its Date: Formatted: Normal, Don't keep lines together, Hyphenate Revised 2009 Adopted December Final Document

60 OWNERS: CHARLES A. DIKE, JR. Formatted: Normal LINDA C. DIKE Formatted: Normal Revised 2009 Adopted December Final Document

61 MARTIN B. EMRICK, AS TRUSTEE OF THE NOLA E. EMERICK CREDIT TRUST Revised 2009 Adopted December Final Document

62 Formatted: Normal JACK H. GILL, Trustee of the Jack and Kathleen Gill Revocable Living Trust KATHLEEN M. GILL, Trustee of the Jack and Kathleen Gill Revocable Living Trust Revised 2009 Adopted December Final Document

63 Formatted: Normal DEAN R. HILLIER MAXINE A. HILLIER, his wife ROBIN HILLIER, as a separate estate Revised 2009 Adopted December Final Document

64 Formatted: Normal DAVID A. MATTILA HELEN C. MATTILA Revised 2009 Adopted December Final Document

65 ESTATE OF ELLEN K. NIKKO Formatted: Normal By Its Revised 2009 Adopted December Final Document

66 NW PROPERTY INVESTORS II, a Formatted: Normal By Its Revised 2009 Adopted December Final Document

67 JOHN A. TELLVIK Formatted: Normal, Don't keep with next PATRICIA A. TELLVIK, his wife Formatted: Don't keep with next, Don't keep lines together Revised 2009 Adopted December Final Document

68 Formatted: Normal, Don't keep with next GARY C. WARNER KENDRA L. WARNER, his wife Revised 2009 Adopted December Final Document

69 Revised 2009 Adopted December Final Document

70 TALUS COMPOSITE LEGAL DESCRIPTION SEPTEMBER 19, 2001 ALL OF THE PLAT OF TALUS DIV. A, A MASTER PLAT,, ACCORDING TO THE PLAT THEREOF RECORDED IN VOLUME 201 OF PLATS, PAGES 38 THROUGH 50, RECORDS OF KING COUNTY, WASHINGTON; TOGETHER WITH LOTS 3 AND 4, CITY OF ISSAQUAH BOUNDARY LINE ADJUSTMENT NO. LLA 00001EV AS RECORDED IN BOOK 138 OF SURVEYS, PAGES 196, A E UNDER RECORDING NUMBER , RECORDS OF KING COUNTY WASHINGTON; TOGETHER WITH THAT PORTION OF THE SOUTHEAST QUARTER OF SECTION 29, TOWNSHIP 24 NORTH, RANGE 6 EAST, WILLAMETTE MERIDIAN, IN KING COUNTY, WASHINGTON DESCRIBED AS FOLLOWS: BEGINNING 294 FEET NORTH OF THE SOUTHWEST CORNER OF THE NORTHWEST QUARTER OF THE SOUTHEAST QUARTER OF SAID SECTION 29; THENCE NORTH 302 FEET; THENCE EAST 1426 FEET TO SUNSET HIGHWAY; THENCE SOUTHEASTERLY ALONG SAID HIGHWAY 211 FEET; THENCE WEST 121 FEET TO THE TRUE POINT OF BEGINNING; THENCE EAST 121 FEET TO THE SUNSET HIGHWAY; THENCE SOUTHEASTERLY ALONG SAID SUNSET HIGHWAY 93 FEET; THENCE WEST 130 FEET; THENCE NORTHERLY 93 FEET MORE OR LESS TO THE TRUE POINT OF BEGINNING. AND TOGETHER WITH THE SOUTH HALF OF THE OF THE NORTHEAST QUARTER AND THE NORTH HALF OF THE OF THE SOUTHEAST QUARTER AND THE EAST HALF OF THE NORTHEAST QUARTER OF THE NORTHEAST QUARTER OF THE SOUTHWEST QUARTER AND THE SOUTH HALF OF THE EAST HALF OF THE OF THE NORTHEAST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 32, TOWNSHIP 24 NORTH, RANGE 6 EAST, WILLAMETTE MERIDIAN, IN KING COUNTY, WASHINGTON LYING EASTERLY OF STATE ROAD NUMBER 2 (ALSO KNOWN AS COUNTY ROAD NUMBER 485 AND RENTON ISSAQUAH ROAD); EXCEPT ANY PORTION THEREOF LYING WITHIN SQUAK MOUNT ROAD. WRITTEN: WVS CHECKED: DAR th Avenue NE Kirkland, Washington Fax Revised 2009 Adopted December Final Document

71 Revised 2009 Adopted December Final Document