HomeMy WebLinkAboutRes1988-043
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Sponsored by: Schaefermeyer
CITY OF SEWARD, ALASKA
RESOLUTION NO. 88-043
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
SEWARD, ALASKA, APPROVING AMENDMENTS TO A LEASE
OF CITY-OWNED REAL PROPERTY BY AND BETWEEN THE
CITY AND CHUGACH ALASKA CORPORATION
WHEREAS, on January 11, 1988, the Seward City Council
approved Resolution No. 88-007, authorizing a lease of
city-owned property to Chugach Alaska Corporation; and
WHEREAS, following public hearing on April 25, 1988,
the City Council has determined that it is in the public
interest to authorize certain amendments to the lease which
would alter the terms of the lease with regard to lease
assignment for financing purposes, right of lessee to
terminate lease if unable to receive essential government
permits, and various insurance requirements;
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF
THE CITY OF SEWARD, ALASKA, that:
Section 1. The city manager is hereby authorized to
execute the "Chugach Alaska Corporation Addendum to Lease"
which is attached and incorporated herein by reference.
Section 2. This resolution shall take effect thirty
(30) days after passage and posting as required by law.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF
SEWARD, ALASKA, this 25 day of April , 19~
THE CITY OF SEWARD, ALASKA
~C~'~A.4
HARR . GIESELER, MAYOR
AYES:
NOES:
ABSENT:
ABSTAIN:
DUNHAM, GIESELER, HILTON, NOLL, O'BRIEN & SIMUTIS
NONE
MEEHAN
NONE
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CITY OF SEWARD, ALASKA
RESOLUTION NO. 88-043
ATTEST:
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(City Seal)
APPROVED AS TO FORM:
HUGHES, THORSNESS, GANTZ,
POWELL & BRUNDIN, Attorneys
for the City of Seward, AK
7~ 1If~
Fred B. Arvidson
City Attorney
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CHUGACH ALASKA CORPORATION
ADDENDUM TO LEASE
The lease agreement between Chugach Alaska Corporation and the
City of Seward approved by the City of Seward City Council on
January 11, 1988, by Resolution 88-007 is hereby amended as
follows:
SECTION 1. The provisions of ARTICLE 2, Section 2.3 of the
Lease Agreement are amended to read as follows:
2.3--Permits. CITY shall cooperate in good faith
with LESSEE in LESSEE's efforts to promptly obtain any required
permits for construction or operation of LESSEE's facilities.
If, despite best efforts of LESSEE and CITY the
LESSEE or the City has not received the following permits by
June 1, 1989, LESSEE shall have the option, at its discretion,
to terminate this lease agreement in accordance with section of
this lease agreement:
a) A Tidelands Lease or Right of Entry from
the State of Alaska Department of Natural Resources,
b) Any required Waste-water disposal or Air
Quality Control Certification from the Deparment of
Environmental Control of the State of Alaska,
c) Any required permit from the United States
Army Corps of Engineers pursuant to Section 404 of the Clean
Water Act.
Upon termination by LESSEE under this section LESSEE
shall not be entitled to any refund, rebate, or payments from
the CITY for any rent, investment, or costs incurred by LESSEE
with respect to the development of the leased land, it being the
intent of the parties that the risk of obtaining the required
permits be solely a risk undertaken by LESSEE.
At LESSEE's request CITY will apply for any
necessary tidelands lease or ownership transfer from the
appropriate governmental agencies. LESSEE will cooperate in
that application process and both parties will assist the other
in expediting the application and grant process. If CITY
obtains a lease or title to the tidelands adjacent to the leased
land then it will provide LESSEE--for no additional
consideration other than that contained in this lease--rights of
access across said tidelands adequate for LESSEE's operations.
LESSEE agrees to pay whatever charges might be incurred by CITY
either in the form of lease payments to the governmental agency
having title to the tidelands, or any other permits or agency
fees as they become due. Any such charges shall not be subject
to credits against rent under ARTICLE 6. LESSEE may contest the
amount or applicability of any of those charges but LESSEE will
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not allow any lapse or default under any applicable leases or
permits. In the event that CITY does not obtain a tidelands
lease/title on terms and conditions acceptable to LESSEE, LESSEE
may terminate this lease without further obligation to CITY.
SECTION 2. ARTICLE 15 of the Lease Agreement is amended to read
as follows:
ARTICLE 15.--SUBLEASE OR ASSIGNMENT.
15.1--Assianment of Lease or Subleasina for
Operations. The parties recognize that a material reason for
the finding by the City Council of Seward in Resolution 88-007
that it is in the public interest to lease the lease land to
LESSEE is LESSEE's status as a Native Regional Corporation under
43 U.S.C. ~1601 (et.seq.) and the interests of its Alaska Native
shareholders, a substantial number of whom are residents of the
City of Seward. Therefore, CITY shall have the right to refuse
permission to any prospective assignee, sub-lessee or sub-tenant
even though such entity intends to use the leased land for
forest products manufacturing, and even though that corporation
may be an Alaska Native Corporation, it being understood that
one of CITY's reasons for entering into this lease is the
compatibility of LESSEE's corporate objective with CITY's desire
to promote the public interest.
l5.2--Assianment of Lease for Security.
Notwithstanding Section 15.1 above, LESSEE may assign, encumber
or mortgage its interests in this lease or improvements on the
leased land, by deed of trust or other security instrument, to
an institutional lender ("Lender") for development of or
operations on the leased land, provided that Lender shall be
subject to all obligations of LESSEE under the terms of this
lease agreement. CITY shal1 furnish Lender, at the address
provided to CITY by Lender in writing, with notice of any
default or breach of LESSEE under this lease. Lender shall have
the right (without being required to do so and without thereby
assuming the obligations of LESSEE under this lease) to make
good such default or breach within thirty (30) days after
written notice specifying such breach. Notwithstanding the
provisions of Article 12 above, no "LESSEE Act of Default" shall
exist until expiration of thirty (30) days after such notice is
furnished to Lender; provided, a) if Lender, with respect to
any default or breach other than a failure to make any required
payment of rent or other money, shall undertake within thirty
days after notice to cure the default or breach and shal1
diligently and in good faith proceed to do so, CITY may not
terminate this lease or relet the leased land unless Lender
fails to cure the default or breach within a reasonable period
of time thereafter; and b) if the default for which notice is
given is a breach of Article l2(c), CITY shall not exercise any
of the remedies afforded to it under Article 13 above so long as
Addendum to Lease Agreement
Chugach Alaska Corporation
Page 2
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LESSEE or Lender remains in possession of the leased land and
satisfied LESSEE's obligations under the terms of this lease.
Upon foreclosure or other assertion of its security interest,
Lender may further assign, transfer, or dispose of its
interests, provided that any subsequent assignee, purchaser or
transferee shall remain bound by each and every term of this
lease agreement.
l5.3--Assianment to Affiliate. LESSEE may assign
this lease to an affiliate of LESSEE as that term is defined by
A.S. 10.05.825(1); provided, however, that LESSEE's full faith
and credit shall remain obligated under this lease agreement as
though the transfer had not taken place.
DATED this ____ day of April, 1988.
CITY:
LESSEE:
CITY OF SEWARD
CHUGACH ALASKA CORPORATION,
INC.
BY:
Its:
BY:
Its:
Attest:
City Clerk
4421S
Addendum to Lease Agreement
Chugach Alaska Corporation
Page 3