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AGREEMENT FOR FINANCING, LEASE,
CONSTRUCTION, OPERATION AND MAINTENANCE
OF THE ALASKA SEALIFE CENTER
Dated: April 28, 1995
BY AND BETWEEN:
THE CITY OF SEWARD
and
SEWARD ASSOCIATION FOR THE ADVANCEMENT
OF MARINE SCIENCE
1 . 1 . 36 "SAAMS" means the SEWARD ASSOCIATION
FOR THE ADVANCEMENT OF MARINE SCIENCE d/b/a ALASKA SEALIFE CENTER,
a non-profit corporation organized under the laws of the State of
Alaska, with Section 501 (c) (3) status .
1 . 1 . 37 "State" means the State of Alaska.
1 . 1 . 38 "Term" means the term of this
Agreement, which shall be the duration of the lease of the Property
by the City to SAAMS as set forth in Section 3 . 1 .
1 . 1 . 39 "Termination Fund Requirement" means
an amount determined not less frequently than every five (5) years
during the term of this Agreement by a qualified consultant
retained by SAAMS to be the amount required to maintain the
Property while closed to public access and to any research activity
for a period of one (1) year.
1 . 1 .40 "Transaction Documents" means this
Agreement and all other documents executed in connection with this
Agreement .
1 . 1 .41 "Trustee Council" means the Exxon
Valdez Oil Spill Trustee Council .
1 . 2 General Definitions.
1 . 2 . 1 Sections . All references in this
Agreement to designated "Sections" and other subdivisions are to
designated sections and other subdivisions of this Agreement .
1 . 2 . 2 General Words of Reference. The
words "herein, " "hereof, " "hereto, " "hereby, " and "hereunder" and
AGREEMENT FOR FINANCING, LEASE, CONSTRUCTION, AND
MAINTENANCE OF THE ALASKA SEALIFE CENTER Page 9
I
5 . 8 . 3 Termination Fund. Amounts shall be
withdrawn from the Revenue Fund and deposited in the Termination
Fund each year in an amount equal to the lesser of (i) the
difference between the balance of the Termination Fund and the
Termination Fund Requirement, and (ii) twenty percent (20%) of the
Termination Fund Requirement . "Termination Fund Requirement" means
an amount determined not less frequently than every five (5) years
during the term of this Agreement by a qualified consultant
retained by SAAMS to be the amount required to maintain the
Property while closed to public access and to any research activity
for a period of one (1) year.
5 . 8 .4 Other Special Funds . SAAMS may, in
its discretion, establish one or more funds for special purposes,
including without limitation endowment and other special fund
raising.
5 . 9 Taxes, Assessments, and Other Charges. SAAMS
shall pay all real and personal property taxes, sales taxes,
special assessments, and other charges of every description levied
on or assessed against the Property, improvements on the Property,
personal property located on the Property, the leasehold estate, or
SAAMS' business operations located on the Property, to the full
extent of installments falling due during the Term. SAAMS shall
make all such payments before delinquency and before any fine,
interest, or penalty shall become due or be imposed by operation of
law for their nonpayment; provided that SAAMS may pay any such
AGREEMENT FOR FINANCING, LEASE, CONSTRUCTION, AND
MAINTENANCE OF THE ALASKA SEALIFE CENTER Page 42
•
, ^f
AMENDED AND RESTATED
AGREEMENT FOR LEASE OF TRACT 2A,
WATERFRONT TRACTS AND ADJACENT
TIDELANDS, AND THE LEASE,
OPERATION AND MAINTENANCE OF
THE ALASKA SEALIFE CENTER
between
CITY OF SEWARD, ALASKA
and
SEWARD ASSOCIATION FOR THE
ADVANCEMENT OF MARINE SCIENCE
Effective Date:November 9,2006
I:\Dom44337►o22Winal Amended and Restated Agreement 2006.doc
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Kenai Fjords Tours - Boardwalk Site #8
Lease Period Base Value Lease rate Cost of Lease Percentage Increase
(2/10/1997 - 6/30/2005) $70,737.50 8.00% $5,659.00
(7/1/2005 - 6/30/2010) $175,000.00 8.00% $14,000.00 147.39%
Renewed2010 Lease (Same Rate) $175,000.00 10.00% $17,500.00 25.00%
Est. 25%Apprisal Increase $218,750.00 10.00% $21,875.00 56.25%
1.1.30 "State" means the State of Alaska.
1.1.31 "Termination Fund Requirement" means the amount required to
maintain the Site and Improvements while closed to public access and to any research activity
for a period of one year pursuant to SAAMS's election not to operate the Improvements under
Subsection 3.1.1, and determined to be (i) $700,000 for the Fiscal Year ending September 30,
2006, and(ii) for each subsequent Fiscal Year, the amount determined by multiplying increasing
the Termination Fund Requirement for the immediately preceding Fiscal Year by 1.030.
1.1.32 "Term" means the term of this Agreement, which shall be the duration of
the lease of the Site, Improvements, and Tidelands by the City to SAAMS as set forth in Section
3.1.
1.1.33 'Tidelands " means the real property owned by the City and described in
Exhibit "C."
1.1.34 'Tour" means the Alaska SeaLife Marine Tour operated by the Qualified
Vessel Operator or by SAAMS, or such other name that may be determined by SAAMS and the
Qualified Vessel Operator.
1.2 General Definitions.
1.2.1 Sections. All references in this Agreement to designated "Sections" and
other subdivisions are to designated sections and other subdivisions of this Agreement.
1.2.2 General Words of Reference. The words "herein," "hereof," "hereto,"
"hereby," and "hereunder" and other words of similar import refer to this Agreement as a whole
and not any particular section or other subdivisions.
1.2.3 Singular/Plural. The terms specifically defined in Section 1.1 have the
meanings assigned to them in that Section and include the plural as well as the singular.
1.2.4 GAAP. All accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with applicable generally accepted accounting
practices, consistently applied, in effect from time to time.
1.2.5 Authority,. Every "approval," "request," "order," "demand,"
"application," "appointment," "notice," "statement," "certificate," "consent," or similar action
hereunder shall, unless the form thereof is specifically provided, be in writing, signed by a duly
authorized officer or agent of the party or other person with a duly authorized signature.
AMENDED AND RESTATED AGREEMENT FOR LEASE OF TRACT 2A, Page 8 of 36
WATERFRONT TRACTS,AND ADJACENT TIDELANDS,AND THE LEASE,OPERATION AND
MAINTENANCE OF THE ALASKA SEALIFE CENTER r� 417
W1
1:\Docs\43371022\Fina1 Amended and Restated Agreement 2006.doc
5.3 Space for EVOS Research. SAAMS shall comply with the terms of the
Cooperative Agreement then in effect concerning giving priority to research related to the Exxon
Valdez Oil Spill restoration mission, rent for space to conduct research funded with joint Exxon
Valdez Oil Spill civil settlement funds, allocation of laboratory and office space to ADF&G for
research projects at the EVOS Facility, and use of Research Equipment & Restoration Exhibitry
as described in the Cooperative Agreement.
5.4 Proactive Maintenance of the Improvements. As a part of its commitment to
operate and maintain the Improvements to a standard that is comparable to that of other well-
operated and well-maintained marine research facilities throughout the United States, SAAMS
will adopt with its operating budget for the Fiscal Year ending September 30, 2007, and update
annually, a proactive maintenance plan as a part of its operation of the Improvements. This plan
will identify all routine and periodic maintenance to be performed during the next Fiscal Year,
costs of such maintenance, and a schedule of performance. SAAMS shall designate in each
annual operating budget an amount for proactive maintenance. By way of example, SAAMS
annual operating budget for the Fiscal Year ending September 30, 2006 includes $800,000 for
proactive annual maintenance.
5.5 Renewal and Replacement Fund. In addition to the proactive annual
maintenance described above, SAAMS will accumulate and maintain an amount equal to the
Renewal and Replacement Fund Requirement in a special fund dedicated to pay the cost of
major repairs and replacements to and within the Improvements, that otherwise would be the
obligation of the City under the Cooperative Agreement. For purposes of this Agreement,
"major repairs and replacements" means a discrete repair expenditure greater than $50,000, or
any repair or maintenance project that is outside the scope of the proactive maintenance
described in the current proactive maintenance plan. Amounts may be withdrawn from the fund
to pay the cost of major repairs and replacements within the Improvements, to the extent that
insurance or other moneys recoverable as the result of damage or loss to the Improvements are
not available to pay such cost. If a withdrawal from the fund to pay the cost of major repair or
replacements within the Improvements causes the amount remaining in the fund to be less than
the Renewal and Replacement Fund Requirement, SAAMS shall restore the amount in the fund
to not less than the Renewal and Replacement Fund Requirement by making not more than five
equal annual deposits to the fund. Nothing in this subsection limits SAAMS' responsibility to
maintain and repair the Improvements in a timely manner even if the costs exceed the amount in
the fund.
5.6 SAAMS Election Not to Operate the Improvements. SAAMS shall notify the
City if SAAMS elects not to operate the Improvements, either because the Improvements have
reached the end of their practical life as defined in Subsection 3.1.1, or if for any other reason
permitted under this Agreement, SAAMS elects not to operate the Improvements. The City shall
provide the same notice to ADF&G under the Cooperative Agreement within thirty (30) business
days after receiving the notice from SAAMS. If the City elects not to operate the Improvements,
AMENDED AND RESTATED AGREEMENT FOR LEASE OF TRACT 2A, Page 24 of 36
WATERFRONT TRACTS,AND ADJACENT TIDELANDS,AND THE LEASE,OPERATION AND
MAINTENANCE OF THE ALASKA SEALIFE CENTER
I:\Docs\43371022`.Final Amended and Restated Agreement 2006.doc
the latter notice commences the one-year period during which ADF&G shall have the option to
enter and assume the operation of the Alaska SeaLife Center, as provided in the Cooperative
Agreement. For a period of one year after giving notice to ADF&G under this subsection,
SAAMS shall continue to operate and maintain the Site and Improvements to the standard of
other well-maintained and well-operated marine research facilities throughout the United States.
SAAMS shall maintain an amount equal to the Termination Fund Requirement in a special fund
dedicated to pay the cost of performing this obligation. Nothing in this subsection is intended to
limit SAAMS' responsibility if the costs exceed the amount in the special fund. Any amount
remaining in the fund at the end of the one-year period shall be released to the party that has
assumed the operation of the Improvements.
6. Insurance. Commencing not later than the effective date of this Agreement and
throughout the Term, SAAMS shall procure and maintain at its expense the insurance required
under this section. All such policies shall be written by insurance companies legally authorized
or licensed to do business in the State of Alaska and acceptable to the City. SAAMS shall
provide to the City from time to time certificates that it has procured and is maintaining the
insurance required under this Agreement.
6.1 Under the Cooperative Agreement. For so long as the Cooperative Agreement
requires the City to insure the Site or Improvements, the minimum insurance for the Site and
Improvements shall be that required of the City under the Cooperative Agreement; provided that
such insurance requirements may be modified as provided in this Section 6.1. If one or more of
the required insurance coverages is not available under reasonable terms and conditions,
SAAMS shall, under the guidance and direction of the State of Alaska, Division of Risk
Management, use its best efforts to obtain reasonably equivalent coverage acceptable to
ADF&G. If, after utilizing its best efforts, SAAMS is unable to obtain adequate insurance at a
cost effective rate as reasonably determined by SAAMS, SAAMS may request a waiver of the
relevant insurance requirement. The request shall outline the steps taken by SAAMS to obtain
such insurance and shall disclose quotations received for coverage. Upon the written
determination of the State of Alaska, Division of Risk Management that a reasonable basis exists
to believe that a waiver of such insurance will not materially affect the State's risk with regard to
the Improvements or any activities in, on, or around the Improvements, and approval of the
requested waiver by ADF&G, the City will approve the requested waiver.
6.2 If Not Required by the Cooperative Agreement. If the Cooperative Agreement
does not require the City to insure the Site or Improvements, the insurance for the Site and
Improvements shall be that which the City then requires generally under leases of City property
to private parties.
6.3 Notice to City. All insurance policies shall provide for thirty (30) days' notice to
the City and ADF&G of cancellation and/or material change in policy terms.
AMENDED AND RESTATED AGREEMENT FOR LEASE OF TRACT 2A, Page 25 of 36
WATERFRONT TRACTS,AND ADJACENT TIDELANDS,AND THE LEASE,OPERATION AND
MAINTENANCE OF THE ALASKA SEALIFE CENTER �la
I\Docs\43371022\Final Amended and Restated Agreement 2006.doc
(5)
SECOND AMENDED AND RESTATED
AGREEMENT FOR LEASE OF TRACT 2A,
WATERFRONT TRACTS AND THE
LEASE, OPERATION AND
MAINTENANCE OF THE ALASKA
SEALIFE CENTER
between
CITY OF SEWARD, ALASKA
and
SEWARD ASSOCIATION FOR THE
ADVANCEMENT OF MARINE SCIENCE
Effective Date:
Final Second Amended and Restated Agreement 2009.DOC
•
operate and maintain the Improvements to a standard that is comparable to that of other well-
operated and maintained marine research facilities throughout the United States. SAAMS shall
develop and implement a maintenance plan and schedule to ensure that the Improvements are
operated and maintained to the standard set forth in this subsection.
5.2 Compliance with Cooperative Atreement. SAAMS shall use and maintain the
Improvements in accordance with all requirements of the Cooperative Agreement then in effect
with respect to such use and maintenance. SAAMS shall not use the Improvements in any
manner that would cause the City to be in breach of, or to incur any liability under, any provision
of the Cooperative Agreement then in effect.
5.3 Space for EVOS Research. SAAMS shall comply with the terms of the
Cooperative Agreement then in effect concerning giving priority to research related to the Exxon
Valdez Oil Spill restoration mission, rent for space to conduct research funded with joint Exxon
Valdez Oil Spill civil settlement funds, allocation of laboratory and office space to ADF&G for
research projects at the EVOS Facility, and use of Research Equipment & Restoration Exhibitry
as described in the Cooperative Agreement.
5. 4 Renewal and Replacement Fund. SAAMS has accumulated and shall maintain
•
an amount equal to the Renewal and Replacement Fund Requirement in a special fund dedicated
to pay the cost of major repairs and replacements to and within the Improvements, that otherwise
would be the obligation of the City under the Cooperative Agreement. For purposes of this
Agreement, "major repairs and replacements" means a discrete repair expenditure greater than
$50,000, or any repair or maintenance project that is outside the scope of the annual operating
budget or annual maintenance plan. Amounts may be withdrawn from the fund to pay the cost of
major repairs and replacements within the Improvements, to the extent that insurance or other
moneys recoverable as the result of damage or loss to the Improvements are not available to pay
such cost. If a withdrawal from the fund to pay the cost of major repair or replacements within
the Improvements causes the amount remaining in the fund to be less than the Renewal and
Replacement Fund Requirement, SAAMS shall restore the amount in the fund to not less than
the Renewal and Replacement Fund Requirement by making not more than five equal annual
deposits to the fund. Nothing in this subsection limits SAAMS' responsibility to maintain and
repair the Improvements in a timely manner even if the costs exceed the amount in the fund.
5.5 SAAMS Election Not to Operate the Improvements. SAAMS shall notify the
City if SAAMS elects not to operate the Improvements, either because the Improvements have
reached the end of their practical life as defined in Subsection 3.1.1, or if for any other reason
permitted under this Agreement, SAAMS elects not to operate the Improvements. The City shall
provide the same notice to ADF&G under the Cooperative Agreement within thirty (30)business
days after receiving the notice from SAAMS. If the City elects not to operate the Improvements,
the latter notice commences the one-year period during which ADF&G shall have the option to
enter and assume the operation of the Alaska SeaLife Center, as provided in the Cooperative
Agreement. For a period of one year after giving notice to ADF&G under this subsection,
SECOND AMENDED AND RESTATED AGREEMENT FOR LEASE OF TRACT 2A,
Page 17 of 30
WATERFRONT TRACTS AND THE LEASE,OPERATION AND
MAINTENANCE OF THE ALASKA SEALIFE CENTER
•
SAAMS shall continue to operate and maintain the Site and Improvements as defined in
Subsection 1.1.25. SAAMS shall maintain an amount equal to the Termination Fund
Requirement in a special fund dedicated to pay the cost of performing this obligation. SAAMS
may access up to $500,000 annually from the Termination Fund between October 1 and
September 29, but shall provide evidence to the City that on September 30 that this fund is fully
replenished. Nothing in this subsection is intended to limit SAAMS' responsibility if the costs
exceed the amount in the special fund. Any amount remaining in the fund at the end of the one-
year period shall be released to the party that has assumed the operation of the Improvements.
6. Insurance. Commencing not later than the effective date of this Agreement and
throughout the Term, SAAMS shall procure and maintain at its expense the insurance required
• under this section. All such policies shall be written by insurance companies legally authorized
or licensed to do business in the State of Alaska and acceptable to the City. SAAMS shall
provide to the City from time to time certificates that it has procured and is maintaining the
insurance required under this Agreement.
6.1 Under the Cooperative Agreement. For so long as the Cooperative Agreement
requires the City to insure the Site or Improvements, the minimum insurance for the Site and
Improvements shall be that required of the City under the Cooperative Agreement; provided that
such insurance requirements may be modified as provided in this Section 6.1. If one or more of
the required insurance coverages are not available under reasonable terms and conditions,
SAAMS shall, under the guidance and direction of the State of Alaska, Division of Risk
Management, use its best efforts to obtain reasonably equivalent coverage acceptable to
ADF&G. If, after utilizing its best efforts, SAAMS is unable to obtain adequate insurance at a
cost effective rate as reasonably determined by SAAMS, SAAMS may request a waiver of the
relevant insurance requirement. The request shall outline the steps taken by SAAMS to obtain
such insurance and shall disclose quotations received for coverage. Upon the written
determination of the State of Alaska, Division of Risk Management that a reasonable basis exists
to believe that a waiver of such insurance will not materially affect the State's risk with regard to
the Improvements or any activities in, on, or around the Improvements, and approval of the
requested waiver by ADF&G,the City will approve the requested waiver.
6.2 If Not Required by the Cooperative Agreement. If the Cooperative Agreement
does not require the City to insure the Site or Improvements, the insurance for the Site and
Improvements shall be that which the City then requires generally under leases of City property
to private parties.
6.3 Notice to City. All insurance policies shall provide for thirty (30) days' notice to
the City and ADF&G of cancellation and/or material change in policy terms.
6.4 Additional Insurance Provisions. The City and Indemnified Parties shall be
named as additional insureds under all insurance policies maintained by SAAMS as required
under Section 6.1, or SAAMS shall obtain an appropriate waiver of subrogation in favor of the
SECOND AMENDED AND RESTATED AGREEMENT FOR LEASE OF TRACT 2A, Page 18 of 30
WATERFRONT TRACTS AND THE LEASE,OPERATION AND
MAINTENANCE OF THE ALASKA SEALIFE CENTER
•
1.1.16 "Hazardous Substance" shall be defined as any substance or material
defined or designated as hazardous or toxic waste; hazardous or toxic material; hazardous, toxic,
or radioactive substance; or other similar term by any federal, state, or local statute, regulation,
or ordinance or common law presently in effect or that may be promulgated in the future as such
statutes,regulations, and ordinances may be amended from time to time.
1.1.17 "Improvements" means all improvements to real property located on the
Site, including without limitation the EVOS Facility.
• 1.1.18 "Indemnified Parties" means ADF&G, EVOS Trustee Council and
Executive Director of the EVOS Trustee Council, the State of Alaska, the United States of
America, and their officers, agents, and employees, for so long as the City or SAAMS is required
to indemnify such person or entity under the terms of the Cooperative Agreement.
1.1.19 "Prime Rate" means the interest rate published in the money rates
column of the Wall Street Journal and identified as the prime rate, defined in the Wall Street
Journal as the general level of the base rate on corporate loans at large U.S. money center
commercial banks.
1.1.20 "Prior Agreements" means the Agreement for Financing, Lease,
Construction, Operation, and Maintenance of the Alaska SeaLife Center dated as of April 28,
1995, as amended to the date hereof, between the City and SAAMS and Amended and Restated
Agreement for Lease of Tract 2A, Tidelands, and the Lease, Operation and Maintenance of the
Alaska SeaLife Center effective November 8, 2006, as amended to the date hereof, between the
City and SAAMS.
1.1.21 "Renewal and Replacement Fund Requirement" means (i) $500,000
for the Fiscal Year ending September 30, 2007, and (ii) for each subsequent Fiscal Year, the
amount determined by multiplying the Renewal and Replacement Fund Requirement for the
immediately preceding Fiscal Year by 1.030.
1.1.22 "SAAMS" means the Seward Association for the Advancement of Marine
Science d/b/a Alaska SeaLife Center, a nonprofit corporation organized under the laws of the
State of Alaska and recognized by the Internal Revenue Service under 26 USC 501(c)(3).
1.1.23 "Site" means the real property owned by the City and described on the
attached Exhibit"A."
1.1.24 "State" means the State of Alaska.
1.1.25 "Termination Fund Requirement" means the amount required to
maintain the Site and Improvements while closed to public access and to any research activity
SECOND AMENDED AND RESTATED AGREEMENT FOR LEASE OF TRACT 2A, Page 6 of 30
WATERFRONT TRACTS AND THE LEASE,OPERATION AND
MAINTENANCE OF THE ALASKA SEALIFE CENTER
•
for a period of one year pursuant to SAAMS' election not to operate the Improvements under
Subsection 3.1.1, and determined to be (i) $700,000 for the Fiscal Year ending September 30,
2006, and (ii) for each subsequent Fiscal Year, the amount determined by multiplying the
Termination Fund Requirement for the immediately preceding Fiscal Year by 1.030.
1.1.26 "Term" means the term of this Agreement, which shall be the duration of
the lease of the Site, Improvements, by the City to SAAMS as set forth in Section 3.1.
1.2 General Definitions.
1.2.1 Sections. All references in this Agreement to designated "Sections" and
other subdivisions are to designated sections and other subdivisions of this Agreement.
1.2.2 General Words of Reference. The words "herein," "hereof," "hereto,"
"hereby," and "hereunder" and other words of similar import refer to this Agreement as a whole
and not any particular section or other subdivisions.
1.2.3 Singular/Plural. The terms specifically defined in Section 1.1 have the
meanings assigned to them in that Section and include the plural as well as the singular.
1.2.4 GAAP. All accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with applicable generally accepted accounting
practices, consistently applied, in effect from time to time.
1.2.5 Authority. Every "approval," "request," "order," "demand,"
"application," "appointment," "notice," "statement," "certificate," "consent," or similar action
hereunder shall, unless the form thereof is specifically provided, be in writing, signed by a duly
authorized officer or agent of the party or other person with a duly authorized signature.
2. Representations and Warranties.
2.1 Representations and Warranties of City. As of the date hereof, the City hereby
represents and warrants as follows:
2.1.1 Good Standing. The City is a home rule city duly organized and existing
under the constitution and laws of the State of Alaska.
2.1.2 Authorization. The City has the full power and authority to enter into
this Agreement and to carry out its terms and provisions.
2.1.3 Consent, Approval. Except as may have already been obtained, no
consent or approval of any trustee or holder of any indebtedness or obligation of the City, and no
consent, approval, permission, authorization, order, or license of any governmental authority, is
SECOND AMENDED AND RESTATED AGREEMENT FOR LEASE OF TRACT 2A, Page 7 of 30
WATERFRONT TRACTS AND THE LEASE,OPERATION AND
MAINTENANCE OF THE ALASKA SEALIFE CENTER