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HomeMy WebLinkAboutRes1984-065 . . . , - . 06/15/84 FBA/rsa CITY OF SEWARD, ALASKA RESOLUTION NO. 84-65 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, FINDING THAT THE PUBLIC INTEREST WOULD BE SERVED BY A DISPOSITION OF THE GATEWAY SUBDIVISION BY NEGOTIATED SALE TO GATEWAY VENTURES, INC. WHEREAS, the City Council of the City of Seward, Alaska, has repeatedly determined that development of the City of Seward in an orderly manner is in the public interest, and WHEREAS, numerous capital projects of the City of Seward have been implemented in order to promote industrial development of the City in order to assure steady rates of employment and promote new industries, and WHEREAS, there is now a critical residential building lots within the City anticipates rapid residential growth as a new industries locating in Seward, and shortage of available limits, and the City result of the several WHEREAS, public development of the Gateway Subdivision would involve commitment of scarce public resources which are now fully engaged in developing necessary public services, and WHEREAS, the City Council offered, by public notice, the opportunity for private firms to develop the Gateway Subdivision in its Request for Proposals dated March , 1984, and that process provided interested members of the public and the market generally to determine under what conditions and terms development of the Gateway Subdivision could best take place, and WHEREAS, the City Council has determined, in Resolution 84-59, that the public interest would not be served by an appraisal prior to disposition of the Gateway Subdivision, and WHEREAS, the City and Gateway Ventures, Inc., have concluded a negotiated sale of the property described in the Contract of Sale of Unimproved Property and related documents which are attached hereto as exhibits. WHEREAS, the Developer, Gateway Ventures, Inc., has agreed to deve lop the property in accordance wi th that certain Development Agreement attached and in which the Developer has undertaken the development of the property and the consistent supply of residential building sites for construction in Seward, and provide WHEREAS, off-site the Developer has improvements which additionally will enhance agreed to the City's -l- . . . . e . existing utility services as well as serve the property being developed. NOW, THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF CITY OF SEWARD, ALASKA, as follows: Sect ion l. public interest to attached Exhibits by The City Council finds that it is in the dispose of the property described on the negotiated sale rather than public auction. interest property process. Section 2. The City Council finds that the public in assuring full and fair opportunity to purchase the has been accomplished by the Request for Proposal Section 3. The City Council finds that the best proposal was that submitted by Gateway Ventures, Inc. concluded protection Resolution Section 4. The City Council finds that the agreements subsequent to that proposal have provided adequate to the public interest as described above and in 84-59. Section 5. The City Manager is directed to execute the documents attached to this resolution effecting the transfer of the property described in accordance with the terms of the agreements attached to this Resolution. Section 6. This resolution shall become effective thirty (30) days after passage and posting. PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, this 25 day of June , 1984. {CIT. y,,,' S:W/;A~RD~ ALASKA . ~, .. {/ " ~!?i1t;; " .' rtr-7 DONALD W. CR PS, MAYOR AYES: NOES: ABSENT: ABSTAIN: CRIPPS, HILTON, MEEHAN, SWARTZ, WILLIAMS & WILSON NONE NONE GILLESPIE -2- . ATTEST: . . . (City . . -3- . APPROVED AS TO FORM: HUGHES, THORSNESS, GANTZ, POWELL & BRUNDIN Fr1:! !~, Attorney . . . '. / A J /1 , I r 112 . iUAJ (~'fJ I ~i~pi~~lf~ · CONTRACT OF SAL~ OF UNIMPROVED PROPERTY of (the THIS CONTRACT is made and entered into this day , 1984, by and between the City of Seward, Alaska, "Seller"), and Gateway Ventures, Inc., (the "Purchaser"). Seller and Purchaser agree as follows: 1. Contract of Sale. Seller shall sell to Purchaser, and Purchaser shall purchase from Seller, at the price and upon the terms and condi t ions set forth in this Contract, the parcel of land more particularly described in Schedule A attached hereto (the "Land"). 2. Title. Seller shall convey and Purchaser shall accept a g6oo-and marketable title in fee simple to the Property, free and clear of all liens and encumbrances, subject only to: (a) the rights and reservations expressed in the U. S. Patent to the Property; (bl the lien of current real estate taxes not yet due and payable; (c) usual and ordinary public utility easements for gas, electric, water, sewer and other utility lines; and (d) the matters set forth in Schedule B attached hereto (collectively, the "Permitted Exceptions"). 3. Purchase Price and Acceptable Funds. The purchase price (the "Purchase Price") to be paid for the Property as provided in Schedule C shall be SEVEN HUNDRED FORTY-TWO THOUSAND FIVE HUNDRED AND NO/lOa DOLLARS ($742,500.00). The Purchase Price and all other monies payable under this Contract, unless otherwise speci- fied in this Contract, shall be paid by (a) good certified checks of Purchaser or any entity making a purchase money loan to Pur- chaser drawn on a bank or savings and loan association having a banking office in the State of Alaska or (b) bank checks drawn on any such financial institution, payable to the order of Seller, except that uncertified checks of Purchaser payable to the order of Seller up to the amount of two percent (2%) of the Purchase Price shall be acceptable for sums payable to Seller at Closing. 4. Purchase Money Deed of Trust. (a) Schedule C provides for the payment of the Purchase Price by execution and delivery to Seller of a promissory note secured by a purchase money deed of trust. ( t'he )"984 fat 5. Closinq. The closing of title "Closing") shall take place on the at pursuant to this Contract day of o'clock .m. -l- SST/bs/103/G-4 6. that: Acknowledgements of Purchaser. Purchaser acknowledges (a) Purchaser has inspected the Property, is familiar with the physical condition thereof, and shall the Property "AS IS" and in its present condition. fully accept (b) Before entering into this Contract, Purchaser has made such examination of the Property as Purchaser deemed neces- sary. In entering into this Contract, Purchaser has not been induced by and has not relied upon any representations, warran- ties or statements, whether express or implied, made by Seller or any agent, employee or other representative of Seller or by any broker or any other person representing or purporting to repre- sent Seller, which are not expressly set forth in this Cotract, whether or not any such representations, warranties or statements were made in writing or orally. 7. Condemnation. If prior to the Closing Date, all or any part of the Property shall be taken by condemnation in any pro- ceeding by a governmental authority or other entity vested with the power of eminent domain or shall be acquired for public or quasi-public purposes or condemnation proceedings therefor shall have been instituted, then Purchaser may elect to cancel this Contract by giving Seller notice to such effect within thirty (30) days after Purchaser shall have received notice of such occurrence, and, if Purchaser shall so elect, both parties shall be relieved and released of and from any and all further liabil- ity hereunder. If Purchaser does not elect to so cancel, this Contract shall remain in full force and effect and Seller shall, at the Closing, sell, transfer and assign to Purchaser all of Seller's right, title and interest in and to any award paid or payable for such taking. 8. Seller's Closing Obligations. At the Closing, Seller shall deliver the following to Purchaser: ( a) substance with description of proper form for this Contract. A Statutory Warranty Deed complying in form and A. S. Section 34.15.030, containing an adequate the Property, and being properly executed and in recording so as to convey the title required by (b) A policy of title insurance in an amount equal to the Purchase Price, and such affidavits as Seller's title company shall reasonably require in order to omit from its policy of title insurance all exceptions for mechanics liens, judgments, bankruptcies or other returns against persons or e(1.tities whose names are the same as or similar to Seller's name. (c) Possession of the Property in the condition required by this Contract. -2- SST/bs/l03/G-4 . . . (d) Any other documents required by this Contract to be rlelivered by Seller. 9. Purchaser's Closing Obligations. At the Closing, Pur- chaser shall deliver the following to Seller: (a) Checks in payment of Price payable at the Closing, as under pa ragraph IS, recording fees fees for the Purchase Money Mortgage, the port ion of the Purchase adjusted for apportionments for the deed and recording if any. (b) The purchase money deed of trust, ln proper form for recording, and the note secured thereby. (c) The fully executed Development Agreement. (d) Any other documents required by this Contract to be delivered by Purchaser. lU. Apportionments. (a) The following apportionments shall be made between the parties at the Closing as of 12:01 A.M. on the Closing Date: . (i) Real estate taxes. Such taxes shall be appor- tioned upon the basis of the fiscal period for which assessed, and if the Closing shall occur before a new tax rate is fixed, the apportionment of taxes at the Closing shall be upon the basis of the old tax rate for the preceding fiscal period applied to the latest assessed valuation. 11. Objections to Title. Seller shall promptly order a preliminary commitment for a policy of title insurance in an a~ount equal to the Purchase Price. Seller shall be entitled to a reasonable adjournment of the Closing for up to sixty (60) days or until the expiration date of any written commitment of Pur- chaser's Institutional Lender delivered to Purchaser prior to the scheduled date of Closing, whichever occurs first, to remove any defects in or objections to title noted in such title report and any other defects or objections which may be disclosed on or prior to the Closing Date. 12. Failure of Seller or Purchaser to Perform. . (a) I!eller shall be unable to convey title to the Property at the Closing in accordance with the provisions of this Contract or if Purchaser shall have any other grounds under this Contract for refus ing to consummate the purchase provided for herein, Purchaser, nevertheless, may elect to accept such title as Seller may be able to convey wi th a credi t against the Pur- chase Price and the monies payable at Closing equal to the rea- sonably estimated cost to cure the same up to the Maximum 2xpense -3- SSTjbsj103jG-4 of two percent (2%) of the Purchase Price, but without any other credit or liability on the part of Seller. If Purchaser shall not so elect, Purchaser may cancel this Contract by giving Seller notice to such effect and the sole liability of Seller shall be to refund the Earnest Money to Purchaser. Upon such refund and reimbursement, this Contract shall be null and void and the parties hereto shall be relieved and released of and from any and all further obligations and liability other than any arising under paragral?h 18. Seller shall not be required to bring any action or proceeding or to incur any expense in excess of the Maximum Expense to cure any title defect or to enable Seller otherwise to comply with the provisions of this Contract. (b) Any unpaid taxes and assessments, charges for util- ity services, together with the interest and penalties thereon to the Closing Date, and any other liens and encumbrances which Seller is obligated to pay and discharge or which are against corporations, estates or other persons in the chain of title, together with the cost of recording or filing any instruments necessary to discharge such liens and encumbrances of record, may be paid out of the monies payable at the Closing if Seller deliv- ers to Purchaser on the Closing Date official bills Ear such taxes, assessments, charges, interest and penalties and instru- ments in recordable form sufficient to discharge any other liens and encumbrances of record. (c) If Purchaser shall default in the performance of its obligation under this Contract to purchase the Property, Seller shall have the right to institute an action for specific performance to enforce Purchaser's obligation under this Contract to purchase the Property. 13. Broker. Seller and Purchaser each represent to the other that neither is represented by any broker, agent or finder in connection with this transaction. Each party agrees to indem- nify and hold the other party harmless from and against any and all liability, costs, damages, causes of action or other proceed- ings instituted by any broker, agent or finder, licensed or otherwise, claiming through, under or by reason of the conduct of the indemnifying party in the purchase and sale of the Property or in any manner whatsoever in connection with this transaction. 14. Miscellaneous Provisions. (a) This Contract sets forth the entire agreement of the parties as to the subject matter hereof and supersedes all prior discussions and understandings between them. This Contract may not be amended or rescinded in any manner except by an instrument in writing signed by a duly authorized officer or representative of each party hereto. -4- SST/bs/l03/G-4 . . . (b) This Contract shall be governed by, and construed and enforced in accordance with, the laws of the State of Alaska. (c) Should any of the provisions of this Contract be found to be invalid, illegal or unenforceable by any court of competent jurisdiction, such provision shall be stricken and the remainder of this Contract shall nonetheless remain in full force and effect unless striking such provision shall materially alter the intention of the parties. (d) In the event any action is brought to enforce this Contract, the parties agree to be subject to exclusive in per- sonam jurisdiction in the Superior Court for the State of Alaska and agree that in any such action venue shall lie exclusively at Anchorage, Alaska in the Third Judicial District, State of Alaska. (e) No waiver of any right under this Contract shall be effective unless contained in a writing signed by a duly author- ized officer or representative of the party sought to be charged with the waiver and no waiver of any right arising from any breach or failure to perform shall be deemed to be a waiver of any future right or of any other right arising under this Con- tract. . (f) Paragraph headings contained in this Contract are included for convenience only and form no part of the agreement between the parties. (g) All notices or requests required or permitted under this Contract shall be in writing; shall be personally delivered or sent by certified mail, return receipt requested, postage prepaid; shall be deemed given when so delivered or mailed, irre- spective of whether such notice or request is actually received by the addressee; and shall be sent to the parties at the addresses set forth below: Purchaser: Seller: Gateway Ventures, Inc. 6230 "A" Street Anchorage, AK 99507 Ci ty of Seward Post Office Box 167 Seward, AK 99664 . (h) This Contract shall be binding upon, and inure to the benefit of, the parties hereto and their respective succes- sors and assigns. Purchaser shall not assign this Contract or its rights hereunder without the prior written consent of Seller, which consent may be withheld for any reason deemed sufficient by Seller in its sole and uncontrolled discretion. No permitted assignment of this Contract or Purchaser's rights hereunder shall be effective against Seller unless and until an executed counter- -5- SST/bs/103/G-4 part of the instrument of assignment shall have been delivered to Seller and Seller shall have been furnished with the name and address of the assignee. The term "Purchaser" shall be deemed to include the assignee under any such permitted assignment. (i) This Contract shall not be binding or effective until properly executed and delivered by Seller and Purchaser. (j) As used in this Contract, the masculine shall include the feminine and neuter, the feminine shall inclucie the masculine and neuter, the neuter shall include the masculine and feminine, the singular shall include the plural, and the plural shall include the singular, as the context may require. (k) If the provisions Contract are incons is tent wi th the provisions of such schedule of any schedule or rider to this the provision of this Contract, or rider shall prevail. IN WITNESS WHEREOF, the parties hereto have executed this Contract as of the date first above written. SELLER: CITY OF SEWARD, ALASKA By PURCHASER: GATEWAY VENTURES, INC. By -6- SST/bs/103/G-4 Lots 22, 23 and 24, Block 1; Lots 1 inclusive, Block 8; Lots I through through 40 inclusive, Block 9 ADDITION, City of Seward, Seward District, Third Judicial District, Alaska. through 7 7 and 34 TERMINAL Recording State of e . Schedule A . Description of Property The Property is described as follows: All of TERMINAL ADDITION in the City of Seward, Seward Recording District, Third Judicial District, State of Alaska, SAVE and EXCEPT Lots 10, II, 12, 22, 23 and 24, tUock 1; Lots I through 7 inclusive, Block 8, Lots 1 through 7 inclusive and Lots 34 through 40 inclusive, Block 9, and Lots 6 and 7, Block 2~. All of tracts A-IA and A-2A, JESSE LE~ HEiGHTS SUBDIVISION, ADDITION NO. l~ a subdivision of portions of Jesse Lee Heights Subdivision, Bayview Addition and Terminal Addition, City of Seward, according to Plat 6 on file in the Seward Recording District, Third Judicial District, State of Alaska. . Lots la, II and 12, Block 1, TERMINAL ADDITION in the City of Seward, Seward Recording District, Third Judicial District, State of Alaska. Lots 6 and 7, Block 29, TER/>II NAL ADDIT ION in the City of Seward, Seward Recording District, Third Judicial District, State of Alaska. . -7- SST/bs/103/G-4 Schedule B Permitted Exceptions I. Zoning regulations and ordinances which are not violated by the existing impt"ovements, if any, or the present use thereof and which do not render title uninsurable. 2. Consents by the Seller or any former owner of the Prop- erty for the erection of any structure or structures on, under or above any street Ot" streets on which the Property may abut. 3. Unpaid installments of assessments not due and payable on or before the Closing Date. 4. Securi'ty agreements and financing statements on person- alty filed more than five (5) years prior to the Closing Date and not renewed, or filed against property or equipment no longer located on the Property or owned by Tenants. 5. Rights of utility companies to install, t"epair pipes, lines, poles, conduits, cable boxes equipment on, over and under the Property, provided such rights imposes any monetary obligation on the Prope rty. ma inta i nand and re la ted that none of owner of the 6. Encroachments ascertainable by physical inspection of the Property. 7. Revocability of the right to maintain excavations and sub-surface equipment beyond the property line of the Property. 8. Any state of facts that an accurate survey would dis- close, provided that such facts do not render the title unmarket- able. . -8- SST/bs/103/G-4 . . Schedule C . Purchase Price The Purchase Price shall be paid as follows: By execution and delivery to Seller by Purchaser or its assignee of a promissory note secured by a Purchase Money Deed of Trust covering the Property and by a separate deed of trust securing development performance obligations, payable as follows: As lots are developed and sold within the Land, Pur- chaser shall pay to Seller the sum of $2,000.00 per lot until 100 lots have been sold. Thereafter, Purchaser shall pay to Seller the sum of $3,500.00 per lot until the total price of $742,500.00 shall have been paid. . . -9- SST/bs/103/G-4 --------- ._~---_._.---_._- DEVELOPMENT AGREEMENT THE CITY OF SEWARD (hereinafter the "City"), an Alaska home rule city, and GATEWAY VENTURES, INC. (hereinafter the "Developer'), enter into the following Agreement this day of June, 1984. Kenneth J. Lythgoe, Lynn H. Lythgoe, Jr., and John F. Gillespie execute this Agreement on behalf of the Developer. It is understood that the Developer is an Alaska corporat ion, and that the persons who executed the Agreement on behalf of the Developer do so in the capacity of officers and directors. Kenneth J. Lythgoe, Lynn H. Lythgoe, Jr., and John F. Gillespie warrant that they have authority to execute this Agreement on behalf of the Developer. The parties to this Agreement shall accept notices at the following addresses and telephone numbers: Developer City Gateway Ventures, Inc. 6230 'A" Street Anchorage, AK 99502 (907) Ci ty Manager Ci ty of Seward Fifth & Adam Streets Post Office Box 167 Seward, AK 99664 (907) 224-3331 The real property which is the subject of this Agreement (hereinafter the "Property') is located in the City of Seward and is described as: All of TERMINAL ADDITION in the City of Seward, Seward Recording District, Third Judicial District, State of Alaska, SAVE and EXCEPT Lots 10, 11, 12, 22, 23 and 24, Block 1: Lots 1 through 7 inclusive, Block 8: Lots 1 through 7 inclusive and Lots 34 through 40 inclusive, Block 9, and Lots 6 and 7, Block 29. All of tracts A-IA and A-2A, JESSE LEE HEIGHTS SUBDIVISION, ADDITION NO.1, a subdivision of portions of Jessee Lee Heights Subdivision, Bayview Addition and Terminal Addition, City of Seward, according to Plat 6 on file in the Seward Recording District, Third Judicial District, State of Alaska. -1- -- ._----'---. --~--.._-, Lots 10, 11 and ADDITION in the Recording District, State of Alaska. 12, Block 1, TERMINAL City of Seward, Seward Third Judicial District, Lots 22, 23 and 24, Block 1.; Lots 1 inclusive, Block 8: Lots 1 through through 40 inclusive, Block 9 ADDITION, City of Seward, Seward District, Third Judicial District, Alaska. through 7 7 and 34 TERMINAL Recording State of Lots 6 and the City District, Alaska. 7, Block 29, TERMINAL ADDITION in of Seward, Seward Recording Third Judicial District, State of The Developer seeks the City's agreement to enter into a contract for the sale of the Property from the Ci ty to the Developer for development. In consideration of the City's agreement to enter into such a contract of sale. the Deve loper agrees to cons truct and install the improvements described in Article IV of this Agreement in accordance with all the terms, covenants and conditions of this Agreement. The Developer shall construct and install the following improvements: x street -X- sidewalk ---x- curb and gutter ---x- storm drain ---x- drainage ---x- sanitary sewer X water X telephone -X- electrical X monumentation -X- street lighting ---x- traffic control devices -X- street signs --;r-- other: Reservoir system The Developer estimates the cost of the improvements to be $2.5 million. -2- SST/bs/45/G-1 ARTICLE I GENERAL PROVISIONS 1.01 Application of Article Unless this Agreement expressly provides otherwise. all provisions of this article apply to every part of this Agreement. 1.02 Permits, Laws, and Taxes The Developer shall acquire and maintain in good standing all permits, licenses, platting approvals and other entitlements necessary to its performance IJnder this Agreement. All actions taken by the Developer IJnder this Agreement shall comply with all applicable statlJtes, ordinances, rules, and regulat~ons. The Developer shall pay all taxeS pertaining to its performance IJnder this Agreement. 1.03 Relationship of Parties Neither by entering into this Agreement, nor by doing any act hereunder, may the Developer, or any contractor or subcontractor of the Developer be deemed an agent, employee. or partner of the City, or otherwise associated with the City other than, in the case of the Developer, as an independent contractor. The Developer and its contractors and subcontractors shall not represent themselves to be agents, employees. or partners of the City, or otherwise associated with the City other than, in the case of the Developer, as an independent contractor. The Developer shall notify all its contractors and subcontractors of the provisions of this section. 1.04 Enqineer's Relation to City Notwithstanding Section 2.08, or any agreement Whereby the City reimburses the Developer's engineering costs, an engineer retained by the Developer to perform work IJnder this Agreement shall not be deemed an agent, employee, partner, or contractor of the City, or otherwise associated with the City. -3- SST/bs/45/G-I ---- -. . 1.05 Developer's Responsibility The Developer shall be solely responsible for the faithful !;>erformance of all terms, covenants, and conditions of this Agreement, notwithstanding the Developer's delegation to another of the actual !;>erformance of any term, covenant, or condition hereof. 1.06 Allocation of Liabilitv The Developer shall indemnify and hold the City , , , \ :.t :~ harmless from any claim, action, or demand arising from any act or omission related to this Agreement in whole or in part of the .; Developer, his agents, employees, or contractors. The liability ... " ~, assumed by the Developer pursuant to this section includes, but is not limited to claims for labor and materials furnished for the construction of the improvements. i I I 1.07 Disclaimer of Warranty Notwi thstanding this Agreement or any action taken by any person hereunder, neither the City nor any City officer. agent, or employee warrants or t:'epresents the fitness, suitability, or merchantability of any property, !;>lan, design, material, workmanship, or structure for any !;>urpose. 1.08 Non-Discrimination A. In performing its obligations under this Agreement, the Developer shall not discriminate against any person on the basis of race, creed, color, national origin, sex, marital st.atus, or age. B. In selling property or improvements in the subdivision, the Developer shall not discriminate against any person on the basis of race, creed, color, national origin, sex, marital status, or age. -4- SST/bs/45/G-l ~_. ~-~~ -----._~ t! 1. 09 Cost of Documents All plans, reports, drawings, or other documents that this Agreement requires the Developer to provide the City , shall be furnished at the Developer's expense. 1.10 Public Utilities A. Any public utility service contemplated by this ,- ~;~ :, ,;:i .~ Agreement need be provided only to areas where the service is allowed by the Alaska Public Utilities Commission and applicable law. All utility service shall conform to the r:ules, .J' "' ; regulations, and tariffs of the Alaska Public Utili ties Commission to the extent they may apply. a. If the Alaska Public Utilities Commission disallows any utility service by the City or any utility following execution of this Agreement, the provlsion of the disallowed service shall be deleted from the requirements under this Agreement wi thout affecting any other part hereof. The disallowance shall not be grounds for any Claim, action, or demand against the City. 1.11 Time is of the Essence Unless otherwise expressly provided herein, time is of the essence of each and every term, covenant, and condition of this Agreement. 1.12 Assiqnments A. Except insofar as subsection a of this section specifically permits assignments, any assignment by the Developer of its interest in any part of this Agreement or any delegation of duties under this Agreement shall be void, and any attempt by the Developer to assign any part of its interest or delegate any duty under this Agreement shall constitute a default entitling the City to invoke any remedy available to it under Section 1.13. -5- SST/bs/45/G-l -.- ' t - .-------- ------ '..~-- B. The Developer may assign its interest or delegate its duties under this Agreement: 1. To the extent that Article 9 Commercial Code requires that contract rights be allowed. of the Uniform assignments of 2. To contractors and subcontractors, subject to Section 1. 05. 3. As expressly permitted in writing by the City. 1.13 Default - City's Remedies A. The Ci ty may declare the Deve loper to be in default: 1. If the Developer is adjudged a bankrupt, makes a general assignment for the benefit of creditors, suffers a receiver to be appointed on account of insolvency, takes advantage of any law for the benef i t of insolvent debtors: or 2. If the Developer has failed in any measurable way to perform its obligations under this Agreement, provided the City gives the Developer notice of the failure to perform and the Developer fails to correct the failure within thirty (30) days of receiving the notice; or if the failure requires more than thirty (30) days to cure, the Developer fails within thirty (30) days of receiving the notice to commence and proceed with diligence to cure the failure. 3. If the Developer is in default under that con- tract of sale, purchase money deed of trust, and deed of trust executed by Developer in favor of the City on , 1984. B. Upon a declaration of default, the City may do any one or more of the following: 1. Terminate the Agreement wi thou t liabi li ty for any obligation maturl,ng subsequent to the date of the termination. 2. Perform any act required of the Developer under this Agreement, including constructing all or any part of the improvements after giving seven (7) days notice in writing to the Developer. The Developer shall be liable to the City for any costs thus incurred. The City may deduct any costs thus incurred from any payments then or thereafter due the Developer from the Ci ty whether under this Agreement or otherwise. 3. Exercise its rights under any provision of this Agreement, or any ~erformance or warranty guaranty securing the Developer's obligations under this Agreement. -6- SST/bs/45/G-l 4. Pursue any including but injunction and appropriate judicial remedy. not limited to an action for civil penalties. 1.14 Non-Waiver The failure of the City at any time to enforce a provision of this Agreement shall in no way constitute a waiver of the provision, nor in any way affect the validity of this Agreement or any part hereof, or the right of the City thereafter to enforce each and every provision hereof. 1.15 Interpretation A. Each document incorporated by reference herein is an essential part of this Agreement, and any requirement, duty, or obligation stated in one document is as binding as if stated in all. All documents shall be construed to operate in a complementary manner and to provide for a complete project. B. If the terms of any of the documents and amendments thereto comprising this Agreement conflict, the conflict shall be resolved by giving the conflicting documents and amendments thereto the following order of preference: 1. Documents or Provisions." sections titled "Special 2. Article II of this Agreement titled "Construction of Improvements," and Article III of this Agreement titled "Acceptance of Improvements." J. Article I of this Agreement titled "General Provisions." 4. Documents incorporated under Article IV of this Agreemen t. 5. Article IV of this Agreement "Improvement Requirements." titled 6. Any other document incorporated by reference herein. -7- SST/bs/45/G-l -----.-- . 1.16 Effect of Standard Specifications The 1984 Municipality of Anchorage Standard Specifications are incorporated by reference herein as minimum construction standards for performance under this Agreement, except where this Agreement specifically provides otherwise: provided, however, that provisions in the Standard Specifications describing the relationships and responsibilities of parties to municipal construction contracts do not apply herein to the extent that they conflict with any provision of this Agreement. 1.17 Amendment , I' .-! .' '1' The parties may amend this Agreement only by written agreement, which shall be attached as an appendix hereto. 1.18 Jurisdiction - Choice of Law Any civil action ariSing from this Agreement shall be brought in the Superior Court for the Third Judicial District of the State of Alaska at Seward. The law of the State of Alaska shall govern the rights and duties of the parties under this Agreement. 'L 1.19 Severability Any prOVision of this Agreement that may be declared invalid or otherwise unenforceable by a court of competent jurisdiction shall be ineffective to the extent of ach invalidity without invalidating the remaining provisions of the Agreement. 1.20 Inteqration .. This instrument, and any writings incorporated by reference herein, embody the entire agreement of the parties. -8- SST/bs/45/G-l ---:-:--- - ~-- ---- .~ ~ This Agreement shall su~ersede all ~revious communications, representations, or agreements, whether oral or written, between the ~arties hereto. 1.21 Definitions Unless this Agreement expressly ~rovides otherwise, the following definitions shall a~~ly herein: A. "Improvements" means all work ,.,hich the Develo~er is required to ~erform by this Agreement. S. .'City improvements II means improvements ',.,hich are to be dedicated to the City ~ursuant to Cha~ter of the Seward City Code, or the final approval of a cond i t ional use unde r Chapter of the Seward City Code, or which are to be o~erated and controlled by a City owned utility. C. "City," for the ~urposes of administering this Agreement, means the City Manager for the City of Seward, or his designee. D. "Acceptance" by the City means a determination that an improvement meets City construction standards, and does not refer to accepting a dedication of the improvement by the Developer. -9- SST/bs/4S/G-l ~, -- . ARTICLE II IMPROVEMENT CONSTRUCTION STANDARDS AND PROCEDURES 2.01 Recordinq of Pinal Plat The final plat for the subdivision shall not be recorded until the Developer has submitted, and the City has approved the performance guaranty required by Section 2.02. 2.02 Performance Guaranty A. The Developer shall guarantee, for the sole benefit of the City, that the Developer will perform all of its obligations under this Agreement. The guaranty shall be in one of the forms specified by Sections 2.03, 2.04 and 2.05. During the term of this Agreement, the Developer may, with the written consent of the City, substitute for a performance guaranty submi tted under this section another guaranty in the required amount and in one of the forms specified by Sections 2.03, 2.04 and 2.05. a. Amount of Guaranty 1. The guaranty shall be in an amount equal to the estimated cost of all improvements, which shall be computed as follows. The Developer shall submit for the City's approval, a cost estimate for each improvement required by this Agreement. The Developer's engineer shall prepare and certify all cost estimates. The estimated cost of all improvements shall be the sum of the approved estimated cost of constructing each improvement, plus an overrun allowance upon that sum as follows: Total Estimated Cost of Constructinq Improvements Overrun Allowance less than $500,000.00 $5UO,OOO.00 - $1,000,000.00 over $1,000,000.00 20% 15% 10% 2. If the City finds that increases in construction costs, between the time the City approves the estimated improvement costs under section 2.01 of this Article and the time the -10- SST/bs/45/G-l '\,- improvements are completed, have rendered the approved estimated improvement costs unreasonably low, the City may require the Developer to increase the performance guaranty to an amount equal to an approved estimated cost of all improvements based upon current construction costs. C. If the Developer is not in default under this Agreement, the Ci ty may allow a reduct ion in the amount of the performance guaranty, or the amount secured thereby, not exceeding the difference between the estimated cost of all improvements and the current estimated cost of the work remaining to be performed under this Agreement; provided, however. that the amount of the performance guaranty, or the amount secured thereby always shall be greater than or equal to the amount of the warranty guaranty required by Section 3.08. D. As soon as one of the following occurs, the Ci ty shall release any performance guaranty which has not been used or encumbered under Section 1.13: 1. The final acceptance of all improvements and the posting of warranty guaranty as provided in Section 3.07; 2. The expiration of the warranty period as provided in Section 3.07; or 3. The expiration of a period of three years from the date of a declaration of default under Section 1.13. 2.03 Performance Bond The Developer may provide a performance bond from a company qualified by law to act as a surety in the State of Alaska. The bond shall be in a form approved by the City. the bond shall name the City as the sole obligee and the Developer as the principal. 2.04 Escrow . The Developer may deposit cash in an escrow with a bank or financial institution qualified by law to do business in the State of Alaska. The disbursement of the escrowed funds shall be governed by an escrow agreement in a form approved by the City. -11- SST/bs/45/G-l . . 2.05 Letter of Credit The Develo~er may cause a bank or financial institution qualified by law to do business in the State of Alaska to issue an irrevocable letter of credit or loan commibment agreement to the City as beneficiary. The letter of credit or loan commitment agreement shall be in a form approved by the City. 2.06 Prerequisites to Construction The Developer shall not obtain permi ts for the construct ion of improvements, or commence t.he construction of ! :, , improvements until the requirements of Sections 2.07 through 2.12 have been met. 2.07 E:nqineer A. The Developer shall retain an engineer, registered as a ~rofessional engineer under the laws of the State of Alaska, 1 1 I j to design and administer the construction of the improvements, including ~reparing plans and specifications, ins~ecting and controlling the quality of the work, and ~re~aring as-built data. The engineer shall ~erform the work described herein in accordance with the City's recommended ~rocedures for consulting engineers. B. The Oeveloper shall inform the City of the name and mailing address of the engineer it has retained to ~erform the duties described in subsection A of this section, and agrees that notice to the engineer at the address so s~ecified regarding the performance of such duties shall constitute notice to the Developer. The Developer shall promptly inform the Ci ty of any change in the information required under this subsection. -12- SST/bs/45/G-l - ---:-~ -.- - --,.- .J! 2.08 Plans and Specifications A. The Deve lope!:" shall submi t to the City, in such fOt"m as the City may specify, all plans and specifications pe!:"taining to the construction of the improvements. B. The Developer shall submit to the City proof that it has retained an engineer to perform the duties described in Section 2.07A. C. If the City requires soils tests or other tests !?ertaining to the design of improvements, the Developer shall submi t !:"eports of the test resul ts ..i th the plans and i I , , ~, " "., ! specifications. D. The City shall approve the plans and specifications .. "- as submitted, or indicate to the Developer how it may modify them "- to secur~approval ..ithin three ..eeks from the submission of all '''/' , , . i !?lans and specifications for the improvement. I ,I j I 2.09 Quality Control Proqram A. The Developer shall submit to the City, in such form as the City may specify, a quality control !?rogram for the construction of the improvements. B. The quali ty control program shall !?rovide sufficient inspection and test procedures to determine compliance ..ith all applicable plans. specifications. and safety !:"equirements. The program shall include at least the following: 1. The frequency and type of all tests to be performed. 2. A list of all persons who will perform tests and inspections. 3. Procedures for coordinating testing and inspections with the City, and for providing advance notice to the Ci ty of all inspections and tests which the City shall witness. 4. Procedures for reporting activities. including deficiencies in the "ork. quality control discoveries of -13- SST/bs/45/G-l . ,----- -. . 2.10 Woek Schedule A. The Developee shall submit to the City. in such form as the City may specify, a woek schedule. B. The work schedule shall include a progress chart of a suitable scale, indicating the approximate peecentage of woek scheduled foe completion at any given time. For each improvement, the schedule shall indicate starting and completion dates for the following: 1. Clearing, g,rubbing, and eemoving of oveebueden. 2. Excavation, installation, compaction for each utility the Developer. and backfill and to be installed by I ,t .' ., ! 3. Excavation, backfill, and compaction foe steeet facilities othee than paving. 4. Paving. .. 2.11 <'1aterials A. The Developer shall submi t, in such form as the City may specify, detailed information conceening all materials and equipment it proposes to incorporate into an impeovement. B. Upon the City's request, the Developer shall submit samples of maerials or equipment it proposes to incorpoeate into an improvement. 2.12 Liability Insurance The Developer shall provide proof that it has acquired the insurance r'equired under the 1984 Municipality of Anchorage standard construction specifications in the fol."lll prescribed in those standard specifications, or, if the Developer has engaged a prime contractor' to perfol."lll the work under this Agreement, proof that the prime contractor has acquired such insurance, naming the Developer' as an insured. -14- SST/bs/45/G-l 2.13 Gene~al Standa~d of Wo~kmanship A. The Develope~ shall construct all improvements in acco~dance with plans, specifications, and cont~acts approved by the City, and with the terms, covenants, and conditions of this Agreement. The Developer shall not incorporate any material or equipment into an improvement unless the City has app~oved its use. Unless the City specifically agrees otherwise in writing, all materials, supplies, and equipment inco~po~ated into an improvement shall be new. B. If the course of construction conditions appear in the exercise of ~easonable enginee~ing judgment, to ~equi~e a I .-,; modification of, or substitution for approved materials, equipment, plans, specifications, or contracts to meet a higher standard of performance, the Develope~ shall make the , , i modification or substitution. C. The Developer shall construct all facilities in the , I subdivision not otherwise subject to this Agreement in acco~dance with applicable statutes, o~dinances, and specifications. 2.14 Placement of Utilities The Develope~ shall place all utilities unde~ground, except where this requi~ement is specifically waived unde~ Article IV of this Agreement. 2.15 Work In Riqht-of-Wav The Developer shall comply with all ordinances and secure all necessary permits and authorizations j;lertaining to work in public rights-of-way. The Developer shall coordinate and supervise the installation and construction of all utility imj;lrovements, including those not otherwise covered by this Agreement, in a manner that will prevent delays in City construction or other damage to the City, and that will permit the City to properly schedule work that it will perform. -15- SST/bs/45/G-l ~ 1 I ;,j " "t " , } 1 . '--~.----' 2.16 Surveyor All surveys required for the completion of improvements under this Agreement shall be made by a \lerson registered as a \lrofessional land surveyor under the laws of the State of Alaska. 2.17 Required Reportinq A. Quality Control 1. The Deve lO\ler shall submi t to the Ci ty regularly and ?romptly, written re\lorts describing the results of all tests and lnspect~ons required by the quality control ?rogram, and all other tests and ins\lections which the Developer may make. 2. The Developer shall coordinate testing and inspections with the City, and \lrovide advance notice to the City of all tests and inspections which the City shall witness as required by the a\lproved quality control \lrogram. B. Construction Progress 1. At such intervals as the Ci ty may require, the Developer shall enter on the a\lproved work schedule \lrogress chart the actual work \lrogress to date and immediately forward two (2) cOIl ies of the marked \lrogress chart to the City. 2. If actual \lrogress indictes that the Developer will not \lerform the work as scheduled, the Developer shall \lrepare and submi t a revised schedule for the City's approval. 3. In addition to any other notice Agreement may requlre, the Developer the City reasonable notice \lrior to the following: that this shall give commencing a. Clearing and grubbing: b. Completion of excavation: c. Installation of utilities, \llacement of backfill or classified backfill: d. ~1rst concrete ?our: e. ~irst \llacement of leveling course: f. ~irst \llacement of asphalt; g. ~1rst placement of seal coat. -16- SST/bs/45/G-l -~-.- ~'--- - ----- ___. 1 C. Surveys The Developer shall furnish promptly to the City copies of all surveys required for the completion of the improvements. D. Express or implied approval by the City of any report or inspection, shall not authorize any deviation from approved plans and specifications, or from the terms of this Agreement. 2.18 proqress Payments The Developer shall pay its contractors all contract progress payments when due. 2.19 Surveillance A. The City may monitor the progress of the work and the Developer's compliance with this Agreement, and perform any inspection or test which it deems necessary to determine whether the work conforms to this Agreement. B. If the Developer fails to notify the City of inspections, tests, and construction progress, as required by Section 2.17, the City may require, at the Developer's expense, retesting, exposure of previous stages of construction, or any other steps which the Ci ty deems necessary to determine whether the work conforms to this Agreement. C. Any monitoring, tests, or inspections that the City orders or performs pursuant to this section, are solely for the benefit of the City. The City does not undertake to test or inspect the work for the benefit of the Developer or any other person. 2.20 Stop Work Orders A. If the City determines there is a substantial likelihood that the Developer will fail to comply, or if the Developer does fail to comply wi th this Agreement, the Ci ty may -17- SST/bs/45/G-l -. ~ ----- . .- ,-,--_.- -- -------. stop all further construction of improvements by posting a stop work order at the site of the nonconforming construction and notifying the Developer or its engineer of the order. B. A stop work order shall remain in effect until the Ci ty approves: 1. Arrangements made by the Developer to remedy the nonconformity; and 2. Assurances by the Developer nonconformities will not occur. that future C. The issuance of a stop work order under this section is solely for the benefit of the City. The City does not undertake to supervise the work for the benefit of the Developer or any other person. No suspension of work under this section shall be ground for an action or claim against the City, or for an extension of time to perform the work. D. The Developer shall include in all contracts for work to be performed, or materials to be used under this Agreement, the following provision: The City of Seward, pursuant to a Development Agreement on file wi th the City Clerk and incorporated by reference herein, has the authority to inspect all work or materials under this contract, and to stop work in the event that the work performed under this Agreement fails to comply with any provision of the Development Agreement. In the event that a stop work order is issued by the City, the contractor shall immediately cease a 11 work and awa it further ins truct ions from the Developer. 2. 21 Access The City shall have access to all parts of the subdivision convenient for monitoring the necessary or Developer's performance, inspecting, surveying, testing, or performing any other work. 2.22 Maintenance A. Until the City accepts the improvements, the Developer shall maint'ain all existing roads within the -18- SST/bs/4S/G-l "..--.-- ...-..----- I ! J ." , ,; '" " ; " 1 I i subdivision that are necessary for access to \lro\lerty not o....ned by the DeveloJ;ler. For the J;lurJ;loses of this subsection, existing roads are roads that physically exist. as distinguished from mere rights-af-way dedicated for road purJ;loses. The maintenance required by this subsection includes cleaning. effective dust contral measures, snow removal, and similar activities, but does not include reJ;lair, reJ;llacement. or reconstruction. B. The DeveloJ;ler shall reJ;lair or pay the cost of reJ;lairing damage to any imJ;lrovement that occurs "rior to the Ci ty' s acceptance of the imJ;lrovements, except for damage caused solely by the Ci ty, its agents. emJ;lloyees. or contractors. The DeveloJ;ler shall give reasonable notice to the City before undertaking the repair of the damaged imJ;lrovement. 2.23 Operation of Improvements Prior to Acceptance A. Before the City acceJ;lts the imJ;lrovements. the City may enter upon. insJ;lect. control. and oJ;lerate any imJ;lrovement if the City determines that such action is necessary to "rotect the public's health, safety. and welfare. B. The action described in subsection A of this section shall not constitute the acceJ;ltance of any imJ;lrovement by the City, nor shall the action affect in any way the Develo\ler's ....arranty under this Agreement. 2.24 Time A. All imJ;lrovements required by this Agreement shall be completed within two (2) years of the date of execution hereof. B. The Developer shall begin actual construction of improvements required under this Agreement in accord with the Developer's work schedule as approved by the City. C. If the DeveloJ;ler is delayed by an act or omission of the City not otherwise authorized under this Agreement, or by -19- SST/bs/45/G-l - . ._.~..__._._.~ ._- --- changes ordered in the work. labor disputes. fire, delays in transportation, casualties, or other causes beyond the Developer's control. or by any cause which the City in its discretion determines to be adequate to justify the delay, the time of completion of construction under this Agreement may be extended for a reasonable time, which shall be determined by the City. No extension shall be granted unless the Developer gives notice in writing to the City within ten (10) days after the occurrence of the cause for delay. In the case of a continuing delay, only one notice is required. ~._----.-- -_.~.'.--~ -20- SST/bs/45/G-l ARTICLE III ACCEPTANCE UP IMPROVEMENTS 3.01 PrerequiSites to Acceptance The City shall not accept the improvements until all the requirements of Sections 3.02 through 3.05 have been met. 3.02 Monuments and As-Built Drawinqs A. Upon completing the improvements, the Developer shall replace lost lot corners and monuments and shall monument t 1 :; { the center lines of all required paved streets with monuments of --~~t least one-foot rebar and alcap at points of curvature, ends of curvature, intersections, and centers of cul-de-sacs in ~.~ , accordance with the terms of Anchorage Municipal Code. Section 21.85.025 and any standards established thereunder. B. No later than sixty (60) days after the final inspection and certification under Section 3. 05F, the Developer shall provide the City with one acceptable set of reproducible mylar as-built drawings for each improvement. The as-built drawings shall be certified by a professional engineer registered under the laws of the State of Alaska to represent accurately the improvements as actually constructed. 3.03 Certificate of Compliance The Developer shall furnish the City with a certificate of compliance for the work performed under this Agreement, in the form prescribed by the 1984 Mun icipa11 ty of Anchorage standard specifications. 3.04 Conveyance of Easements and Riqhts-of-Way to City The Developer shall convey to the City any easement, right-of-way, or other property interest necessary to allow access to the City improvements to operate, maintain. or repair -21- SST/bs/45/G-l I! ---.-.---....-.. " ~ '1, . \ ~ . the City improvements. The Developer may condi tion the conveyance upon the City.s acceptance of the improvements. 3.05 Inspection A. Upon receiving notice that the Developer has completed the improvements, the City shall schedule inspections of the improvements. The City may inspect all improvements, and any other work in dedicated easements or rights-of-way. B. A privately owned utility may inspect any phase of ~ork on an improvement of which it is to assume control. C. The City or appropriate privately owned utility shall inform the Developer in writing of any deficiencies in the work found in the course of its inspection. D. The Developer shall, at its own expense, correct all deficiencies found by inspections under subsections A or B of this section. Upon receiving notice that the deficiencies have been corrected, the City or appropriate privately owned utility shall reinspect the improvements. g. The City or appropriate privately owned utility may continue to reinspect an improvement until the Developer has corrected all deficiencies in the improvement. F. After a final inspection has revealed that all improvements and other work in dedicated easements and rights-of- way meet City standards, and each privately owned utility ',;hich is to assume control of an improvement certifies that that improvement or improvements are acceptable to it, and the Developer has furnished the as-built drawings required by Section 3.02B, the City shall notify the Developer that all improvements have been accepted. 3.06 Consequences of Acceptance of Improvements A. The City's final of acceptance the City improvements constitutes a grant to the City of all the -22- SST/bs/45/G-l ...p L 1 ,I I i Developer's right, title, and interest in and to the City improvements. B. By accepting the City improvements under this Agreement, the City does not undertake to maintain any such improvement, unless obligated to do so by applicable statute, ordinance, regulation, or tariff. 3.07 Developer's Warranty A. The shall warrant Developer the design, construction materials, and workmanship of the improvements against any failure or defect in design, construction, material, or workmanship which is discovered no more than one year from the date the City notifies the Developer of the acceptance of the improvements. This warranty shall cover all direct and indirect costs of repair or replacement, and damage to the property, improvements, or facilities of the City or any other person, caused by such failure or defect or in the course of repairs thereof, and any increase in cost to the Ci ty of operating and maintaining a City improvement resulting from such failures, defects, or damage. B. The Developer's warranty shall not extend to any failure or defect solely caused by changes in des ign, construction, or materials required by the City. C. Except as provided in subsection B of this section, the fact that the City takes any action, or omi ts to take any action authorized in this Agreement, including out not limited to operation or routine maintenance of the improvements prior to acceptance, or surveillance, inspections, review or approval of plans, tests or reports, shall in no way limit the scope of the Developer's warranty. -23- SST/bs/4S/G-l . . ---- -- ----..-e 3.08 Warranty Guaranty A. To secure the Developer's performance of the warranty under Section 3.07, the performance guaranty provided by the Developer under Section 2.02 shall remain in effect until the end of the warranty period, or the Developer shall provide a warranty guaranty by one or more of the methods described in Sections 2.03 through 2.06. 8. The amount of the warranty guaranty shall be the percentage of the estimated cost of all improvements calculated pursuant to Section 2.028, determined by the following table: I .: " .~ ' Estimated Cost of All Improvements Percent to Secure Warranty less than 5500,000.00 5500,000.00 - 51,000,000.00 over 51,000,000.00 10.0% 7.5% 5.0% 3.09 City's Remedies Onder Warranty A. The City shall notify the Developer in writing upon its discovery of any failure or defect covered by the warranty in Section 3.07. The City shall notify the Developer before conducting any tests or inspections to determine the cause of the failure or defect, and shall notify the Developer of the results of all such tests and inspections. 8. The Developer shall correct any failure or defect covered by the warranty within thirty (30) days of receiving notice of the failure or defect from the Ci ty. The Developer shall correct the failure or defect at its own expense and to the satisfaction of the City. C. If the Developer fails to correct the failure or defect within the time allowed by subsection 8 of tris section, the City may correct the failure or defect at the Developer's expense. If the Developer fails to pay the City for the corrective work within thirty (30) days of receiving the City's bill therefor, the City may pursue any remedy provided by law or this Agreement to recover the cost of the corrective work. -24- SST/bs/45/G-l -:--:-,.~ ~ 3.10 Conditions of Reimbursement A. If this Agreement requires the City to reimburse the Developer for all or part of the cost of an improvement, the reimbursement shall be conditioned upon the Developer's performance of all its obligations under this Agreement. B. Any reimbursement shall be subject to the approval of bonds and the appropriation of funds as required by law. If funds are not ava ilable at the time any reimbursement is due under this Agreement, the City shall reimburse the Developer when funds become ava ilable. The Ci ty shall not be liable for any delay in reimbursing the Developer due to the unavailability of funds, nor shall such delay constitute a breach of this Agreement. C. The installments, and interest at the t"e imburs ema n t . City may reimburse the Developer in in such event, any unpaid balance shall bear rate paid on bonds sold to finance the 3.11 Completion of Performance: Release of Warranty A. The City shall inspect the improvements at or before the end of the warranty period, and before releasing any performance guaranty or warranty guaranty then in effect. The Developer shall correct any failure or defect in the work revealed by the inspection as required by Section 3.09. B. On the Developer's satisfactory performance of all its obliga tions under this Agreement, the Ci ty shall execute a written statement acknowledging such performance. and shall release any remaining security posted by the Developer under this Agreement. -25- SST/bs/45/G-l ._----.'.. --- j " .~ '- --.. '", . (' .-- ARTICLE IV IMPROVEMENT REQUIREMENTS 4.01 Improvements Required It is the intent of the City and Developer to provide for the orderly development of the property. It is understood and agreed that a principal reason for the City of Seward to provide for the development of the property is a ~erceived need, by the City Council of the City of Seward, as more particularly set forth in Resolution 84- to provide building lots for residential expansion within the City, especially as a result in cecent and future The antlclpatea industrial growth. availability of residential building lots within the City of Seward for construction of residential structures is perceived by the City as being in the public interest, and it is the steady supply of such lots by Developer as a result of the development plans contained herein that has induced the City to enter into this, agreement. The City Council of the City of Seward has determined that private development of the property would be more advantageous than public development in that such private development will be more responsive to market pressures, less expensive, and will not commit scarce public resources to a project that can be developed privately. The City, however, requires as a fundamental matter that the public's need for a steady supply of building lots be met by the Developer during the course of this Agreement. Therefore, Developer shall be required to complete development and market for sale 40 lots by and, upon sale of the first 40 residential lots within the property. to continuously and diligently develop the remainder of the property such that there are consistently available at least 20 residential building lots within the property. -26- SST/bs/45/G-l The term I'consistently availablelt means listed for sale at fair market value or less with a realtor who is a ~artici~ant in the Mult i~le Listing Service. Terms of the listing shall ~ermit closing of the sale on a cash on first draw basis upon construct ion of a res ident ial structure, such construction to begin no later than ninety days from the date of execution of the earnest money agreement, or 60 days after the beginning of the spring construction season, whichever is later. If the Develo~er is unable to meet the requirements of this condi tion because of circumstances actually beyond its control and reasonably beyond the control of an experienced developer with adequate available financing, then a reasonable extension of time to meet this requirement may be requested by the Developer and granted by the City Council of the City of Seward. If Developer fails, for a ~eriod of sixty days, to have consistently available twenty (20) building lots, then the City may, at its sole discretion, declare a default under the terms of this Agreement. If the Developer is of the belief that its failure to make twenty (20) lots consistently available is excusable by reason of circumstances actually beyond its control and reasonably beyond the control of an experienced developer with adequate available financing, then the Developer may request arbitration of the issue of default. . \. Provided a decision of the arbitrators is rendered within ninety days from the date of the declaration of default by the City Council, this Agreement will not be in default. Upon the rendering of a decision that the Developer has failed to meet these requirements by an arbitrator in accordance with this Agreement, the City may proceed with the default remedies provided in section 1.13B under the terms of this Agreement, or the City may acquire the ~roperty that has been sold upon assumption by the City of any outstanding indebtedness of Developer for development of the ~roperty secured by a Deed of Trust on all or part of the Property. In making its decision, -27- SST/bs/45/G-l 'C --..'-. ~ -.----- ..- --~-- -~- 4.03 Sanitary Sewer Improvements Sewer system improvements shall be provided in accordance with an agreement with the City, incorporated by ~eference herein. The estimated cost of the sewer system is s 4.04 Water System Requirements A. Water system improvements, including reservoir and related facilities, shall be provided in accordance with an agreement with the City, incorporated by reference herein. The the water system is estimated to be The Developer's total water facility cost, including connection fees, under this Agreement is estimated to be S The City's cost share of water facilities is estimated to be S 4.05 Electrical Facilities A. Electrical improvements shall be provided in accordance with an agreement with the City, incorporated by reference herein. The total cost of the electrical system serving the subdivision is estimated to be S 1. The Developer's facilities within to be S cost share of electrical the subdivision is estimated 2. The City's cost share of electrical facilities within the subdivision is estimated to be S 4.06 Telephone Facilities A. Telephone improvements shall be provided in accordance with an agreement with the City, incorporated by reference herein. The total cost of the telephone system serving the subdivision is estimated to be S 1. The Developer's cost share of telephone facilities within the subdivision is estimated to be S -29- SST/bs/45/G-l .J! the arbitration panel shall award reasonable costs and attorney's fees and expert witness fees to the prevailing party. The intent of requiring Developer to make at least twenty (20) lots consistently available and the remedies of City is to insure that the public purposes as set forth in Resolution 84-____ are met. 4.02 Street, Alleyway, Monumentation, Waterway, Traffic Control, Street Liqhtinq, Street Name Signing, and Drainaqe Improve- ~ A. All improvements to the property (herein "site improvements') shall be provided and constructed in accordance ! " '\ I' :{ .' "' l wi th the approved pIa t and the 1984 Municipali ty of Anchorage standard specifications. B. In addition to the site improvements referred to in '. subparagraph A above, Developer shall construct, in accordance with the 1984 Municipality of Anchorage standard specifications, additional improvements within the City but on property other than the developed hereunder ('off-s ite improvements.). Such off-site improvements wi-II be in accordance with the plans and specifications therefore attached hereto as exhibit and incorporated herein by reference. The estimated costs for such improvements is SevEN HUNDRED FORTY-TWO THOUSAND FIVE HUNDRED AND NO/IOO DOLLARS (5742,500.00). The Developer shall promptly construct such improvements as part of its obligations hereunder and in accordance with the construction schedules developed under paragraph 2.10. C. The City shall reimburse Developer for construction of off-site improvements only after receipt from Developer of invoices for such work and further in accordance with the provisions of Article III of this Agreement. All of the provisions of this Agreement shall apply to off-site as well as on-site improvements. -28- SST/bs/45/G-l .-.- 2. The City's within the $ .. cost share of subdivision telephone facilities is estimated to be IN WITNESS WHEREOI;', the parties hereto ha'Je set their hands on the date first set forth abo'Je. CITY 01;' SEWARD, ALASKA By: ATTEST: Linda Murphy, City Clerk SST/bs/45/G-l DEVELOPER, GATEWAY VENTURES, INC. By: Title: By: Title: By: Title: APPROVED AS TO I;'ORM: HUGHES, THORSNESS, GANTZ, POWELL AND BRUNDIN, Attorneys for the City of Seward By I;'red B. Arvidson -30- ~ DEED Ob' TRU::iT (Securing Promissory Note) of Inc., an Alaska address is 6230 This Deed of Trust ("Deed of Trust"), made this day , 1984, between and among Gateway Ventures, corporation (hereinafter called "Trustor"), whose "G" Street, Anchorage, Alaska 99502; (hereinafter called "Trustee"), whose address is and the City of "Beneficiary"), whose Alaska 99664. Seward, address is Alaska (hereinafter Post Office Box 167, called Seward, WIT N E SSE T H: \vHEREAS, Beneficiary is the fee owner of certain real property described in Exhibit "A"; WHEREAS, Trustor has agreed to purchase from Beneficiary the real property described in Exhibit "A" and to pay the pur- chase price of SEVEN HUNDRED FORTY-TWO THOUSAND FIVE HUNDRED AND NO/IOO DOLLARS ($742,500.00) on an installment basis as lots are developed and sold, said purchase price to be evidenced by a promissory note of even date herewith (hereinafter called the "Note"). NOW, THEREFORE, in orde r to secure the payment of the principal on the Note as the same shall become due and payable according to its tenor, and to secure the performance and observ- ance of all the provisions therein and herein contained, and for and in consideration of the debt above described, Trustor by these presents does irrevocably grant, transfer and assign in Trust, with power of sale, unto , as Trustee, and unto its successors in the Trust hereby created, and unto its assigns forever all of the following contained in Granting Clauses I to IX inclusive (all of which are hereinafter collectively called the "Property"). GRANTING CLAUSE I Real P~operty OWned in Fee. All that certain real prop- erty situated In the Seward Recording District, Third Judicial District, State of Alaska, more particularly described in Exhibit A attached hereto and made a part hereof. GRANTING CLAUSE II Buildings, Improvements and Building Equipment'. All right, title and interest of Trustor in and to the buildings, structures and improvements now or at any time hereafter erected, -l- SST/bs/l04/G-5 . . . . . constructed and situated upon the real property described in Granting Clause I or any part thereof and (i) all apparatus, appliances, furnaces, boilers, machinery, engines, motors, com- pressors, dynamos, elevators, fittings, piping, connections, conduits, ducts, equij;lment and ot'her like personal property of every kind and description now or hereafter affixed or attached to any such building structure or improvement as shall be now or hereafter used or procured for use in connection with the heat- ing, cooling, lighting, plumbing, ventilating, air conditioning, refrigeration, cleaning or general operation and which are struc- tural components of any such building, structure, or improvement (all of which other than such foundations and footings are here- inafter called the "Building Equipment"), together with any and all alterations, replacements and additions to any such building, structure or improvement or Building Equipment, whether made by Trustor or any successor in interest (all of the foregoing including the Building Equipment being hereinafter collectively called the "Buildings"). GRANTING CLAUSE III Assignment of Rents and Other Riyhts and Interests of Trustor in or Appurtenant to the Buildings. All right, title and interest of Trustor now owned or hereafter acquired, in and to all and singular the tenements, hereditaments, privileges, ease- ments, franchises, leases, licenses, and appurtenances belonging or in any wise appertaining to the property described in the preceding Granting Clauses and the reversions, remainders, rents, issues and prof i ts thereof, including all interest of Trustor as landlord in and to all present and future licenses, leases, ten- ancies and occupancies of space in the Buildings and all the estate, rights, title and interest, claim and demand whatsoever in law or in equity, which Trustor now has or may hereafter acquire in and to such property, including, without intending to limit the generality of the foregoing, any proceeds of insurance or awards in condemnation. GRANTING CLAUSE IV Architectural Plans, Soil Tests, Etc. All architectural drawings, plans, specifications, soil tests, feasibility studies, appraisals, and similar materials, documents or studies relating to the Property. GRANTING CLAUSE V Governmental Permissions. All governmental permissions, environmental clearances, authority to subdivide or combine the Property and such rights, licenses and permits as are necessary for the commencement, continuation, completion, occupancy, use and disposition of any or all of the Property. -2- SST/bs/104/G-5 GRANTING CLAUS8 VI Intangibles. All general intangibles relating to the development or use of the Property, including without limitation, all names under which or by which the Property or any improve- ments on the Property may at any time be operated or known, all rights to carryon the business under any such names or any vari- ant thereof, and all trademarks and goodwill in any way relating to the Property. GRANTING CLAUSE VII Reserves, Deferred Payments, Etc. All reserves, deferred payments, deposits, refunds, cost savings and payments of any kind relating to the construction, operation, occupancy, use and disposition of any or all of the Property. TO HAVE AND TO HOLD the Property together wi th all buildings, improvements and building equipment thereon and all the rights, hereditaments and appurtenances in anywise appertain- ing or belonging thereto, and all reversions, remainders, rents, issues and profits thereof, and all of the estate, right, title, claim or demands whatsoever of Trustor, either in law or in equi ty, of, in and to the Property, unto Trustee and its succes- sors and assigns forever, SUBJECT, HOWEVER, to the right, power and authority hereinafter given to and conferred upon Beneficiary to collect and apply such rents, issues and profits. FOR THE PURPOSE OF SECURING: (1) Payment of the sum of SEVEN HUNDRED FORTY-TWO THOUSAND AND FIVE HUNDRED AND NO/IOO DOLLARS ($742,500.00), according to the terms of the Promissory Note of even date herewith made by Trustor, payable to Bene- ficiary or order, and all modifications, extensions or renewals thereof i and (2) Performance of each agreement of Trustor con- tained herein or incorporated herein by reference. This conveyance is made in Trust, and these presents are upon the express condition, that if Trustor, or its successors or asslgns, pays the sum of money stated in the Promissory Note secured by this Deed of Trust, and otherwise performs all of its obligations under this Deed of Trust, and the Promissory Note, and other documents incorporated herein by reference, then this Deed of Trust and the estate hereby granted, shall cease, deter- mine and be void and Trustee shall reconvey without warranty the Property then held hereunder. Trustor warrants that (i) it is lawfully possessed and is the fee owner of the real property described in Granting Clause Ii (ii) it is well and truly seized of the property described in Granting Clauses II through VII hereof, free and -3- SST/bs/I04/G-5 . . . . . clear of any liens and encumbrances except as expressly set forth in this Deed of Trust; (iii) it has not heretofore assigned the rents and payments mentioned under Granting Clause III hereof i (iv) it will maintain and preserve the lien of this Deed of Trust until the indebtedness secured hereby has been paid in full; (v) it has good right and lawful authority to mortgage and pledge the Property, as provided in and by this Deed of Trust; and (vi) that it will forever warrant and defend the same against any and all claims and demands whatever, except as are specifically set forth in this Deed of Trust. THE TRUSTOR HEREBY COVENANTS AND AGREES AS fOLLOWS: 1. Payment of Indebtedness. To pay all debts and monies secured by this Deed of Trust, when from any cause the same shall become due. To keep the Property free from statutory and governmental liens of any kind and to forever warrant and defend the Property against every gerson _WJ:LoIIlsoever lawfully claiming the same or any part thereof. Trustor upon request by mail will furnish a writ.ten statement duly acknowledged of the amount due on the indebtedness secured by this Deed of Trust and specifying whether any offsets or defenses exist against the debt secured by this Deed of Trust. 2. Defense of Security and Attorney fees. To appear in and defend any suit, action or proceeding that might affect the value of this Deed of Trust or the security itself or the rights and powers of Beneficiary or Trustee, and should Beneficiary or Trustee elect also to appear in or defend any such act ion or proceeding, be made a party to such action by reason of this Deed of Trust, or elect to prosecute such action as appears necessary to preserve said value, security or powers, Trustor will, at all time, indemnify and save Beneficiary or Trustee harmless from, and, on demand, reimburse Beneficiary or Trustee for, any and all loss, damage, expense or cost, including costs of evidence of title and attorney's fees, arising out of or incurred in connec- tion with any such suit, action or proceeding, and the sum of such expenditures shall be secured by this Deed of Trust with interest at the rate !?rovided for in the Note and shall be due and payable on demand. To pay costs of suit, cost of evidence of title and a reasonable attorney's fee in any proceeding or suit brought by Beneficiary to foreclose this Deed of Trust. 3. Payment of Taxes, Etc. To pay in full at least thirty (30) days before delinquent all taxes, assessments and encumbrances, charges or liens wi th interest, that may now or hereafter be levied, assessed or claimed upon the Property or any part thereof, which at any time appear to be prior or superior hereto for which provision has not been made heretofore, and upon request to exhibit to Beneficiary official receipts therefor, and to pay all taxes imposed upon, reasonable costs, fees and ex- -4- SST/bs/I04/G-S penses of this Trust, provided, however, that the Trustor shall not be required to discharge any such tax, assessment, encum- brance, charge or lien so long as the Trustor shall in good faith diligently contest such tax, assessment, encumbrance, charge or lien or defend enforcement thereof in legal proceedings which operate to prevent its enforcement or forfeiture of the property or any part thereof, and provided further that funds equal to 150% of the amount in dispute shall be escrowed wi th the Bene- fie i ary for tha t purpose, on such terms and condi t ions as Bene- ficiary may reasonably require. 4. Repayment of Benef iciary' s Expenditures. To repay immediately after written notice to Trustor all sums expended or advanced hereunder by or on behalf of Beneficiary or Trustee, with lawful interest from the date of such expenditure or advance maximum until paid, and the repayment thereof shall be secured by this Deed of Trust. Failure to repay such expenditure or advance and interest thereon within ten (10) days of the mailing of such notice will, at Beneficiary's option, constitute an event of default hereunder, or, Beneficiary may, at its option, commence an action against Trustor for the recovery of such expenditure or advance and interest thereon, and in such event Trustor agrees to pay, in addition to the amount of such expenditure or advance, all costs and expenses incurred in such action, together with a reasonable attorney's fee. 5. Beneficiary's Right to Protect Security. Should Trustor fail to make any payment or to do any act as herein pro- vided, then Beneficiary or Trustee, but without obligation so to do and without notice to or demand upon Trustor and without releasing Trustor from any obligation hereof, may (i) make or do the same in such manner and to such extent as either may deem necessary to protect the security hereof, Beneficiary or Trustee being authorized to enter upon the Property for such purposes; (ii) commence, appear in and defend any action or proceeding purporting to affect the security hereof or the rights or powers of Benef iciary or Trustee; (i ii) pay, purchase, contest, or com- promise any encumbrance, charge or lien which in the judgment of either appears to be prior or superior hereto, and in exercising any such powers, incur any liability, expend whatever amounts in its absolute discretion it may deem necessary therefor, including cost of evidence of title, employ counsel and pay his reasonable fees. Trustor covenants and agrees to pay immediately and with- out demand all sums so expended by Beneficiary or Trustee, with lawful maximum interest from the date of such expenditure until paid, and the repayment thereof shall be secured by this Deed of T ru st. 6. Condemnation. Should the Property, or any part or appurtenance thereof, or right or interest therein, be taken or damaged by reason of any public or private improvement, condem- -5- SST/bs/I04/G-5 . . . . . nation proceeding (including change of grade), fire, earthquake or other casualty, or in any other manner, Beneficiary may, at its option, commence, appear in and prosecute, in its own name, any action or proceeding, or make any compromise or settlement, in connection with such taking or damage, and obtain all compen- sation, awards or other relief therefor. All such compensation, awa rds, damages, righ ts of act ion and proceeds, inc lud i ng the proceeds of any policies of insurance affecting the Property, are hereby assigned to Beneficiary, which may, after deducting there- from all its expenses, including attorney's fees, release any monies so received by it, or apply the same on any obligations secured by this Deed of Trust or apply the same to the repair or restorat ion of the Property, as it may elect. Trustor further assigns to Beneficiary any return premiums or other repayments upon any insurance at any time provided for the benefit of Bene- ficiary, refunds or rebates made of taxes or assessments on the Property, and Beneficiary may at any time collect said return premiums, repayments, refunds and rebates, notwithstanding that no sum secured by this Deed of Trust be overdue when such ri<;jht to collection be asserted. Trustor also agrees to execute such further assignments of any such compensation, award, damages, rebates, return of premiums, repayments, rights of action and proceeds as Beneficiary or Trustee may require. 7. Waiver. Time is of the essence hereof in connection with all obligations of the Trustor under this Deed of Trust or the note secured by this Deed of Trust. By accepting payment of any obligation secured by this Deed of Trust after its due date, Beneficiary does not waive its right either to require prompt payment when due of all other obligations so secured or to declare default for failure so to pay. 8. Platting, Reconveyance, Etc. Trustee may, at any time upon written request of Beneficiary, and upon payment of its fees and presentation of this Deed of Trust and the note secured by this Deed of Trust for endorsement (in case of full recon- veyance, for cancellation and retention), without affecting the liability of any person for the payment of any obligations secured by this Deed of Trust: (a) consent to the making of any map or plat of the Property; (b) join in granting any easement or creating any restriction thereon; (e) join in any subordi- nation or other agreement affecting this Deed of Trust or the lien or charge thereof; (d) reconvey, without warranty, all or any part of the Property. The grantee in any reconveyance may be described as the "person or persons legally entitled thereto," and the recitals therein of any matters or facts shall be con- clusive proof of the truthfulness thereof. Trustor agrees to pay a reasonable Trustee's fee for full or partial reconveyance, together with a recording fee if Trustee, at its option, elects to record said reconveyance. -6- SST/bs/I04/G-5 9. Order of Sale. In case of a sale under this Deed of Trust, the Property, real, personal and mixed, may be sold in one parcel or in separate parcels and in such order as Trustee shall determine. 10. Impairment of Security. The Trustor shall not, without first obtaining Beneficiary's written consent, change the general nature of the occupancy or initiate or acquiesce in any zoning reclassification, or do or suffer any act or thing which would impair the security for said debt or Beneficiary's lien upon the Property or the assignment to Beneficiary of the rents, issues and profits thereof. In the event of breach of any of the requirements of this paragraph, Beneficiary may, in addition to any other rights or remedies, at any time thereafter declare all obligations secured by this Deed of Trust immediately due and payable. II. Receiver. The holder of this Deed of Trust, in any action to foreclose it, shall be entitled (without notice and without regard to the adequacy of any security for said debt) to the appointment of a receiver of the rents, issues and profits of the Property and such receiver shall have, in addition to all the rights and powers customarily given to and exercised by such receiver, all the rights and powers granted to Beneficiary by the covenants contained in paragraph 13 hereof. 12. Assignment of Rents. As additional security for the payment of all obligations secured by this Deed of Trust, all Trustor's rents, issues and profits of the Property and the right, title and interest of the Trustor in and under all leases now or hereafter affecting the Property, are hereby assigned and transferred to Beneficiary, and Trustor hereby gives to and confers upon Beneficiary the right, power and authority, during the continuance of these Trusts, to collect and receive the rents, issues and profits of the Property, reserving unto Trustor the right, prior to the occurrence of an event of default under this Deed of Trust, to collect and receive the rents, issues and profits of the Property as they may become due and payable. All rents, issues or profits of Trustor receivable from or in respect to the Property which it shall be permitted to collect~hereunder shall be received by it in trust to pay the usual and reasonable operating expenses of, and the taxes upon, the Property and the sums owing to Benef iciary as they may become due and payable as provided in this Deed of Trust or the Note or in any modification of either. The balance of such rents, issues and profits after payment of such operating expenses, taxes and sums due to Bene- ficiary, and after the setting aside of accruals to date of such expenses, taxes and sums, including amortization, shall be Trustor's absolute property. -7- SST/bs/104/G-S . . . . . 13. Collection of Rent by Beneficiary after an Eve~t of Default. Upon the occurrence of any event of default under this Deed of Trust, Beneficiary may, at its option, without demand or notice and at any time, either in person, by agent, or by a receiver to be appointed by a court, and without regard for the adequacy of any security for the obligations secured by this Deed of Trust, enter upon and take possession of the Property, or any part thereof, making therefor such alterations as it finds neces- sary, in its own name sue for or otherwise collect such rents, issues and profits including those past due and unpaid and apply the same, less costs and expenses of operation and collection, including reasonable attorney's fees, upon any obligations secured by this Deed of Trust in such order as Beneficiary may determine, and terminate in any lawful manner any tenancy or occupancy of the Property, or any part thereof, exercising with respect thereto any righ t or option ava ilable to Trustor. from and after the occurrence of an event of default under this Deed of Trust, if any owner of the Property shall occupy the Property, or any part thereof, such owner shall pay to Benef iciary in advance on the first day of each month a reasonable rental for the space so occupied, and upon failure to do so Beneficiary shall have the right to remove such owner from the Property, or any part thereof, by any appropriate action or proceeding. 14. No Cure or Waiver. The entering upon and takin9 possession of the ProQerty, the collection of such rents, issues and profits, or the proceeds of fire and other insurance policies or compensation or awards for any taking or damage of the Prop- erty, and the application or release thereof as aforesaid, shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice. 15. Default and foreclosure. 15.1 All obligations secured by this Deed of Trust shall become immediately due and payable, at the option of Bene- ficiary, without demand or notice, after any of the following occur, each of which shall be an event of default: (a) Default by Trustor in the payment of any obligation secured by this Deed of Trust or in the performance or observance of any agreement contained herein or in the Development Agreement between Trustor and Beneficiary of even date; or (b) Any assignment made by Trustor or the then owner of the Property for the benefit of creditors; or (c) Any of the following shall occur, with respect to the Property, Trustor or the then owner of the Property: (i) the appointment of a receiver, liquidator, or trustee who is not discharged wi thin thirty (30) days after such appointment; (i i) the adjudication as a bankrupt or insolvent; (iii) the filing of any Petition for Bankruptcy, reorganization or arrangemeni under the Bankruptcy Act which is not dismissed within thirty (30) days of such filing; (iv) the institution of any proceeding for disso- -8- SST/bs/l04/G-5 lution or liquidation which is not dismissed or abandoned within thirty (30) days of such institution; (v) if Trustor be unable, or admit in writing an inability, to pay its debts as they mature; (vi) a default in any provision of any other instrument which may be held by Beneficiary as security for the note secured by this Deed of Trust, the terms and conditions of which are incorporated herein by reference as though fully set forth herein. No waiver by Beneficiary of any default on the part of Trustor shall be construed as a waiver of any subsequent default hereunder. l5.2 In the event of such default Beneficiary may, at its option, execute or cause Trustee to execute a written notice of such default and if its election to cause the Propecty to be sold to satisfy the obli(Jations secured by this Deed of Trust, and shall cause such notice to be recorded in the office of the recorder of each recording district in which the Property or some part thereof is situated. Notice of sale having been given as then required by law and not less than the time then required by law having elapsed after recordation of such notice of default, Trustee, without demand or notice, shall sell the I?roperty in accordance with the Deeds of Trust Act of the State of Alaska, A.S. Section 34.20.070-135 as now enacted, or here- after amended, and the Uniform Commercial Code of the State of Alaska where applicable, at the time and place of sale fixed by it in such notice of sale, at public auction to the highest and best bidder for cash in lawful money of the United States, pay- able at time of sale. In the event no time period is provided by law for such notice, then Beneficiary shall cause notice of sale to be given thirty (30) days prior to said sale. Trustee may postpone sale of all or any portion of the Property by public announcement at such time and place of sale, and from time to time thereafter may postpone such sale by public announcement at the time fixed by the preceding postponement. Any person except Trustee, but including Trustor or Beneficiary, may bid at such sale. Trustee shall deliver to the purchaser at such sale its deed without any covenant or warranty expressed or implied, which deed shall convey to such purchaser the interest in the Property which Trustor had or had the power to convey at the time of its execution of this Deed of Trust, and such as it may have acquired thereafter. The recitals in such deed of any matters or facts shall be conclusive proof of the truthfulness thereof. Trustee shall apply the proceeds of sale as follows: (a) to the expenses of sale, including all costs, fees and expenses of Trustee and of this trust, costs of evidence to title, and attorney's fees in connection with such sale; (b) to the obligations secured by this Deed of Trust, and (c) the surplus, if any, to the person or persons legally entitled thereto pursuant to such Deeds of Trust Act. -9- SST/bs/l04/G-5 . . . . . 16. Right to foreclose this Deed of Trust as a Mortgaqe; to a De E ic iency Judqment and to a Personal Judgment. The Power of Sale conferred by this Deed of Trust and by such Deeds of Trust Act is not an exclusive remedy, and when not exer- cised, Benef iciary may foreclose this Deed of Trust as a mort- gage. If Beneficiary elects to judicially foreclose this Deed of Trust as a mortgage, Beneficiary shall be entitled to a defi- c iency judgment aga inst the maker, surety or guarantor of the Note. If Beneficiary elects to commence an action on the Note, Beneficiary shall be entitled to a personal judgment against the maker, surety or guarantor of such Note. 17. Taxation. In the event of the passage after the date of this Deed of Trust of any Federal, State or local law, deducting from the value of real property for the purpose of taxation any lien thereon, or changing in any way the laws now in fot'ce for the taxation of mortgages, deeds of trust, or debts secured thereby for Federal, State or local purposes, or the manner of the collection of any such taxes so as to affect the interest of Beneficiary, then and in such event, Trustor shall bear and pay the full amount of such taxes, provided that if for any reason payment by Trustor of any such new or additional taxes would be unlawful or if the payment thereof would constitute usury or render the obligations secured by this Deed of Trust wholly or partially usurious under any of the terms or provisions of the Note or otherwise, Beneficiary may, at its option, without demand or notice, declare all obligations secured by this Deed of Trust with interest thereon to be immediately due and payable, or Beneficiary may, at its option, pay that amount or portion of such taxes as renders the obligations secured by this Deed of Trust unlawful or usurious, in which event Trustor shall concur- rently therewith pay the remaining lawful and non-usurious por- tion or balance of said taxes. 18. Subrogation. Beneficiary shall be subrogated for further security to the rights of all beneficiaries, mortgagees, lienholders and owners directly or indirectly paid off or satis- fied in whole or in part by the proceeds of the loan secured by this Deed of Trust, regardless of whether such persons ass igned or released of record their rights. 19. Execution of Further Instruments. Trustor, from time to time, within fifteen (15) days after request by Benefici- ary, shall execute, acknowledge, and deliver to Beneficiary, such securi ty agreements or other security instruments, in form and substance satisfactory to Beneficiary, covering all property of any kind whatsoever owned by Trustor or in which Trustor has any interest which, in the sole opinion of Beneficiary, is essential to the operation of the Property. Trustor shall further, from time to time, within fifteen (15) 'days after request by Benefici- ary, execute, acknowledge and deliver any financing statement, -10- S~T/bs/I04/G-5 renewal, a.ffidavit, certificate, continuation statement or other document as Beneficiary may request in order to perfect, pre- serve, continue, extend or maintain the security interest under, or the priority of, this Deed of Trust and the priority of such security agreement or other security instrument as a first lien. Trustor further agrees to pay to Beneficiary on demand all costs and expenses incurred hy Beneficiary in connection with the prep- aration, execution, recording, filing and refiling of any such instrument or document. However, neither a request so made by Beneficiary nor the failure of Beneficiary to make such request shall be construed as a release of the Property, or any part thereof, from the conveyance of title by this Deed of Trust, it being understood and agreed that this covenant and any such security agreement or other security instrument, delivered to Beneficiary, are cumulative and given as additional security. 20. Cumulative Rights. All of Beneficiary's rights and remedies herein specified are intended__t() J:>e. c1,!mu~E_tive and not in substitution for any right or remedy otherwise available and no requirement whatsoever may be waived at any time except by a writing signed by Beneficiary, nor shall any waiver be operative upon other than a single occasion. The term "Beneficiary" shall mean the holder and owner, including pledgees, of the Note, whether or not named as Beneficiary herein. 21. Right to Release Collateral, Etc. Without affect- ing the liability of any other person for the payment of any obligation herein mentioned (including Trustor shoul<i it convey the Property) and wi thout affecting the lien hereof upon any property not released, Beneficiary may, without notice, release any person so liable, extend the maturity or modify the terms of any such obligation, or grant other indulgences, release or re- conveyor cause to be released or reconveyed a t any time all or part of the Property, take or release any other security or make compositions or other arrangements with debtors. Beneficiary may also accept additional security, either concurrently herewith or thereafter, and sell same or otherwise realize thereon, either before, concurrently with, or after sale hereunder. 22. Sale, Transfer or Encumbrance of the Property. (a) Beneficiary would not sell the property secured by this Deed of Trust on the terms set forth in the Note were it not for the financial strength and development and management capabilities of Trustor. In the event that Trustor shall sell, convey, transfer, lease (except as provided in this Deed of Trust) assign, further encumber or alienate the Property, or any part thereof, or any interest therein, or be divested of title or any interest therein, (all of the foregoing being hereinafter called "transfer"), in any manner whatsoever, whether voluntarily or involuntarily, without prior written approval from -11- SST/bs/io4/G-5 . . . . . l3eneficiary, Beneficiary may, in addition to any other rights or remedies, at its option, declare all obligations secured by this Deed of Trust immediately due and payable without, in the case of a voluntary or involuntary transfer, forfeiture of any prepayment fee provided for in the Note secured by this Deed of Trust. Beneficiary's option to declare all obligations secured by this Deed of Trust immediately due and payable may be exercised at any time after transfer is made and acceptance of one (1) or more monthly payments made by transferee shall not constitute a waiver of Beneficiary's option and shall not be construed as a waiver of the provisions hereof regarding any subsequent purchaser or transferee. Beneficiary may withhold its consent for any reason it deems sufficient in its sole and uncontrolled discretion. Consent by Beneficiary to one such transaction shall not be deemed to waive the right to require such consent to future transactions, and any consent given may be conditional. Beneficiary will not require a modification of the interest rate provided for in the Note as a condition of its approval, or impose any charges on Trustor in connection therewith, except a charge for processing and reviewing any application of Beneficiary, or a transferee, for its approval. (b) Notwithstanding anything herein to the contrary, Beneficiary agrees to subordinate this deed of trust in favor of any lender for specific loans or advances by lender to Trustor to be used for development in accordance with the development agreement attached hereto as Exhibit "B." However, as a precondition to subordination, Beneficiary shall be entitled to approve and consent to the terms of such loans or advances, which approval and consent may not be unreasonably withheld. 23. Duties of Trustee. Trustee accepts this trust when this Deed of Trust, duly executed and acknowledged, is made a public record as provided by law. Trustee is not obligated to notify any party hereto of any pending sale under any other Oeed of Trust or of any action or proceeding in which Trustor, Bene- ficiary or Trustee shall be a party, unless brought by Trustee. 24. Substitution of Trustee. Beneficiary may, from time to time, as provided by statute, appoint another Trustee in place and stead of Trustee herein named, and thereupon, Trustee herein named shall be discharged and the Trustee so appointed shall be substituted as Trustee hereunder with the same effect as if originally named Trustee herein. 25. Powers of Trustee. If two or more persons be designated as Trustee herein, any, or all, powers granted herein to Trustee may be exercised by any of such persons, if the other person or persons is unable, for any reason, to act, and any recital of such inability in any instrument executed by any of such persons shall be conclusive against Trustor, its successors and assigns. -12- SST/bs/I04/G-5 26. Notice of Default and Notice of Sale. signed Trustor requests that a copy of any Notice of of any Notice of Sale hereunder be mailed to it at hereinabove set forth. The under- Default and its address 27. Miscellaneous Provisions. 27.1 This Deed of Trust sets forth the entire agreement of the parties as to the subject matter hereof and supersedes all prior discussions and understandings between the~. This Deed of Trust may not be a~ended or rescinded in any manner except by an instrument in writing signed by a duly authorized officer or representative of each party hereto. 27.2 This Deed of Trust shall be governed by, and construed and enforced in accordance with, the laws of the State of Alaska. 27.3 Should any of the provisions of this Deed of Trust be found to be invalid, illegal or unenforceable by any court of competent jurisdiction, such provision shall be stricken and the remainder of this Deed of Trust shall nonetheless remain in full force and effect unless striking such provision shall materially alter the intention of the parties. 27.4 In the event any action is brought to enforce this Deed of Trust, the parties agree to be subject to exclusive in personam jurisdiction in the Superior Court for the State of Alaska and agree that in any such action venue shall lie exclu- sively at Anchorage, Alaska in the Third Judicial District, State of Alaska. 27.5 Paragraph headings contained in this Deed of Trust are included for convenience only and form no part of the agreement between the parties. 27.6 All notices or requests required or permitted under this Deed of Trust shall be in writing: shall be personally delivered or sent by certified mail, return receipt requested, postage prepaid; shall be deemed given when so delivered or mail- ed, irrespective of whether such notice or request is actually received by the addressee, and shall be sent to the parties at the addresses set forth in in the introductory paragraph of this Deed of Trust. Either party may change the address to which notices shall be sent by notice to the other party. 27.7 This Deed of Trust shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns. -13- SST/bs/104/G-5 . . . . e 27.8 As used in this Deed of Trust, the masculine shall include the feminine and neuter, the feminine shall include the masculine and neuter, the neuter shall include the masculine and feminine, the singular shall include the plural and the plural shall include the singular, as the context may require. TRUSTOR: By Its: ss. TO CERTIFY that on this day of the undersigned, a Notary Public in and for the , personally appeared , to me known and known to me to be the individual named in and who executed the foregoing document and he acknowledged to me that he was authorized to execute the foregoing document for the uses and purposes therein set forth. 1984, State THIS IS before me, of WITNESS my hand and notarial seal the day and year first hereinabove written. Notary Public in and for My Commission Expires: -14- SST/bs/104/G-5 , ~ ~TATUTORY \,ARRANTY DE:~D Th~ Granr.or. th~ CITY OF ~EWARD, ALASKA, an Alaska ~ome rule C1t'l, for and in considec-ation of the sum of TEN DOLLARS I :;10.00) lawful money of th~ United States of Amec-ica, and other ~ood and valuable Consideration in hand paid, cOnveys and warc-ants to GATl::WAY VENTUR!;;~, INC., of 6230 "/'." Street, ;nchoc-age. Alaska 99502, and assigns foc-evec- the following ,iescc-ibed c-eal pc-opec-ty situated in the Seward Recoc-ding DLstr-ict, Thir-d Judicial District, State of Alaska, and moc-e particularly descr-ibed as follows: All of TERMINAL ADDITION in the City of Seward, Seward Recording District, Third Judicial District, State of Alaska, SAVE and EXCEPT Lots 10, 11, 12, 22, 23 and 24, Alock 1; Lots 1 thr-ough 7 inclusive, Block 8; Lots 1 thcough 7 inclus1ve and Lots' 34 thcough 40 1nclus1ve. Alock 9; and Lots 6 and 7, Alock 29. All of tr-~cts 1'.-11'. and 1'.-21'., JF.SSl:: LEE KEIGKTS SUBDIVISION, ADDITION NO.1, a subdivision of portions of Jesse Lee Heights SubdiVision, Bayview Addition and Terminal Addition, City of Seward, accor-ding to Plat 6 On file in the Seward Recording Oistr-ict, Third Judicial District, State of Alaska. Lots 10, 11 and 12, Block 1, TERMINAL in the City of Seward, Seward Distr-ict, Third Judicial District, Alaska. AOQITION, Recording State of Lots 22, 23 and 24, BLOCk 1; Lots 1 i.nclusive. Fllock 8; Lots 1 through through 40 inclusive, Fllock 9, ADDITION, City of Seward, Seward District, Third Judicial District, Alaska. through 7 7 and 34 TEllM I NAL Recording State of Lots 6 and 7, Block 29, TERMINAL ADDITION, 1n the City of Seward, Seward Recording District, Third Judicial District, State of Alaska. SUA.TECT wherein Grantor Developer, which ree..rence. only to that certain is named the City and is attached hereto and D",velopment G~ante", is incorporated Ag reel'len t the named here in "y Toyether with all and singular, the tenements, heredi- taments and appurtenances thereunto belonging or in anywlse appertaining, and subject to the rights and reservations ex- pressed in the patent to said land, existing easements tor roads, power. lights and other utilities and restrictions of record, and to encroachments ascertainable by physical inspection of the i;)roperty. 1984. DATED at: Anchorage, Alaska, this _ day of GRANTOR: CITY OF SEWARD, ALASKA By Ron Garzinl, City Manager -1-