HomeMy WebLinkAboutRes2022-046 Resurrection Bay Seafoods Lease1
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Sponsored by: Bower
Public Hearing: April 11, 2022
CITY OF SEWARD, ALASKA
RESOLUTION 2022-046
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD,
ALASKA, AUTHORIZING THE CITY MANAGER TO ENTER INTO A
NEW 20 YEAR LEASE WITH 2 FIVE-YEAR OPTIONS TO EXTEND WITH
PACIFIC RESURRECTION BAY SEAFOODS FOR PARCEL 14823009 AND
PARCEL 14823010 IN THE SEWARD RECORDING DISTRICT, THIRD
JUDICIAL DISTRICT, STATE OF ALASKA, CONSISTING OF
APPROXIMATELY PARCEL A 19,756 SQUARE FEET AND PARCEL B
33,572 SQUARE FEET, MORE OR LESS
WHEREAS, Pacific Resurrection Bay Seafoods Inc. has been a large part of the Seward
community for a long time; and
WHEREAS, the City of Seward and Pacific Resurrection Bay Seafoods Inc., entered into
Lease No 91-07 on September 6, 1991, which the lease has been transferred through an estoppel
certificate; and
WHEREAS, the current lease expired on September 30, 2021; and
WHEREAS, Pacific Resurrection Bay Seafoods Inc. has submitted a request to renew the
ground lease with the City of Seward; and
WHEREAS, the City Manager and administration has negotiated a new 20-year lease with 2
five-year extensions with Pacific Resurrection Bay Seafoods Inc. which will, among other things,
incorporate standard lease language for City leases which represent substantive changes to the lease
language as compared to the lease initially approved in 1991.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF SEWARD, ALASKA, that:
Section 1. The City Council hereby approves a new lease for Portion of ATS 174 (Parcel
A & B), between the City of Seward and Pacific Resurrection Bay Seafoods Inc., expiring March
29, 2042 with two 5-year options to extend, in substantial form as attached hereto.
Section 2. The City Manager is authorized to execute a new lease with Pacific Resurrection
Bay Seafoods Inc.
Section 3. This resolution shall take effect thirty (30) days upon adoption.
CITY OF SEWARD, ALASKA
RESOLUTION 2022-046
PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this 11th
day of April, 2022.
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST:
T
isty Terry,
Casagranda, McClure, DeMoss, Osenga, Wells, Calhoon, Terry
None
None
None
Brenda J. Balld MMC
City Clerk
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City Council Agenda Statement
Meeting Date: April 11, 2022
To: City Council
From: Janette Bower, City Manager
Agenda Item: Resolution 2022-046: Authorizing the City Manager to Enter into a New 20
Year Lease with 2 Five -Year Options to Extend with Pacific Resurrection Bay
Seafoods for Parcel 14823009 and Parcel 14823010 in the Seward Recording
District, Third Judicial District, State of Alaska, Consisting of Approximately
Parcel A 19,756 Square Feet and Parcel B 33,572 Square Feet, More or Less
Background and justification:
The Seward City Council approved the initial lease for Seward Marine Services, on October 23,1991,
for a thirty-year term with no options to extend. The initial lease was for Parcel A 19,756 square feet
and Parcel B 33,572 square feet more or less; with an amendment by Estoppel Certificate dated
March 6, 2006, as evidenced by an Assignment and Assumption of Lease recorded July 1, 1996.
Lease (91-70) expired on September 30, 2021. Pacific Resurrection Bay Seafoods Inc. has requested
a new thirty-year ground lease.
The City Manager and administration has negotiated a new 20-year lease with two five-year
extensions, the new lease also incorporates standard lease language which has been added to all
City leases since the original Seward Marine Services lease was approved thirty years ago (i.e. lease
appraisals; annual CPI rental adjustments, etc.).
The current lease payment is $8,400; this would be reduced according to the amount of lease
credits applied, it could also change with the 2022 yearly CPI or upon the new appraisal in 2025.
Comprehensive and Strategic Plan Consistency Information
This legislation is consistent with (citation listed):
Comprehensive Plan: p 23/ 3.5.1.1 Encourage the growth and development of an efficient, functional
boat harbor that meets Seward's commercial and recreational needs
Strategic Plan:
Other:
Page 6/ Attract New Industry - Develop an aggressive marketing campaign
which highlights the
diverse resources and quality of life that make Seward a great place
to live and establish a business or industry
N/A
Certification of Funds
Total amount of funds listed in this legislation: $ 8,400
Th s legislation (✓):
Creates revenue in the amount of:
Creates expenditure in amount of:
Creates a savings in the amount of:
Has no fiscal impact
X
$ 8,400
32
Funds are (✓):
Budgeted Line item(s):
Not budgeted
Not applicable
11000- 2000-5000
Unassigned Fund Balance and Available Unrestricted Cash Balance Information
Fund (✓):
General
Boat Harbor
Motor Pool
SMIC
Parking
Other
Electric
Water
Wastewater
Healthcare
Unassigned Fund Balance*: $
Available Unrestricted Cash Balance*: $
Attorney Review✓
Yes
Not applicable
Finance Signature:
*unaudited numbers
�.� tit ,' 4:
Administration Recommendation
Adopt Resolution
Other:
33
ESTOPPEL CERTIFICATE
This Estoppel Certificate is entered into this v day of /lAi(CH, 2006, by the City of Seward.
RECITALS:
A. The City of Seward ("City"), as landlord, and Seward Marine Services, Inc. ("Original Tenant"), as
tenant, entered into that certain Lease Agreement ("Original Lease") dated September 6, 1991 for certain premises
more particularly described therein ("Premises"). The Original Lease was evidenced by a Memorandum of Lease,
dated October 25, 1991, and a subsequent Lease Memorandum Amendment, dated January 30, 1992. The Original
Lease was amended by that certain Second Amendment to Lease, dated October 1, 1995. (Collectively, the foregoing
shall be referred to as the "Lease".)
B. Original Tenant assigned its interest in the Lease to Wards Cove Packing Company, an Alaska
corporation, pursuant to that certain Assignment of Lease, dated November 1995. Wards Cove Packing Company
subsequently assigned its interest to 2-3, LLC, an Alaska limited liability company, pursuant to that certain Assignment
and Assumption of Lease Agreement, dated February 23, 2003. (2-3, LLC has since changed its corporate name to
Resurrection Bay Seafoods, LLC ("RBS")).
C. As of the date hereof, RBS is the valid and legal tenant under the Lease.
D. RBS and Pacific Resurrection Bay, Inc., an Alaska corporation ("Pacific"), have entered, or will
enter, into a Purchase and Sale Agreement, whereby RBS will sell to Pacific the Resurrection Bay Seafoods plant. As
part of the sale of the Resurrection Bay Seafoods plant, RBS intends to assign its interest in the Lease to Pacific.
Consent by the City to this assignment is not required under the Lease, unless RBS desires to be released from liability
under the Lease which RBS has not elected to do.
E. Pacific requests this estoppel certificate as a condition of its purchase of the Resurrection Bay
Seafoods plant.
NOW THEREFORE, the City certifies as follows:
1. Lease. The Lease, a copy of which is attached hereto as Exhibit A, is a true, correct and complete agreement
between City and RBS with respect to the Premises. The Lease has not been modified or amended, orally or in
writing, except pursuant to amendments attached hereto as part of Exhibit A. No agreement or obligation of any kind
with respect to the Premises exists between the City, as landlord, and RBS, as tenant, under the Lease except for the
Lease attached hereto.
2. Exniration of Term. The term of the Lease expires on, unless terminated earlier as provided in the Lease (such
as tenant default), September 30, 2021.
3. Rent. Rent is based on the fair market rental value of the Premises, adjusted every five (5) years under the
procedure set forth in Article 3.3. The last fair market rental adjustment appraisal dated April 12, 2005 did not require
a change in the current rate which became effective January 1, 2006, and the next fair market rental adjustment will
occur in July, 2010. The current annual rent is $3,200.00.
4. Prepaid rent or security deposit. RBS has not prepaid any rent or made a security deposit except as
specifically set forth in the Lease.
(00392403.DOC;2}
l
36
5. No defaults. The Lease is in effect and there is no existing monetary default on the part of City or RBS and to
the City's knowledge, there is no non -monetary default, claimed default or failure of any performance required by
either City or RBS or any outstanding non- monetary obligations of City or RBS due under the Lease.
(00392403.DDC,2)
CITY OF SEWARD
By: ChL
Clark Corbridge, City ‘jokna3—k-at
ger
ATTESTED BY:
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191,77243723
03/2:3/2E122 11: 39
1907224:3723
RESURECTIONBAY SEAFD
PAGE 01/35
CITY REVISIONS DATED 3/29/2022.
AMENDED AND RESTATED
LEASE AGREEMENT
between
CITY OF SEWARD, ALASKA
and
Pacific Resun-ection Bay Seafoods.
Effective Date
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03/29/2022 11:39
3.9
ARTICLE 4
4.1
4.2
4.3
4.4
4.5
4.6
4,7
4.8
ARTICLE 5 -
5 .1
5,2
5.3
1- LEASED LAND
ARTICLE 6-
6.1
6.2
ARTICLE 7-
ARTICLE 8-
ARTICLE 9-
ARTICLE 10
ARTICLE 11
11.1
TABLE OF CONTENTS
1
Description ofLeased Land 1
Covenant of Quiet Etyoyment; Warranty of Title
Property Accepted 2
2
Permits
2
Platting
2
Development of Leased Land
2
Amendment and Restatement of Original Lease.3
- LEASE TERM
- RENTAL RATE
3
Initial Rental Rate
3
Rental Adjustments
4
Procedure for Rental Adjustment 4
Effect of Ltzte Appraisal by CITY
4
Appraisal by LESSEE
Tariffs and Other Service Fees
Time for Payment of Utilities and Taxes 7
Other Uses
7
Use of Public Docks and Pori Facilities 7
UTILITIES AND RIGHTS OF ACCESS 8
Utilities
8
ARTICLE
Li
1.2
J,3
1.4
1.5
1,6
1.7
ARTICLE 2
ARTICLE 3
3.1
3.2
3.3
3.4
3.5
3.6
3.7
4
Effective _Date ofAcljusted Rental Rate 5
Interim Rental Adjustments
5
3.8 Rent Payment Credits for Production and Employment Error! Bookmark not
defined.
Late Payment Charge
- USE OF LEASED LAND
Use of Leased Land
6
6
6
Obligations: of LESSEE
6
No Preferential Rights to Use Public Facilities 6
Adequacy of Public Facilities 6
Third -Party Improvements 8
Easements
9
CONSTRUCTION BY LESSEE 9
Improvements on Leased Land
9
City Review of Cana traction
1 0
RETURN OF LEASED LAND/SITE CONDITIONS . 11
FORCE MAJEURE
11
LESSEE'S ACTS OF DEFAULT 11
- REMEDIES FOR DEFAULT BY LESSEE 12
- TITLE TO IMPROVEAUNTS INSTALLED BY LESSEE 14
Real Property Improvements 14
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11.2 Personal Property
ARTICLE 12
12,1
12.2
12.3
12.4
ARTICLE 13
ARTICLE 14
ARTICLE 15
15.1 Minimum _Insurance Requirements
15.2 Subrogation Rights Waived
15.3
ARTICLE 16
ARTICLE 17
17.1
ARTICLE 18
18.1
18.2
18.3
ARTICLE 19
19.1
19.2
ARTICLE 20
ARTICLE 21
ARTICLE 22
ARTICLE 23
ARTICLE 24
ARTICLE 25
ARTICLE 26
ARTICLE 27
ARTICLE 28
ARTICLE 29
ARTICLE 30
ARTICLE 31
ARTICLE 32
ARTICLE 33
ARTICLE 34
EXHIBIT A
EXHIBIT B
15
- ASSIGNMENT OR SUBLEASE 15
Assignment of Lease or Subleasing 15
Assignment of Lease for Security 15
Assignment to Affiliate 16
Assignment or Encumbrance by City 16
- LESSEE'S DUTY TO DEFEND/INDEMNIFY 16
- CITY'S MfTY TO DEFEND/LNDEMNIFY 17
- INSURANCE 17
17
18
Restoration of Buildings and Itnprovements 18
- CONDEMNATION 19
ARBITRATION 20
Arbitration 20
MAINTENANCE AND REPAIRS 21
Normal Maintenance 21
Safety Issues 21
Cost °Repairs 22
- ENVIRONMENTAL CONCERNS 22
Hazardous Materials 22
Permits and Reporting 24
- ESTOPPEL CERTIFICATES 25
- CONDITIONS AND COVENANTS 25
- NO WAIVER OF BREACH 25
- TIME OF THE ESSENCE 25
- COMPUTATION OF TIME - 25
- SUCCESSORS IN INTEREST 26
- ENTIRE AGREEMENT 26
- GOVERNING LAW 26
- PARTIAL INVALIDITY 26
- RELATIONSIFI1P OF PARTIES 26
- INTERPRETATION 26
- CAPTIONS 26
AMENDMENT 27
- NOTICES . 27
- FIRE PROTECTION FOR LEASED LAND 27
Li
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AMENDED AND RESTATED LEASE AGREEMENT
TJS AMENDED AND RESTATED LEASE AGREEMENT T (the "LEASE") is made
by and between the CITY OF SEWAR,D (the "CITY"), a municipal corporation located in. the
Kenai Peninsula Borough, State of Alaska, whose mailing address is P.O. Box 167, Seward,
Alaska 99664 and Seward Pacific Resurrection Bay Seafoods Inc_ (the "LESSEE"), an Alaska
corporation whose mailing address is P.O. Box 1710 Seward, AK 99664.
WHEREAS, LESSEE is currently occupying the Leased Land (a$ defined in Section 1.1
below) pursuant to various leases and most recently pursuant to that certain Ground Lease
(Contract No. 91-07), dated September 6, 1991, as amended by Estoppel Certificate dated March
6, 2006, as evidenced by a Assignment and Assumption of Lease recorded July 1, 1996, in Book
82 at Page 92, Seward Recording District, Third judicial District, State of Alaska (collectively, the
"ORIGINAL LEASE') and desires to continue to lease the Leased Land; and
WHEREAS, the City Council of CITY has determined that a continued lease of the Leased
Land (as defined below) to LESSEE for the purposes described herein would be in the public
interest; and
WHEREAS, pursuant to this LEASE, CITY and LESSEE desire to amend and restate the
ORIGINAL LEASE in its entirety; and
WHEREAS, neither CITY nor LESSEE intends that anything in this LEASE shall be
construed as a novation of the ORIGINAL LEASE, and this LEASE shall not affect a novation of
the ORIGINAL LEASE; and
WHEREAS, it is the intent of this LEASE to transfer from CITY to LESSEE the entire
burden of compliance with environmental regulations or controls with respect to LESSEE's
operations on the Leased Land.
NOW THEREFORE, for and in consideration of the mutual promises and covenants
hereinafter contained, the parties hereto agree as follows;
1.1
ARTICLE I - LEASED LAND
escriptiast of Leased Land. The Leased Land is located in the City of Seward, Alaska_
The Leased Land is described as follows:
Portion of ATS 1 74(Parcel A & B), Seward Recording District, Third Judicial District,
State of Alaska, consisting of approximately Parcel A 19,756sq ft and Parcel B 33,572sq
ft, more or less (thc "Leased Land") (Tax Parcel ID 14823009 and Parcel B ID 148230 10)_
The Leased Land is also depicted on the attached Exhibit A, and B, which is
incorporated herein by refexeuce.
1
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1.2 Covenant of Quiet Enjoyment; Warranty of Title. Subject to theencumbrances as of the
date hereof, any appurtenant easements or rights of way, and any reasonable restrictions
imposed on the Leased Land as part of recording of a plat by CITY, and the provisions of
this LEASE, C1'.l' Y hereby covenants and warrants that LESSEE shall have the quiet
enjoyment and possession of the Leased Land for the full term of this LEASE.
1.3 Property Accepted "As -is." LESSEE acknowledges that it has inspected the Leased Land.
and accepts the same "as -is" and without reliance on any expressed or implied
representations or warranties of CITY (other than the representations in Section 1.2
hereof), or agents of CITY, as to the actual physical condition or characteristics thereof
and the legal description or depiction of the Leased Land in Section 1.1 or Exhibit A hereto.
1,4 Permits. LESSEE, at its sole cost, shall obtain all permits necessary to the construction
and operation of its facilities on the Leased Land, CITY may from time to time, upon
request of LESSEE, execute such documents, petitions, applications, and authorizations as
may be necessary, as the underlying fee owner, to file with ari agency or public body
responsible therefor an application for conditional use permits, zoning and re -zoning,
tentative and final tract approval, or precise plan approval that may be required for the
lawful construction and operation of the facilities of LESSEE permitted on the Leased Land
by the terms of this LEASE. However, nothing in this Section shall be construed as
requiring CITY to support or approve any such application or permit requests. If the
agency or public body responsible to approve or grant such application or permit request
is a City of Seward agency, department, or board. LESSEE shall follow all City of Seward
procedures, the same as any other applicant making similar requests of the City of Seward,
according to the Charter, ordinances, resolutions, or any regulation, rules, or procedures of
the City of Seward, Nothing in this Section imposes any duty or responsibility on CITY
to assist LESSEE in obtaining any other permits or approvals, including without limitation
those required by the U.S. Ariny Corps of Engineers (e.g., wetland fill permits), the
Environmental Protection Agency (e.g., Clean Air Act permits), the Alaska Department of
Public Facilities and Transportation (e.g,, right-of-way permits), the Alaska Department of
Fish and (lame, and the Alaska Department of Environmental Conservation.
1.5 Platting. If LESSEE requests a replat of the Leased Land, CITY shall assist LESSEE in
the preparation and filing of the replat, and LESSEE shall reimburse CITY for CITY's costs
in assisting with the preparation and filing of the replat. In the event CITY elects to replat,
LESSEE agrees to sign the plat and any other documents necessary to complete the platting
or replatting of any area including all or a portion of the Leased Land. LESSEE shall
accept reasonable restrictions, easements, or plat notes as may be required by CITY or
other governmental authorities as a condition to filing the plat of the Leased Land or the
plat of CITY -owned real property adjacent to the Leased Land.
1.6 Development of teased Land. LESSEE shall continue to operate a fish processing
facility, and other uses necessary and incidental to the foregoing, through the term of this
LEASE. LESSEE understands that construction and operations of its marine -related
business is a major consideration for the CITY's agreement to lease the Leased Land to
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P'ESUCFCTIONEA'';' SEAFD PAGE 0r,!35
LESSEE. LESSEE shall not operate any other unrelated business on the Leased Land
without the consent of the CITY,
a) CITY may withhold its Consent as to any proposed business or activity which, in
CITY's sole discretion, is not desirable or compatible with the CITY's operation of
the City of Seward.
b) In accordance with the provisions of Article 12, no assignment or sublease shall be
permitted, unless approved in writing by Crnr. Any sublease shall be expressly
subject and subordinate to this Lease and the rights of the CITY hereunder. The CITY
may elect to not approve any proposed assignment or sublease that might result in a
business or activity that, in the CITY's sole discretion, is undesirable and/or
incompatible with the CITY's Comprehensive .plan_
1.7 Amendment and Restatement of Original Lease. To accommodate LESSEE'S existing
financing. this LEASE amends and restates in its entirety the ORIGINAL LEASE. This
LEASE does not evidence a termination of L ESSEE's leasehold interest in, nor a re -leasing
of, the LEASED LAND. Such leasehold interest of the LESSEE in and to the Leased Laud
pursuant to the ORIGINAL LEASE shall be continuing in all respects, as amended. and
restated by this LEASE. The parties do not intend for this LEASE to be a novation of the
ORIGINAL LEASE, and this LEASE shall not affect a novation of the ORIGLNAL
LEASE.
ARTICLE 2 - LEASE TERM
The term of this LEASE (the "Lease Term") shall be in accordance with CITY's
authorization in Resolution No. 2022- (the "Resolution"). The Lease Term shall commence
on the date this LEASE is signed by CITY and that date shall be the effective date of this LEASE
(the "Effective Date"). The Lease Term shall tun for approximately 20 years from the Effective
Date, ending at midnight on March 29, 2042. LESSEE shall have the right to extend the ter, in of
this TEASE for 2 additional 5-year periods, provided that:
a) LESSEE exercises its option to extend at least one hundred and eighty (180) days
prior to the expiration of the then current lease term;
b) LESSEE is not in default under any term or provision of this LEASE;
c) LESSEE shall exercise its options to extend by sending written notice in accordance
with the provisions of Article 33 of this LEASE.
ARTICLE 3 - RENTAL RATE
3,1 Initial Rental Rate. Commencing on the Effective Date of this LEASE through June 30,
2022, the annual rental rate for the Leased Land shall be set at $iI,400_ Rent shall be
payable quarterly in advance upon the Effective Date of this Lease (prorated for the balance
of the current quarter) and thereafter an or before the 20th day of the month beginning each
calendar quarter: January 20, April 20, July 20 and October 20. The amount of each
3
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RE I_IRECTIONBAV SEAFD PAGE I7r'35
quarterly payment shall be one -quarter of the annual rental rate as initially established or
later adjusted under this Article 3.
3.2 Rental Adjustments. The annual rental payment shall be adjusted on July 1, 2022, and on.
the same date every five years thereafter (each a "Rental Adjustment Date"). The adjusted
annual rental payment to be paid under the terms of tins Lease shall be the appraised fair
market rental value (the "Fait- Market Rental Value") of the Leased Land at the highest and
best use of the Leased Land. The highest and best use of the Leased Land shall be
determined without regard to LESSEE's intended or actual use of the Leased Land unless
that use is coincidentally the highest and best use of the Leased Land. CITY shall complete
such appraisal and deliver a copy of the appraisal report to LESSEE not less than ninety
(90) days before each Rental Adjustment Date.
3.3 Procedure for Rental Adjustment To adjust the rent as of any successive Rental
Adjustment Date, CITY shall, at its own expense, retain an independent State of Alaska
certified MAI appraiser (Member, Appraisal Institute), who shall determine the "Fair
Market Rental Value" of the Leased Land in accordnce with this Article 3, exclusive of
improvements placed thereon by LESSEE at any time but inclusive of all improvements
made by CITY (including those made by CITY before or subsequent to this LEASE). The
appraiser's report shall be delivered to LESSEE not less than ninety (90) days before the
Rental Adjustment Date. The appraiser's determination of Fair Market Rental Value of the
Leased Land shall constitute a final binding determination of the Fair Market Rental Value
and the adjusted annual rental rate until the next Rental Adjustment Date, unless LESSR1~'
objects to CITY's appraiser's determination of the Fair Market Rental Value. In that case,
LESSEE shall give written notice to CITY of its objection within thirty (30) days of receipt
of the appraiser's report, and LESSEE shall then engage an independent State of Alaska
certified l IAI appraiser (Member, Appraisal Institute) at LESSEE'S expense to make an
appraisal of the Fair Market Rental Value in accordance with this Article 3.
If LESSEE's appraisal determines a Fair Market Rental Value that varies from that
determined by CITY's appraisal by no more than twenty percent (20%), then the adjusted
rental rate shall be the average of the rental rates determined by the two appraisals. If
LESSEE's appraisal determines a hair Market Rental Value that varies from CITY's
appraisal by more than twenty percent (20%), then, unless CITY and LESSEE agree on a
rate themselves_ the adjusted annual rental rate of the Leased Land shall be determined in.
accordance with the arbitration provisions contained in Article 19 of this LEASE.
3A Effect afLate Appraisal by CITY If, for any reason, CITY does not complete the appraisal
or deliver a copy of the appraisal report to LESSEE ninety (90) days before the Rental
Adjustment Date, CITY may proceed to complete the appraisal or deliver a copy of the
appraisal report to LESSEE at any time thereafter. However, any such adjusted annual
rental rate shall not be effective until the quarterly payrneut due date immediately following
the date CITY delivers the appraisal report to LESSEE.
3.5 Appraisal by T.1 SS` E, If, for any particular Rental Adjustment Date, CITY fails to obtain
an appraisal of the Fair Market Rental Value or fails to deliver rile appraisal report to the
4
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LESSEE by the Rental Adjustment Date, LESSEE may engage an independent State of
Alaska certified MAI appraiser (Member, Appraisal Institute) at LESSEES expense to
make an appraisal under the terms of this Article 3 and submit a copy to CITY before the
next quarterly rental paynient due date. However, LESSEE must notify CITY in -writing
within thirty (30) days following the Rental Adjustment Date of LESSEE'S election to
obtain an appraisal, If CITY objects to LESSEES appraiser's determination of the Fair
Market Rental Value, CITY shall give written notice to LESSEE of its objection within
thirty (30) days of receipt of the appraiser's report, and CITY shad then engage an
independent State of Alaska certified MAT appraiser (Member, Appraisal Institute) at
CITY's expense to make an appraisal of the Fair Market Rental Value as of the Rental
Adjustment Date and in accordance with this Article 3, If the CITY's appraisal determines
a X'air Market Rental Value that varies from that determined by LESSEE'S appraisal by no
more than. twenty percent (20%), then the adjusted rental rate shall be the average of the
rental rates determined by the two appraisals. If the CITY's appraisal determines a Fair
Market Rental Value that varies from LESSEE's appraisal by more than twenty percent
(20%), then, unless CITY and LESSEE agree on a rate themselves, the adjusted annual
rental rate of the Leased Land shall be determined in accordance with the arbitration
provisions contained in Article 19 of this LEASE.
3.6 .Effective Date of Adjusted Rental Rate, The adjusted annual rental rate established by this
Article 3 shall apply as of the Rental Adjustment Date if CITY provided a copy of the
appraisal report to LESSEE no later than, ninety (90) days before the Rental Adjustment
Date. Ifthe adjusted annual rental rate is based on CITY's late appraisal or late delivery of
the appraisal report to LESSEE, the adjusted rental rate shall be effective beginning with
the quarterly rental payment due date immediately following the date the CITY delivers
the appraisal report to LESSEE. Notwithstanding the above, the exercise by either CITY
or LESSEE of the objection procedure relating to rental adjustment described in this Article
3 shall not postpone LESSEE's obligation to pay rent at the rate established by CITY.
LESSEE shall pay the amount of rent as established or adjusted by CITY until the question
of objection to the rental rate is finally resolved. At such time the objection to the rental
rate is resolved, an appropriate credit or adjustment shalt be made retroactive to the date
the new rental rate was established by CITY or in cases where CITY failed to obtain an
appraisal or deliver the appraisal report to the LESSEE, to the Rental Adjustment Date.
3.7 Interim Rental Adjustments. For each year in the period between each Rental Adjustment
Date, excepting the Rental Adjustment Dates, the annual rental payment shall be increased
beginning July 1, 2022 and on July I of every year thereafter (each an "Interim Rental
Adjustment Date") in, an amount that reflects the increase, if any, in the cost of living for
the previous year as stated in the Consumer Price Index, All Urban. Consumers, Anchorage,
Alaska Area, All Items 1967=100 ("CPI"), as published by the United States Department
of Labor, Bureau of Labor Statistics for the most recent period published immediately prior
to the Interim. Rental Adjustment Date. In no event shall the rent be less than the previous
year. If the CPI is revised or ceases to be published, the CITY shall instead use such revised
or other index as most nearly approximates the CPI for the relevant period, and make
whatever adjustment in its application as ma.y be necessary, in the CITY's sole discretion,
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to accomplished as nearly the same result as if the CPI had not been revised or ceased to
be published.
3.8 Late Payment Charge_ Rental payments not received by the due date shall bear interest
until paid at a rate of 10.5% per annum, or the maximum rate permitted under Alaska law,
whichever is Iess, plus a flat monthly late fee of $2.50, or such amount as may be
established from time to time by CITY ordinance or resolution and relating to late fees for
CITY leases generally.
ARTICLE 4 - USE OF LEASED LAND
4.1 Use of Leased Land. CITY has limited land available for lease. Use of the Leased Land
by LESSEE has been determined by the City Council of CITY to be in the public interest.
LESSEE may use the Leased Land for fish processing, and other marine oriented business,
4.2 Obligations of LESSEE. LESSEE may use the Leased Land only in accordance with
applicable CITY zoning code provisions and provided the following conditions are met:
a) The Leased Land is to be completely cleaned and restored to its original condition,
that is, the condition existing prior to this LEASE or in better condition upon
termination of this LEASE.
b) LESSEE agrees to prohibit the use, keeping, storage, or disposal of Hazardous
Materials on the Leased Land except as permitted in Article 19 of this LEASE.
c) LESSEE shall not use the Leased Land in any manner or construct any facilities
thereon which would inhibit the use of adjacent or other lauds,
d) LESSEE shall operate a fish processing, cold storage, and other marine oriented
business on the Leased Land_
e) Any changes to this site require prior CITY approval, through the City Manager.
4.3 No Preferential Rights to Use Public Facilities. This LEASE does not grant to LESSEE
any exclusive rights to use any public port facilities constructed or operated by CmTY.
LESSEE will be subject to any tariffs, procedures, rules, and regulations of CITY
concerning the use of such facilities as they may now exist or from time to time be
amended, and LESSEE shall not be entitled to ally exclusive use.
4.4 Adequacy of Public Facilities_ CJTY makes no representations or warranties as to the
fitness of a:ny particular part or the whole of CITY's public facilities for the uses intended
by LESSEE, and LESSEE has inspected those facilities and has satisfied itself that the
facilities are sufficient for the intended uses by LESSEE. CITY makes no representations
or warranties °fatly nature with respect to the c°tercial practicability or accuracy of any
inforzt.ation provided by CITY.
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4.5 Tariffs and Other Service Fes. CITY shall have the right to inake amendments to its
tariffs, regulations, and scheduled fees from time to time, even if those adjustments shall
cost LESSEE more for its operations or use of public facilities, and CITY is free to do so
provided only that it does not impose any greater burden or higher rate upon LESSEE than
upon any other similar user of the public facilities.
4.6 Time for Payment of Utilities and Taxes. LESSEE will pay for utilities and taxes related
to operations on the Leased Land and LE SSEE's interest in this LEASE and improvements
thereon, if any, before suchobligations become delinquent, provided that LESSEE may, in
good faith and before such delinquency, contest any such charge or assessment.
4.7 Other Uses. This LEASE shall not preclude the CITY from actively seeking other and
additional tenants for space, including those who would be in competition with LESSEE
or who might be interested in leasing the Leased Land should this LEASE be terminated
for any reason.
4.8 Use of Pudic Docks and Fort Facilities. public docks are subject to port and harbor rules
and regulations as adopted by City Council,
4.9 Adequacy of Public Facilities. The City makes no representations or warranties as to any
particular part or the whole of CITY 's public facilities With respect to their fitness for the
uses intended by LESSEE. In. particular, LESSEE has had an opportunity to review
C1TY''s Reconnaissance Studies for repair and upgrade of the Lowell Canyon Diversion
Tunnel project. CITY makes no representations or warranties of any kind with respect to
the present adequacy of the Lowell Canyon Diversion Tunnel facilities including the spill-
way and outfall located near the Leased Land, nor does CITY herby undertake any special
obligations to repair, replace or refurbish that facility in order to provide flood and disaster
protection for LESSEE'S operations from and near the Leased Land LESSEE has
examined the plans and specifications of those facilities and has satisfied itself that the
capacities of the facilities are sufficient for the intended uses of Leased Land by LESSEE.
4.10 Risk of Adjacent _Facilities Including Lowell Canyon Diversion Tunnel, Access Road and
Easements, Lessee will not use the land in any manner or construct any facilities thereon
which would inhibit the us of adjacent or other lands including the existing Lowell Canyon
Diversion Tunnel, the existing Lowell Point access road and easements (including the
sewage line to the Seward sewage lagoon).
If any operations or construction by LESSEE might adversely affect the safety of
nearby public lands and facilities or pose a risk to the public health or safety, CITY may
engage an independent engineering consultant who shall furnish to CITY a comprehensive
survey and report for the purpose of establishing whether the work by a LESSEE poses an
unreasonable risk to the public, and if that survey discloses an unreasonable risk then
LESSFF shall pay the costs of the survey and the immediately take whatever remedial
steps are reported as necessary to eliminate that risk or reduce it to an acceptable level,.
If LESSEE disputes the CITY's selection of an engineer, the it shall promptly, and
within 10 days of such selection provide CITY with the mines of three independent
engineering consultants and Off may utilize any one of the three listed by the LESSEE,
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or in the alternative, CITY may submit the names of two additional engineers. The parties
then shall promptly meet and mutually agree on an acceptable engineer. If they are unable
to agree within five days of the date LESSEE has submitted its list, then both parties shall
promptly and confidentially rank their choice of engineers in the same manner as that
utilized by the American Arbitration Association to select a single arbitrator. The engineer
with the lowers composite score ((i.e., most preferred or least objectionable) shall be the
engineer.
ARTICLE S - UTILITIES AND RIGHTS OF ACCESS
5.1 Utilities. LESSEE, at LESSEE's sole cost and expense, shall provide for the extension of
public utilities to the Leased Land required for LESSEE's intended operations. In so doing,
LESSEE shall comply with all CITY regulations and requirements, and the tariffs of the
affected utilities, with respect to the construction of those utilities. CITY agrees to
cooperate and assist the LESSEE, though consultation and review, th. LESSEE's planning
and engineering of those improvements.. All utilities will be located and sized in
accordance to CITY!s Master Plan for the area leased. All such construction shall be in
compliance with all applicable building, mechanical and fire codes. Utilities constructed
by the LESSEE within the public rights -of -way or within public utility easements will
normally be accepted and maintained by CITY or utility companies and may be used to
serve other customers of CITY's without payment of fees or reimbursement of construction.
cost to the LESSEE, However, this does not preclude several lessees from agreeing to
share the cost of constructing a utility to serve their facilities. CI'Y or other utility
company may determine that it would be to th.ei.r benefit to oversize the utility or install
special fittings or equipment in order to serve other existing or future users. The additional
direct costs of such oversizing shall be borne by CITY or ether utility company.. Such costs
shall be limited to the supplier's cost of the additionalfittings, equipment, direct labor, and
equipment costs to complete the installation. The costs of oversizing pipe or electrical
conduit shall be li rnited to the difference between the supplier's price to provide the size
required to serve LESSEE's facility and the price of the oversized material required by
CITY or utility company.
LESSEE shall not be entitled to any refund, rebate, or payments from CITY for any rent,
investment, or costs incurred by LESSEE with respect to any required permits for
construction or operation of LESSEE'S facilities on the Leased Land, it being the intent of
the parties that the risk of obtaining required permits be solely a risk undertaken by
LESSEE.
5.2 Thir-c-Party Improvements.. At the request of LESSEE, CITY shall, from time to time,
execute and deliver, or join in execution and delivery of, such documents as are
appropriate, necessary, or required to impose upon the Leased Land in accordance with the
terms of this LEASE covenants, conditions, and restrictions providing for the granting of
uses of the Leased Land, or any part thereof, the establishment of party walls, the
establishment of mutual and reciprocal parking rights or rights ofingress or egress, or other
like matters (herein called "third -party improvements"), all of which are for the purpose of
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the orderly development of the Leased Land as a commercial unit subject, however, to the
conditions that:
a) All such matters shall be limited to the Lease Tenn and shall terrninate upon
termination of this LEASE for whatever reason.
Any such matters of a permanent nature extending beyond the Lease Term shall not
be granted without the prior ulitten approval of CITY. In any of the foregoing
instances referred to in this Section, CITY shall be without expense therefor, and
the cost and expense thereof shall be borne solely by LESSEE.
At the expiration of the Lease Term (including any extended period) third -party
improvements on the Leased Land other than trade fixtures and equipment shall
become the property of CITY without the payment of any compensation to
LESSEE.
5.3 Easements. In order to provide for the orderly development of the Leased Land and
adjacent lands, it may be necessary, desirable, or required that street, railroad, water, sewer,
drainage, gas, power line, and other easements and dedications and similar rights he
granted or dedicated over or within portions of the Leased Land. As additional
consideration for this LEASE, CITY and LESSEE each shall, at the request of the other,
join with each other in executing and delivering such documents from time to time and
throughout the Lease Tenn as may be appropriate, necessary, or required by the several
governmental agencies (including the City of Seward), public 'utilities, and other users or
tenants of CIZ"i land for the purpose ofgranting such easements and dedications; provided,
however, that such easements and dedications and similar rights do not unreasonably
interfere with LESSEE'S operations. The costs of locating or relocating any public
easements or restrictions of record including any relocation of public road, railroad, utility,
or other easements shall be at the sole cost and expense of the party requesting the
relocation. CTTY shall not refuse reasonable requests for such relocations provided those
relocations do not interfere with or inhibit the overall development of CITY property or
other public property. Any easements or rights of access granted to LESSEE by CITY
need not be exclusive to LESSEE_
5.4 Delay in Performance_ In the event either LESSEE or CITY is delayed from performance
of any of its obligations under this Lease, due to acts of God, enerics of the United States
of America, war, blockage, insurrection, epidemic, fires, floods, explosions,
earthquakes/tsunami, the time period wherein such performance is to occur shall be
extended by that amount of time necessary to compensate for the delay.
ARTICLE 6 - CONSTRUCTION BY LESSEE
6.1 Improvements on Leased Land. LESSEE shallhave the right to erect, maintain, alter,
remodel, reconstruct, rebuild, build, ancllor replace buildings and other improvements on
the Leased Land, subject to the following conditions:
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a) The cost of any construction, reconstruction demolition, or of any changes,
alterations, or improvements, shall be borne and paid for by LESSEE,
b) The Leased Land shall at all times be kept free of mechanic's and naterialren's
liens.
c) LESSEE shall provide CITY with a copy of all building plans and specifications
and a site development plan or plans (based on a recent survey) for the Leased Land
prior to commencement of construction.
d) LESSEE is solely responsible for resurveying and locating improvements on the
Leased Land in such manner not to violate building setback requirements or
encroach into rights -of -ways or easennents. On completion of any improvements,
LESSEE shall provide CITY a copy of an as -built survey depicting the
improvements as completed on the Leased Land,
e) Any general contractor employed by LESSEE shall be appropriately bonded by use
of performance and labor and material payment bonds in the customary form when
cost ofthe work is equal to or exceeds FIFTY THOUSAND DOLLARS ($50,000).
Copies of all such bonds Shall he furnished to CITY prior to comnencerneut of
construction. If the cost of the work is less than FIFTY THOUSAND DOLLARS
($50,000), LESSEE shall provide CITY, if no performance and labor and material
bonds are provided by LESSEE, any necessary- assurances or guarantees that the
contemplated work will be performed by the general contractor or by LESSEE_ In
the event that LESSEE elects to construct the facility with its own personnel and
equipment, or the personnel and equipment of any corporation or person that is an
"affiliate" of LESSEE as sucb term is defined in AS 10.06.990(2) or Alaska limited
liability company in which LESSEE maintains a substantial membership interest, a
performance bond shall be required when the cost ofthe work is equal to or exceeds -
FIFTY THOUSAND DOLLARS ($50,000).
g)
CITY may, as contemplated by Alaska Statutes, give notice of non -responsibility
for any improvements constructed or effected by LESSEE on the Leased Land.
LESSEE shall comply with all federal, state, and local statutes and regulations with
respect to such construction, including, but not limited to, all applicable building,
mechanical, and fire codes.
6.2 City Review of Construction. CITY shall have the right to review initial plans, including
those supplied to CITY under Section. 6,1 hereof, and any future changes or additions to
LESSEE'S facilities on the Leased Land, by reviewing the design thereof prior to the
commencement of construction. CITY shall have the right to comment upon that design
and to require LESSEE to make reasonable changes so as to avoid interference with public
operations, but the exercise of these rights shall not iraply any obligation to do so nor any
obligation to do so in a particular way. LESSEE shall construct the facility in accordance
with final design specifications approved by CITY. CITY's representatives may monitor
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the work and shall have access to the site at an reasonable times. LESSEE shall, be solely
responsible for completing all improvements according to LESSEE'S plans anid
specifications and shall bear all risk, responsibility, and liability for properly surveying the
Leased Land before construction and to place all improvements on the Leased Land
without encroaching upon any land, easements, rights -of -way, or setback requirements.
LESSEE shall obtain the usual and customary performance guarantees from its contractors.,
and CITY shall be named as an additional insured.
ARTICLE 7 TURN OF LEASED LAND/SITE CONDITIONS
7.1 Return of Leased Land in Original Condition. Subject to the provisions of Article 1.1.1
herein, upon termination of this LEASE for any reason, LESSEE shall return the Leased Land to
CITY in the same condition as at the commencement this LEASE, subject to normal, non -abusive
use. The Leased Land shall be free of all 1Hazardous Materials and contamination arising out of or
resulting from or occurring during LESSEE's operations or use of the Leased Larl.d during this
LEASE.
ARTICLE S u FORCE MAd'EL-R.E
In the event either LESSEE or CTTY is delayed from performance of any of its obligations
under this LEASE due to acts of nature, acts of the enemies of the United States of Ameriea,
sabotage, blockade, insurrection, not, epidemic, fire, flood, explosion, earthquake/tsunami, civil
disturbance, or war, the time period wherein such performance is to occur shall be extended by
that amount of time necessary to compensate for the delay.
ARTICLE 9 m LESSEE'S .ACTS OF DEFAULT
Each of the following shall be a "LESSEE Act of Default" under this LEASE and the terms
"acts of default" and "default" shall mean, whenever they are used in this LEASE, any one or more
of the following events:
9.1 Failure by LES SEE to pay promptly when due, and in no event later than twenty 1,20) days
from the due date thereof, the rent required to be paid under this LEASE,
9.2 Failure by LESSEE to comply with Section 4.1 of this LEASE for a period of thirty (30)
days after written notice specifying such failure, requesting that it be remedied, and stating
that it is a notice of default, has been given to LESSEE by CITY; provided, however, that
if said default is such that it cannot be corrected within the applicable period, it shall not
constitute an act of default if corrective action is instituted by LESSEE within the
applicable period and diligently pursued until the default is corrected.
9.3 Failure by LESSEE to observe, fulfill or perform any covenants, conditions, or agreements
on its part to be observed or performed under this LEASE, other than payment of rent or
compliance with Section 4.1, for a period of thirty (30) days after written notice specifying
such failure, requesting that it be remedied, and stating that it is a notice of default, has
been given to LESSEE by CITY; provided, however, that if said default is such that it
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cannot be corrected within the applicable period, it shall not constitute an act of default if
corrective action is instituted by LESSEE within the applicable period and diligently
pursued until the default is corrected.
9.4 The making by LESSEE of an assignment for the benefit of creditors, the filing of a petition
in bankruptcy by LESSEE, the adjudication of LESSEE as insolvent or bankrupt, the
petition or application by LESSEE to any tribunal for any receiver or any trustee for itself
or for any substantial part of its property; or the commencement of any proceeding relating
to LESSEE under any bankruptcy, insolvency, reorganization, arrangement, or
readjustment of debt law or statute or similar law or statute of any jurisdiction, whether
now or hereafter in effect which shall remain un-dismissed for a period of six (6) months
from the date of coiencernent thereof,
9.5 Violation by LESSEE of any laws or regulations of the United States, or of the State of
Alaska, or any conditions of any permits issued by agencies of the City of Seward, the
Kenai Peninsula Borough, the State of Alaska, or of the United States Government
applicable to LESSEE'S use of the Leased Land, pursuant to the regulations of such
agencies, for a period of sixty (60) days after written notice specifying such violation has
been give, by the agency charged with the enforcement of such laws, regulations, or
permits to LESSEE; provided, however, if such violation be such that it cannot be corrected
within the applicable period, it shall not constitute an act of default if corrective action is
instituted by LESSEE within. the applicable period and diligently pursued until the
violation is corrected. Furthermore, if LESSEE shall contest such alleged violation through
appropriate judicial or administrative channels, the time period specified herein shall not
commence until such proceedings are finally determined provided such proceedings are
diligently pursued; provided, however, that any such extension of tixne shall not be
effective if the effect of the interim administrative or judicial action is to cause a stoppage,
interruption, or threat to the activities of any person or entity other than those of LESSEE.
9.6 Failure of LESSEE to maintain its operations within the Leased Land or to keep the public
rights of way clear for a period of thirty (30) days after written notice specifying such
failure, requesting that it be remedied, and stating that it is a notice of default, has been
given to LESSEE by CITY; provided, however, that if said default is such that it cannot be
corrected within the applicable period, it shall not constitute an act of default if corrective
action is instituted by LESSEE within the applicable period and diligently pursued until
the default is corrected,
ARTICLE 10 - REMEDIES FOR DEFAULT BY LESSEE
Whenever an act of default by LESSEE shall have occurred, and any applicable period for
giving notice and any opportunity to cure shall have expired, CITY shall have the following
rights and remedies all in addition to any rights and remedies that may be given to CITY by statute,
eomrnorr, law, or otherwise:
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10.1 CITY may distrain for rent due any of LESSEE's personal property which comes into
CTTY's possession. This remedy shall include the right of CITY to dispose of personal
property distrained in any commercially reasonable manner. It shall be conclusively
presumed that compliance with the procedures set forth in the Alaska Uniform Commercial
Code (AS 45.20.601-.628) with respect to sale of property shall be a commercially
reasonable disposal. notwithstanding the foregoing, CITY agrees that its rights set forth in
this Section 10.1 shall be junior to the rights granted to any Lender (as defined in Section
12.2) under a Security Instrument (as defined in Section 12.2), and CIT'Y's consent is not
required for a Lender to enter upon the LEASED LAND and assemble, have appraised,
display, sever, remove, maintain, prepare for sale or lease, advertise, inspect, repair, lease,
transfer and/or sell (at public auction or private sale), take possession of, or otherwise
enforce such Lender's security interest in LESSEE's personal property or other assets
located on the Leased Lind in which such Lender holds a security interest.
10.2 CITY may re-enter the Leased Land and take possession thereof and, except for any
personal property of LESSEE which CITY has waived its right to distrain under Section
10.1 above, remove all personal property of LESSEE from the Leased Land. Such personal
property may be stored in place or may be removed and stored in a public warehouse or
elsewhere at the cost of LESSEE all without service of notice or resort to legal process, all
of which LES SEE expressly waives.
10.3 In addition to the above, CITY may:
a) Declare this LEASE terminated;
b) Collect any and all rents due or to become due from subtenants or other occupants
of the Leased Land;
c) Recover from LESSEE, whether this LEASE be tenn mated or not, reasonable
attorney's fees and all other expenses incurred by CITY by reason of the breach or
default by LESSEE;
d) Recover an amount to be due immediately on breach equal to the unpaid rent for
the entire nnnaining term of this LEASE.
e) Recover all damages incurred by CITY by reason of LESSEE's default or breach,
including, but not limited to, the cost of recovering possession. of the Leased Land,
expenses of reletting, including costs of necessary renovation and alteration of the
premises, reasonable attorney's fees, and any real estate commissions actually paid.
f) Remove or require the removal of any improvements constructed without CITY
approval (when such approval is required under this TEASE) or constructed
contrary to site development plans approved by CITY and recover allcosts and
expense incurred by CITY to remove violating improvements.
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10.4 If LESSEE does not immediately surrender possession of the Leased Land after
termination by CITY and upon demand by CITY, CITY may forthwith enter into and upon
and repossess the Leased T.and and expel LESSEE without being deemed guilty in any
manner of trespass and without prejudice to any remedies which might otherwise be used
for arrears of rent or breach of covenant.
10,5 No expiration or termination of this LEASE shall expire or terminate any liability or
obligation to perform of LESSEE's which arose prior to the termination or expiration
except insofar as otherwise agreed to in this LEASE.
10.6 Each right and remedy of CITY provided for in this LEASE shall be cumulative and shall
he in addition to every other right or remedy provided far in this LEASE or now or hereafter
existing at law or in equity or by statute or otherwise, and the exercise or beginning of the
exercise by CITY of any one or more of the rights and remedies provided for in this LEASE
or now or hereafter existing at law or in equity or by statute or otherwise shall not preclude
the sirrnultan.eous or later exercise by CITY of any or all other rights or remedies provided
for in this LEASE or now or thereafter existing at law, or in equity or by statute or
otherwise.
10_7 No delay or omission to exercise any right or power accruing following an act of default
shall impair any such right or power or shall be construed to be a waiver thereof, but any
such right and power .may be exercised from time to time and as often as may he deemed
expedient,
10.8 Notwithstanding any other provisionof this Article X, if this LEASE is rejected in a
bankruptcy or 'insolvency proceeding or terminated due to LESSEE's breach of Section 9.4
above, upon Lender's written request made not more than forty (40) days after this LEASE
is rejected, CITY will enter into a new lease of the Premises with the nominee of such
Lender for the remainder of the term of this LEASE, at the same rent and under the same
terms and conditions set forth in this LEASE. All sums due and owing to CITY under this
LEASE shall be paid at the time of execution. of the new lease.
ARTICLE 11 - Trrix TO IMPROVEMENTS INSTALLED BY LESSEE
11.1 Re'al Property Improvements. All improvements constructed by LESSEE or its
predecessors on the Leased Land or on easements to or from the same, such as buildings,
warehouses, conveyor systems, ditches, sewer lines, water lines, dikes or berms and similar
improvements, are the property of LESSEE and shall be removed by LESSEE at the
termination of this LEASE. for any reason. All such improvements that are not removed
by LESSEE prior to the termination of this LEASE shall become the property of CITY
upon termination of this LEASE for any reason; provided, however, that CITY may require
LESSEE to remove any improvements desigated by CITY and without cost to CITY by
giving notice to LESSEE of such requirement not more than 10 days after termination of
this LEASE and sooner if possible. LESSEE shall have a period not to exceed three
hundred sixty-five (365) days after LEASE termination or LESSEE's receipt of such notice
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(whichever is later) in which to remove such improvements, and LESSEE shall pay rent
during such time, and shall continue to pay public utility hills until it has completed the
removal obligations described in this Section 11.1,
11.2 Personal Property. Any other provisions of this LEASE to the contrary notwithstanding,
LESSEE, upon termination of this LEASE for any reason, may, but need Trot, promptly
remove, in no event later than ninety (90) days from the termination of the LEASE, trade
fixtures and equipment from the Leased Land provided that LESSEE shall repair any
damages to the Leased Laird caused by such removal..
ARTICLE 12 - ASSIGNMENT OR SUBLEASE
12.1 Assignment of Lease or Subleasing. The parties recognize that this LEASE has been
determined to be in the public interest by the City Council of CITY for the reasons set forth
in the approving Resolution. The rights and duties created by the LEASE are personal to
LESSEE and CITY has granted the LEASE in reliance upon the business character and
financial capability of LESSEE. Therefore, LESSEE shall not assign or sublease this
LEASE without CITY's prior written consent, in CITY's sole discretion.
1.2.2 Assignment of Lease for Security. Notwithstanding Section 12.1 above, LESSEE may
assign, encumber, or mortgage its interest in this LEASE or improvements on the Leased
Land, by deed of trust or other security instrument (the "Security l`nstrument"), to (i) the
State of Alaska to secure the LESSEE's tax obligations, and (ii) one or more entities
engaged in the business of loaning money for LESSEE's development of or operations on
the Leased Land (each beneficiary named in such Security Instrument referred to
hereinafter as the "Lender"). CITY's consent is not required for any Security Instrument
as described herein, or any loan documents related to the saute (or any amendment,
modification, restatement, supplement, renewal or substitution thereof), but upon a
Lender's request, CITY shall execute a consent to the Security Instrument or include
consent language in an estoppel certificate provided to CITY pursuant to Article XX of
this LEASE. If requested by a Lender, CITY shall furnish such. Lender, at the address
provided to CITY by Lender in writing, with notice of any default or breach of 7.F.SSEE
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 receipt of such written notice specifying such breach.
Notwithstanding the provisions of Article 10 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 (30) days
after notice to cure the default or breach and shall diligently and in good faith
proceed to do so, CITY may not terminate this LEASE or relet the Leased Land
unless Lender fails tocure the default or breach within a reasonable period of time
thereafter; and
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b) If the default for which notice is given is a breach. of Section 9.3, CITY shall not
exercise any of the remedies afforded to it under Article 10 above so long as
LESSEE or Lender remains in possession of the Leased Lancl and satisfies
LESSEE'S obligations under the terms of this LEASE.
This LEASE shall not be terminated upon foreclosure or other assertion by Lender of its
security interest as long as all obligations of LESSEE under the terms of this LEASE
continue to be performed. Any assignee, purchaser at a foreclosure sale, or transferee
shall agree to assume this i.FASE and be bound by each and every term of this LEASE.
No amendment, modification or termination of this LEASE prior to its expiration date shall
be effective at any time that the Security Instrument remains effective, unless Lender shall
have given its prior written consent thereto, which consent shall not unreasonably be
withheld, If at any time the leasehold interest under this; IXASE and the fee estate in the
Leased Land are commonly held, such estates shall remain separate and distinct estates and
shall not merge without the consent of Lender.
12.3 Assignment to Affiliate. Notwithstanding Section. 12.1 above, LESSEE may assign this
LEASE to an affiliate of LESSEE or of its parent company (as the teen "affiliate" is defined
by AS 10.06.990(2)) or to an Alaska limited liability company in which LESSEE or its
parent company maintains a substantial membership interest; provided, however, that
LESSEE's full faith and credit shall remain obligated under this LEASE as though the
assignment had not taken place.
12.4 Assignment or Encumbrance by CITY. CITY agrees that, so long as any Security
Instrument remains outstanding, the CITY shall not encumber its interest in the Leased
Land or under the LEASE in any :respect without the prior written consent of the LESSEE'S
Lender. If any deed of trust or similar instrument encumbers the CITY's interest in the
Leased Land (a -CITY Deed ofTrust") and is senior in priority to this LEASE, the CITY
agrees to obtain: (i) a non -disturbance agreement in form reasonably satisfactory to Lender
pursuant to which the beneficiary named in such CITY Deed of Trust agrees not to disturb
the possession of LESSEE or Lender and their successor and assigns so long as LESSEE
and Lender and their successors and assigns comply with this LEASE.
ARTICLE 13 M LESSEE'S DUTY TO DEFEND/INDENLNIFY
LESSEE shall defend, indemnify, and hold harmless CITY, its officials, employees, agents,
and contractors from any and all liability or claims for damages, including personal injuries,
environmental damage, death and property damage arising out of or resulting from LESSEE'S use
of the Leased Land or the use of the Leased Land by LESSEE'S sub lessees, assignees, agents,
contractors, or thepublic, except for damages arising from the sole ncgli-pence or willful acts or
omissions of CITY, its officials, employees, agents, or contractors. If any action or proceeding is
brought against I,PS SY by reason of any such occurrence, LESSEE shall notify CITY promptly
in writing of such action or proceeding.
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ARTICLE 14 - CITY'S DUTY TO DEFEND/INDEMNIFY
CITY shall defend, indemnify and hold LESSEE barrttess from any and all liability or
claims for damages, including personal injuries, death, and property damage arising from the sole
negligence or willful acts or omissions of CITY, its officials, employees, agents, or contractors.
ARTICLE 15 - INSURANCE
15.1 Minimum Insurance .Requirements. Prior to comurencemertt of the Lease Tenn or
LESSEE'S occupancy of the Leased Land, LESSEE shall procure and maintain, at
LESSEE's sole cost and expense, the following insurance:
a} Comm.ereial General Liability Insurance Policy insuring the Leased Premises and
LESSEE'S use thereof, with a minimum limit of Two Million Dollars
($2,000,000) on account ofbodily injuries or death or property damage for each
occurrence and a minimum limit Two Million Dollars ($2,000,000) annual
general aggregate (such limits may be satisfied through a combination of primary
and umbrella/excess liability insurance). The foregoing policy(ies) shall name
CITY and, upon request, LESSEE'S lender, as additional insureds under
LESSEE's insurance policy(ies);
b) Special Form Cause of Loss (excluding earthquake and flood) Property Insurance
policy, including extended coverage endorsements insuring all of Lessee's
improvements (including LESSEE'S stock -in -trade, trade fixtures, fiirniture,
fin -nisi -zings, special equipment, floor and wall coverings, and all other items of
personal property of LESSEE located on or within LESSEE'S improvements with
such coverage to be in an amount equal to one hundred percent (100%) of the
replacement cost thereof. The foregoing policy shall name CITY and LESSEE'Slender, if any, as loss payee under LESSRP's insurance policy with regard to the
permanent leasehold improvements on the Leased Land.
c) Workers' compensation and United States Longshore and Harbor worker's
insurance covering Tenant's employees at the Leased Premises us required by
Alaska law;
d) Commercial automobile Iiability insurance for hired, awned/registered under
LESSEE'S narne and non -owned vehicles, including contractual liability with rr
single thrift of liability not less than One Million and 001100 Dollars
( 1,000,000.00) per accident for bodily injury and property damage combined or
such other amounts as CITY may reasonably request. The foregoing policy shall
name CITY and, upon. request, LESSEE's lender, as additional insureds under
Tenant's insurance policy,
The minimum amounts and types of insurance provided by LESSEE shall be subject to
revision at the sole discretion of CITY in accordance with standard insurance practices, in
order to provide continuously throughout the tcrrn of this LEASE and any extensions
hereof, a level of protection consonant with good business practice and accepted standards
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in the industry. Such factors as changes in the type of or extent of use of the Lease Land,
in.ereases in the cost of living, inflationary pressures, and other considerations, shall be
utilized in assessing whether the minimum insurance requirements should be increased.
CITY shall notify LESSEE of any rewired increase in insurance coverage. Provisions of
insurance policies required under this Section 15.1 will not be materially altered by
LESSEE during the term of this LEASE, and LESSEE will provide CITY with proof of
insurance upon request.
All such policies shall be written by insurance companies legally authorized or licensed to
do business in the State of Alaska and acceptable to CITY (Best's R,ating B or better)_
CITY shall be listed as an additional insured under all insurance policies. LESSEE shall
furnish CITY, on forms approved by CITY, certificates evidencing that it has procured the
insurance required herein prior to the occupancy of the Leased Land or operation by
LESSEE. Insurance policy deductibles shall be consonant with good business practice and
accepted standards in the LESSEE'S industry. Nothing herein contained shall prevent
LESSEE or CITY from placing and maintaining at CITY's or LESSEE's own individual
cost and expense, additional. or other insurance as may be desired. The minitnurn insurance
requirements under this LEASE shall not act to limit LESSEE's liability for any occurrence
and shall not limit LESSEE'S duty to defend and indemnify CITY for claims related to this
LEASE or the Leased Land.
15.2 Subrogation Rights Waived To the extent permitted by law, LESSEE hereby releases
CITY, its elected and appointed officials, employees and volunteers, and others working
on behalf of CITY from any and all liability or responsibility to LESSEE or anyone
claiming through or under LESSEE by way of subrogation or otherwise, for any loss of
any kind (including damage to property caused by fire or any other casualty), evell if such
loss shall have been caused by the fault or negligence of the CITY, its elected or appointed
officials, employees or volunteers, or others working on behalf ofthe CITY. This provision
shall be applicable and an full force and effect only with respect to loss or damage occurring
during the time of LESSEE's occupancy or use (including LESSEE's occupancy or use
prior to the Effective Date of this LEASE), and LESSEE agrees its policies of insurance
will not contain any clause, provision or endotsement that limits LESSEE'S right to recover
under such policy if au additional insured has obtained a waiver of subrogation.
15.3 Restoration of Buildings and Improvements. In the event of damage to, or destruction of,
any of the buildings or improvements situated on the Leased Land, and to the extent that
LESSEE is entitled to any insurance proceeds resulting therefrom, such proceeds shall be
paid to LESSEE's Lender, to be used to restore the LESSEE'S improvements in accordance
with the Security Instruttent. In the event LESSEE does not have a Lender, then the
insurance proceeds shall be payable to Lessee, and Lessee shall either:
a) Within ninety (90) days after payment of the insurance proceeds, commence
restoration of the buildings and improvements to their condition prior to such
damage, provided, however, that Lessee's obligation to restore will be limited to
the insurance proceeds available to Lessee; or
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b) Apply such insurance proceeds first to the cost of removal of the damaged or
destroyed buildings, including any debris or other nuisance occasioned by the
damage or destruction, and restore the Leased Land to a grade and condition
similar to its grade and condition prior to the construction of the buildings or
improvements thereon_ Insurance proceeds remaining after the removal o£
damaged or destroyed buildings and other improvements, and restoration of the
Leased Land to grade and condition satisfactory to the City may be applied to any
indebtedness owed by Lessee to any lender trained as beneficiary under any Deed
of Trust recorded against the Lessee's interest, in order ofpriority of recordation.
e) Regardless of whether Lessee elects to proceed under a) or b), above, all
insurance proceeds shall be deposited and held in trust with a bank having offices
in Seward and/or Anchorage, Alaska, as Lessee may designate, or with Lessee's
mortgagee named in a Deed of Trust granting such mortgagee a beneficial interest
in the damaged property, and shall be made available to Lessee for its use in
either restoring or repairing any damaged or destroyed buildings or improvements
on the Leased Land, or removing the damaged or destroyed buildings or
improvements and restoring the Leased Land to a grade and condition of
reasonable satisfaction to the City. The proceeds of insurance shall be paid out by
such bank or mortgagee from time to time, on certifications, by the person having
supervision of the work, that the amount certified is being applied to the payment
of the reasonable costs of such work. Should the Lessee elect not to restore and
repair damaged buildings and improvements on the Leased Land, all insurance
proceeds remaining after removal of damaged and destroyed buildings and.
improvements, and restoration of the Leased Land, may be applied to any
indebtedness by Lessee to any lender named as beneficiary under any Deed of
Trust recorded against the Lessee's interest, in order ofpriority of recordation,
after receipt of written satisfactionfrom the City of the restoration of the Leased
Land.
In the event Lessee elects not to restore and repair when substantial damage or destruction
has occurred to the buildings and improvements, this Lease shall terminate, and all Lessee's
obligations hereunder shall expire, upon the date that the City certified in kiting its
satisfaction with the restoration of the Leased Land.
ARTICLE 16 _ CONDEMNATION
If all or any part of the Leased Land is condemned for a public use by any goverment
agency or other duly authorized entity, CITY and LESSEE shall each .make a claim against the
condemning or taking authority for the amount of any damage incurred by or done to them
respectively as a result of the taking, Neither LESSEE. nor CITY shall have any rights in or to any
award made to the other by the condemning authority provided, that in the event of a single award
to CITY which includes specific damages for loss of LESSEE'S leasehold interest, CITY shall
transmit to LESSEE the amount of such specific damages so found, if any or to LESSEE's Lender
if required by a Security In.strun lent_
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If part but not all of the Leased Laud is condemned for pubic use, LESSEE shall make a
good faith determination as to whether or not the taking of the part of the Leased Land designated.
for condemnation will prevent it from continuing to operate on the Leased Land. If LESSEE
determines in good faith that the condemning of such part of the Leased Land will prevent it from
continuing to operate on the Leased Land, LES SEE may notify CITY in writing to this effect, and
this LEASE shall then be terminated for all purposes effective fifteen (15) days from the date
LESSEE sends such notice to CITY, or at such other later date as LESSEE shall specify in its
notice, and such termination shall be treated in the same manner as a termination at the expiration.
of the term of this LEASE. LESSEE shall, as a condition precedent to such termination, remove
all encumbrances, debts, and liens to which the Leased Land is subject. If at the time of such
partial taking for public use, LESSEE determines that such partial taking will not prevent it from
continuing to operate, then LESSEE and CITY shall negotiate an equitable and partial abatement
of the rent beginning to be effective on the actual date when LESSEE is effectively prevented from
utilizing the condemned land.
ARTICLE J7 - ARBITRATION
17.1 Arbitration.
a) Disputes between the parties with respect to the performance of this LEASE that
cannot be resolved by the parties, may be submitted to an independent arbitrator for
a settlement pursuant to the provisions of the Alaska Uniform Arbitration Act
(AS 09,43.010 et. seq.), as it now exists or may hereafter be amended from time to
time, and judgment on the award may be entered in any Superior Court in the State
of Alaska. Either party may subtnit to the other party a request for arbitration and
the party.receiviug a request shall have twenty (20) days to consent, in writing, to
the use of arbitration to resolve th.e dispute. Failure of either party to consent will
preclude the use of arbitration for that dispute. The costs and expenses of
arbitration shall be awed. equally by the parties, and each party shall bear its own
attorney's fees and costs,
b) Arbitration procedures shall be applicable only to contract, negligence, and similar
claims arising fromor related to this LEASE, and shall not be used to resolve or
determine any claim based upon fraud, intentional misrepresentation, nor any claim
based on conduct that is a felony crime in the State of Alaska.
c) Arbitration of any dispute or claim shall be determined by a single arbitrator
selected fronn a list of not less than five (5) arbitrators obtained from the presiding
Superior Court Judge or other appropriate judicial officer in Anchorage, Alaska.
The arbitrator shall be a person who (a) has not less than. fve (S) years legal
experience in the State of Alaska prior to appointment; and (b) sucb legal
experience includes substantial experience with long-term commercial real
property transactions. Each party shall be: provided with a copy of the list and shall
be afforded a maximum of ten (10) working days to become familiar with the
qualifications of the prospective arbitrators. The arbitrator shall be selected by each
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party, co/rime/icing with the party demanding the arbitration, striking one name
from the list until only a single name remains.
d) Arbitration hearings shall be conducted in Anchorage, Alaska or such other location
as the parties may agree. Each party shall produce at the request of the other party,
a least thirty (30) days in advance of such hearing, (i) the navies, addresses, phone
numbers, and email addresses for all witnesses who may testify at the hearing; and
(ii) all documents to be submitted at the hearing and such other documents as are
relevant to the issues or likely to lead to relevant information.
e) In deciding the claim or dispute, the arbitrator shall follow applicable Alaska law,
and the written decision shall be supported by substantial evidence in the record_
'Failure to apply Alaska law, or entry of a decision that is not based on substantial
evidence in the record, shall be additional grounds for modifying or vacating an
arb itration decision.
ARTICLE 18 - MALNTENANCE AND REPAIRS
18.1 No17nal Maintenance. During the entire term of this LEASE and every extension hereof,
if any, LESSEE shall, at LESSEE'S sole cost, risk and expense, maintain the Leased. Land,
including any improvements placed thereon by LESSEE, in as good condition as received
or constructed by LESSEE, subject to normal, non -abusive use. CITY, at CITY's sole
option and expense, may, prior to the commencement of construction by LESSEE, perform
maintenance and preventative work on the Leased Land, exclusive of improvements placed
thereon by LESSEE, in order to prevent erosion, mitigate damage to plants and an.inials, or
prepare the Leased Land for eventual development by LESSEE or others by grading,
filling, or contouring the Leased Land. Any such work performed by CITY shall be at
CITY's sole expense and risk unless LESSEE agrees, in advance and in w -itmg, to share
such expense and risk. LESSEE shall maintain in first class condition at all times all fire,
pollution, and other protective equipment, if any are placed on Leased Land.
18.2 Safety issues_ CITY may notify LESSEE in writing of any deficiencies in the performance
of LESSI~,F's maintenance responsibilities as they relate to public health or safety and
LESSEE shall promptly within thirty (30) days of receipt of such notice advise CTTY in
writing of its proposed schedule for performance of any work necessary to cure such
deficiencies.
If such deficiencies relate to the safety of LESSEE's operation such that the surrounding
land and port facilities are exposed to risk, unnecessary potentialhazards, or a risk to the
public interest (as distinguished from a business risk), or if CITY is not satisfied with the
proposed sebedule of repairs either because ofthe delays therein or the scope of the repairs,
then CITY may engage an independent engineering consultant well -versed and
experienced who shall furnish to CITY a comprehensive survey and report for the purpose
of establishing both the need and urgency to perform stueb maintenance work. As soon as
practicable following receipt of said engineer's determinations and recommendations, if
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the report requires repair then LESSEE shall pay the cost of the report and perform such
work in accordance therewith at LESSEE's cost, risk, and expense.
1$.3 Cost of Repairs. Should LESSEE dispute the necessity of any maintenance work as being
necessary er advisable or reasonable to protect the public facilities on adjacent land, it may
submit the matter to arbitration; provided, however, that pending the decision of the
arbitrator it shall frilly comply with the maintenance requests. If an arbitration award
should ultimately find that the repairs were not nec essary, then LESSEE may either deduct
from future rental payments the cost of such repairs or be reimbursed therefor. In deciding
whether repairs requested by CITY or required by an engineering report are necessary, the
arbitration panel is to give primary consideration to the safety and welfare of the Seward
port facilities and the citizens of Seward in light of the highest standards in th.e industry_
If any facility or service provided by CITY to the Leased T.and shall become inadequate
due to changes in environmental control standards or should any facility require updating
or improvement by reason of a change in LESSEE's use of tbe Leased Laud or operations
therefrom, LESSEE shall either construct such improvements at LESSEE'S own cost or
reimburse CITY for such work at the option of CITY.
ARTICLE 19 - ENVIRONMENTAL CONCERNS
19.1 Hazardous Materials.
a) Condition of Site. LESSEE has had full opportunity to examine the site for the
presence of any Hazardous Material and accepts the site in "as is" condition.
LESSEE may elect, at LESSEE's sole cost, to conduct a baseline soils test prior to
execution of this LEASE.
Release of CET Any other provision of this LEASE to the contrary
notwithstanding, LESSEE releases CITY from any and all claims, demands,
penalties, fines, judgments, liabilities, settlements, damages, costs, or expenses
(including, without limitation, atton iey's fees, court costs, litigation expenses, and
consultant and expert fees) arising prior to, during, and after the terra of this
LEASE, and resulting from the use, keeping, storage, or disposal of Hazardous
Material on the Leased Land by LESSEE or its predecessors in interest, or arising
out of or resulting from LESSEE's operations at the Leased Land or the operations
of its predecessors in interest at the Leased Land except for those claims arising out
of Mrs sole negligence or intentional misconduct. This release includes, without
limitation, any and all casts incurred due to any investigation of the Leased Land
or any cleanup, removal, or restoration mandated by a federal, state, or local agency
or political subdivision or by law or regulation.
c) Use of Hazardous Materials on the Site.
i) LESSEE shall not cause or perrnit any Hazardous Material to be brought
upon, kept, or used it or about the Leased Land except for such Hazardous
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Material as is necessary to conduct LESSEE'S authorized use of the Leased
Land.
Any Hazardous Material permitted on the Leased Land as provided in this
paragraph, and all containers therefor, shall be used, kept, stored, and
disposed of in a manner that complies with all Environmental Laws or other
laws or regulations applicable to such Hazardous Material.
iii) LESSEN. shall not discharge, leaf or emit, or permit to be discharged,
leaked; or emitted, any material into the atmosphere, ground; ground water,
sewer system, or any body of water, if such material (as reasonably
determined by the City, or any governmental authority) does or rnay, pollute
or contaminate the same, or may adversely affect the (a) health, welfare, or
safety of persons, whether located on the Leased Land or elsewhere; or (h)
condition, use, or enjoyment of the Leased Land or any other area or
personal property.
iv) LESSEE hereby agrees that it shall be fully liable for all costs and expenses
related to the use, storage, and disposal of Hazardous Material kept or
brought on the Leased Land by LESSEE, its authorized representatives and
invitees, and LESSEE shall give immediate notice to CITY of any violation
or potential violation of the provisions of this subparagraph.
d) Indemnification of CJTi". Any other provision of this LEASE to the contrary
notwithstanding, LESSEE shall defend, indemnify, and hold CITY harmless from
and against any claims, demands, penalties, fines, judgments, liabilities,
settlements, damages, costs, or expenses (including, without limitation, attorney,
consultant and expert fees, court costs, and litigation expenses) of whatever kind or
nature, known or unknown, contingent or otherwise, arising out of or in any way
related to:
i) The presence, disposal, release, oz threatened release of any such. Hazardous
Material which is on or from the Leased Land, soil, water, ground water,
vegetation, buildings, personal property, persons, animals, or otherwise;
Any personal injury (including -wrongful death) or property damage (real or
personal) arising out of or related to such Hazardous Material or any use of
the Leased Land;
Any lawsuit brought or threatened, settlement reached, or government order
relating to such Hazardous Material or any use of the Leased Land; and/or
iv) Any violation of any laws applicable thereto; provided, however, that this
Section 19.1(d) shall apply only if the acts giving rise to the claims,
deruands, penalties, fines, judgments, liabilities, settlements, damages,
costs, or expenses (1) occur prior to or during the term of this LEASE; and
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(2) arise, in whole or in part, from the use of, operations on, or activities on
the Leased Land by LESSEE or LESSEE's predecessors in interest,
employees, agents, invitees, contractors, subcontractors, authorized
representatives, subtenants, or any other persons. The provisions of this
subparagraph shall be in addition to any other obligations and liabilities
LESSEE may have to CITY at law or equity and shall survive the
transactions contemplated herein and shall survive the termination of this
LEASE.
e) Operator, For all purposes, LESSEE shall be deemed the operator of any facility
on the Leased Land.
fj Hazardous Material .Defined, As used in this LEASE, Hazardous Material is any
substance which is toxic, ignitable, reactive, or corrosive or which is regulated by
any Environmental Law. Hazardous Material includes any and all material or
substances which are defined as industrial waste, hazardous waste, extremely
hazardous waste, or a hazardous substance under any Environmental Law.
Notwithstanding any statutory petroleum exclusion, for the purposes of this
LEASE, the term. Hazardous Material includes, without limitation, petroleum.,
including crude oil or any fraction thereof, petroleum soaked absorbent material,
and other petroleum wastes.
g) Environmental Law Defined. As used in this LEASE, Environmental Laws include
any an.d all local, state, and federal ordinances, statutes, and regulations, as now in.
force or as may be amended from time to time, relating to the protection of hmnan.
health and the environment, as well as any judgments, orders, injunctions, awards;
decrees, covenants, conditions, or other resttietions or standards relating to same.
Environmental Laws include, by way of example and not as a limitation of the
generality of the foregoing, Alaska Statutes Title 46, the Resource Conservation
and Recovery Act of 1976,.the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, the Clean Water Act, and the Superfund
Amendments and Reauthorization Act of 1986.
19.2 Permits and Reporting.
a) Permits Required by Other Governmental Agencies.LESSEE shall obtain all
permits or approvals required by any applicable law or regulation, Copies of all
such permits shall be provided to CITY prior to LESSEE commencing work under
this LEASE. LESSEE shall promptly make all reports to any federal, state, or local
government or agency required by any permit or Environmental Law, including
reports of any spill or discharge of Hazardous Material. The CITY, thraugir the
City Manager, may order LESSEE to immediately cease any operations or activities
ox the Leased Land if the same is being carried out without necessary permits, in
violation of the terms of any permit or Environmental Law, or contrary to this
LEASE.
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b) Correspondence with and Reports to Environmental Agencies. LESSEE shalt
immediately (the sarne or the next business day) provide CITY with copies of ail
correspondence and notice, including copies of all reports between LESSEE and
any state, federal, or local government. or agency regulating Hazardous Material
which relates to LESSEE'S operations on or use of the Leased Land.
ARTICLE 20 - ESTOPPEL CERTIFICATES
Either party shall at any time and from time to time upon not less than ten (10) days' prior
written request by the other party, execute, acknowledge, and deliver to such party, or to its
designee, a statement in writing certifying that this LEASE is -un-amended and in full force and
effect (or, if there has been any amendment thereof, that the serne is in full force and effect as
amended and stating the amendment or amendments), that: there are no defaults existing (or, if
there is any eiaimed default, stating the nature and extent thereof), and that there are no defaults
existing (or, if there is any claimed default, stating the nature and extent thereof), and that there
are no offsets, claims or counterclaims by or infavor of CITY against LESSEE under this LEASE
(or describing all such offsets, claims and counterclaims), the remaining term of this LEASE and
any extensions hereto, all encumbrances panted by CITY, stating the dates to which the rent and
other charges have been paid in advance, and include such other provisions as a prospective
assignee of the LESSEE'S interest in this LEASE or a prospective leasehold mortgagee would
reasonably request.
ARTICLE 21- CONDITIONS AND COVENANTS
All the provisions of this LEASE shall be construed to be "conditions" as well as
"covenants," as though the words specifically expressing or imparting covenants and conditions
were used in each separate provision.
ARTICLE 22 - NO WAIVER Or BREACH
No failure by either CITY or LESSEE to insist upon the strict performance by the other of
any term, covenant, or condition of this LEASE or to exercise any right or remedy consequent
upon a breach thereof shall constitute a waiver of any such breach or of such terms, covenants, or
conditions_ No waiver of any breach shall affect or alter this LEASE, but each and every term,
covenant, and condition of this LEASE shall continue in full force and effect with respect to any
other than an existing or subsequent breach.
ARTICLE 23 - TIME OF THE ESSENCE
Time is of the essence of this LEASE and of each provision.
ARTICLE 24 - COMPUTATION OF TIME
The time in which any act provided by this LEASE is to be done by shall be computed by
excluding the first day and including the last, unless the last day is a Saturday, Sunday, or a holiday,
and then it is also excluded.
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ARTICLE 25 - SUCCESSORS IN INTEREST
Each and all of the terms, covenants, and conditions in this LEASE shall inure to the benefit
of and shall be binding upon the successors in intert of CITY and LESSEE.
ARTICLE 26 - ENTIRE AGREEMENT
This LEASE contains the entire agreement of the parties with respect to the matters covered
by this LEASE, and to other agreement, statement, or promise made by any party which is not
contained in this LEASE shall be binding or valid.
ARTICLE 27 - GOVERNING LAW
This LEASE shall be governed by, construed, and enforced in accordance with the laws of
the State of Alaska. The terms of this LEASE are subject in all respects to the Charter and Codc
of Ordinances of CITY in effect on the date of this LEASE, and as they may be hereafter amended,
including, without limitation, Chapter 7.05 of the Seward City Code_
ARTICLE 28 - PARTIAL INVALIDITY
If any provision of this LEASE is held by a court of competent jurisdiction to be invalid,
void, or unenforceable, the remainder of the provisions shall remain in full force and effect and
shall in no way be affected, impaired, or invalidated
ARTICLE 29 - RELATIONSRELATIONSIILIP OF PARTIES
Nothing contained in this LEASE shall be deemed or construed by tine parties or by any
third person to create the relationship of principal and agent or of partnership or of joint venture
or of any association between CITY and LESSEE; and neither the method of computation of rent,
nor any other provisions contained in this LEASE, nor any acts of the parties, shall be deemed to
create any relationship between CTTY' and LESSEE other than the relationship of lessee and lessor.
ARTICLE 30 - INTERPRETATION
The language in all parts of this LEASE shall in all cases be simply construed according to
its fair meaning and not for or against CITY or LESSEE as both CITY and LESSEE have had the
opportunity to seek assistance of counsel in drafting and reviewing this LEASE.
ARTICLE 31- CAPTIONS
Captions of the articles, paragraphs, and subparagraphs of this I .EASE are for convenience
and reference only, and the words contained therein shall in no way be held to explain, modify,
amplify, or aid in tie interpretation, cortstraction, or meaning of the provisions of this LEASE.
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ARTICLE 32 - AMENDMENT
This LEASE is not subject to amendment except in writing executed by both parties hereto_
ARTICLE 33 - NOTICES
All notices, demands, or requests from one panty to another shall be delivered in person or
be sent by mail, certified or.registered, postage prepaid, to the addresses stated in this Article and
to such other persons and addresses as either party may designate. Notice by mail shall be deemed
to have been given at the time of mailing;_
All. notices, demands, end requests from LESSEE to CITY shall be given to CITY at the
following address:
City Manager
CITY OF SEAVARD
PO Box 167
Seward, Alaska 99664
All notices, demands or requests from CITY to LESSEE shall he given to LESSEE at the
following address:
Seward Pacific Resurrection Bay Seafoods Inc
PO BOX I710
Seward, AK 99664
Each party shall have the right, front time to time, to designate a different address by notice
given in conformity with this Article.
ARTICLE 34 - FIRE PROTECTION FOR LEASED LAND
LESSEE shall at its sole cost, risk and expense provide fire detection and protection to its
operations on the Leased Land and fzre prevention to industry standards for risks to adjacent
facilities such that those risks are minimized. LESSEE shall continue to provide and maintain
industry accepted standards of fire protection such that the City of Seward's ISO rating is not
degraded by reason of LESSEE'S operation. The parties agree that with the rapid expansion of
technology it the field of fire prevention and control LESSEESs obligations hereunder may vary
during the term of this LEASE and CITY may submit LESSEE's compliance with its obligation
hereunder to arbitration not more frequently than once each five years.
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31 19072243723
E1 3''23/ 2R'22 11: 39 190 72243723
RESURECT I ONBA,,' SEAFL:' PAGE 31 / 3 5
IN WITNESS WHEREOF, the parties hereto have set their hands and seals the dates
herein set forth.
CITY: LESSEE:
By:
Janette Bower, City Manager
Date:
ATTEST:
Brenda Ballnu
City Clerk
STATE OF ALASKA )
ss-
THIRD JUDICIAL DISTRICT )
CITY OF SEWARD
Seward Pacific Resurrection Bay
Seafood-
By
David Brindle, eneralIvlanager
Date - - -
The foregoing instrument was acknowledged before me this day of
2022, by Janette Bower, City Manager of the City of Seward, Alaska, on behalf
of the City.
STATE Obi UJM H i WG' ip/kJ
cbu.ktrY 0-Q SOO 1-(O?-4 iSN ) ss.
THIRD JUDICIAL DISTRICT )
Notary Public in and for Alaska
My Commission Expires:
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19072243723
0323/2022 11:3'
19072243723
RESUREC,TIUNBAY SEAFD PAGE 321 _ 5
The
on behalf of
voluntary act
2,E)
foregoing instrument was ackrnowledgeel before me this 2 day of
2022, by David Bundle, General Manager, who executed the foregoing document
Icicle Seafoods, Inc., a corporation, and affirmed such act to be the free and
of such corporation for the uses and purposes mentioned in the instrument.
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29
69
Parcel 14823009 and 14823010
Geographic Inf
mation Systems
4 North Bibkley Street, Soidotna, Alaska 99669
This map is a user generated static output from an Internet mapping site and is for reference only. Data layers that appear on this map may or may not
be accurate, current, or otherwise reliable. It is not to be used for navigation.
DATE PRINTED: 3/16/2022
Legend
• Mileposts
�_•
; City Limits
- Highways
- Major Roads
Roads
— Town Medium Volume
— Town Low/Seasonal; Other
Proposed
Parcels
] Boundary
Footprint
Image
. Red: Red
• Green: Green
▪ Blue: Blue
❑ Boundary
Footprint
Image
III Red: Red
▪ Green: Green
▪ Blue: Blue
Notes
Type any notes here.
70
Geographic inf
4 North B, 1.
mation Systems
Exhibit A Parcel #14823009
This map is a user generated static output from an Internet and is for reference only. Data layers that appear on this map may or may not
be accurate, current, or otherwise reliable. It is not to be used for navigation.
DATE PRINTED: 3/16/2022
Legend
• Mileposts
�_•
; City Limits
- Highways
- Major Roads
Roads
— Town Medium Volume
— Town Low/Seasonal; Other
Proposed
Parcels
] Boundary
Footprint
Image
. Red: Red
• Green: Green
▪ Blue: Blue
❑ Boundary
] Footprint
Image
III Red: Red
® Green: Green
▪ Blue: Blue
Notes
Type any notes here.
71
Exhibit B Parcel #14823010
4 Noith Binkl , • trci't Soidotna. / - SJ9669
This map is a user generated stat c output from an Internet mapping site a ese ence only. Data asrs that appear on this map may or may not
be accurate, current, or otherwise reliable. It is not to be used for navigation.
DATE PRINTED: 3/16/2022
Legend
• Mileposts
�_•
; City Limits
- Highways
- Major Roads
Roads
— Town Medium Volume
— Town Low/Seasonal; Other
Proposed
Parcels
] Boundary
Footprint
Image
. Red: Red
• Green: Green
▪ Blue: Blue
❑ Boundary
Footprint
Image
III Red: Red
▪ Green: Green
▪ Blue: Blue
Notes
Type any notes here.
72