HomeMy WebLinkAboutRes1986-031
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CITY OF SEWARD, AIASKA
RESOLUl'ION NO. 86-31
A RESOLUl'ICN OF THE CITY COUNCIL OF THE CITY OF
SEWARD, AlASKA, AUTHORIZING THE ISSUANCE OF A SUBSTlTUI'E
LEASE FOR COMMERCIAL WATERFFONT BOARrWALK SITE NO. 2 IN THE SEWARD
SMALL BOAT HARBOR 'IO J. B. BENNISON, DBA AIASKA STAR CHARI'ERS
WHEREAS, the Seward City Council previously held public
hearings and approved the issuance of a lease to J. B. Bennison for the
construction of a oormercial building and operation of a charter/tour
business~ and
WHEREAS, the original intent of the lease was to have the
lessee oonstruct the buildings with the cost being credited against the
lease for up to a period of three years and the City retaining ONl1.ership
of the building~ and
WHEREAS, it appears that this is not a workable arrangerrent
for either the lessee or the ci ty ~ and
WHEREAS, the City intent is not to 0Nl1. buildings and rnake
large sums of money on leases, but to encourage economic growth within
the corrmunity and to build a viable tax base thru prosperous business
developrrent~ and
WHEREAS, it is more advantageous for both parties to simply
lease the land as a corrnrercial site with the lessee oonstructing and
retaining ownership of the building as part of his business~
NCM, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF SEWARD, AIASKA, that:
Section 1. The City Manager is hereby authorized to substi-
tute the attached lease in place of that lease approved by Council on
May 13, 1985, with J. B. Bennison. The attached lease is incorporated
herein by reference as a part of this resolution.
Section 2. This resolution shall take effect thirty (30) days
following its adoption.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF SEWARD,
ALASKA, this 14 day of April , 19 86
THE CITY OF SEWARD, ALASKA
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HARRY GIFS~OR
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CITY OF SEWARD, ALASKA
RESOLUTION NO. 86-31
AYES :
NOES:
ABSENT:
ABSTAIN:
ATI'EST:
BOOHER, GIESELER, GILLESPIE, HILTON, MEEHAN, SCHOLL & SIMUTIS
NONE
NONE
NONE
APPROVED AS 'IO FORM:
HUGHES, THORSNESS, GANTZ, F'a'JELL
AND BRUNDIN, Attorneys for the
City of Seward, Alaska
(City Seal)
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Fre B. Arvldson, clty Attorney
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LEASE AGREEMENT
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This Agreement rnade and entered into this
day
of
, 1986, by and between the CITY OF SE'ilARD,
a horre rule rmmicipal corporation located in the Kenai Peninsula Bor-
ough, State of Alaska, hereinafter referred to as "City" and
J. B. BENNISON
hereinafter referred to as "Lessee".
WIT N E SSE T H:
~1HEREAS, City and Lessee are mutually interested in the
developrrent of harbor related facilities in the Small Boat Harbor area
within the City of Seward, Alaska~ and
WHEREAS, Lessee has demonstrated to ci ty an intention to
expand and develop a ccmrercial waterfront visitor-related business~ and
WHEREAS, the City has received a proposal from Lessee for
developrrent of City ONl1.ed land~ and
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~VHEREAS, City, as expressed more fully in City Council Resolu-
tion No.
, has detemined that Lessee's intentions and general
developrrent plans coincide with the public interest of the City and will
provide increased tax revenues and rental ir,corre to the ci ty ~ and
WHEREAS, City and Lessee have reached agreement on the land
City is to lease to Lessee, the general terms and conditions of such a
lease~
FOR AND IN CONSIDERATION OF THE RENTS, CXJIJENANTS, AND CON-
DITIONS HEREIN CONTAINED, CITY AND LESSEE AGREE AS FOLLCWS:
ARI'ICLE 1. DEMISE. City leases to Lessee, and Lessee leases
fran the City that certain real property herein called "Leased Land",
situated in Seward, Alaska, consisting of approximately 900 square feet,
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as shONl1. on Exhibit "A" attached hereto and as more particularly de-
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scribed as follows:
comrercial Lease Site No. 2 imrediately
adjacent to the Seward Small Boat Harbor
Boardwalk between "B" and "0" Rarrps, the
Site to include use of a wood frame
building. The Site is within Block 6,
Oceanview Subdivision.
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ARI'ICLE II. CITY'S WARRANTY OF QUIEl' ENJOYMENI'. Lessee, upon
paying the rent and other charges herein provided for and observing and
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keeping the covenants, oondi tions and terms of this Lease on Lessee's
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part to be kept or perfomed, shall peacefully and quietly enjoy pos-
session of the Leased Land during the tem of this Lease without hin-
drance by, from or through City, subject, however, to any enctm1brances
created or caused by Lessee.
ARI'ICLE III. LEASED LAND ACc.iPl'tlJ "AS IS". Lessee acknowl-
edges that he has inspected the Leased Land and accepts the sarre "as is"
and without reliance on any representations or warranties of City, or
agents of City, as to the physical condition thereof, except as express-
ly herein provided.
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ARI'ICLE IV. USE OF LEASED LAND.
1. Lessee may use the Leased Land for the construction and
operation of charter and sightseeing buisness
Lessee understands that oonstruction and operation of such a facility is
a major oonsideration for City's agreement to lease the Leased Land.
Lessee agrees that he will not operate any other business on the Leased
Land without the consent of the City. ~reover, City rnay withhold its
consent as to any proposed business or activity which, in City's sole
dis=etion, is not desirable or canpatible with the City's Small Boat
Harbor area.
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approved
2. No assignment or sublease shall be pemitted unless
in writing by the City. Any sublease shall be expressly
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subject and subordinate to this lease and the rights of the City ~re-
under. The City may elect to not approve any proposed assignment or
sublease which rnay result in a business or activity which, in the City's
sole discretion, is not desirable or corrpatible with the City's Small
Boat Harbor area.
ARI'ICLE V. LFASE TERM.
1. Com:rencement and Expiration. The tem of this Lease shall
be ten (10) years, ccmnencing on
and ending
2. Options and Extensions. There is a renewal option for
Lessee to extend this lease for an additional three (3) year period, but
by inaction of the parties, the lease shall be deerred to continue from
m:>nth to month. This lease will not terminate until notice in writing
is given by either party to the other, not later than three months prior
to the expiration of the lease tem.
3. Holdover. If Lessee shall hold over after the expiration
of the Lease Tem, such tellancy shall be from month to month on all the
tems, oovenants and oondi tions of this Lease.
4. Surrender of Possession.
(a) Subject to the provisions of Article XI belo.v with
respect to restoration of buildings and irrprovements, upon expi-
ration of the Lease Tem, whether by lapse of time or otherwise,
Lessee shall pronptl y and peacefully surrender the Leased Land.
(b) Upon the expiration of the Lease Tem or any sooner
temination .of this Lease, Lessee agrees to execute, ackno.vledge
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and deliver to City a proper instrurrent in wr.iting, releasing and
quit-claiming to the City all right, title and interest of Lessee
in and to the Leased Land and all inprovements thereto not rerroved
by Lessee as provided herein.
ARI'ICLE VI. RENI' . The rental for the Leased Land shall be
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detemined and paid as follows:
1. Any and all annual rental due under this Lease shall be
paid in advance upon cormencement of this Lease in yearly installments
on or before oomrencerrent of this Lease and on or before July 1 of each
succeeding year, except as otherwise provided.
2. The rental shall be detemined as follows:
(a) The lease rate shall be $1500 per annum.
(b) Should the City and Lessee mutually agree to extend
the lease, not less than ninety (90) days prior to the expiration
of the lease the City, at its 0Nl1. expense, may enploy an indepen-
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dent appraiser to detemine the fair market rental value of the
Leased Land at the highest and best use of the Leased Land and
without consideration of Lessee's intended use of the land unless
that use is coincidentally the highest and best use of the Land.
3. 1\ddi tional Rent and ci ty' s Right to Cure Lessee's ])e-
faults. All oosts and expenses which Lessee assurres or agrees to pay
Pursuant to this Lease or to any mortgage or other encumbrance upon the
Leased Land or Lessee's leasehold interest shall at City's election be
treated as additional rent and, in the event of nonpaYrrent, City shall
have all rights and rerred.ies herein provided for in the case of nonpay-
rrent of rent or of a breach of condition. If Lessee shall default in
making any paYrrent required to be made by Lessee, or shall default in
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perfoming any term, covenant or condition of this Lease or of any such
. mortgage or other encumbrance on the part of Lessee to be perforrred
! which shall involve the expenditure of money by Lessee, City at City I s
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, I option may, but shall not be obligated to, make such payment or, on
behalf of Lessee, expend such sum as rnay be necessary to. perform and
fulfill such tem, covenant or condition, and any and all sums so
expended by the City with interest thereon at the maximum rate under the
laws of the State of Alaska from the date of such expenditure until
repaid, shall be (and shall be deerred to be) additional rent and shall
be repaid by Lessee to the City, on demand, but no such paYment or
expenditure by the City shall be deerred a waiver of Lessee's default nor
shall it affect any other rerredy of the City by reason of such default.
4. Late PaYment Penalty.
Rental payment due but not
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received by the due date shall be subject to a ten percent (10%) delin-
quency fee plus one and one-half percent (l~%) sinple interest per month
until paid or the maxirm.un pemi tted rate under Alaska law, whichever is
higher.
ARI'ICLE VII. TAXES AND ASSESSMENTS.
1, Lessee to Pay Taxes. Lessee agrees to pay prior to
delinquency and directly to the taxing authorities in which the Leased
Land is located all real property taxes (plus all personal property
taxes on personalty situate on the Leased Land and placed thereon by
Lessee or under Lessee's authority), sales taxes, or other business or
use taxes levied or asSessed upon or against the Leased Land or any
irrprovements thereon or Lessee's business during the Lease Tem. Lessee
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agrees to indemnify and hold City harmless from liability for any other
tax, charge, or assesSIrent of any kind or nature. Lessee shall, within
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sixty (60) days after any such tax assesSIrent or other charge consti-
tuting a lien on the Leased Land shall becorre due and payable, produce
and exhibit to City satisfactory evidence of payment.
2.
Lessee to Pay AssesSIrents.
Iessee, during the lease
tem, agrees to pay directly to the public authorities charged with
collection thereof any and all assesSIrents levied on the Leased Land for
a part of or all of the cost of any public work or inproverrent assessed
acoording to benefit found by the levying authority to accrue therefran
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to the Leased Land, including any charges for anti-pollution, environ-
mental, ecological or any other public purposes. If an option is given
to pay such assessrrent(s) in installments, Lessee may elect to pay the
same in installments, and in such case Lessee shall be liable only for
such installments as shall accrue during the Lease Tem.
3.
Proration of Taxes and Assessrrents. If Lessee's obli-
gat ion to pay taxes or assessrrents comrences or ends during a tax year,
such obligation shall be appropriately prorated with City bearing the
remaining cost (or its pro rata share) thereof.
4.
Lessee shall have the right to contest or
Contest.
review any tax, assessrrent, levy, fee, water or sewer charges or rents,
or any other governmental charges which Lessee is obligated to pay.
Such proceedings shall, if instituted, be conducted pronptl y at Lessee's
0Nl1. expense and free from all expense to City. Before instituting any
such proceedings, Lessee shall pay under protest such tax, assessrrent,
levy, fee, water or sewer rents or charges or any other governmental
charges, or shall furnish to City a surety canpany bond in a conpany
acceptable to City, or other security reasonably satisfactory to City,
sufficient to cover the anDunt of the contested item or items with
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interest for the period which such proceedings may be reasonably ex-
pected to take and costs se=ing the payrrent of such contested item or
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items and all interest and costs in connection therewith when finally
detemined. Notwithstanding the furnishing of any such bond or securi-
ty, Lessee shall pay all such items at least twenty (20) days before the
time when the Leased Land or any part thereof might be forfeited. The
legal proceedings herein referred to shall include appropriate cer-
tiorari proceedings and appeals from any orders and judgerrents therein,
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but all such proceedings shall be begun as soon as reasonably possible
after the inposition or assessrrent of any contested items and shall be
prosecuted to final adjudication with reasonable dispatch. In the event
of any reduction, cancellation or discharge, Lessee shall pay the anDunt
that shall be finally levied or assessed against the Leased land or
adjudicated to be due and payable and, if there shall be any refund,
payable by the governmental authority with respect thereto, Lessee shall
be entitled to receive and retain the sarre subject, h~ver, to aPpor-
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tionment as provided in Paragraph 3 above during the first and last
years of the lease term. City at City's option rnay, but shall not be
obligated to, contest or review by legal proceedings or in such other
manner as may be legal and at City's 0Nl1. expense any tax, assessrrent,
levy, fee, water or sewer rents or charges, or any other governmental
charge aforementioned, which shall not be oontested or reviewed as
aforesaid, and unless Lessee shall pranptly join in such contest or
review and pay all oosts therein, the City shall be entitled to receive
and retain any refund payable by the governmental authority with respect
thereof.
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5. Lessee to Pay Utility Charges. Lessee shall payor cause
to be paid all charges for water, heat, gas, electricity, sewers, and
any and all other utili ties used upon the Leased Land throughout the
lease tem, including any connection fees.
ARI'ICLE VIII. CONSTRUCrION BY LESSEE.
1. Lessee's Right to Build--General Conditions. Lessee shall
have the right at any time and from time to time during the lease tem
to construct, rnaintain, alter, remodel, reconstruct, rebuild and replace
building (s) and other irrprovement (s) on the Leased Land, subject to
approval of the City in confomity with the Small Boat Harbor Master
Plan and the following conditions:
(a) The oost of any construction, reconstruction,
demolition, or of any change, alteration or irrprovements, shall be
borne and paid for by Lessee.
(b) The Leased Land shall at all times be kept free of
mechanic IS, materialrren' s, and any other liens, as hereinafter more
specifically provided.
(c) Any building contractors enployed by Lessee or its
sublessees shall be appropriately bonded for one hundred percent
(100%) of the oontract anDunt(s) by use of performance and labor
and rnaterial payrrent bonds in the custCllt'ary fom when cost of the
work is over $10,000.00. Copies of all such bonds shall be fur-
nished to the City prior to camencerrent of oonstruction.
(d) Lessee, upon camencement of pemissible building or
construction activities on the Leased Land, shall oontinue such
activities through to completion with diligence and oontinuity.
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(e) CorrrrEncerrent of construction shall rrean having
materials and labor on site. CorrrrEncement of construction shall take
place within 90 days of the signing of this Lease and oonstruction shall
be completed within 90 days of ccmrencerrent of construction.
2. Lessee's <Mnership of Trade Fixtures, Machinery and
Equiprrent. It is expressly understood and agreed that any and all trade
fixtures, rnachinery and equiprrent of whatsoever nature at any time
constructed, placed or rnaintained upon any part of the Leased Land by
Lessee shall be and remain the property of Lessee or its tenants as
their interests may aPpear and may be rerroved or replaced at any time
during the lease tem, provided Lessee or its tenants repair any and all
damage to the Leased Land resulting fran such rerroval or replacement.
3. Lessee's Right to Rerrove Inprovements and ONnership
Thereof. Lessee shall have the right to rerrove any buildings or im-
provements constructed or placed upon the Leased Land by Lessee prior to
the expiration of the Lease. Any buildings or irrprovements not rerroved
prior to the expiration of the Lease shall becorre the property of the
City without the payrrent of any compensation to Lessee.
ARI'ICLE IX. LIENS.
1. Prohibition of Liens on Fee or Leasehold Interest. Lessee
shall not suffer or pemit any liens to be filed against the fee of the
Leased Land nor against Lessee's leasehold interest in the Leased Land
nor against any buildings or inprovements on the Leased Land by reason
of any work, labor, services or rnaterials supplied or clairred to have
been supplied to Lessee or anyone holding the Leased Land or any part
thereof through or under Lessee.
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2. Rerroval of Liens by Lessee. If any lien shall be re-
corded against the Leased Land, or any irrprovements thereof, Lessee
shall cause the ,same to be rerroved, or, in the alternative, if Lessee in
good faith desires to contest the sarre, Lessee shall be privileged to do
so, but in such case Lessee hereby agrees to provide a surety bond from
a surety licensed to do business in Alaska in a penal sum equal to one
and one-half tirres the anDunt of the claim of lien, which bond shall
guarantee the payrrent of the sum which the lien claimant has clairred,
together with the lien claimant's reasonable cost of suit in the action.
Lessee further agrees to indermify, defend, and save the City hamless
from all liability for damages occasioned thereby and shall, in the
event of a judgerrent of foreclosure upon said lien, cause the same to be
discharged and rerroved prior to the execution of such judgement.
3. Notice of NOn-Responsibility. The City rnay, as contem-
plated by Alaska Statutes 34.35.065 (as now enacted or hereinafter
arrended) give notice of non-responsibility for any irrprovements con-
structed or rnade by'Lessee on the Leased Land.
ARI'ICLE X. INDEMNITY. Except for claims arising out of acts
caused by the negligence of the City or its representatives, Lessee
agrees to protect, indemnify, defend and save hamless the City from and
against any and all liability arising from acts or omissions of any
nature whatsoever of Lessee's officers, servants, enployees, contrac-
tors, tenants, agents or invitees causing injury to or death of persons
or loss of or damage to property during the Lease Tenn, and from any
expense incident to defense of and by the City therefrom. If any action
or proceeding is brought against the City by reason of any such occur-
rences, the City shall notify Lessee in writing of such action or
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I . proceeding, whereupon lessee at Lessee I s expense rnay elect to resist or
II defend ,,-,ch actim or proceeding by counsel awroved in ~iting by the
i ci ty, such approval not to be wi thheld unreasonably.
ARI'ICLE XI. INSURANCE AND RESTORATION.
1. Liability Insurance. Lessee, during the Lease Tem, shall
provide a certificate of insurance showing the City as co-insured in an
amount of not less than $300,000 conprehensive general liability cover-
age for premises operations, broad fonn property damage and personal
injury. The minimum requirerrents in this section rnay be increased from
time to time by the City in accordance with customs and usage for
carparable property in the Seward rretropolitan area.
2. Fire and Extended Coverage Insurance. Lessee, during the
Lease Tem, shall keep all buildings and inprovements insured at its
expense against loss or damage by fire and such other risks as may be
included in the custorrary fom of broad fom extended coverage (which
may exclude earthquakes), in an anount, over and above any deductibles
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in the governing policies, of not less than the unpaid balance (s) due
under any existing deed (s) of trust or mortgage (s) enctmlbering the
buildings or irrprovements or the City's fees.
3.
Blanket Insurance.
Lessee may provide any insurance
required by this Lease in the fom of a blanket policy, provided Lessee
furnishes evidence satisfactory to the City indicating the coverage
thereunder is at least equal to the coverage obtainable under a seParate
policy covering the Leased Land only.
4. Additional Named Insured~ Rights of ~rtgagees (Lenders) ~
Waiver of SUbrogation. All insurance policies required to be maintained
by Lessee shall name lessee and the City as the insureds, as their
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respective interests rnay appear. All policies shall contain an agree-
ment by the insurers that such policies shall not be cancelled without
at least thirty days' prior written notice to the City, and certificates
or copies of all such insurance policies shall be furnished to the City
pronptly after the issuance thereof.
5. Restoration of Buildings and Inproverrents. In the event
of damage to or destruction of any of the buildings or irrprovements
situated on the Leased Land, then from the insurance proceeds payable to
Lessee, Lessee shall within ninety (90) days after payrrent of the
insurance proceeds comrence restoration of the buildings and irrprove-
ments to their oondi tion prior to such damage, provided, however,
Lessee's obligation to restore will be limited to the insurance proceeds
available to Lessee. All such insurance proceeds shall be deposited and
held in trust with such bank having offices in Seward and/or Anchorage,
Alaska, as Lessee may designate, or with Lessee's mortgagee of the
damaged property, and shall be rnade available to Lessee for its use in
restoration or repair, as the case may be, of any damage or destruction
to the buildings and irrprovements on the Leased Land. The proceeds of
insurance shall be paid out by such trustee or mortgagee from time to
time on certification of the person having supervision of the work that
the amount certified is being applied to the payrient of the reasonable
cost of such work.
ARI'ICLE XII. CARE OF LEASED LAND, ACCESS OF '!HE CITY.
1. Care of Leased Land. Lessee at its 0Nl1. oost and expense
shall keep the entire Leased Land and all buildings and irrproVeITents
which at any time may be situated thereon in good, clean and tidy
condition and repair during the Lease Tem.
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2. Other Access Rights of the City. The City and its agents
or representatives shall have the right to enter into and upon the
Leased Land during reasonable hours for the purpose of inspecting the
Leased Land and all buildings and inproverrents thereon.
3. Avoidance of Prescriptive Rights. Lessee shall take such
action as may be necessary to preserve the City's title and ONl1.ership of
the Leased Land free and clear of any public or private rights of way,
easements or other interests acquired by prescriptive use or otherwise
than as pemi tted under this Lease, including but not limited to the
posting of thoroughfares, walkways and Parking areas so as to preserve
the right of private ONl1.ership therein and prevent any adverse rights
thereto accruing through prescriptive use or otherwise than as pemitted
hereunder.
ARI'ICLE XIII. cn1PLIANCE WITH lAWS.
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Lessee shall conply with all
Corrpliance wi th Laws.
applicable laws, ordinances and regulations of duly oonstituted public
authorities now or hereafter in any manner affecting the Leased Land or
any buildings, structures or inprovements situated thereon, whether or
not any such laws, ordinances or regulations which may be hereafter
enacted involve a change of policy on the part of the governrre1ltal body
enacting the same. Lessee further agrees it will not permit any unlaw-
ful occupation, business or trade to be oonducted on said premises or
any use to be made thereof oontrary to any law, ordinance or regulation
as aforesaid with respect thereto.
2. Contest. Lessee may by appropriate proceedings conducted
at Lessee's 0Nl1. expense, contest in good faith the validity or enforce-
ment of any law, ordinance or regulation, provided Lessee diligently
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plrsues such contest to a final detemination by a court, department or
governmental authority or body having jurisdiction thereof; provided
that if the City rnay becorre liable in any manner for damages, penal ties,
fines or costs by reason of Lessee I s failure to comply with any such
law, ordinance or regulation during Lessee's contest thereof, then, as a
condition precedent to the comrencerrent and oontinuation of such pro-
ceedings, Lessee shall furnish the City such bond with oorporate surety
as the City shall reasonably request to save hamless and indemnify the
City against liability for any such damages, penalties, fine,s or oosts.
At the option of the City, it rray at its exPense contest the validity or
enforcement of any such law, ordinance or regulation.
ARI'ICLE XIV. EMINENl' IJCM!\IN.
1. Interest of Parties in Condermation. In the event the
Leased Land or any part thereof shall be taken for public purposes by
condemnation as a result of any action or proceeding in aninent domain,
or shall be transferred in lieu of condemnation to any authority enti-
tled to exercise the power of eminent domain, the interests of the City
and Lessee in the award of consideration for such transfer and the
effect of the taking or transfer upon this Lease shall be as provided by
law.
In the event the extent of the taking rnakes irrpracticable the
continued operation of the self service car wash, gas station and retail
rrerchandise facility, upon written notification by Lessee this Lease andnall of the right, title and interest thereunder of Lessee shall cease on
the date title to such Land so taken or transferred vests in the con-
demning authority.
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2. Partial Taking--Continuation of Lease. In the event the
taking or transfer of a part of the Leased Land leaves the remainder of
the Leased Land in such location and ill such fom, shape or size, or so
accessible as to be effectively and practicably usable in the opinion of
the Lessee and the City for the purpose of operation thereon of Lessee's
business, this Lease shall teminate and end as to the portion of the
Leased Land so taken or transferred as of the date title to such portion
vests in the condemning authority and the condemning authority enters
into possession but shall continue in full force and effect as to the
portion of the Leased Land not so taken or transferred.
ARI'ICLE YN. ARBITRATION. !my oontroversy or claim arising
out of or relating to this Lease, or the breach thereof, shall be
settled by arbitration in accordance with the Unifom Arbitration Act of
Alaska, and judgement upon the award may be entered in any court having
jurisdiction thereof. !my arbitration proceedings hereunder shall be
held before a panel of three arbitrators in the City of Seward, Alaska,
or with the consent of both parties in !mchorage, Alaska.
ARI'ICLE YNI. DEFAULT AND REMEDIES.
1. Default and Temination.
(a) If the rent or any other charge shall be in arrears
for a period of thirty (30) days, or
(b) If Lessee fails to take reasonable steps to keep and
perfom any of the covenants or conditions of this Lease within
thirty (30) days after written notice of default, or
(c) If Lessee files a voluntary petition in bankruptcy
or for reorganization under the bankruptcy laws or is adjudged a
bankrupt by a court of canpetent jurisdiction, or
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(d) If Lessee makes an assignrrent for the benefit of its
creditors, or
(e) If a receiver is appointed by a oourt of canpetent
jurisdiction for Lessee's business and it be established in the
receivership proceedings that Lessee is insolvent, or
(f) If the leasehold interest hereunder is abandoned by
Lessee, then
City rnay at City's option at once without further notice to Lessee or
any other person, teminate this Lease. Upon temination of this Lease
as aforesaid, or at the expiration of this Lease and upon the termina-
tion of said Lease by its tems, Lessee shall at once surrender pos-
session of the Leased Land to the City and remove all Lessee's effects
therefrom and rnay rerrove all Lessee's buildings and other irrproverrents,
and Lessee shall have no further rights hereunder or with respect to the
Leased Land. If such possession be not imrediately surrendered, the
City rnay forthwith enter into and upon and repossess the Leased Land and
expel Lessee or those claiming under Lessee without being deerred guilty
in any manner of trespass and without prejudice to any rerredies which
might othenvise be used for arrears of rent or preceding breach of
covenant, ,and in such event Lessee expressly waives the service of
notice of any intention so to teminate this Lease or to retake the
Leased Land and waives service of any demand for payrrent of rent or for
possession and for any and every other notice or demand prescribed by
any law and hereby waives any claim for damages by reason of such
repossession.
Z. Reletting. At any time or from time to time after any
such expiration or temination, the City may relet the Leased Land, or
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any part thereof, and any unleased buildings and inprovements1 for such
term or terms (which rnay be greater or less than the period which would
otherwise have constituted the balance of the tem of this Lease) and on
such conditions (which rnay include concessions or free rents) as the
City, in its discretion, may detemine and may collect and receive the
rents therefor. The City shall in no way be responsible or liable for
any failure to relet the Leased Land, or any part thereof, or for any
failure to oollect any rent due upon any such reletting.
3. Damages. No such expiration or temination of this Lease
shall relieve Lessee of its liability and obligations under this Lease,
and such liability and obligations shall survive any such expiration or
termination. In the event of any expiration or termination, whether or
not the Leased Land, or any part thereof, shall have been relet, Lessee
shall pay to the City the net rent and all other charges required to be
paid by Lessee up to the time of such expiration or temination of this
Lease, and thereafter Lessee, until the end of what would have been the
term of this Lease in the absence of such expiration or temination,
shall be liable to the City for, and shall pay to the City, as and for
liquidated and agreed current damages for Lessee I s default,
(a) the equivalent of the aITOunt of the rent and charges
which would be payable under this Lease by Lessee if this Lease
were still in effect, less
(b) The net proceeds received by the City from leasing
or reletting the Leased Land and irrprovements thereon after de-
ducting all of City's expenses in oonllection with such leasing and
reletting, including, without limitation, all repossession costs,
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brokerage cc:mnissions, legal expenses, reasonable attorneys' fees,
alteration costs, and expenses of preParation for such reletting.
Lessee shall pay such current damages (herein called "deficiency") to
the City Ironthly, and the City shall be entitled to recover from Lessee
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each monthly deficiency as the same shall arise. At any time after any
such expiration or temination, whether or not the City shall have
collected any monthly deficiencies as aforesaid, the City shall be
entitled to recover fran Lessee, and Lessee shall pay to the City, on
demand, as and for liquidated and agreed final damages for Lessee's
default, an anDunt equal to the difference between a~l rent reserved
hereunder for the unexpired portion of the Lease Tem and the then fair
and reasonable net rental value to the City of the Leased Land for the
same period. In the corrputation of such damages, the difference between
an installrrent of rent becoming due hereunder after the date of temina-
tion and the fair and reasonable rental value to the City of the Leased
Land for the Period for which such installrrent was payable shall be
II discounted to the date of temination at the rate of six percent (6%)
i I per annum. If the Leased Land, or any part thereof, be leased or relet
by the City for the 1.I1lexpired portion of the Lease Tem, or any part
thereof, before presentation of proof of such liquidated damages to any
court, oonmission or tribunal, the anDunt of rent reserved upon such
leasing or reletting shall be prima facie evidence of the fair and
reasonable rental value for the part or the whole of the premises so
leased or relet during the tem of the leasing or reletting. Nothing
herein oontained shall limit or prejudice the right of the City to prove
and obtain as liquidated damages by reason of such temination an anDunt
equal to the maximum allowed by any statute or rule of law in effect at
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the tirre v.,hen, and governing the proceedings in which such damages are
to be proved, whether or not such amount be greater, equal to, or less
than, the anDunt of the difference referred to above.
4. Accunulation of Rerredies. Each right and rerredy of the
City provided for in this Lease shall be cumulative and shall be in
addition to every other right or rerredy provided for in this Lease or
now or hereafter existing at law or in equity or by statute or other-
wise, and the exercise or beginning of the exercise by the City of any
one or more of the rights or rerredies 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 the City of any
or all other rights or rerredies provided for in this Lease or now or
hereafter existing at law or in equity or by statute or otherwise.
5.
Appoini:lrent of Receiver. UPon the cormencerrent of any
suit or action by the City against Lessee pursuant to any rerredy avail-
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able to the City uPon Lessee's default hereunder or at any time there-
after and during the pendency of such suitor action, any court of
oonpetent jurisdiction upon the application of the City may at once and
without notice to Lessee, its successors or assigns, or any person or
persons or tenant or tenants or rrortgagee or person claiming any securi-
ty interest through Lessee, appoint a receiver to collect the rents and
profits arising out of the Leased Land, the buildings and irrprovements
thereon and the subleases pertaining thereto and apply such rents and
profits to the payment and satisfaction of Lessee's obligations under
this Lease, including without limitation the payrrent of the rent due the
City hereunder, first deducting all proper charges and eh-penses attend-
ing the execution of such trusts, and to have any balance remaining held
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by such receiver for disposition in accordance with any judgement or
decree entered therein or as may be fran time to time directed by said
court.
ARI'ICLE XVII. GENERAL PROVISIONS.
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1. Estoppel Certificates. Either party shall at any time and
from time to time, upon not less than thirty days' prior written request
by the other party, execute, ackno.vledge, and deliver to such party, or
to its designee, a staterrent in writing certifying that this Lease ~s
unarrended and in full force and effect (or, if there has been any
arrendment thereof, that the sarre is in full force and effect as arrended
and stating the amendrrent or amendments), that there are no defaults
existing (or, if there is any clairred default, stating the nature and
extent thereof) ~ and stating the dates to which the rent and other
charges have been paid in advance. It is expressly understood and
agreed that any such staterrent delivered pursuant to this section may be
relied upon by any prospective assignee or tenant of the Leasehold
Estate, or estates, or Lessee or any prospective purchaser of the estate
of the City, or any lender or prospective assignee of any lender on the
securi t..y of the Leased Land OI: the fee estate, or any part thereof, and
any third person.
2. Conditions and Covenants. All the provisions of this
Lease shall be deerred as running with the Land, and shall be construed
to be "conditions" as well as "covenants", as though the words specif-
icall y expressing or inparting covenants and conditions were used in
each separate provision.
3. No Waiver of Breach. No failure by either the City or
Lessee to insist upon the strict perfomallce by the other of any
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covenant, agreerrent, tem or condition of this Lease or to exercise any
right or rerredy oonsequent upon a breach thereof, shall oonstitute a
waiver of any such breach or of such covenant, agreerrent, tenn or
condition. No waiver of any breach shall affect or alter this Lease,
but each and every covenant, oondition, agreerrent and tenn of this Lease
shall oontinue in full force and effect with respect to any other then
existing or subsequent breach.
4. Time of Essence. Time is of the essence of this Lease
and of each provision.
5. Computation of Time. The tirre in which any act provided
by this Lease is to be done is COIIplted by excluding the first day and
including the last, unless the last day is a Saturday, Sunday or a
holiday, and then it is also excluded. The tenn "holiday" shall rrean
all holidays as defined by the statutes of Alaska.
6. Successors in Interest. Each and all of the covenants,
conditions and restrictions in this Lease shall inure to the benefit of
and shall be binding upon the successors in interest of City and the
authorized assignees, transferees, tenants, licensees and other succes-
sors-in-interest of Lessee.
7. Entire Agreerrent. This Lease oontains the entire agree-
ment of the parties with respect to the rnatters covered by this Lease,
and no other agreerrent, statement or promise rnade by any party, or to
any enployee, officer of agent of any party , which is not contained in
this Lease shall be binding or valid.
a. Governing raw. This Lease shall be governed by, con-
strued and enforced in accordance with the laws of the State of Alaska.
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9. Partial Invalidity. If any tem, oovenant, oondition or
provision of this Lease is held by a court of competent jurisdiction to
be invalid, void or unenforceable, the remainder of the provisions shall
remain in full force and effect and shall in no way be affected, im-
paired or invalidated.
10. Relationship of Parties. Nothing contained in this Lease
shall be deened or construed by the parties or by any third person to
create the relationship of principal and agent or of partnership or of
joint venture or of any association between the City and Lessee~ and
neither the rrethod of oanputation of rent nor any other provisions
contained in this Lease nor any acts of the parties, shall be deerred to
create any relationship between the City and Lessee other than the
relationship of lessor and lessee.
11. Interpretation. The language in all parts of this Lease
shall in all cases be sinply construed according to its fair rreaning and
not strictly for or against the City or Lessee. Unless otherwise
provided in this Lease, or unless the context otherwise requires, the
follONing rules of construction shall apply to this Lease:
(a) Number and Gender. In this Lease, the neuter gender
includes the rnasculine and the feminine, and the singular number
includes the plural~ the word "person" includes corporation,
partnership, fim or association wherever the context so requires.
(b) Mandatory and Pemissi ve.
"Shall" , "will" and
"agrees" are mandatory; "may" is pemissive.
(c) Captions. Captions of the Articles, Sections and
subsections of this Lease are for convenience and reference anI y,
and the words contained therein shall in no way be held to explain,
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nodify, amplify or aid in the interpretation, oonstruction or
rreaning of the provisions of this Lease.
12. Arrendment. . This Lease is not subject to arrendrrent except
in writing executed by all parties hereto.
13(a).
Delivery of Notices and Rent--Mcthod and Time. All
notices, demands or requests from one party to another shall be de-
livered in person or be sent by rnail, certified or registered, postage
prepaid, to the addresses stated in this Section, and shall be deerred to
have been given at the time of delivery or making.
13 (b) .
Payrrent of Rent. All rents and other sums payable
by Lessee to the City shall be by check, payable to the City, delivered
in person or rnailed to the City at the following address:
City Clerk
City of Seward
PO Box 167
Seward, AK 99664
and shall be deerred to have been paid when received at such address.
13 (c) .
Notices to the ci ty . All notices, demands and
requests from Lessee to the City shall be given to the City at:
City Clerk
City of Seward
PO Box 167
Seward, AK 99664
and to such other persons at such additional addresses as the City may
specify, but not exceeding four in the aggregate.
13 (d) .
Notices to Lessee. All notices, demands or requests
from the City to Lessee shall be given to Lessee at:
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-13 (e) . Change of Address. Each Party shall have the right,
from time to time, to designate a different address by notice given in
conformity with this Section.
14. Broker's Corrmission. Each of the parties represents and
warrants that there are no claims for brokers' corrmissions or finders f
fees in connection with the execution of this Lease.
15. Attorneys' Fees. If either party hereto institutes any
suit, action or arbitration proceeding to oollect the rent reserved or
to enforce any covenant or agreerrent hereof or to obtain any of the
rerredies herein provided, the prevailing party shall be entitled to such
sum of money as the court or the arbitration board may adjudge reason-
able as oosts and attorneys' fees in such suit, action or arbitration
proceeding, inCluding any appeal taken by either party in such suit,
action or arbitration proceeding.
16. Reoords. Lessee shall at all times keep or cause to be
kept proper books of record and account in which full, true and correct
entries will be rnade of all dealings or transactions of or in relation
to the Leased Land.
17. Minerals. Nothing in this Lease shall authorize Lessee
to exercise any rights in regard to oil, oil rights, minerals, mineral
rights, natural gas, natural gas rights, and/or other hydrocarbons by
whatsoever narre that may be within or under the Leased Land. The City
reserves the right to whipstock or directionally drill and mine from
land other than the leased Land oil or gas wells, tunnels and shafts
into, through or across the subsurface of the Leased Land, and to bottom
such whipstocked or directionally drilled wells, tunnels and shafts
under and beneath or beyond the exterior limits thereof, and to redrill,
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retunnel, equip, rnaintain, repair, deepen and operate any such wells or
mines, without, however ,the right to disturb the use of the surface or
i-to drill or mine through the uPper 500 feet of the subsurface of the
Leased Land.
18. Gcxx1 Faith. The terms of this Lease inpose an obligation
of good faith on the City and Lessee in the perfomance and enforcement
thereof.
19. Election to Teminate by City. Lessee, as partial
consideration for this Lease, express 1 y undertakes (1) to build a conces-
si~ shop not to exceed 16 feet by 14 feet~ (2) to cover the remainder
of the lease site with a boardwalk connecting with adjacent sites and
the City boardwalk~ (3) to allow no outside storage on site~ (4) to
allow no overnight occupancy~ (5) to operate said facility for a
minirm.un of a 90-day period annually. If Lessee fails to rreet any of
these requirements in a timely manner, the City may, by giving written
notice to Lessee, elect to tenninate this Lease. All further rights,
duties and obligations hereunder shall cease upon receipt by Lessee of
such notice.
20. Election to Teminate by Lessee. If an earthquake occurs
during the term hereof, making the oonstruction, financing, rnaintenance
or operation of an irrprovement (s), building (s) or other structure (s) on
the Leased Land irrpractical or inpemissible, then in such event,
provided the Lessee be in good standing hereunder, the Lessee rnay, in
its uncontrolled discretion, elect to tenninate this Lease upon:
(a) Giving written notice to the city~ and
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(b) Making payrrent to the City of a sum equal to fifty
percent (50%) of the rents payable to the City for the twelve
calendar months imrediately preceding the notice under (a) ~ and
(c) Satisfying or otherwise releasing the City's fee
from any encumbrance (s) created as the result of Lessee's actions.
All further rights, duties and obligations hereunder shall cease up:m
receipt by the City of such notice of election to terminate and the
fulfilling of conditions (b) and (c).
21. Other Conditions. .The City reserves the right to relo-
cate the building at City expense should such a IT'OVe be necessary to
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accomplish the overall Harbor Boardwalk Project.
ARI'ICLE XVIII. RECORDING, EXECUI'ION, cOONTERPARI'S.
Reoording.
The parties may , concurrently with the
1.
execution of this Lease, execute, acknowledge and record a merrorandum of
lease. Following recording, the rremorandum lease shall be attached to
this Lease.
2.
CounterParts.
This Lease has been executed by the
parties in two counterparts, each of which shall be deerred to be an
original.
3. Execution. This Lease has been executed by the parties
on the day and year first above written.
LESSOR:
LESSEE:
THE CITY OF SEWARD, AUlSKA
By:
Ronald A. Garzini, City Manager
By:
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ATI'EST:
APPROVED AS TO FORM:
.
HUGHES, THORSNESS, GANTZ, FeWEIL
& BRUNDIN, Attorneys for the
City of Seward, Alaska
Linda S. Murphy, City Clerk
Fred B. Arvidson, City Attorney
(City Seal)
STATE OF ALASKA
ss.
THIRD JUDICIAL DISTRIcr
.
THIS IS TO CERI'IFY that on this day of
19 , before me, the undersigned, a Notary Public in and for the State
of Alaska, duly oorrmissioned and sworn as such, personally appeared
, City Manager of the City of Seward,
knONl1. to me and to me knONl1. to be the person who executed the foregoing
instrument on behalf of the City of Seward, and who acknowledged that he
signed the same freely and voluntarily for the uses and puzposes therein
contained.
IN WITNESS WHEREOF, I have hereunto set my hand and seal on
the day and year first hereinabove written.
NOI'ARY PUBLIC in and for Alaska
My Conmission Expires:
STA'IE OF ALASKA
ss.
THIRD JUDICIAL DISTRIcr
.
THIS IS TO CERI'IFY that on this day of ,
19 , before me, the undersigned, a Notary Public in and for the State
of Alaska, duly cornnissioned and sworn as such, personally appeared
, knONl1. to me and to rre knONl1. to be the
person who executed the foregoing instrument, and who acknowledged that
he signed the same freely and voluntarily for the uses and purposes
therein contained.
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IN WITNESS WHEREOF, I have hereunto set ~ hand and seal on
the day and year first hereinabove written.
NarARY PUBLIC in and for Alaska
My Corrmission Expires:
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~I\RaOR
SEYI~RD StA~LL 80AT tl~R80R
RO~RDYI ~Ll( LE~SE SITES