HomeMy WebLinkAboutDoc 401 - Finley Butte Ind La Pine - Cascade Divide Data CentersDeschutes County Board of Commissioners
1300 NW Wall St., Suite 200, Bend, OR 97701-1960
(541) 388-6570 -Fax (541) 385-3202 -www.deschutes.org
AGENDA REQUEST & STAFF REPORT
For Board Business Meeting of August 13, 2014
Please see directions for completing this document on the next page.
DATE: August 8,2014
FROM: J ames Lewis Property & Facilities 385-1414
TITLE OF AGENDA ITEM:
Consideration of Signature of Document 2014-401, an Option Agreement between Deschutes County
and Cascade Divide Data Centers.
PUBLIC HEARING ON THIS DATE? No
BACKGROUND AND POLICY IMPLICATIONS:
Deschutes County developed and owns several lots in the Finley Butte Industrial Park in La Pine. The
land is available for industrial development for a variety of service finns and light manufacturers that
can create jobs in the community.
Cascade Divide Data Centers, with a main office in Washougal, WA, wishes to purchase two lots
totaling 5.48 acres (2.95 and 2.53 acres individually) in the Finley Butte Industrial Park, Phase 1, Lots 1
and 14. Cascade Divide proposes to build and operate a series of up to 5 data center POD's, each
having the capacity to accommodate 200 server racks, at an expenditure of between $6 million and $14
million. They expect an initial employment of 5 full time staff, which will grow toO 20-30 over time as
POD's are constructed toward build-out. Cascade Divide has indicated that the average wage with
benefits will range from $60,000 to $100,000.
The parties have agreed to enter into an Option Agreement so that Cascade Divide can complete due
diligence, including acquiring the necessary permits for development. The sale will not close until all
conditions of the option agreement have been met.
FISCAL IMPLICATIONS:
$5,000 option payment upon execution of the agreement. Full purchase price is $238,709 ($1.00 per sq.
ft.) for both lots.
RECOMMENDATION & ACTION REQUESTED:
Staff recommends signature of Document 2014-401.
ATTENDANCE: James Lewis
DISTRIBUTION OF DOCUMENTS:
One original to James Lewis for the Optionee.
DESCHUTES COUNTY DOCUMENT SUMMARY
(NOTE: This fonn is required to be submitted with ALL contracts and other agreements, regardless of whether the document is to be
on a Board agenda or can be signed by the County Administrator or Department Director. If the document is to be on a Board
agenda, the Agenda Request Fonn is also required. If this fonn is not included with the document, the document will be returned to
the Department. Please submit documents to the Board Secretary for tracking purposes, and not directly to Legal Counsel, the
County Administrator or the Commissioners. In addition to submitting this fonn with your documents, please submit this fonn
electronically to the Board Secretary.)
Please complete all sections above the Official Review line.
Date: 18/8/201 ~ Department: IProperty & Facilities
Contractor/Supplier/Consultant Name: Cascade Divide Data Center
Contractor Contact: pohn Wart~ Contractor Phone #: 360-818-93m~
Type of Document: Option Agreement
Goods and/or Services: Offer to purchase real property.
Background & History: Deschutes County developed and owns several lots in the Finley
Butte Industrial Park in La Pine. The land is available for industrial development for a
variety of service firms and light manufacturers that can create jobs in the community.
Cascade Divide Data Centers, with a main office in Washougal, WA, wishes to purchase
two lots totaling 5.48 acres (2.95 and 2.53 acres individually) in the Finley Butte Industrial
Park, Phase 1 , Lots 1 and 14. Cascade Divide proposes to build and operate a series of
up to 5 data center POD's, each having the capacity to accommodate 200 server racks, at
an expenditure of between $6 million and $14 million. They expect an initial employment of
5 full time staff, which will grow toO 20-30 over time as POD's are constructed toward bUild
out. Cascade Divide has indicated that the average wage with benefits will range from
$60,000 to $100,000.
The parties have agreed to enter into an Option Agreement so that Cascade Divide can
complete due diligence, including acquiring the necessary permits for development.
The sale will not close until all conditions of the option agreement have been met.
Agreement Starting Date: IUpon signatur~ Ending Date: 112 month~
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N/A 0 Insurance Certificate Received (check box)
Insurance Expiration Date: I 1
N/A Check all that apply: o RFP, Solicitation or Bid Process o Informal quotes «$150K)o Exempt from RFP, Solicitation or Bid Process (specify -see DCC §2.37)
81712014
___ _____
N/A Funding Source: (Included in current budget? DYes D No
If No, has budget amendment been submitted? DYes D No
Is this a Grant Agreement providing revenue to the County? DYes l:8j No
Special conditions attached to this grant:
Deadlines for reporting to the grantor:
If a new FTE will be hired with grant funds, confirm that Personnel has been notified that
it is a grant-funded position so that this will be noted in the offer letter: DYes D No
Contact information for the person responsible for grant compliance: Name:
Phone #:
Departmental Contact and Title: James Lewis, Property Mgr. Phone #: 385~
Department Director Approval: _-I'~-....L..-~_
Signature Date
Distribution of Document: One original to James Lewis for the Optionee
Official Review:
County Signature Required (check one): BOCC 0 Department Director (if <$25K)
o Administrator (if >$25K but <$150K; if >$150K, BOCC Order No. _____,)
Legal Review Date
Document Number 2014-401
81712014
REVIEWED
LEGAL COUNSEL
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OPTION AGREEMENT
Parties: Owner: Deschutes County, Oregon
Optionee: Cascade Divide Data Centers
RECITALS
Owner owns title to certain unimproved real properties identified as Finley Butte
Industrial Park Phase 1, Lots 1 and 14, and further described as (Parcel 1 ) Tax Lot 400,
on Tax Assessors map Section 14DA, Township 22S. Range 10E, Willamette Meridian,
Deschutes County, Oregon (2.95 acres) and, (Parcel 2) Tax Lot 200, on Tax Assessors
map Section 14DD, Township 22S, Range 10E, Willamette Meridian, Deschutes
County, Oregon (2.53 acres), 5.48 acres as combined, at the southeast corner of the
intersection of Mitts Way and CW Reeves Lane (see attached map, marked Exhibit "A"),
together with all other rights, hereditaments, and tenements appurtenant to the property
(collectively referred to as "the Property").
Optionee desires to acquire the Property and Owner has agreed to grant Optionee an
exclusive option to purchase the Property. In consideration of the foregOing premises
and other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties therefore agree as follows:
1. Grant of Option
Owner. for and in consideration of the sum of Five Thousand Dollars ($5,000.00) paid to
Owner by Optionee, receipt of which is acknowledged by Owner, grants to Optionee the
sole and exclusive option to purchase the Property in the manner and subject to the
terms and conditions stated in this Agreement.
2. Option Terms
2.1 Term. The term of this Option shall be one (1) year from and after the date
this Option Agreement has been signed and dated by the Deschutes County Board of
Commissioners indicated on the signature page of this Option Agreement (the "Effective
Date"). If the expiration date falls on a Saturday, Sunday, or legal holiday recognized by
the State of Oregon, Optionee's rights during such time period shall extend until 4:00
p.m. on the next business day.
2.2 Exercise of Option. This option shall be exercised, if at all, by written
notice (Exercise Notice) given by Optionee to Owner at any time during the Term, which
notice shall state that Optionee has elected to exercise this Option. This Option may be
exercised only with respect to the entirety of the Property, subject to Optionees
completion of Conditions Precedent to Owner Closing as specified in Section 7 of this
Page 1 of 13 -OPTION AGREEMENT -Document No. 2014-401 DC 2 0 14 OZ# 4 0 1
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Agreement, and nothing contained herein shall be construed as permitting Optionee to
purchase less than all of the Property pursuant to this Option. Upon exercise of this
Option, Optionee shall be obligated to purchase the Property from Owner. and Owner
shall be obligated to sell the Property to Optionee, for the price and subject to the terms
and conditions set forth herein.
2.3 Failure to Exercise Option. If Optionee fails for any reason to exercise this
option in the manner set forth herein, Optionee shall have no further claim against or
interest in the Property or any of the option payments. In the event of the failure to
exercise the option, Optionee shall execute and deliver to Owner any recordable
instrument( s) that Owner reasonably may deem necessary for the purpose of clearing
title to the Property, attributable to this Agreement.
3. Option Money
In payment for Owner's grant of this option, Optionee has paid Owner the cash sum of
Five Thousand Dollars ($5,OOO.00) as stated in Section 1 above, the receipt of which is
acknowledged by Owner. No other Option Money Payment shall be due or payable
during the Term. Whether or not the option is actually exercised, the Option Money
Payment shall belong to Owner. If the option is exercised and the Property is acquired
by Optionee, then the Option Money Payment paid by Optionee shall be credited
against the Purchase Price at Closing (as those terms are defined below).
4. Purchase Price
The purchase price for the Property shall be $1.00 per square foot. payable in full and in
cash at Closing. Optionee shall be given credit for Option Money Payment paid by
Optionee to Owner. The price for each separate parcel shall be as follows:
Parcel 1 -$128,502.00
Parcel 2 -$110.207.00
With the total price being $238,709.00 (less the Option Money Payment as described
herein).
5. Remedies
5.1 Optionee. If Owner breaches any term or provision of this Agreement,
then Optionee, as its exclusive remedy and in lieu of any other relief, may either (1)
terminate this Agreement and obtain the return of all Option Money Payments
previously paid to Owner, or (2) tender performance of the obligations of Optionee and
seek to specifically enforce all obligations of Owner. Except as noted in Section 6.3
below and any specific remedies reserved elsewhere in this Agreement, Optionee
waives the right to pursue any remedy in law or equity against Owner other than the
remedies specified above, including without limitation, an action for damages of any
nature, in the event of a default by Owner.
Page 2 of 13 -OPTION AGREEMENT ~ Document No. 2014-401
5.2 Owner. If Optionee breaches any term or provision of this Agreement, and
regardless of whether the breach occurs before or after Optionee notifies Owner of the
exercise of the Option, then Owner, as its exclusive remedy and in lieu of any other
relief, shall be entitled to terminate this Agreement by giving Optionee written notice of
termination and to retain all Option Money Payments paid by Optionee. Owner
acknowledges (1) the adequacy of this exclusive remedy, and (2) that this limitation of
remedies is an essential part of this Agreement from the perspective of Optionee.
Except as noted in Section 6.3, below, and any specific remedies reserved elsewhere in
this Agreement, Owner expressly waives the right to pursue any other right or remedy in
law or equity other than the remedy specified above, including without limitation the right
of specific performance and the right to sue for damages, in the event of a default by
Optionee. Optionee and Owner have established the foregoing remedy in favor of
Owner because of the difficulty and inconvenience of ascertaining the actual damages
Owner may suffer as a result of a breach of this Agreement by Optionee.
5.3 Other Remedies. The limitations on remedies set forth in this section shall
not preclude either party from seeking or obtaining injunctive relief or from seeking
recovery against the other under any contractual indemnity set forth herein or for
causing physical damage or injury to persons or property.
6. Conditions Precedent to Optionee Closing
In addition to any other conditions contained in this Agreement, set forth below are
certain conditions precedent for the benefit of Optionee (the "Optionee Conditions").
The Optionee Conditions are intended solely for the benefit of Optionee, and Optionee
shall have the right to waive. by written notice, any of the Optionee Conditions, at its
sole discretion; giving the Exercise Notice shall not constitute such a waiver. If any
Optionee Condition is not satisfied or waived on or before the deadline for satisfaction
specified herein, then Optionee shall have the right to terminate this Agreement, at Its
sole election. by giving Owner Notice of Termination before the expiration of this
Agreement. Optionee shall be entitled to retum of the Option Money Payments paid, but
only if the subject Optionee Condition was not satisfied by reason of a breach of this
Agreement by Owner and Optionee fumishes Owner with timely Notice of Termination.
If Optionee does not give Owner Notice of Termination before the applicable deadline,
then Optionee shall be deemed to have waived the termination privilege with respect to
the Optionee Condition in question. The Optionee Conditions specifically delineated in
this section are the following:
6.1 On the Closing Date, the Title Company (defined below) shall be ready,
willing, and able to issue and shall issue to Optionee on recordation of the Owner's
deed mentioned below, the title insurance policy required by Section 9, below.
6.2 On or before the Closing Date, Owner shall have performed or Optionee
shall have waived Owner's performance of all of the covenants, conditions, agreements,
and promises to be performed by it under this Agreement.
Page 3 of 13 -OPTION AGREEMENT -Document No. 2014-401
6.3 Optionee has at Optionee's expense obtained all federal, state, and local
regulatory approvals (including but not limited to Land Use and Building approvals and
permits) to Optionee's satisfaction necessary to commence construction of a Data
Center and Business Recovery Facility (herein "Project").
6.4 On or before Closing, Optionee shall have the opportunity to obtain at
Optionee's expense, an ALTA survey of the Property (the "Survey") from a surveyor
deSignated by Optionee, indicating to Optionee's satisfaction that
(1) there are no discrepancies in the boundaries of the Property, (2) there are no
material encroachments on, or protrusions from, the Property, (3) the Property has
acceptable access to a dedicated public right-of-way, (4) the Property contains 5.48
acres, (5) the Property lies adjacent to the Midstate Electric Cooperative powerline
corridor, and (6) the Property does not lie within any area designated as wetlands by
any governmental agency or any area determined by the United States Department of
Housing and Urban Development to be flood-prone or subject to a flood hazard.
Optionee shall advance the charges due for preparing the Survey; however, if Optionee
terminates this Agreement by reason of a material defect in the Property disclosed by
the Survey, which is not after reasonable notice thereof remedied by Owner, then
Owner shall pay the charges attributable to preparing the Survey, on demand.
7. Conditions Precedent to Owner Closing
In addition to any other conditions contained in this Agreement, set forth below are
certain conditions precedent for the benefit of Owner (the "Owner Conditions"). The
Owner Conditions are intended solely for the benefit of Owner, and Owner shall have
the right to waive, by written notice, any of the Owner Conditions, at its sole discretion. If
any Owner Condition is not satisfied or waived on or before the deadline for satisfaction
specified herein, then Owner shall have the right to terminate this Agreement, at its sole
election, by giving Optionee notice of termination before the deadline expires and retain
the Option Money Payment. The Owner Conditions specifically delineated in this section
are the following:
7.1 On or before the Closing. Optionee has furnished Owner with
documentation indicating that Optionee has obtained, to Owner's reasonable
satisfaction and at Optionee's expense, substantially all federal, state and local
regulatory approvals (including but not limited to Land Use and Building approvals and
permits) necessary to commence construction on the Data Center and Business
Recovery Facility.
7.2 On or before closing, Optionee has provided Owner evidence, reasonably
satisfactory to Owner, that Optionee has obtained construction financing or financing
commitments from its construction lender which, when combined with Optionee's equity
funds, will be sufficient to complete construction of the Project.
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7.3 On or before closing, Optionee has executed all necessary documents to
Owner's satisfaction and suitable for recording with the property records of the
Deschutes County Clerk's office by which Optionee agrees to transfer clear, lien-free
title to the property back to Owner upon Owner's payment of the purchase price less
Option Money Payments in the event construction of the Project has not commenced
within 12 months of the date of closing. Such reacquisition shall occur no later than 16
months after the date of closing.
7.4 Optionee has executed all necessary covenants, conditions, and
restrictions to Owner's satisfaction and suitable for recording with the property records
of the Deschutes County Clerk's office by which Optionee and Optionee's heirs,
successors, and assigns agree that the property shall not be used for other than a Data
Center and Business Recovery Facility. Owner's remedies for violation of such covenant
shall be as set forth in the covenant document.
8. Title
Within fifteen (15) days following the Effective Date, Owner shall deliver to Optionee, at
Owner's expense, a preliminary title report (the "Title Report") covering the Property.
The Title Report shall be issued by the Title Company (defined in Section 9.1). The Title
Report shall be accompanied by legible copies of all plats and exceptions to title
referenced in the Title Report (the "Exceptions"). Within 45 days of receiving the Title
Report and the Exceptions documents, Optionee shall give written notice (the "Initial
Notice") to Owner of the Exceptions that Optionee shall require Owner to remove of
record at or before Closing (the "Unacceptable Exceptions"). If Optionee fails to give
Owner the Initial Notice, then Optionee shall be deemed to have approved the Title
Report. Owner shall have ten (10) days following receipt of the Initial Notice to give
written notice to Optionee (the "Reply Notice") of those Unacceptable Exceptions that
Owner concludes, in good faith, that Owner cannot or will not remove at or before
Closing or at any time. Owner shall not have any obligation to institute litigation or
spend any sum of money to cure or remove any Unacceptable Exceptions; provided,
however, that Owner shall be obligated to remove, at or before Closing, any
Unacceptable Exception created or suffered to be created by Owner that is security for
payment of a sum of money (including mortgages, deeds of trust, tax liens, contractor's
liens, and judgment liens) and any Unacceptable Exception created, or suffered to be
created, by Owner after the Effective Date. Owner agrees to remove all Unacceptable
Exceptions not referenced in a duly given Reply Notice. If one of more of the
Unacceptable Exceptions cannot be removed at or before Closing and Owner so states
in a duly given Reply Notice, then Optionee may exercise any of the following rights by
giving written notice to Owner within fifteen (15) days of receiving the Reply Notice: (1)
Optionee may terminate this Agreement. in which even the Option Money Payments
shall be refunded to Optionee and neither party shall have any further liability; (2)
Optionee may accept title to the property subject to any such Unacceptable Exceptions;
or (3) Optionee may attempt to cure the Unacceptable Exception(s) or any of them
without cost or liability to Owner (but Owner shall be obligated to cooperate with such
cure effects and to join in the execution of any curative instruments that will operate or
Page 5 of 13 -OPTION AGREEMENT -Document No. 2014-401
remove such Unacceptable Exception(s)). The foregoing rights of Optionee shall not be
deemed waived by giving the Exercise Notice. Exceptions that are shown on the Title
Report and to which Optionee does not object or to which Optionee agrees, in writing, to
waive objection, are referred to herein as the "Permitted Exceptions."
Owner shall not cause, permit, or suffer any matter to be recorded with respect to the
Property during the Term, except any matter that Optionee approves, in writing and at
its sole discretion, before recordation.
9. Closing
9.1 Time and Place. Closing of the sale and purchase of the Property (the
"Closing") shall occur on a date (the "Closing Date") selected by Optionee, but in all
events the CloSing shall occur within fourteen (14) days after the date that the Exercise
Notice is given. The escrow for the Closing shall be established at the office of
AmeriTitle -Downtown Bend Branch (the "THle Company"), at 15 NW Oregon Avenue,
Bend, OR 97701.
9.2 Closing Obligations. On the Closing Date, Owner and Optionee shall
deposH the following documents and funds in escrow, and the Title Company shall close
escrow in accordance with the instructions of Owner and Optionee.
9.2.1 Owner shall deposit the following:
(a) The conveyance documents described in Section 10, below,
duly executed and acknowledged;
(b) A duly executed affidavit certifying that Owner is not a
foreign person, trust, partnership, or corporation in compliance with the requirements of
IRC § 1445;
(c) Original counterparts or legible photocopies of all
documents, feasibility studies, surveys, engineering reports. and other items of a similar
nature in the possession of Owner that relate to the Property;
(d) Such documents as Optionee or the Title Company may
require to evidence the authority of Owner to consummate this transaction; and
(e) Such other documents and funds, including (without
limitation) escrow instructions, as are required of Owner to close the sale in accordance
with this Agreement.
9.2.2 Optionee shall deposit the following:
(a) The cash payment specified in Section 4, above, minus any
credits available to Optionee under the terms of this Agreement;
Page 6 of 13 -OPTION AGREEMENT -Document No. 2014-401
(b) Such documents as Owner or the Title Company may
require to evidence the authority of Optionee to consummate the transaction
contemplated;
(c) All necessary documents suitable for recording by which
Owner may reacquire the Property from Optionee in the event construction of the
Project has not commenced as required herein, upon Owner's payment to Optionee of
the purchase price less Option Money Payments;
(d) Documentation indicating to Owner's satisfaction that
Optionee has obtained all federal, state and local regulatory approvals (including but not
limited to Land Use and Building approvals and permits) necessary to commence
construction of a Data Center and Business Recovery Facility (herein "Project");
(e) All necessary covenants, conditions and restrictions to
Owner's satisfaction and suitable for recording with the property records of the
Deschutes County Clerk's office by which Optionee and Optionee's heirs, successors
and assigns agree that the property shall not be used for other than a Data Center and
Business Recovery FaCility; and.
(f) Such other documents and funds, including and without
limitation, escrow instructions as are required of Optionee to close the sale and
purchase of the Property in accordance with this Agreement.
9.3 Costs. Optionee shall pay the escrow fee of the Title Company with
respect to the ClOSing. Optionee shall pay the premium for the title insurance policy that
Owner is obligated to provide to Optionee. Optionee shall pay the fee (exclusive of any
conveyance or excise tax) for recording the conveyance documents referred to herein.
9.4 Prorations. All real property taxes and assessments payable with respect
to the tax year in which Closing occurs shall be prorated between Owner and Optionee
as of the ClOSing Date.
9.5 Title Insurance Policies. As soon as practicable after Closing, and in any
event no later than ten (10) days after the Closing Date, Owner shall cause the Title
Company to issue its standard form Owner's ALTA Title Insurance Policy, with extended
coverage, in the amount of the Purchase Price, insuring fee simple title to the Property
vested in Optionee, subject only to the Permitted Exceptions.
9.6 Effect of Closing on Conditions. Conveyance of Title to the Property to
Optionee shall conclusively establish satisfaction or waiver of respective conditions
precedent for Optionee and Owner to close unless expressly stated otherwise in writing
at the time of conveyance.
Page 7 of 13 -OPTION AGREEMENT -Document No. 2014-401
10. Conveyance
At the Closing, Owner shall execute, acknowledge, and deliver to Optionee a
Bargain and Sale Deed conveying the Property to Optionee, subject only to the
Permitted Exceptions.
11. Possession
Optionee shall be entitled to exclusive possession of the Property on and after the
Closing Date.
12. Covenants of Owner
Owner acknowledges that the covenants of Owner contained in this Agreement,
including the covenants contained in this Section 12 (the "Covenants"), are material
inducements to Optionee to enter into this Agreement. The Covenants specifically
delineated in this Section are the following:
12.1 Information. Owner agrees to deliver to Optionee, within twenty (20) days
after the Effective Date, photocopies of all documents related to the use or ownership of
the Property that Owner possesses, including and without limitation, all studies, reports,
aerial photographs, and other documents of a like nature.
12.2 Maintenance. Before the ClOSing Date, Owner shall maintain the Property
in the same condition as it now exists, ordinary wear and tear excepted, and shall not
cause or permit any waste.
12.3 Ownershi.o. During the Term, Owner shall not sell, contract to sell, assign,
lease, or otherwise transfer the Property or any part of it, nor grant an option to any third
party to acquire all or any portion of it.
13. Representations of Owner
13.1 Owner represents that Owner has disclosed to Optionee the
environmental reports and studies in Owner's possession relating to any generation,
manufacture, refinement, transportation, treatment, storage, handling, disposal, transfer,
or production of Hazardous Substances, or other dangerous or toxic substances or solid
wastes and except as contained or referred to in said reports and studies, Owner has
no Notice of the release of any Hazardous Substances on the Property.
13.2 Owner represents that, to Owner's actual knowledge, without further
investigation or inquiry, (1) the Property will be in substantially its present condition at
the time Optionee is entitled to possession, (2) except as disclosed in writing, Owner
has no notice of any liens to be assessed against the Property, (3) there is no
condemnation, environmental, or similar proceeding, existing or planned which could
detrimentally affect the use, development, or value of the Property, (4) Owner has no
Page 8 of 13 -OPTION AGREEMENT -Document No. 2014-401
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notice from any governmental entity of any violation of law relating to the Property, and
(5) Owner is not a "foreign person" under the Foreign Investment in Real Property Tax
Act (FIRPTA").
13.3 Changed Conditions. If Owner discovers that one or more of the
Warranties or one of the conditions referred to in this section 13 has changed after this
Agreement is executed, through no fault of Owner, Owner shall immediately inform
Optionee, in writing, of such discovery. If the changed condition cannot be cured within
ten (10) days of the date Owner discovers the change, then Optionee may terminate
this Agreement (and its exercise of the Option, if any) by giving written notice of
termination to Owner within fifteen (15) days after receiving the notice from Owner, and
in such event all Option Money Payments previously paid by Optionee shall be returned
to Optionee. If the changed condition can be corrected within ten (10) days after
discovery by Owner, Optionee shall not have the right to terminate this Option
Agreement pursuant to this section and Owner shall correct the changed condition
within ten (10) days of the discovery.
13.4 Zoning. The Property is currently subject to City of La Pine zoning
regulations which restrict the development and use of Property pursuant to all
applicable City of La Pine adopted zoning and development regulations. Owner shall
provide all proper assistance to Optionee in the form of consents to submit applications
in order to secure any permits and regulatory approvals pertaining to the Property;
provided however, that such assistance shall not be construed as Owner's
governmental approval of any land use, site development or building construction
approvals necessary for the Project.
13.5 Access to Property. Owner grants to Optionee and its agents non
exclusive, revocable access to Property for the purposes of conducting necessary tests,
inspections, and surveys. Such tests, inspections, and surveys will be undertaken at
Optionee's expense and without charge or obligation to Owner. Optionee shall defend,
indemnify, and hold Owner harmless from and against any liability, action, or claim
arising out of Optionee's exercise of the rights granted by this section.
13.6 AS-IS. Except for Owner's express written agreements and written
representations contained herein, if Optionee exercises Optionee's right to purchase,
then Optionee is purchasing the Property AS-IS in its present condition and with all
defects, apparent or not apparent.
14. Recording
If Optionee fails to exercise the option before the Term expires, Optionee shalf execute,
acknowledge and deliver to Owner a statutory quitclaim deed or other appropriate
recordable instrument to Owner's satisfaction releasing Optionee's interest in the
Property.
15. Waiver
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Failure by Owner or Optionee to enforce any right under this Agreement shall not be
deemed to be a waiver of that right or of any other right.
16. Successors and Assigns
Subject to the limitations on Owner's right to convey the Property set forth elsewhere
herein, the terms, covenants, and conditions herein contained shall be binding on and
inure to the benefit of the heirs, successors, and assigns of Owner and Optionee.
Optionee may not assign its interest in this Option Agreement and the Property to any
person or entity, without the consent of Owner, which consent shall not be unreasonably
denied or delayed.
17. Notices
All notices required or permitted to be given shall be in writing and shall be
deemed given and received on personal service or deposit in the United States
Mail, certified or registered mail, postage prepaid, return receipt requested,
addressed as follows:
To Owner: Susan Ross,
Property and Facilities Director
14 NW Kearney Avenue
Bend, Oregon 97701
To Optionee: Cascade Divide Data Centers
John Warta, Chairman
421 C. Street, Suite 1A
Washougal, Washington 98671
The foregoing addresses may be changed by written notice, given in the same
manner. Notice given in any manner other than the manner set forth above shall
be effective when received by the party for whom it is intended.
18. Owner's Option to Reacquire the Property
In the event Optionee after closing of the purchase has failed to commence
construction of the Project within twelve (12) months, then Owner will have the
option to reacquire the Property upon payment by Owner to Optionee the Purchase
Price, less the Option Money Payment.
During such 12-month period and such longer period as is needed to close the
reacquisition, Optionee shall keep the Property free of Hazardous Substances.
Optionee shall comply fully with all laws pertaining to the protection of human hearth
and the environment, including, but not limited to, employee and community right-to
know laws and all laws regarding the use, generation, storage, transportation,
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treatment, disposal, or other handling of hazardous substances. Optionee shall promptly
advise Owner in writing of any hazardous substances regulated by such laws that are
used, generated, manufactured, stored, transported, or otherwise handled on the
Property, except for small quantities of petroleum products used in the ordinary course
of construction. Optionee shall exercise extreme care in handling any hazardous
substances and shall not cause or permit hazardous substances to be spilled, leaked,
disposed of, or otherwise released on the Property.
19. Indemnification and Hold Harmless
Optionee shall indemnify and hold Owner, and its officers, agents and employees,
harmless from all activities of Optionee, its officers, agents, employees and contractors
relating to its actions and activities in connection with the development of the Property
resulting in:
1 damages to the Property or Project Area, or any portion thereof;
2 injuries to or death of any person or persons, including without limitation
employees or agents of Owner;
3 any and all claims. demands, workers' compensation claims in any way
resulting from the negligent or wrongful acts or omissions of Optionee, its
employees, agents. contractors or subcontractors, except for any such damage
or injury as a result of the negligence or wrongful acts or omissions of Owner or
its officers. agents or employees; and
4 any claims, demands or liens involving labor, services or materials
furnished to or on account of the Property preliminary to construction of the
Project.
20. Integration. Modification or Amendments
This Agreement contains the entire agreement of the parties with respect to the
Property and supersedes all prior written and oral negotiations and agreements with
respect to the Property. Any modifications, changes, additions, or deletions to this
Agreement must be approved by Owner and Optionee, in writing.
21. Representation by Legal Counsel
Owner and Optionee have each been represented by separate legal counsel of choice
with respect to this transaction. Each party shall be responsible for all attorney fees
incurred by it with respect to this Agreement, including without limitation litigation or
alternative dispute resolution.
22. Governing Law; Venue: Interpretation
This Agreement shall be governed by the laws of the State of Oregon. with venue in the
Deschutes County Circuit Court. If a court of competent jurisdiction holds any portion of
this Agreement to be void or unenforceable as written, Owner and Optionee intend that
Page 11 of 13 -OPTION AGREEMENT -Document No. 2014-401
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(1) that portion of this Agreement be enforced to the extent permitted by law. and (2) the
balance of this Agreement remain in full force and effect.
23. Time is of the Essence
Time is of the essence of this Agreement.
24. Authority to Execute
Each person executing this Agreement on behalf of Owner and Optionee,
respectively. warrants his or her authority to do so.
25. Statutory Disclaimer
THE PROPERTY DESCRIBED IN THIS INSTRUMENT MAY NOT BE WITHIN A FIRE
PROTECTION DISTRICT PROTECTING STRUCTURES. THE PROPERTY IS
SUBJECT TO LAND USE LAWS AND REGULATIONS, THAT, IN FARM OR FOREST
ZONES. MAY NOT AUTHORIZE CONSTRUCTION OR SITING OF A RESIDENCE
AND THAT LIMIT LAWSUITS AGAINST FARMING OR FOREST PRACTICES AS
DEFINED IN ORS 30.930 IN ALL ZONES. BEFORE SIGNING OR ACCEPTING THIS
INSTRUMENT, THE PERSON TRANSFERRING FEE TITLE SHOULD INQUIRE
ABOUT THE PERSON'S RIGHTS, IF ANY UNDER ORS 195.300. 195.301 and
195.305 to 195.336 AND SECTION 5 TO 11, CHAPTER 424, OREGON LAWS 2007.
BEFORE SIGNING OR ACCEPTING THIS INSTRUMENT, THE PERSON ACQUIRING
FEE TITLE TO THE PROPERTY SHOULD CHECK WITH THE APPROPRIATE CITY
OR COUNTY PLANNING DEPARTMENT TO VERIFY THAT THE UNIT OF LAND
BEING TRANSFERRED IS A LAWFULLY ESTABLISHED LOT OR PARCEL, AS
DEFINED IN ORS 92.010 TO 215.010, TO VERIFY THE APPROVED USES OF THE
LOT OR PARCEL, TO VERIFY THE EXISTENCE OF FIRE PROTECTION FOR
STRUCTURES AND TO INQUIRE ABOUT THE RIGHTS OF NEIGHBORING
PROPERTY OWNERS, IF ANY, UNDER ORS 195.300, 195.301 AND 195.305 TO
195.336 AND SECTION 5 AND 11, CHAPTER 424, OREGON LAWS 2007.
SIGNATURES ON FOLLOWING PAGE
Page 12 of 13 -OPTION AGREEMENT -Document No. 2014-401
OPTIONEE: Cascade Divide Data Centers
By: '~C d>
Name:<-~h ...W~-Vl
Title: C)AA\Q.~
Date: A",C)us+ )) 20\4
STATE OF GREGOfq WASil NE:ilD ~
) ss.
County of Deschutes )
The foregoing Instrument was acknowledg~ before me ~qLa,14
My Commission Expires
'<
OWNER: Deschutes County, Oregon
Dated this of , 2014 BOARD OF COUNTY COMMISSIONERS
OF DESCHUTES COUNTY. OREGON
TAMMY BANEY. Chair
ANTHONY DEBONE. Vice Chair
ATTEST:
Recording Secretary ALAN UNGER, Commissioner
STATE OF OREGON )
) ss.
County of Deschutes )
Before me, a Notary Public, personally appeared TAMMY BANEY, ANTHONY DEBONE, and ALAN
UNGER the above-named Board of County Commissioners of Deschutes County, Oregon and
acknowledged the foregoing instrument on behalf of Deschutes County. Oregon.
DATED this __day of ___-', 2014
My Commission Expires: ________
Notary Public for Oregon
Page 13 of 13 -OPTION AGREEMENT -Document No. 2014-401