HomeMy WebLinkAboutRes1994-001
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Sponsored by: lones
CITY OF SEWARD, ALASKA
RESOLUTION NO. 94-001
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF SEWARD, ALASKA, AUTHORIZING THE LEASE OF CERTAIN
LANDS WITHIN THE SEWARD MARINE INDUSTRIAL CENTER
TO INLET FISH PRODUCERS, INC.
WHEREAS, in order to encourage investment and employment opportunities
within the community of Seward, the City Council has determined that the continued
development of the Seward Marine Industrial Center is in the public interest; and
WHEREAS, Resolution No. 88-102 authorized a lease agreement with Inlet
Fisheries, Inc., for the phased development of a dock and fish processing facility on three
land parcels within the Seward Marine Industrial Center; and
WHEREAS, Inlet Fish Producers, Inc., current lessee by assignment, has offered
to release its two upland lease sites in return for being relieved of certain lease
development requirements; and
WHEREAS, the city and Inlet Fish Producers, Inc., have concluded negotiation of
a new lease agreement which simultaneously terminates the current amended lease,
recorded by memoranda at Book 57, Page 126, and Book 60, Page 784, Seward Recording
District, Third Judicial District, State of Alaska; and
WHEREAS, it is the intent of this Lease to relieve the city of the entire burden of
compliance with present or future environmental regulations or controls with respect to
LESSEE's operations on or adjacent to the Leased Land during the lease term; and
WHEREAS, on January 10, 1994, the City Council conducted a properly noticed
public hearing on the proposed lease of public property as required by law; and
WHEREAS, an appraisal of the leased land would not be in the public interest or
necessary;
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF SEWARD, ALASKA, that:
Section 1. The Lease Agreement between the City of Seward and Inlet Fish
Producers, Inc., is hereby TERMINATED.
Section 2. The attached Lease Agreement between the City of Seward and Inlet
Fish Producers, Inc., is found to be in the public interest and is hereby APPROVED.
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CITY OF SEWARD, ALASKA
RESOLUTION NO. 94-001
Section 3. The City Manager is hereby authorized to execute the Lease
Agreement, Lease Memorandum and Lease Termination documents, attached and
incorporated herein by reference, between the City of Seward and Inlet Fish Producers,
Inc., for and on behalf of the City of Seward.
Section 4. The City Council finds that it is in the public interest to waive appraisal
of the leased property.
Section 5. This resolution shall take effect thirty (30) days following passage and
posting as required by law.
PASSED AND APPROVED by the City Council of the city of Seward, Alaska, this
10th day of January, 1994.
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST:
THE CITY OF SEWARD, ALASKA
~~ 0. 0~
Dave W. Crane, Mayor
Anderson, Crane, Darling, Krasnansky, O'Brien and Sieminski
None
Bencardino
None
APPROVED AS TO FORM:
Wohlforth, Argetsinger, Johnson &
Brecht, Attorneys for the city of Seward,
Alaska
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(City Seal)
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LEASE AGREEMENT
BETWEEN
CITY OF SEWARD
AND INLET FISH PRODUCERS, INC.
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Prepared by:
Perkins Coie
Anchorage, Alaska
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CONTBNTS
ARTICLB 1.--LBASBD LaHD . .
1.1--SUrv.y of L....d L.nd
1.2--PI.ttinq
1.3--Cov.nant of Qui.t Bnjoya.nt
ARTICLB 2.--BABBMBNTS, UTILITIBS AND PBRMITS
2.1--utiliti.. ....
2.2--P.tition. for zoninq
2.3--P.rait. . . . . .
2.4--Third P.rty Improvem.nt.
2.5--Futur. B.....nt. . . . .
ARTICLB 3.--CONSTRUCTION BY LBSSBB
ARTICLB 4.--LBASB TBRM
4.1--Initi.1 L.... T.ra
4.2--Co...nc...nt of L.... T.ra
4.3--T.rain.tion of oriqin.l L....
4.4--0ption to R.n.. by LBSSBB
ARTICLB 5.--RBNT
5.1--Initi.1 R.nt.l R.t.
5.2--a.ntal Adju.tm.nt.
5.3--proo.dur. for R.nt.l Adju.tm.nt
ARTICLB '.--US8 O. LEASBD LaHD
'.l--U.. of L....d L.nd
..2--0p.r.tion R.quirem.nt.
ARTICLB 7.--USB OF ADJACBNT LaHD/PUBLIC FACILITIBS
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7.1--No Preferential Riqhts to Use Public Facilities 12
7.2--0ther Users of Seward Marine Industrial Center 12
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7.3--Adequacy of Public Facilities.
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7.4--Tariffs and other Service Fees
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7.5--Ti.e for Payment of Utilities, Taxes
7.6--Use of the Dock
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ARTICLB 8.--FORCE MAJEURB
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ARTICLB '.--CITY BRBACB OF ITS OBLIGATION
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ARTICLB 10.--RBKBDIBS FOR CITY'S ACTS OF DEFAULT
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ARTICLB 11.--LBSSBB'S ACTS OF DB FAULT
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ARTICLB 12.--RBMEDIBS FOR DBFAULT BY LESSEE
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ARTICLB 13.--TITLB TO IMPROVEMENTS INSTALLED BY LESSEE
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13.1--Real Property Improvements
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13.2--Personal Property
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ARTICLB 14. --SUBLEASB OR ASSIG!lKENT
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14.1--Assiqnment of Lease or Subleasinq
for Operations . . . . . . .
14.2--Assiqnment of Lease for security
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14.3--Assiqnment to Affiliate
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ARTICLB 15.--LBSSBE'S DUTY TO DEFEND/INDEMNIFY
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ARTICLB 16.--CITY'S DUTY TO DEFEND/INDEMNIFY
ARTICLB 17. --IN8UJlA1fCll
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ARTICLB 18. --COIIDBJOIATION
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ARTICLB l'.--ARBITRATION
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ARTICLB 20. --MAINTBHAJI'CB MID RBPAIRS
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20.1--General Maintenance obliqations
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20.2--continqency Plan/Environmental Hazards
20.3--Inspection/cure
ARTICLE 21.--FIRB PROTECTION
ARTICLE 22.--ESTOPPEL CERTIFICATES
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ARTICLE 23.--CONDITIONS AND COVENANTS
ARTICLE 24. --NO WAIVER OF BRBACH
ARTICLE 25.--TIME OF ESSENCE
ARTICLE 26.--COMPUTATION OF TIME
ARTICLE 27. --SUCCESSORS IN INTEREST
ARTICLE 28.--ENTIRB AGRBBJlBNT
ARTICLE 29. --GOVERNING LAW
ARTICLE 30.--PARTIAL INVALIDITY
ARTICLE 31.--RBLATIONSHIP OF PARTIES
ARTICLE 32.--INTERPRBTATION . .
ARTICLE 33.--NUMBER AND GENDER
ARTICLE 34. --IIAJrI)ATORY AND PERMISSIVE
ARTICLE 35.--CAPTIONS .
ARTICLE 36.--AMBNDMENT
ARTICLE 37.--DELIVERY OF NOTICES - METHOD AND TIME
ARTICLE 38.--NOTICES . . . . .
ARTICLE 39.--CBaBGB OF ADDRBSS
ARTICLE 40.--~ THIRD PARTY BENEFICIARIES
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F :\IILETFP\SIIlLEASE\.IICIIlIII11
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ATTEST:
APPROVED AS TO FORM:
PERKINS COlE, Attorneys
for the City of Seward
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7/Vl4 kR ~
FRED B. ARVIDSON
CITY ATTORNEY
LINDA S. MURPHY, CMCjAAE
CITY CLERK
(City Seal)
STATE OF ALASKA )
)ss.
THIRD JUDICIAL DISTRICT )
THIS IS TO CERTIFY that on this day of ,
1994, before me, the undersigned, a Notary Public in and for the
State of Alaska, personally appeared , known
to me and to me known to be the ind~vidual named in and who
executed the foregoing document, and he acknowledged to me that he
signed and sealed the same as his free and voluntary act for the
uses and purposes therein set forth.
WITNESS my hand and notarial seal the day and year first
hereinabove written.
Notary Public in and for Alaska
My Commission Expires:
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Return to:
City of Seward
P.O. Box 167
Seward, Alaska 99664
Lease Tcnnination RE-074
Inlet Fi>h Produccn
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NOTICE OF LEASE TERMINATION
NOTICE IS HEREBY GIVEN that the lease agreement between the CITY
OF snARl) ("LESSOR"), P.O. Box 167, Seward, Alaska 99664 AND INLET
FISH PRODUCERS IIlC., ("LESSEE") of P.O. Box 114, Kenai, Alaska
99611, successors in lease interest to Inlet Fisheries, Inc., dated
November 8, 1988 as recorded by Lease Memorandum in Book 57, Page
126, and amended at Book 60 Page 784, Seward Recording District,
Third Judicial District, State of Alaska, and covering the
following described real property is hereby mutually terminated
effective Fe~ru.ry 10, 1994 as authorized on behalf of the Lessor
by city Resolution 94-001.
Three (3) parcels, together being plus or minus five (5)
acres, located within portions of USS 4827 and ATS 1222 making
up that tract of land known as the Seward Marine Industrial
Center, all within T1S, R1E, SM, Seward Recording District,
Third Judicial District, State of Alaska.
IN WITNESS WHEREOF, the Parties hereto have respectively signed
this Memorandum of Lease Termination on the dates below noted.
LESSOR:
THE CITY OF SEWARD, ALASKA
LESSEE:
INLET FISH PRODUCERS, INC.
TYLER JONES
CITY MANAGER
BY:
ITS:
DATE:
DATE:
Lease Termination RE-074
Inlet Fish Produce"
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IN WITNESS WHEREOF, the parties hereto have respectively signed this Memorandum of Lease
on the dates below noted.
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LESSOR:
CITY OF SEWARD, ALASKA
LESSEE:
INLET FISH PRODUCERS, INC.
TYLER JONES
CITY MANAGE
BY:
ITS:
DATE:
DATE:
ATTEST:
APPROVED AS TO FORM:
PERKINS COIE, Attorneys
for the City of Seward
LINDA S. MURPHY, CMC/AAE
CITY CLERK
'7MAJ I\P ~
FRED B. ARVIDSON
CITY ATIORNEY
(City Seal)
STATE OF ALASKA )
)ss.
THIRD JUDICIAL DISTRICT )
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THIS IS TO CERTIFY that on this _ day of , 1994, before me,
the undersigned, a Notary Public in and for the State of Alaska, personally appeared
known to me and to me known to be the individual named in and
who executed the foregoing document, and acknowledged to me that he signed and sealed the same of
his voluntary act and deed for the uses and purposes therein mentioned.
WITNESS my hand and notarial seal the day and year tirst hereinabove written.
Notary Public in and for Alaska
My Commission Expires:
Return to:
City of Seward
P.O. Box 167
Seward, Alaska 99664
Inlet Lease Memo
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LEASE MEMORANDUM
(WITH RENTAL AMOUNT OMrITED FOR RECORDING)
NOTICE IS HEREBY GIVEN, that a lease between the CITY OF SEWARD, ALASKA,
P.O. Box 167, Seward, Alaska 99664, a bome rule municipal corporation located within the Kenai
Peninsula Borough, State of Alaska, berein called the LESSOR, and INIEf FlSH PRODUCERS,
INC., P.O. Box 114, Kenai, Alaska 99611, a corporation organized and existing under the laws of
the State of Alaska, hereinafter referred to as LESSEE, was made regarding the following described
real property, to wit:
Two (2) parcels, shown below, both situated within Alaska Tideland Survey 1222 in that tract
of land known at the Seward Marine Industrial Center, all within Section 18, TIS, R1E, SM,
Seward Recording District, Third Judicial District, State of Alaska. Parcel A, located on wbat
is called the Inlet Dock, is approximately 11,700 SF in size. Parcel B, located in the southeast
comer of the intersection of wbat is called Sorrel Road and Morris Ave., is approximately
13,400 SF in size.
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BLDG.
PARCEL B
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0, PARCEL A
APPROX. 130
MORRIS AVE
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The effective lease term is February 10, 1994 through December 31, 2008. The original lease is on
file and available for public review in the City Clerk's Office, City ball, Fifth and Adams Streets,
P.O. Box 167, Seward, Alaska 99664.
Inlet Lease Memo
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WHEREAS, by Resolution of the city Council of the City of
Seward (Resolution 90-038, adopted 4/23/90) the First Amendment
to the Original Lease was approved after public notice and
hearing whereby the original Lease was amended to, among other
things, allow Inlet Fisheries, Inc., to assign its interest in
the Original Lease in accordance with the terms of that
Amendment; and
WHEREAS, by Assignment of Lease dated December 29, 1989,
Inlet Fisheries, Inc., assigned all of its right title and
interest in the original Lease to LESSEE, and with the consent of
CITY in accordance with the First Amendment to the Original
Lease; and
WHEREAS, Inlet Fish Producers obligations and duties under
the Original Lease, as amended, were, and continue to be, subject
to the personal guaranty of vincent Goddard, dated september 16,
1988; and
WHEREAS, maintenance and operations of the Dock have changed
since the inception of the Original Lease, and some of these
changes were documented in the First Amendment to the Original
Lease; and
WHEREAS, Inlet Fish Producers, Inc., successor in interest
to Inlet Fisheries, Inc., does not desire to develop Parcels A
and B as described in the Original Lease, but does wish to
continue operations from the Dock and adjacent uplands, including
without limitation its right to preferential use of the Dock and
exclusive use of the Leased Land, as more particularly described
below; and
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WHEREAS, the parties wish to re-state their existing
relationShip in order to accommodate the changes that have
occurred during the past several years and to further permit CITY
to seek development from third parties of Parcels A and B in the
Original Lease.
NOW, THEREFORE, for and in consideration of the mutual
promises and covenants contained herein, the parties agree as
follows:
ARTICLB 1.--LBABBD LAND
The land subject to this Lease (the "Leased Land") consists
of approximately 11,700 square feet, more or less, and is
outlined in RBD on the Attached Exhibit A, which is incorporated
herein by reference, and shall be known as Parcel A.
[1l914-G'l1111 AA9.lOliIIO.Ot7)
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December 14, 1993
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INLET FISH PRODUCERS, INC.
FISH PROCESSING AND STORAGE FACILllY
LEASE AGREEMENT
199
THIS LEASE AGREEMENT (the "Lease") made and entered
into effective as of , 199__, by and between
the City of Seward, a municipal corporation located in the Kenai
Peninsula Borough, State of Alaska, hereinafter referred to as
"CITY", and Inlet FiSh Producers, Inc., a corporation organized
and existing under the laws of the State of Alaska, hereinafter
referred to as "LESSEE".
WHEREAS, CITY has constructed public port facilities and
other public improvements at the Seward Marine Industrial Center
in an effort to expand the local economy, and to provide year-
round employment and business opportunities for the residents of
Seward; and
WHEREAS, by Lease Agreement approved by the City Council of
the City of Seward in Resolution 88-102, CITY and Inlet
Fisheries, Inc., entered into a lease agreement for the lease of
lands at the Seward Marine Industrial Center (the "Original
Lease"); and
WHEREAS, under the terms of the Original Lease, Inlet
Fisheries, Inc., undertook an obligation to construct a dock (the
"Dock") without charge to CITY and in exchange for consideration
provided in the Original Lease, including, without limitation,
the right to preferential use of the Dock in connection with
Inlet Fisheries, Inc.'s, fish processing business; and
WHEREAS, Inlet Fisheries, Inc., completed construction of
the Dock and transferred ownership to the City of Seward by deed
dated November 1, 1989, and recorded February 9, 1990, in Book 57
at Page 131 of the recorder's office of the Seward Recording
District and the Dock is now operated as a public facility of
CITY, subject to LESSEE's rights under the Original Lease; and
WHEREAS, under the terms of the Original Lease, Inlet
Fisheries, Inc., further completed construction of a building on
lands subject to the original Lease and installation of two
cranes, power connectors and a water line on the Dock; and
(119l4-Ollll1 AA93Il6lIO.017J
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Dccombcr 14, 1993
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for and make reasonable efforts to obtain any necessary tidelands
permits or leases to such land and, upon receipt, to further
lease to LESSEE by whatever means are necessary CITY's interest
in such land (at no additional cost to LESSEE) which land shall
thereupon be subject to the provisions of this Lease. The
parties recognize that CITY is in the process of obtaining
ownership of the Leased Land from other governmental entities
including the United States and the State of Alaska. CITY agrees
to pursue such applications, selections, permits and other steps
required to obtain ownership; however, LESSEE agrees that the
Leased Land is now and may in the future be subject to
restrictions of record or reservations in patent which may affect
LESSEE's quiet enjoyment. CITY makes no representations or
warranties as to the title of the Leased Land other than these
specifically contained herein. LESSEE agrees to join with CITY
and assist CITY in obtaining title to the Leased Land by
executing such consents or documents as may be necessary or
convenient in applications or proceedings before any federal or
state agency, including the Bureau of Land Management, to enable
CITY to obtain title to the Leased Land.
ARTICLB 2.--BASBKEHTS, UTILITIES AND PBRMITS
2.1--utilitie.
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(a) Water. CITY provides residential and commercial
fresh water service to the City of Seward and agrees to
continue commercial water availability to the Leased Land in
accordance with, and at the rates established by, any
applicable tariff rates and conditions. CITY will use its
best efforts to supply LESSEE with the fresh water necessary
for LESSEE's operation of the facility. LESSEE may not
develop or interconnect any private fresh water system to
the Leased Land without prior written permission by CITY and
compliance by LESSEE with all applicable health standards
including those related to the quality and treatment of
potable water.
(b) Sanitary Sewer. CITY agrees to continue to
provide sanitary sewer interconnection for the Leased Land
in accordance with its tariff and regulations as they may
exist or be adopted. The parties recognize that almost all
water used at the Leased Land will be used for fish
processing and may be discharged into Resurrection Bay. The
parties understand and agree that the city sewer system is
neither designed for nor capable of disposal of processing
waste from the fish processing and storage facilities to be
operated by LESSEE, and that LESSEE shall be responsible for
obtaining and keeping in effect any necessary discharge
permits from the Alaska Department of Environmental
[1l91441l11/M93061Jl.017J
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December 14. 1993
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In addition to Parcel A, CITY leases to LESSEE approximately
13,400 square feet of land, outlined in GREEN on the attached
Exhibit A, and the additional parcel shall be known as Parcel B.
The Leased Land shall consist of Parcel A and Parcel B in their
entirety.
1.1--Burvay of La as ad Land
within ninety (90) days from the date of the Lease, LESSEE,
at its sole cost and direction, will have the survey conducted by
Alaska Land Surveys on October 31, 1989, updated by a registered
land surveyor to reflect the Leased Land as depicted on Exhibit
A, and the description of the land thus prepared shall be
attached to this Lease as Exhibit B, and shall be incorporated
herein by reference. That new description shall be considered
the correct description of the Leased Land for all purposes under
this Lease. The intent of the parties in providing for an
interim description of the Leased Land on Exhibit A is to
sufficiently identify the Leased Land for purposes of public
hearing and approval of the Lease by the City Council of the City
of Seward and, further, to enable LESSEE to have immediate access
to the Leased Land for commencement of construction and site
preparation.
1.2--Plattinq
CITY intends to re-plat the Seward Marine Industrial Center
("SMIC") on a periodic basis in order to assure the orderly
development of the property and as leases are entered into with
various tenants. CITY agrees to include the Leased Land in the
next re-plat of the SMIC in accordance with the description
prepared by LESSEE in accordance with section 1.1 above. If
LESSEE requires a plat of the Leased Land prior to that time,
LESSEE may request an earlier re-plat and, upon request, CITY
shall assist LESSEE in the preparation and filing of a re-plat of
the Leased Land. If LESSEE requests a special re-plat, LESSEE
shall reimburse CITY for CITY's direct costs in assisting in the
preparation and filing of that re-plat.
1.3--Covanant of Quiat Enjoyaant
Subject only to the provisions of this Lease and this
paragraph, CITY hereby covenants that LESSEE shall have the quiet
enjoyment and possession of the Leased Land for any use
authorized hereunder for the full term of this Lease. CITY is
fully empowered to enter into this Lease. The Leased Land is not
now owned in fee simple by the City of Seward. Some of the
Leased Land may be considered tidelands and is leased subject to
any interest the United States or the State of Alaska may have
because of its classification as tidelands. CITY agrees to apply
[l1914-Ol111/M9JOli11O.017]
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(b) LESSEE shall obtain the conditional use permit
required under the Seward City Code for the establishment of
fish processing facilities.
2.4--Third Party Improvements
At the request of LESSEE, CITY shall, from time to time,
execute and deliver or join in execution and delivery of such
documents as are appropriate, necessary or required to impose
upon the Leased Land, in accordance with the terms of this Lease,
covenants, conditions and restrictions providing for the granting
of uses of the Leased Land, or any part thereof, the
establishment of party walls, the establishment of mutual and
reciprocal parking rights or rights of ingress or egress, or
other like matters (herein called "third-party improvements"),
all of which are for the purpose of the orderly development of
the Leased Land as a commercial unit subject, however, to the
conditions that:
(a)
term and
whatever
all such matters shall be limited to the lease
shall terminate upon termination of the Lease for
reason;
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(b) any such matters of a permanent nature extending
beyond the lease term shall not be granted without the prior
written approval of CITY (in any of the foregoing instances
referred to in this paragraph 2.4(b), CITY shall be without
expense therefore, and the cost and expense thereof shall be
borne solely by LESSEE); and
(c) at the expiration of the lease term (including any
extended period) third party improvements on the Leased Land
other than portable equipment shall become the property of
CITY without the payment of any compensation to LESSEE.
2.5--Puture Bas...nts
In order to provide for the more orderly commercial
development of the Leased Land and adjacent lands including
publicly owned. facilities at the SMIC, it may be necessary,
desirable or required that street, railroad, water, sewer,
drainage, gas, power lines and other easements and dedications,
and similar rights be granted or dedicated over or within
portions of the Leased Land. As additional consideration for
this Lease, both CITY and LESSEE shall, at the request of the
other, join with each other in executing and delivering such
documents from time to time and throughout the lease term as may
be appropriate, necessary, or required by the several
governmental agencies (including CITY), public utilities and
other users or tenants of the SMIC for the purpose of granting
[l1914-Ol1111 M9.lII6IIO.Dl7J
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Conservation, the U.S. Environmental Protection Agency, the
U.S. Coast Guard, or any other responsible agencies. CITY
shall cooperate with LESSEE in obtaining and retaining all
permits (or waivers) necessary for operation of the
facility.
(c) Changes. If any public sewer facility or service
provided by CITY to the Leased Land shall require updating
or improvement by reason of a change in LESSEE's use of the
Leased Land or operations therefrom, LESSEE shall either
construct such improvements at LESSEE's own cost or
reimburse CITY for such work as provided in applicable
tariffs.
(d) Extensions. LESSEE, at LESSEE's sole cost and
expense, shall provide for the extension of public utilities
to the Leased Land necessary for LESSEE's intended
operations. In so doing, LESSEE shall comply with all city
regulations and requirements with respect to the
construction of those utilities. CITY agrees to cooperate
and assist LESSEE in LESSEE's planning and engineering of
those improvements and further to assist in coordinating the
actual connection of those utilities to the city system.
2.2--Petitions for zoning
CITY represents that the current zoning classification of
the Leased Land is "Industrial". In the event that at any time
LESSEE deems it necessary or appropriate to obtain use, zoning or
subdivision and precise plan approval for the Leased Land, or any
part thereof, CITY agrees from time to time upon request of
LESSEE to execute such documents, petitions, applications and
authorizations as may be appropriate or required, and to obtain
from the agency or public body responsible therefor any
conditional use permits, zoning and re-zoning, tentative and
final tract approval and precise plan approval. This section
shall impose no duty or responsibility on CITY to assist LESSEE
in obtaining any other permits or approvals for operation or
construction, such as those required by the U.S. Army Corps of
Engineers (wetland fill permits), Environmental Protection Agency
(Clean Air Act permits), Alaska State Department of Fish and
Game, etc.
2.3--peraits
(a) CITY shall cooperate in good faith with LESSEE in
LESSEE's efforts to promptly obtain any required permits for
construction or operation of LESSEE's facilities, including
obtaining permits and a right-Of-way for a waste water line
to Resurrection Bay.
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December 14, 1993
ARTICLB 4.--LBASB TERN
4.1--Initi.l L.... T.rm
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The initial term of this Lease shall be for a period of
fifteen years commencing on , 199__, and ending
on December 31, 2008.
4.2--Co...nc...nt of L..s. T.rm
This Lease shall be subject to the applicable provisions of
the Seward City Charter and Code with respect to the filing of a
referendum petition within thirty (30) days from the date of
posting of the resolution approving this Lease. If such a
petition is not filed by that date, then the term of this Lease
shall commence on , 199__.
4.3--T.rmin.tion of origin.l L....
Upon commencement of the term of this Lease pursuant to
section 4.2, the Original Lease shall terminate and cease to be
of any force or effect, and each party shall be released of
further obligation thereunder. Upon the termination of the
Original Lease, this Lease shall constitute the entire agreement
between the parties; except, however, that the personal guaranty
agreement executed by vincent Goddard on September 16, 1988,
shall survive the termination of the Original Lease and shall
operate as a continuing guaranty of all of LESSEE's obligations
under this new Lease. Vincent Goddard shall execute the consent
to such continuing guaranty in the form attached hereto as
Bxhibit C and incorporated herein by reference.
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The termination of the Original Lease shall not act as a
waiver or release by any party thereto of any unknown or
undiscovered default under the terms of that Original Lease.
Neither LESSEE nor CITY is aware of any existing default by
either party, with the exception of LESSEE's failure to construct
improvements upon Parcel A and/or Parcel B as described in that
Original Lease which default is specifically waived by CITY.
4.4--Option to a.n.w by LESSEE
LESSEE may, at LESSEE's option, extend the original term of
this Lease for three (3) additional period(s) of five (5) years
each, subject to all the provisions of this Lease, including, but
not limited to, provisions for adjustment in rent. Failure to
exercise the option for any period shall nullify the option for
all subsequent periods. LESSEE may, at LESSEE's election, assign
these options, or anyone option, at any time, and from time to
time, in connection with an assignment pursuant to Article 14,
[l1914-O'l11l1 AA93D6IIIJI17]
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Oecombcr 14, 1993
I
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such easements and dedications; provided, however, that such
easements and dedications and similar rights do not unreasonably
interfere with LESSEE's efficient operations. The costs of
locating or relocating any public easements or restrictions of
record including any relocation of public road, railroad,
utility, or other easement shall be at the sole cost and expense
of the party requesting the relocation. CITY shall not refuse
reasonable requests for such relocations provided those
relocations do not, in the judgment of CITY, interfere with or
inhibit the overall development or utilization of the SMIC. Any
easements or rights of access granted to LESSEE by CITY need not
be exclusive to LESSEE.
ARTICLE 3.--CONSTRUCTION BY LESSEE
LESSEE shall have the right to erect, maintain, alter,
remodel, reconstruct, rebuild, build and/or replace buildings and
other improvements on the Leased Land, subject to the following
conditions.
(a) The cost of any such construction, reconstruction,
demolition, or of any changes, alterations or improvements,
shall be borne and paid for by LESSEE.
(b) The Leased Land shall at all times be kept free of
mechanic's and materialmen's liens.
(c) Any construction work shall be appropriately
bonded by use of performance and labor and material payment
bonds in the customary form when cost of the work is over
Twenty Thousand Dollars ($20,000) unless otherwise agreed in
writing by CITY. Copies of all such bonds shall be
furnished to CITY prior to commencement of construction.
(d) CITY may, as contemplated by Alaska Statutes, give
notice of non-responsibility for any improvements
constructed or effected by LESSEE on the Leased Land.
(e) LESSEE shall comply with all applicable federal,
state and local statutes and regulations. LESSEE shall
defend, indemnify, and hold CITY harmless with respect to
any alleqed violations of any such provisions and, further,
shall promptly pay any amounts due, including defense costs;
(f) LESSEE may add, alter, or remodel improvements at
LESSEE's discretion during the term of this Lease.
[l1914-O'llll/AA9.lll6lllUll.7J
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December 14, 1993
ARTICLI 5.--aa.r
5.1--Initial .ental Rate
.
In return for LESSEE's construction and conveyance of the
Dock, the rent for Parcel A of the Leased Land for the initial
term of this Lease shall be One Dollar ($1.00) per year, which
LESSEE has prepaid for the initial term. The rent for Parcel B
of the Leased Land for the initial term shall be $0.40 per square
foot per year. The rent for Parcel B shall be due and payable in
advance quarterly, on the first day of January, April, July and
October of each year.
5.a--RaDta1 A4justaents
.
Not more than ninety (90) days before January 1, 1995, and
in five year increments thereafter, the total annual rent due and
payable for Parcel B of the Leased Land shall be adjusted to the
fair market value at the hiqhest and best use of the Leased Land,
exclusive of improvements placed thereon by LESSEE but inclusive
of all improvements made by CITY (includinq those made before or
subsequent to this Lease). The annual rent shall be at the fair
market value at the hiqhest and best use of the Leased Land,
without consideration to LESSEE's intended or actual use of the
land unless that use is coincidentally the hiqhest and best use
of the land. CITY shall employ an independent MAl certified
appraiser to make this determination.
Commencinq on January 1, 2010, and in five year increments
thereafter, includinq option periods, the rent for Parcel A of
the Leased Land shall be adjusted to the fair market value in
accordance with the provisions of the above paraqraph, provided
that the appraiser shall, in calculatinq the value, assume that
any user or owner of Parcel A would have use of the Dock as
outlined in Section 7.6 of this Lease. Rent for the calendar
year of 2009 shall be the fair market value as determined by the
fair market value appraisal of Parcel A conducted durinq the year
2004.
5.3--.zovedare for .enta1 A4ju.taent
If LlSSBB object. to the appraiser's determination of the
fair market rental value within thirty (30) days of receipt of
the report, it shall qive written notice of its objection and
LESSEE &hall then enqaqe a second independent MAl certified
apprai.er at it. expense to make a second appraisal of the fair
market rental value as set forth in Section 5.2 above.
If the second appraisal reflects a fair market rental value
which varies from the first appraisal by no more than ten percent
(lot), then the two appraisal values shall be averaqed. If the
11~A"-"'1I
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DeceIobc< 17, 1993
I
.
and may give any such assignee power of attorney to exercise any
such option. After the exercise of any option to extend, all
references in this Lease to term shall be considered to mean the
term as extended, and all references to termination or to the end
of the term shall be considered to mean the termination or the
end of the term as extended.
LESSEE's right to the option is subject to:
(a) The following conditions precedent:
(i) the Lease shall be in effect at the time notice
of exercise is given and on the last day of the term.
(ii)
provision
given, or
LESSEE shall not be in default
of this Lease at the time notice
on the last day of the term.
under any
of exercise is
(iii) LESSEE shall have operated a fish processing and
storage facility employing at least 22,500 man-hours in
Seward over the initial lease term of fifteen (15) years and
7,500 man-hours in Seward during any preceding option
period. LESSEE may demonstrate compliance with the
requirements of this section by promptly (and within ninety
(90) days of the end of any year) submitting information
satisfactory to CITY establishing the number of employee
hours worked in Seward. Unless promptly disputed by CITY
after submission, that information will be conclusive as to
the numbers of hours worked.
(b) Compliance with the following procedure for exercising
the option:
(i) At least four (4) months before the last day of
the term, LESSEE shall give CITY written notice irrevocably
exercising the option.
(ii) In lieu of executing a new lease, each party
shall, at the request of the other, endorse on an original,
executed version or counterpart of this Lease, or on a true
copy of this Lease, that party's signature or signatures,
the date the option was exercised, and the words "option
exercised". Alternatively, each party shall, at the request
of the other, execute a memorandum in recordable form, ac-
knowledging the fact that the option has been exercised and
otherwise complying with the requirements of law for an
effective memorandum or abstract of lease.
[t19M-O'llJl/AA93Olllll.Ol7J
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December 14, 1993
I
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(a) above (the "deficiency"). The payment shall be double
the amount computed by multiplying CITY's share of the tax
rate, times the deficiency, times the average value per
pound of fishery's resources controlled, purchased, acquired
or first brought on shore within the City of Seward by
LESSEE, its agents, subsidiaries, employees of affiliated
entities but not processed on the Leased Land.
Notwithstanding subparagraphs (a) and (b) of this Section
6.2, the processing of species other than salmon shall be exempt
from this section if the facilities on the Leased Land are
operating at maximum capacity when species other than salmon are
processed off the Leased Land, provided that LESSEE shall
promptly notify CITY in writing that LESSEE is or expects to be
operating the facilities on the Leased Land at maximum capacity
and that species other than salmon will be processed off of the
Leased Land.
Any amendment or repeal of the current provisions of
AS 43.75 shall not reduce, but may increase, LESSEE's obligations
under this section, including the payment to be paid pursuant to
subparagraph (b) above. LESSEE shall supply CITY with copies of
returns filed for purposes of calculation of taxes under AS 43.75
which information shall be used by CITY solely for the purpose of
verifying the rental due under this Article.
ARTICLB 7.--USB OF ADJACBNT LAND/PUBLIC FACILITIES.
7.1--50 Pr.r.r.n~ial Righ~. ~o Us. Public Facili~ies
.
Excep~ as to the Leased Land and as provided in Section 7.6,
this Lease shall not be construed to grant any preferential
rights of use to LESSEE of any public port facilities, including
the general cargo dock or any other facilities constructed or
maintained by the City of Seward at the Seward Marine Industrial
Center, and in particular the public port facilities. Insofar as
use of those facilities is concerned, LESSEE will be subject to
any applicable tariffs, procedures, rules and regulations of the
City of Seward as they may now exist or from time to time be
amended. Subject to the rights of others to utilize the public
facilities as set forth in any applicable tariff or regulations,
CITY agrees not to impose any greater obstruction to LESSEE's
access than is imposed upon any similar user of the public
facilities.
7.2--0~h.r U..r. or Seward Marin. Industrial Center
This Lease shall not preclude the City of Seward from
actively seeking other and additional tenants for space at the
Seward Marine Industrial Center including those who would be in
[11914-UlQ11 AA9306IIII.OI7]
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December 14, 1993
I
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second appraisal reflects a fair market rental value which varies
from the first appraisal by more than ten percent (lot) then,
unle.. CITY and LESSEE agree on a value themselves, the value of
the rent shall be determined in accordance with the arbitration
provision. contained in ARTICLE 19 of this Lease.
ARTIC~ '.--US. OF LBAS.D LAMD
'.l--U.e of Lea.e4 LaD4
LESSEE will only use the Leased Land to operate a fish pro-
cessing facility and Dock, and for uses necessary and incidental
thereto. LESSEE will not use the Leased Land in any other manner
or construct any facilities thereon for any other purpose without
a finding by the City Council of the City of Seward that such
uses/construction are in the public interest. The parties
recognize that one of the principal reasons for finding, by the
City Council of the City of Seward in Resolution 88-102 approving
the Original Lease and Resolution 9f-___ approving this Lease,
that this Lease is in the public interest is the commitment of
LESSEE's predecessors to develop and operate a fish processing
and storage facility and LESSEE's continued obligation to operate
which will promote the development of industry in the City of
Seward and diversify the local economy.
,.2--aperation aequir..ent.
As a material consideration for this Lease, LESSEE agrees to
annually either:
(a) process at the Leased Land an amount of fishery's
resources equal to or greater in weight than eighty percent
(80t) of the fishery's resources controlled, purchased or
acquired, or first brought on shore within the City of
Seward by LESSEE, its agents, subsidiaries, employees or
affiliated entities. For purposes of determining whether
fishery'S resources have been "processed" the parties agree
that, at a minimum, the obligation of LESSEE herein shall
include sufficient activity such that the City of Seward
would qualify for a refund of the taxes levied under
AS 43.75 for at least eighty percent (80t), by weight, of
the .-aunt of the fishery'S resources controlled, purchased,
acquired or fir.t brought on shore by LESSEE within the City
of Seward, Alaska, from whatever sources, inclUding brokers
or othan; or
(b) if LESSEE does not comply with subparagraph (a)
above, LESSEE shall pay CITY an amount calculated in
accordance with this subparagraph (b). The payment shall be
paid on the difference in weight between the amount of
fishery'S resources actually processed on the Leased Land
and the amount required to be processed under subparagraph
[119I44lIII(AA-"l1l
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I
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operators may be unwilling to commit to purchase or sell to
LESSEE without this assurance. Accordingly, CITY grants LESSEE
the right to have vessels receiving or delivering fish and fish
products to LESSEE's facilities on the Leased Land and at the
Dock be accorded the right to berth their vessels at the Dock
immediately upon arrival in the Seward Marine Industrial Center.
LESSEE shall immediately advise the Seward harbormaster upon
learning of anticipated incoming vessels in order to facilitate
CITY's scheduling of berthing at the Dock. Similarly, LESSEE
shall advise the Seward harbormaster of anticipated vessel
departures.
a)(l) Maintenance or Dock. LESSEE shall, at its sole ex-
pense, provide maintenance and fire protection for the Dock in
accordance with the requirements of ARTICLES 20 and 21 of this
Lease. The cost of general routine maintenance, including
cathodic protection, shall be paid by LESSEE. LESSEE will
provide CITY annually, by March 1, a written report for the
previous calendar year, outlining the work accomplished on the
Dock and the cost of that work. LESSEE shall have the cathodic
protection system reviewed on an annual basis by a qualified
person or firm. Any report generated by such qualified person or
firm shall be made available to CITY. LESSEE will be responsible
for correction of deficiencies described in said report. Should
LESSEE reasonably disagree with the advisability of any repairs
or maintenance in that report or by request of CITY, LESSEE may
submit that issue to arbitration in accordance with ARTICLE 20 of
this Lease Agreement.
.
a)(2) Damage Repairs. LESSEE shall, at its sole expense,
promptly repair damage to the Dock resulting from LESSEE's use of
the Dock or use of the Dock by others in connection with LESSEE's
business. For purposes of damage caused by public use of the
Dock unrelated to LESSEE's business, the Dock shall be considered
a public dock and shall be governed by the same regulations,
rules or tariffs as other public facilities owned and operated by
CITY.
a) (3) Oeteraination or Responsibility ror Damage. Each
year during the term of this Lease, LESSEE shall notify the CITY
of the date LESSEE shall (i) commence fish processing operations
on the Leased Land (the "Operation Commencement Date") by giving
the CITY rourteen (14) days written notice prior to such date
(the "Operations Commencement Notice"); and (ii) terminate fish
processing operations on the Leased Land (the "Operations
Termination Date") by giving the CITY fourteen days written
notice prior to such date (the "Operations Termination Notice") .
The Operations Commencement Notice shall identify damage which
LESSEE determines was caused by public use of the Dock unrelated
to LESSEE's business which occurred since termination of LESSEE's
[11914-O'lUl1 AA93OI!IIIl.Ol7)
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Dccombcr 14, 1993
I
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competition with LESSEE or who might be interested in leasing the
Leased Land leased to LESSEE should this Lease be terminated for
any reason.
7.3--Adequacy or Public Facilitie.
CITY makes no representations or warranties as to any
particular part or the whole of CITY's public facilities with
respect to their fitness for the uses intended by LESSEE, and
LESSEE has inspected those facilities and has examined the plans
and specifications of those facilities under construction or
planned for construction and has satisfied itself that the
facilities are sufficient for the intended uses by LESSEE.
LESSEE has independently reviewed all conceptual plans submitted
by the City of Seward and is not relying on any representations
made therein or by CITY, but has conducted its own review,
investigation, and assessment. The parties recognize that CITY
has provided information to LESSEE for LESSEE's convenience and
neither party intends the CITY or its agents to be responsible
for any errors or omissions or misrepresentations therein short
of actual fraud.
7.4--Tarirf. and Other service Fee.
CITY shall have the right to make amendments to its tariffs,
regulations and scheduled fees from time to time even if those
adjustments shall cost LESSEE more for its operations or use of
public facilities, and CITY is free to do so; provided, only that
it does not pose any greater burden or higher rate upon LESSEE
than upon any other similar user of the public facilities at the
Seward Marine Industrial Center.
7.5--Ti.e ror Payaent of otilitie., Taxes
LESSEE will pay for utilities and taxes related to
operations on the Leased Land and LESSEE's interest in this
Lease, if any, before such obligations become delinquent;
provided, that LESSEE may, in good faith and before such payment,
contest any such charge or assessment.
7.6--0.e of the Dock
It is the intent of the parties to exchange normally
anticipated lease payments from LESSEE on Parcel A of the Leased
Land in consideration for LESSEE having constructed the Dock at
no cost to the City and having conveyed all its interest in the
Dock to the CITY. LESSEE must be assured that its supply of raw
fish from vessels and its ability to ship fish products is not
disrupted. This assurance is required in order for LESSEE to
remain competitive in the fish processing industry as vessel
[11914-G'll1ll/AM.lOlilDDl7J
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I
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Each of the following shall be a "CITY Act of Default" under
this Lease and the terms "acts of default" and "default" shall
mean, when they are used in this Lease, anyone or more of the
following events.
a) Failure by CITY to fulfill, observe or perform any
covenants or agreements on its part to be observed or performed
under this Lease for a period of thirty (30) days after written
notice specifying such failure, requesting that it be remedied,
and stating that it is a notice of default and has been given to
CITY by LESSEE; provided, however, that if said default is such
that it cannot be corrected within the applicable period, it
shall not constitute an act of default if corrective action is
instituted by CITY within the applicable period and diligently
pursued until the default is corrected.
b) Violation by CITY of any applicable laws or regulations
of the United States, the State of Alaska, the Kenai Peninsula
Borough, or the City of Seward or any conditions of any permits
issued by agencies of the City of seward, the Kenai Peninsula
Borough, the State of Alaska or of the United States Government
pursuant to the regulations of such agencies for a period of
sixty (60) days after written notice specifying such violation
has been given by the agency to CITY; provided, however, if such
violation be such that it cannot be corrected within the
applicable period, it shall not constitute an act of default if
corrective action is instituted by CITY within the applicable
period and diligently pursued until the violation is corrected.
Furthermore, if CITY shall contest such alleged violation through
appropriate jUdicial or administrative channels, the time period
specified herein shall not commence until such proceedings are
finally determined, provided such proceedings are diligently
pursued.
.
ARTICLB 10.--RBKBDIBS FOR CITY'S ACTS OF DBFAULT.
Whenever an act of default by CITY shall have occurred, any
applicable period for giving notice and any opportunity to cure
shall have expired, LESSEE shall have the following rights and
remedies in addition to any rights and remedies that may be given
to LESSEE by statute, common law or otherwise:
a) withhold payment of any rental otherwise due CITY;
b) refuse to proceed with any of LESSEE's other
performance obligations under this Lease;
(11914mlBfAA9DlllO.Ol7J
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Dcccmber 14, 1993
I
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fish processing operations for the previous season. Such
determination shall be binding upon the CITY unless within thirty
(30) days of receipt thereof, the CITY submits the issue to
arbitration in accordance with ARTICLE 19 of this Lease. The
Operations Termination Notice shall identify damage which LESSEE
determines resulted from LESSEE's use of the Dock or use of the
Dock by others in connection with LESSEE's business which
occurred since the operations Commencement Date that year. Such
determination shall be binding upon the CITY unless within thirty
(30) days of receipt thereof, the CITY submits the issue to
arbitration in accordance with ARTICLE 19 of this Lease.
b) City operation. CITY shall operate the Dock as a
public facility and, except for LESSEE's requirements set forth
in this Section, CITY shall have the discretion to adopt regula-
tions, rules, tariffs, and other provisions with respect to the
Dock.
c) Indemnification. LESSEE shall indemnify CITY and
provide insurance for the Dock in accordance with the
requirements of ARTICLES 15 and 17 of this agreement.
d) Regulatory Approval.. If additional regulatory
approval becomes necessary to secure LESSEE's rights to use the
Dock as set forth in this Section, then CITY shall continue to
operate the Dock as a public facility and CITY and LESSEE shall
jointly prepare and submit for approval to any regulatory agency
having jurisdiction a Dock Use Agreement including the provisions
set forth in this Section. The parties agree to incorporate in
that operation agreement as many of the provisions of this
Section as are not prohibited under applicable law. Further, to
the extent that LESSEE's operations are reasonably impaired by
the exclusion of any of the provisions of this section, CITY
agrees to cooperate in obtaining any waivers, approvals, or other
agreements, including, if necessary, voter approval by the voters
of Seward.
ARTICLB 8. --FORCB JlAJBURB
In the event either LESSEE or CITY is delayed from
performance of any of its obligations under this Lease, due to
acts of God, acts of the enemies of the United States of America,
sabotage, war, blockade, insurrection, riot, epidemic, fire,
flood, explosion, earthquake/tsunami, civil disturbance or war,
the time period wherein such performance is to occur shall be
extended by that amount of time necessary to compensate for the
delay.
ARTICLB '.--CITY BRBACH OF ITS OBLIGATION
[1l914-OlQS1 M93OliIIllDl7J
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Dccanbcr 14, 1993
.
c) the making by LESSEE of an assignment for the benefit
of creditors, the filing of a petition in bankruptcy by LESSEE,
the adjudication of LESSEE as insolvent or bankrupt, the petition
or application by LESSEE to any tribunal for any receiver or any
trustee for itself or for any substantial part of its property;
or the commencement of any proceeding relating to LESSEE under
any bankruptcy, insolvency, reorganization, arrangement or
readjustment of debt law or statute or similar law or statute of
any jurisdiction, whether now or hereafter in effect which shall
remain undismissed for a period of six (6) months from the date
of commencement thereof;
d) violation by LESSEE of any laws or regulations of the
United States or of the State of Alaska, or any conditions of any
permits issued by agencies of the city of Seward, the Kenai
Peninsula Borough, the State of Alaska or of the United States
Government pursuant to the regulations of such agencies, for a
period of sixty (60) days after written notice specifying such
violation has been given by the agency charged with the
enforcement of such laws, regulations or permits to LESSEE;
provided, however, if such violation be such that it cannot be
corrected within the applicable period, it shall not constitute
an act of default if corrective action is instituted by LESSEE
within the applicable period and diligently pursued until the
violation is corrected. Furthermore, if LESSEE shall contest
such alleged violation through appropriate jUdicial or
administrative channels, the time period specified herein shall
not commence until such proceedings are finally determined
provided such proceedings are diligently pursued; provided,
however, that any such extension of time shall not be effective
if the effect of the interim administrative or judicial action is
to cause a stoppage, interruption or threat to the activities of
any person or entity other than those of LESSEE;
.
e) failure to promptly pay when due any user, wharfage, or
other charges by the City of Seward and associated with the
Seward Marine Industrial Center; or
f) failure of LESSEE to promptly pay when due any real or
personal property taxes or any sales taxes assessed by the Kenai
Peninsula Borough.
ARTICLE 12.--""DI8S POR DEPAULT BY LESSEE.
Whenever an act of default by LESSEE shall have occurred,
and any applicable period for giving notice and any opportunity
to cure shall have expired, CITY shall have the following rights
and remedies all in addition to any rights and remedies that may
be given to CITY by statute, common law or otherwise:
[l191~/AA93068OJl17]
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Dcocmber 14, 1993
I
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c) recover, whether this Lease be terminated or not, from
CITY reasonable attorney's fees and all other expenses incurred
by LESSEE by reason of the default by CITY;
d) declare this Lease terminated;
e) no expiration or termination of this Lease shall expire
or terminate any liability or obligation to perform of CITY's
which arose prior to the termination or expiration except insofar
as otherwise agreed to in this Lease;
f) each right and remedy of LESSEE provided for in this
Lease shall be cumulative and shall be in addition to every other
right or remedy provided for in this Lease, now or hereafter
existing at law or in equity or by statute or otherwise, and the
exercise or beginning of the exercise by LESSEE of anyone or
more of the rights and remedies provided for in this Lease, now
or hereafter existing at law or in equity or by statute or
otherwise, shall not preclude the simultaneous or later exercise
by LESSEE of any or all other rights or remedies provided for in
this Lease, now or thereafter existing at law or in equity or by
statute or otherwise; and
g) no delay or omission to exercise any right or power
accruing following an act of default shall impair any such right
or power or shall be construed to be a waiver thereof, but any
such right and power may be exercised from time to time and as
often as may be deemed expedient.
ARTICLE 11.--LESSEB'S ACTS OF DEFAULT.
Each of the following shall be a "LESSEE Act of Default"
under this Lease and the terms "acts of default" and "default"
shall mean, whenever they are used in this Lease, anyone or more
of the following events:
a) failure by LESSEE to pay promptly when due, and in no
event later than twenty (20) days from the due date thereof, the
rentals required to be paid under this Lease;
b) failure by LESSEE to observe, fulfill or perform any
covenants, conditions or agreements on its part to be observed or
performed under this Lease for a periOd of thirty (30)days after
written notice specifying such failure, requesting that it be
remedied, and stating that it is a notice of default has been
given to LESSEE by CITY; provided, however, that if said default
is such that it cannot be corrected within the applicable period,
it shall not constitute an act of default if corrective action is
instituted by LESSEE within the applicable period and diligently
pursued until the default is corrected;
[l19144'lll111 AA!1.lOQIOJI11J
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Dcccmbcr 14, 1993
I
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i) eadh right and remedy of CITY provided for in this
Lease shall be cumulative and shall be in addition to every other
right or remedy provided for in this Lease or now or hereafter
existing at law or in equity or by statute or otherwise, and the
exercise or beginning of the exercise by CITY of anyone or more
of the rights and remedies provided for in this Lease or now or
hereafter existing at law or in equity or by statute or otherwise
shall not preclude the simultaneous or later exercise by CITY of
any or all other rights or remedies provided for in this Lease or
now or thereafter existing at law, or in equity or by statute or
otherwise; and
j) no delay or omission to exercise any right or power
accruing following an act of default shall impair any such right
or power or shall be construed to be a waiver thereof, but any
such right and power may be exercised from time to time and as
often as may be deemed expedient.
ARTICLB 13.--TITLB TO IMPROVEMENTS INSTALLED BY LESSEE.
13.1--Real Property Improvements
a) Upon termination of this Lease for any reason, LESSEE
may remove from the Leased Land, from the Dock, and from
easements to or from the same, all improvements constructed by
LESSEE such as buildings, warehouses, conveyor systems, ditches,
sewer lines, water lines, dikes or berms, and similar improve-
ments. Upon removal of any such improvements, LESSEE shall
return the Leased Land, the Dock or easements to their original
condition, ordinary wear and tear excepted.
.
b) Upon termination of this Lease for any reason, LESSEE
shall, at the option of CITY, remove at LESSEE's sole expense
from the Leased Land, from the Dock or from any easements to or
from the same all improvements constructed by LESSEE, such as
buildings, warehouses, conveyor systems, ditches, sewer lines,
water lines, dikes or berms, and any similar improvements, or any
of such improvements as CITY shall designate. In such event,
LESSEE shall return the Leased Land, the Dock or easements to
their original condition, ordinary wear and tear excepted.
c) All improvements constructed or installed by LESSEE on
the Leased Land, on the Dock, or on easements to or from same,
such as buildings, warehouses, conveyor systems, ditches, sewer
lines, water lines, dikes or berms, or any similar improvements,
which are not promptly removed by LESSEE and in any event within
sixty (60) days of the date of termination of this Lease shall
become the property of CITY without payment of compensation to
LESSEE.
[11914-(1)Ul1 M9.lIIQIO.Ol7]
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Ikccmbc:r 14, 1993
.
a) CITY may distrain for rent due any of LESSEE's personal
property which comes into CITY's possession. This remedy shall
include the right of CITY to dispose of personal property
distrained in any commercially reasonable manner. It shall be
conclusively presumed that compliance with the procedures set
forth in the Alaska Uniform Commercial Code (AS 45.09.504) with
respect to sale of property shall be a commercially reasonable
disposal;
b) CITY may re-enter the Leased Land and take possession
thereof and, except for any personal property of LESSEE which
CITY has waived its right to distrain under subparagraph (a)
above, remove all personal property of LESSEE from the Leased
Land. Such personal property may be stored in place or may be
removed and stored in a public warehouse or elsewhere at the cost
of LESSEE all without service of notice or resort to legal
process, all of which LESSEE expressly waives;
c) declare terminated this Lease and/or the Dock Use
Agreement referenced in section 7.6(d) of this Lease;
d) collect any and all rents due or to become due from
subtenants or other occupants of the Leased Land;
e) recover, whether this Lease be terminated or not,
reasonable attorney's fees from LESSEE and all other expenses
incurred by CITY by reason of the breach or default by LESSEE;
f) recover an amount to be due immediately upon breach
equal to the rent reserved under this Lease discounted to the
date of such breach at the rate of eight percent (8%) per year.
If the Leased Land or any part thereof be re-let by CITY for the
unexpired term of this Lease, CITY shall reimburse to LESSEE upon
receipt an amount not to exceed the amount received by CITY under
this paragraph;
g) if LESSEE does not immediately surrender possession of
the Leased Land after termination by CITY and upon demand by
CITY, CITY may forthwith enter into and upon and repossess the
Leased Land and expel LESSEE without being deemed guilty in any
manner of trespass and without prejudice to any remedies which
might otherwise be used for arrears of rent or breach of
covenant;
h) no expiration or termination of this Lease shall expire
or terminate any liability or obligation to perform of LESSEE's
which arose prior to the termination or expiration except insofar
as otherwise agreed to in this Lease;
[1l914.O'll1l1 AA9.lOllIIlJl17J
-19-
December 14, 1993
I
CITY to consent to any assignment, encumbrance or subletting by
LESSEE.
.
It.2--Assiqnment of Lease for Security
.
Notwithstanding section 14.1 above, LESSEE may assign,
encumber or mortgage its interests in this Lease or improvements
on the Leased Land by deed of trust or other security instrument,
to an institutional lender ("Lender") for development of or
operations on the Leased Land, provided that Lender shall be
subject to all obligations of LESSEE under the terms of this
Lease. CITY shall furnish Lender, at the address provided to
CITY by Lender in writing, with notice of any default or breach
of LESSEE under this Lease. Lender shall have the right (without
being required to do so and without thereby assuming the
obligations of LESSEE under this Lease) to make good such default
or breach within thirty (30) days after written notice specifying
such breach. Notwithstanding the provisions of ARTICLE 11 above,
no "LESSEE Act of Default" shall exist until expiration of thirty
(30) days after such notice is furnished to Lender; provided, a)
if Lender, with respect to any default or breach other than a
failure to make any required payment of rent or other money,
shall undertake within thirty days after notice to cure the
default or breach and shall diligently and in good faith proceed
to do so, CITY may not terminate this Lease or re-let the Leased
Land unless Lender fails to cure the default or breach within a
reasonable period of time thereafter; and b) if the default for
which notice is given is a breach of ARTICLE ll(c), CITY shall
not exercise any of the remedies afforded to it under ARTICLE 12
above so long as LESSEE or Lender remains in possession of the
Leased Land and satisfied LESSEE's obligations under the terms of
this Lease. Upon foreclosure or other assertions of its security
interest, Lender may further assign, transfer, or dispose of its
interests, provided that any subsequent assignee, purchaser or
transferee shall remain bound by each and every term of this
Lease.
It.3--Assiqnment to Affiliate
Notwithstanding Section 14.1, LESSEE may assign this Lease
to an affiliate of LESSEE, provided that LESSEE's full faith and
credit shall remain obligated under this Lease as if the transfer
had not taken place, including the obligations contained in
section 6.2 thereof. For purposes of that section 6.2, LESSEE,
and any affiliate of LESSEE, shall be considered together as one
entity. For purposes of this Section 14.3, "affiliate of LESSEE"
means any corporation, partnership, or other entity of which not
less than fifty-one percent (51%) is owned or controlled by
LESSEE or Vincent L. Goddard.
[119144111II1 AA'13Ol5III.Ol7J
-22-
Dccombcr 14, 1993
.
13.2--PerBonal property
Any other provisions of this Lease to the contrary notwith-
standing, LESSEE, upon termination of this Lease for any reason,
may but need not promptly remove trade fixtures and equipment
from the Leased Land and the Dock provided that LESSEE shall
repair any damages to the Leased Land and the Dock caused by such
removal. Any trade fixtures, equipment, or other personal
property not DromDtlv removed from the Leased Land or the Dock
and in any event within sixty (60) days of the date of
termination of this Lease shall become the property of CITY
without payment of any compensation to LESSEE.
ARTICLB 14.--SUBLBASB OR ASSIGHMBHT
14.1--ABsignment of Lease or Suble.sing for operations
LESSEE shall not voluntarily assign or encumber its interest
in this Lease or in the Leased Land or sublease all or any part
of the Leased Land, or allow any other person or entity (except
LESSEE's authorized representatives) to occupy or use all or any
part of the Leased Land without first obtaining CITY's written
consent, which may be withheld by CITY for any or no reason
whatsoever in its sole unfettered discretion. Any assignment,
encumbrance or sublease without CITY's consent shall be voidable
and, at CITY's election, shall constitute a default. No consent
to any assignment, encumbrance, or sublease shall constitute a
further waiver of the provisions of this paragraph.
If LESSEE is a partnership, a withdrawal or change,
voluntary, involuntary or by operation of law, of any partner or
partners owning fifty percent (50%) or more of the partnership,
or the dissolution of the partnership, shall be deemed a
voluntary assignment. If LESSEE is a corporation, any
dissolution, merger, consolidation or other reorganization of
LESSEE, or the sale or other transfer of a controlling percentage
of the capital stock of LESSEE, or the sale of fifty-one percent
(51%) of the value of the total combined voting power of all
classes of LESSEE's capital stock issued, outstanding and
entitled to vote for the election of directors shall be deemed a
voluntary assignment. This paragraph shall not apply to
corporations the stock of which is traded through an exchange or
over the counter.
LESSEE warrants that as of the time of execution of this
Lease, LESSEE is a corporation, 100% of the capital stock of
which is owned by vincent Goddard.
LESSEE shall pay to CITY, on demand, reasonable costs
incurred by CITY in connection with any request by LESSEE for
(11914-Ul11l1 AA9.lOIIIIO.017J
-21-
Dccombcr 14, 1993
I
.
be subject to revision in accordance with standard insurance
practices in order to provide continuously, throughout the term
of this Lease and any extensions hereof, a level of protection
consonant with good business practice and accepted standards in
the industry. such factors as increases in the cost of living,
inflationary pressures, and other considerations, shall be
utilized in assessing whether the minimum insurance requirements
should be increased. CITY may notify LESSEE of any requested
increase in insurance coverages.
All insurance policies shall provide for thirty (30) days'
notice of cancellation and/or material change to be sent to CITY
at the address designated in ARTICLE 38 of this Lease. All such
policies shall be written by insurance companies legally
authorized or licensed to do business in the State of Alaska, and
acceptable to CITY (Best's Rating A or better). LESSEE shall
furnish CITY, on forms supplied by CITY, certificates evidencing
that it has procured the insurance required herein prior to the
occupancy of the Leased Land or operation by LESSEE. LESSEE
shall promptly forward copies of all insurance policies to CITY.
Nothing herein contained shall prevent LESSEE or CITY from
placing and maintaining at CITY's or LESSEE's own individual cost
and expense, additional or other insurance as may be desired.
At least annually, commencing on the first anniversary date
of this Lease and annually thereafter throughout the term of this
Lease, LESSEE shall procure and submit to CITY a written report
from a reputable insurance broker acceptable to CITY that the
broker has reviewed the types and amounts of coverage of
insurance obtained by LESSEE and the operations of LESSEE and in
the opinion of the broker the coverage complies with LESSEE's
obligations under this Lease.
.
All of the insurance policies required above as well as any
other insurance carried by LESSEE or CITY shall provide that the
insurers waive their rights of subrogation against CITY and
LESSEE and their respective officers, servants, agents or
employees. LESSEE further agrees to waive and agrees to have its
insurers waive any rights of subrogation (whether by loan
receipts, equitable assignment or otherwise), with respect to
deductibles under such policies and with respect to damage to
equipment including the loss of use thereof, whether insured or
not. LESSEE shall also name CITY as an additional insured on the
general liability insurance policy maintained by LESSEE as
required above, excluding coverage for claims resulting from
CITY's sole negligence or use of the Dock by the public unrelated
to LESSEE's business.
[1l914m18/AA93Ol5III.Ol7)
-24-
Dc=nber 14, 1993
.
ARTICLB 15.--LBSSBB'S DUTY TO DBFBND/INDBXNIFY.
LESSEE agrees to defend, indemnify and hold CITY harmless
from any and all claims for damages, including personal injuries
and property damage arising out of or resulting from LESSEE's use
of the Leased Land or the Dock, or the use of the Leased Land or
the Dock by LESSEE's sublessees, agents or contractors or the
public, except for damages arising from the sole negligence or
willful acts or omissions of CITY, its agents, employees, or
contractors or from the public's use of the Dock unrelated to
LESSEE's business.
ARTICLB 16.--CITY'S DUTY TO DEFEND/INDBXNIFY.
CITY agrees to defend, indemnify and hold LESSEE harmless
from any and all claims for damages, including personal injuries
and property damage arising out of or resulting from CITY's use
of the Leased Land or the Dock, including use by the public
unrelated to LESSEE's business, or the use of the Leased Land or
the Dock by CITY's agents or contractors, or from conditions
existing or activities occurring on the Leased Land prior to this
Lease.
ARTICLB 17.--IHSURANCB.
Prior to commencement of construction of any facilities on
the Leased Land, LESSEE shall procure and maintain, at LESSEE's
sole cost and expense, commercial general liability insurance,
with limits of liability of One Million Dollars ($1,000,000) for
all injuries and/or deaths resulting to anyone person and Two
Million Dollars ($2,000,000) limit from anyone occurrence. The
limit of liability for property damage shall be Two Million
Dollars ($2,000,000) for each occurrence and aggregate. Coverage
under such insurance shall also include explosion, collapse and
underground property damage hazards. Such insurance shall
include a blanket contractual liability endorsement. For non-
owned watercraft of LESSEE or its customers any "watercraft
exclusion" in the commercial liability insurance policy shall be
eliminated. Protection and indemnity insurance shall be provided
with the same limits as the commercial liability insurance for
the use of LESSEE-owned watercraft. LESSEE shall also provide
fire and extended coverage insurance for any buildings,
equipment, machinery, vessels of customers or any other property
stored or being worked on by LESSEE upon the Leased Land at
replacement value rather than original cost. LESSEE shall
provide Workmen's Compensation Insurance and insurance under the
Harbor Workers and Longshoremen's compensation Act, and warehouse
and motor vehicle insurance and any other insurance required
under any permit or tariff of the City of Seward, Alaska. The
minimum amounts and types of insurance provided by LESSEE shall
[11914-4'll1l/M9306llO.Ol7]
-23-
Dccombcr 14, 1993
.
If neither party has objected to the other's designation
within fifteen (15) days of the notice by the second party of its
representative of an arbitrator, then the two chosen arbitrators
(called the "consent panel") shall select a third person
agreeable to both to become the third member of the consent
panel. The consent panel may utilize informal techniques and
hold informal hearings without reference or adherence to the
rules or procedures of the American Arbitration Association.
Promptly and within thirty (30) days of concluding any proceeding
the consent panel shall render its written decision. It is the
intent of this subparagraph to provide for a speedy and
inexpensive resolution of disputes provided the parties agree to
such a procedure.
b) Porma1 Arbitration. If either party objects, within
fifteen (15) days of the second party's designation of an
arbitrator to the other's choice of an arbitrator pursuant to
subparagraph (a) above, or the first party initially decides not
to use the consent panel procedure, then the matter shall be
promptly referred to the American Arbitration Association in
accordance with the then existing rules of the American
Arbitration Association.
c) Arbitration Avard.. Any award by either a consent
panel or as a result of proceedings before a panel pursuant to
the rules of the American Arbitration Association shall be
enforceable in accordance with Alaska statutes. Any award shall
include an award of costs, interest and attorney fees. The
requirements imposed on the arbitrator to make monetary awards
shall not alter the standards of review of particular disputes
set forth in this Lease.
n'UCLB 20. --XA:I:ll'l'BlIANCB AND RBPAIRB.
20.1--General xaintenance obligations
.
During the entire term of this Lease and every renewal or
extension hereof LESSEE shall, at LESSEE's sole cost, risk and
expense, maintain the Leased Land including any improvements
placed thereon by LESSEE or CITY, in as good condition as
received or constructed by LESSEE, ordinary wear and tear
excepted. LESSEE shall prevent the discharge of any pollutants
into any public sewer system beyond those for which the system
was designed. LESSEE shall maintain in first class condition at
all times all fire, pollution and other protective equipment.
20.2--Contingency Plan/Environmental Hazards
In the event required by the laws and regulations of the
United States, State of Alaska, Kenai Peninsula Borough or the
[119I~/AA93IIllIIO.Ill7J
-26-
I>=mber 14, 1993
.
ARTICLB 18.--CONDBKHATION.
If all or any part of the Leased Land is condemned for a
public use by any governmental agency or other duly authorized
entity, CITY and LESSEE shall each make a claim against the
condemning or taking authority for the amount of any damage
incurred by or done to them respectively as a result of the
taking. Neither LESSEE nor CITY shall have any rights in or to
any award made to the other by the condemning authority;
provided, that in the event of a single award to CITY which
includes specific damages for loss of LESSEE's leasehold
interest, CITY shall transmit to LESSEE the amount of such
specific damages so found, if any.
If part, but not all of the Leased Land is condemned for
public use, LESSEE shall make a good faith determination as to
whether or not the taking of the part of the Leased Land
designated for condemnation will prevent it from continuing to
operate on the Leased Land. If LESSEE determines in good faith
that the condemning of such part of the Leased Land will prevent
it from continuing to operate on the Leased Land, LESSEE may
notify CITY in writing to this effect, and this Lease shall then
be terminated for all purposes effective fifteen (15) days from
the date LESSEE sends such notice to CITY, and such termination
shall be treated in the same manner as a termination at the
expiration of the term of this Lease. LESSEE shall, as a
condition precedent to such termination, remove all encumbrances,
debts and liens to which the Leased Land is subject. If at the
time of such partial taking for public use, LESSEE determines
that such partial taking will not prevent it from continuing to
operate, then LESSEE and CITY shall negotiate an equitable and
partial abatement of the rent beginning to be effective on the
actual date when LESSEE is effectively prevented from utilizing
the condemned land.
ARTICLB 19.--ARBITRATION.
Any dispute between CITY and LESSEE with respect to any
provision of this Lease or the rights and Obligations of the
parties hereunder shall be decided by arbitration, in accordance
with the provisions of this paragraph.
a) Con..nt pan.l. The party desiring arbitration of a
dispute shall give written notice to that effect to the other
party specifying in such notice the name and address of a person
to serve as an arbitrator on its behalf. within fifteen (15)
days after receipt of such notice the other party shall give
written notice to the first party specifying the name and address
of a person designated to serve as an arbitrator on its behalf.
[11914-G'l11l/M93OlllWll7)
-25-
~14.1993
20.3--XD.p.c~ioD/cur.
.
CITY may periodically inspect the Leased Land and facilities
constructed thereon and exercise its rights under this Lease, but
the exercise of these rights shall not imply any obligation to do
so nor any obligation to do so in any particular way.
CITY may notify LESSEE in writing of any deficiencies in the
performance of LESSEE's maintenance and pollution control
responsibilities and LESSEE shall promptly within ten (10) days
of receipt of such notice, or sooner if it affects the pUblic
health or safety, advise CITY in writing of its proposed schedule
for performance of any work necessary to cure such deficiencies.
If such deficiencies relate to the safety of LESSEE's
operation such that the surrounding land and port facilities are
exposed to risk or unnecessary potential hazards, or if CITY is
not satisfied with the proposed schedule of repairs either
because of the delays therein or the scope of the repairs, CITY
may engage an independent engineering consultant well-versed and
experienced in fish processing and storage facilities or
environmental engineering, as appropriate, who shall furnish to
CITY a comprehensive survey and report for the purpose of
establiShing both the need and urgency to perform such mainte-
nance work. As soon as practicable following receipt of said
engineer's determinations and recommendations, if the report
requires repair then LESSEE shall pay the cost of the report and
perform such work in accordance therewith at LESSEE's cost, risk
and expense.
.
Should LESSEE dispute CITY's determination that any such
maintenance work is necessary or advisable or reasonable to
protect the public facilities on the Leased Land or on adjacent
land facilities, it may submit the matter to arbitration
provided, however, that pending the decision of the arbitrators
it shall fully comply with the maintenance requests. If an
arbitration award (which shall include costs, interest and
attorneys' fees) should ultimately find that the repairs were
"not necessary" then LESSEE may deduct from future rental
payments the cost of such repairs. In deciding whether repairs
requested by CITY or required by an engineering report are
necessary the arbitration panel is to give primary consideration
to the safety and welfare of the Seward port facilities and the
citizens of Seward such that the highest standards of industrial
and environmental safety are achieved.
If any facility or service provided by CITY shall become
inadequate due to changes in environmental control standards or
should any facility require updating or improvement by reason of
a change in LESSEE's use of the Leased Land or operations
[1l9144lU11 AA9.lIIMII.017]
-28-
Dazmbcr 1., 19'13
I
.
City of Seward, LESSEE shall develop and submit to the City Engi-
neer a waste, chemical and oil spill contingency plan. Such
plan(s) must provide reasonable assurances to CITY that LESSEE
has and will comply with all applicable requirements of federal,
state and local laws and regulations including the Environmental
Protection Act. LESSEE shall be solely responsible for the
avoidance of any discharge of pollutants of any type from either
LESSEE's operations or any vessels under the care, custody and
control of LESSEE to the Leased Land or adjacent public waters or
adjacent private or public lands unless same is caused solely by
acts or omissions of CITY, its employees, agents or contractors.
LESSEE shall maintain a complete file, which may be inspected at
any reasonable time by CITY containing copies of all correspond-
ence, permits or other material between LESSEE and any
governmental agency claiming jurisdiction over LESSEE's operation
including, but not limited to the Environmental Protection
Agency, the State of Alaska Department of Environmental
Conservation, the U.S. Army Corps of Engineers, the National
Marine Fisheries service, the Kenai Peninsula Borough, the U.S.
Coast Guard, the U.S. Fish and Wildlife Service, the National
Park Service, the State of Alaska, the City of Seward and others.
The purpose of this provision is to require continued information
to be made available to CITY relating to LESSEE's operations and
how those operations might affect the Seward Marine Industrial
Center and the City of Seward.
In the event LESSEE receives from any governmental agency
any notice or other correspondence indicating dissatisfaction
with LESSEE's operation on the basis of environmental concerns,
LESSEE shall promptly forward a copy of same to CITY and in no
event no later than three days from the receipt by LESSEE of
same. If CITY finds a pattern of violation of this requirement,
CITY may inspect LESSEE's records as often as it, in its sole
discretion, deems necessary to remain informed, and LESSEE shall
pay the cost of such inspections to CITY within twenty (20) days
of invoice from the CITY.
CITY, at CITY's sole option and expense, may, prior to the
commencement of construction by LESSEE, perform maintenance and
preventative work on the Leased Land exclusive of improvements
placed thereot by LESSEE in order to prevent erosion, mitigate
damage to plants and animals, or prepare the Leased Land for
eventual development by LESSEE or others by grading, filling or
contouring the Leased Land, any such work performed by CITY shall
be at CITY's sole expense unless LESSEE agrees, in advance and in
writing, to share such expense.
(ll91~M9.lOlIIIO.017]
-27-
l>uaDbct 14, 19'13
-,