MACADAM P| eats (COMMBRCIAL REAL ESYATE SERVICES April 11, 2018 Mr. Guadalupe Guerrero Portland Public Schools 501 N Dixon Street Portland, OR 97227 RE: Letter of Intent ¢o Purchase, Blanchard Education Service Center @ 501 N. Dixon Dear Mr, Guerrero: On behalf of Trammell Crow Company, I am pleased to present the following Letter of Intent to Purchase the above referenced property. First and foremost, we undersiand that the Property is not being actively marketed for sale and the offer is made on an unsolicited basis. As you know, Thave been working with a group that would be an anchor business at this location and they have selected ‘Trammell Crow as a development partner for the project, This offer is made with fall support and knowledge of the end user, Further, the inclusion of a master developer will allow for a more complete approach relative to the Buyer's and neighborhood's goals of incorporating the Albina Vision objectives into the Master Planning of this site. In particular, the Buyer anticipates acquiring additional properties in the immediate area and adding additional workforce housing, retail, and employment opportunities within the project, We recognize that significant consideration and thought must be put into this decision and process for Portiand Public Schools, ‘The Buyer requests that this offer is kept confidential, to the extent possible for the Seller, and that Seller provides as much timely feedback as possible relative to the feasibility of this proposed transaction, ‘The Buyer is working on a timeline of their own to secure this site which will be key to subsequently securing this business in Portland. The Buyer continues to explore other altematives in the event this transaction is ultimately not successful, appreciate your consideration and assistance this transaction thus far and I am happy to answet any further questions you may have about the terms or the parties involved. Please review the terms outlined below: 1. Buyer: ‘Trammell Crow Company and/or assigns 2 Seller: Portland Public Schools 1200SW Fst Ave, Suite 490 & Portland, Oregon 97201 * FAKS0B2748216 » Telephone $00227.2500" Letter of intent to Purchase ~ Blanchard Education Service Center | 501 N. Dixon St Apri 11, 2018 Page 2 of 5 3. Property. __Land and improvements located at $01 N. Dixon Street in Portland, OR. The site consists of a variety of tax lots comprising approximately 500,000 SF of land and the Blanchard Education Service Center building. The Buyer would work to secure additional land around the BESC to best master plen the project. A legal description would be attached to a binding sale agreement. 4, Price and Payment, ‘The Buyer offers the following: ‘The Purchase Price shall be the greater of the Appraised Value of the Property or $80,000,000.00 5. Consideration. The Buyer can offer multiple scenarios based on the best solution for the parties. The Buyer offers the following: @) Cash payment upon Closing to Seller, Seller to vacate at an agreed upon time and schedule following Closing, with a short-term lease back from Buyer if needed. b) Buyer currently has a mutually executed Letter of Intent for the former Banfield Pet Hospital HQ building at 8600 N. Tillamook and is working to finalize the Purchase and Sale Agreement. Buyer understands this property may be a suiteble replacement for the PPS administrative functions currently ongoing at BESC, Buyer will contribute this property as consideration to Seller at Closing, subject to timing requirements in Buyer's purchase contract for the Banfield property. Further, if Seller elects, Buyer will complete improvements required for Seller’s occupancy in the Banfield property and secure any fixtures / furniture / equipment already in the facility for Seller's use prior to Seller's move. ‘The value for this contribution shall be determined per separate process, ©) Buyer and the end user are interested in creating a partnership agreement with the Seller relative to further ongoing contributions to Portland Public School's mission to serve the children and community within the District's boundaries. At Seller's election, the Buyer and the end user would endeavor to create a long term contribution plan to Seller's facilities, fields, gymnasiums, etc and create additional educational, recreational, and employment opportunities between the District's constituents and the Buyer’s future business venture, 4) Buyer is able to design and build any additional facilities needed by Seller to accommodate the move-out of the BESC. (i.e. warehouse space to storage and trade work). This could be designed to accommodate a move of the Multnomah County Fleet and operations staff as well. If desired by Seller, Buyer would consider contributing this property as consideration to Seller to be delivered at or after in the Closing. Ifthe parties proceed down this path, the value for this contribution shall be determined per separate process. 6. Eamest Money Deposit. Upon execution of the Purchase and Sale Agreement (PSA), Buyer shall provide an eamest money deposit of Five Hundred Thousand ($500,000.00) dollars in the form of cash in an escrow account with Chicago Title, attention Lori Medak at Fidelity" Letter of fntent to Purchase ~ Blanchard Education Service Center | 501 N, Dixon St ‘April 11, 2018 Page 3 of 5 National Title (“Closing Agent”), ‘The Eamest Money shall be considered non-refundable upon removal of the Contingencies (as defined herein), except in the event of Seller's default, but applicable to the Purchase Price. In addition, Buyer agrees to pay Fifty Thousand and no/100 Dollars ($50,000) as non-refundable and non-applicable Eamest Money to the Seller, upon ‘execution of the Purchase and Sale Agreement as compensation for third party (legal, appraisal, etc) costs associated with execution of the Purchase and Sale Agreement, Buyer shall deposit an additional Five Hundred Thousand ($500,000.00) dollars upon removal of Contingencies, which shall also be considered non-refundable. In the event Buyer does not waive its contingencies as called for im PSA, said PSA shall become void and the Eamest Money shall be returned to Buyer and neither party shall have any remaining obligation to one another. If Buyer defaults under the terms of the PSA, the carnest money shall be released to Seller as Seller’s liquidated damages and the sole remedy to Seller. 7. Contingencies. If the following contingencies (collectively, the “Contingencies”) are not, in the sole and absolute disoretion of Buyer, satisfied by written notice to Seller from Buyer no later than One Hundred Righty (180) days following execution of the Purchase and Sale Agreement (the “Contingency Period") and subject to further extension, the PSA and any related agreements shall be null and void and of no further force or effect, and the Earnest Money shall promptly be returned to Buyer: 7.1. Buyer's determination that the transaction is feasible, Buyer shall have the right to review all materials provided in item 7 below. Further, Buyer may conduct a feasibility study and inspection of the building and land, including without limitation a Phase I environmental analysis, individually and/or through Buyer’s employees, agents, and independent contractors. 7.2 City of Portland’s adoption of the Central City 2035 Plan, which designates the Property as EX(d) zoning. ‘This is expected in May 2018, 7.3 Buyer shall have the right to extend the Contingency Period for ‘Three (3) additional Thirty (30) day periods by depositing Fifty Thousand ($50,000.00) into escrow priot to the expiration of the Contingency Period, or extension thereof, Such extension payment shall be considered non-refundable to Buyer, but applicable to the Purchase Price at Closing, 7.4 Notwithstanding the above, if Buyer removes the general Contingencies by the end of the Contingency Period, or as extended, Buyer shall be allowed an additional contingency (the “Land Use Contingency”) for obtaining land use spprovals (“Buyer’s Land Use Approvals”), subject only to such conditions as Buyer approves. Buyer shall have an additional cighteen months from waiver of the general Contingencies (the “Land Use Contingency Period”) to obtain Buyer's Land Use Approvals, provided that: 1) at the end of the general Contingency Period, Buyer has secured the availability of the 8000 N. Tillamook building through the end of the Land Use Contingency Period and Closing Period; and 2) Buyer makes application for Buyer's Land Use Approvals within the first six months of the Land Use Contingency Period, If the Land Use Contingency is not, in the sole and absolute discretion of Buyer, satisfied by written notice to Seller from Buyer no later than the end of the Land Use Contingency Period, the PSA and any related agreements, including Buyer’s rights to purchase the 8000 N. TillamookLetter of Intent fo Purchase ~ Blanchard Eduention Service Center | 501 N. Dixon St April 11, 2018 Page 4 of 5 building, shall be null and void and of no further force or effect, and the Earnest Money shall promptly be returned to Buyer. 7.4 Agreement by the parties on a relocation timeline for the Seller and a short-term lease, if necessary, for any post-closing occupancy. 8. Due Diligence Materials. Within Thirty (30) days after execution of the Purchase and Sale Agreement, Seller shall deliver to Buyer for inspection and review all items pertaining to the development, ownership, and operation of the Property in Seller’s possession or control, including but not limited to, the following items: 1) a preliminary title report for the Property and copies of all exceptions noted therein; 2) building architectural plans, surveys, appraisals, construction drawings, any HVAC and engineering reports, and any available reports on environmental and/ or geological issues; 3) any reciprocal easement agreements; and 4) pertinent correspondence with governmental agencies relating to development conditions of the Property; (collectively, the “Due Diligence Materials”). Buyer agrees to treat all information so obtained fiom Seller as confidential 9. Access. During the term of the Purchase and Sale Agreement, Buyer and its representatives shall have access to the Property to make or conduct any inspection, investigation, test, or survey reasonably related to the purchase of the Property. Buyer shall indemnify Seller for any loss or liability arising out of Buyer’s activities on the Property. 10. Closing, Closing shall take place on or before Sixty (60) days following Buyer's waiver of all contingencies precedent to closing. If Seller prefers to delay Closing until the timing for a move-out is feasible, Buyer can accommodate such request, so long as the parties agree to a mutually acceptable end-date to such extension, 11, Proration and Costs. Real property taxes, lease rents and all operating expenses shall be prorated at the close of escrow. Seller shall pay the cost of the title insurance policy described below. Buyer and Seller shall each pay one-half of customary escrow charges, 12. Delivery of Title an insurance. Seller shall deliver a Standard Warranty Deed at the close of escrow. Seller shall also deliver the Property to Buyer or assignee of Buyer, free and clear of liens and encumbrances other than liens for taxes not yet payable. 13, je Agreement. Within thirty (30) days of Sellers acceptance of this Letter of Intent, Seller and Buyer shall enter into a PSA reasonably aeceptable to both parties, which shall contain the terms and conditions set forth in this letter of intent, Buyer shall provide a draft of said PSA. 14, Seller's Covenants, Representations and Warranties, The Purchase and Sale Agreement shall contain Seller's covenants, representations and warranties with respect to the following matters, all {in a form reasonably acceptable to Buyer: (a) Seller’ title to the Property, (b) Seller's authority to enter into the transaction, (c) the correctness and completeness of all documents provided to Buyer by Seller, and (4) the absence of defaults under any leases affecting the Propecty.Letter of Intent fo Purchase ~ Blanchard Education Service Center | 501 N. Dixon St April 11, 2018 Page 5 of 5 15, Brokerage Agreement. Seller is not represented by a broker in the proposed transaction, Buyer is represented by Kevin VandenBrink of Macadam Forbes Ine. and shall be compensated per separate agreement by the Buyer. Seller shall have no obligation to pay any commissions as aresult of the sale. The parties acknowledge that no other brokers are party to this transaction. 16. of Acceptance, Buyer requests that Seller respond by 5:00 p.m. Pacific Time on April 27, 2018 to this Letter of Intent. Acceptance is not effective until a copy of this Agreement, which has been signed and dated by Seller, is actually received by Buyer. If Seller needs additional time to consider this Letter of Intent and discuss at the Board level, please indicate when a response may be expected. 17. Seller’s Acceptance. If the above terms and conditions are acceptable, please indicate by signing in the signature block provided below. 18. Legal Effect, This letter of intent shall not bind the parties. A binding agreement will not exist between the parties unless and until the Purchase and Sale Agreement containing all terms and provisions is prepared and executed and delivered by both parties. This letter of intent is not intended to impose any obligation whatsoever on either party, including without limitation, an obligation to negotiate in good faith. Neither party may claim any legal rights against the other by reason of actions taken in reliance upon this non-binding letter of intent including, without limitation, any partial performance of the transactions contemplated by it. The parties acknowledge that this non-binding letter of intent does not address all essential terms of the ‘transaction contemplated by it and that such essential terms will be the subject of further negotiation. The parties further acknowledge and agree that either party will have the right to terminate the negotiation of the PSA for any reason or no reason and that neither party owes the other party any duty to negotiate a formal agreement. No prior or subsequent correspondence or course dealing between the parties will be construed to create any contract or to vest any rights in either party with respect to the PSA. ‘This paragraph supersedes all other conflicting language in this letter of intent. ‘Once this letter of intent has been executed, the parties shall work together in good faith to prepare and execute the Purchase and Sale Agreement as soon as possible, Agreed and accepted: Agreed and accepted: BUYER: SELLER: By (Date) By (Date) Title Title