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HomeMy WebLinkAbout119-86 RESOLUTIONRESOLUTION NO. 119-86 A RESOLUTION AUTHORIZING AND DIRECTING THE MAYOR AND CITY CLERK TO EXECUTE A LEASE WITH THE NORTHWEST ARKANSAS RESOURCE. RECOVERY AUTHORITY FOR THE CONSTRUCTION AND OPERATION OF A SOLID WASTE DISPOSAL AND RESOURCE RECOVERY FACILITY. BE IT RESOLVED BY TEE BOARD OF DIRECTORS OF TEE CITY OF FAYET EVILLE, ARKANSAS: That the Mayor and City Clerk are hereby authorized and directed to execute a. lease with the Northwest Arkansas Resource Recovery Authority for the construction and operation of a solid waste disposal and resource recovery facility. A copy of the lease authorized for execution hereby is attached hereto marked Exhibit "A" and made a part hereof. PASSED AND APPROVED this g day of December APPROVED ATTEST Mayor 1986. 0 LEASE AGREEMENT This LEASE AGREEMENT executed this 22nd 1986, by and between the City ot Fayetteville, corporation organized and existing under the Arkansas, hereinafter reterred to as Lessor, and aay or 'December , Arkansas, a municipal laws ot the State or the Northwest Arkansas . Resource Recovery Authority, an authority organized and existing pursuant to the provisions of Act 699 of 1979, the Arkansas Joint County and Municipal Solid waste Disposal Act, hereinafter referred to as Lessee. In consideration of the mutual covenants contained herein, Lessor and Lessee hereby agree as follows: Section. 1. Demise, description, and use of premises. Lessor leases to Lessee, and Lessee leases trcm Lessor, those premises situated in the City or Fayetteville, County or wasnington, state or Arkansas, described in Exhibit "A" attached hereto and made a part hereor. As used herein, the term "premises" refers to the real property above described and to any improvements located thereon frau time to time during the term hereof. The premises are leased by Lessor to Lessee for the sole purpose of constructing and operating a solid waste disposal and resource recovery facility, including energy generating and trans- mission facilities and necessary appurtenances. Section 2. for twenty-seven on December 31, Term. The initial teen of this lease shall be (27) years commencing on January 1, 1987, and ending 2013, as 12:00 p.m. As used herein, the expression "term hereof" refers to the initial term and to any renewal thereof as hereinafter provided. Section 3. Fent. The total rent payable by Lessee to Lessor under this lease shall be $1.00 per year. T. Section 4. Warranties of Title and Quiet Possession. .:Lessor covenants that Lessor is (1).seized of the demised premises in tee supple or (2)has obtained an order or possession in an eminent domain proceeding before a court of competent jurisdiction, and has full right to make this lease and that Lessee shall have quiet and peaceful possession of the demised premises during the term hereof. _Section -5. Ccsbliance with Laws Luring the term of this lease, Lessee shall comply with all federal, state, end local laws and regulations aftecting the demised premises and the construction and operation of a solid waste disposal and resource recovery- facility. Lessee shall indemnify, defend, and hold Lessor harmless from and against any and all penalties, fines, or charges, howsoever designated, that may be levied by any federal, state, or local government agency having jurisdiction over said facility resulting from Lessee's failure to•comply with all applicable regulatory require- ments, subject to the following conditions: (i) Lessee may appeal, at Lessee's expense, any such .penalty, fine or charge to the appropriate agency or to the courts. Lessee shall have sole .and exclusive control over any such appeal; and -3 - (ii) Lessor shall refund to Lessee any penalties,. fines or charges for which Lessee has indemnified Lessor and that may subsequently be reduced or rescinded. Section 6. Abandonment of Premises. Lessee shall not vacate or abandon the premises at any time during the term hereof.. Section 7. Lessor's Right ot Entry. Lessee -shall permit Lessor and -the agents and employees ot Lessor to enter into any upon the demised premises at all reasonable times for:the purpose or inspecting the same.. .:Section 8. Encumbrance of Lessee's Leasehold Interest. .Lessee shall not encumber by mortgage or geed ot trust, or other =proper .instrument,. its leasenola interest and estate in the demised premises, tcgetrer with all buitaings aro improvements placed by Lessee thereon, as_ security_tor any.ineebtedness ot Lessee without the prior written consent of Lessor. ,Lessor hereby consents to Lessee encumbering . its :leasehold interest in the demised premises and all buildings and _improvements thereon to secure . bonds issued by Lessee to finance con- struction of a solid waste:disposal and resource recovery facility. Section. 9. Subletting and ?ssignment. Lessee shall not sublet the premises in whole or in part without Lessor's prior written consent, and the making of any such sublease snail not release Lessee from or otneraise artect in any manner, any ot Lessee's obligations nereuncer. Lessee shall not assign or transfer -4 - this lease, or any interest herein, without the prior written consent of Lessor, and a consent to an a consent to any subsequent assignment shall not be deemed to be assignment; provided, this Lease may be assigned to the Trustee for bonds issued by Lessee to finance construction of a solid waste disposal and resource recovery facility. 'Section 10. Notices. ,___ _ - - All notices required to be given or authorized to be given by any party pursuant to this agreement shall be in writing and shall be served personally or sent by certified mail, return receipt requested, to: Northwest Arkansas Resource Recovery Authority c/o Chairperson 113 W Mountain Street Fayetteville, AR 72701 City of Fayetteville, Arkansas c/o City Manager 113 W :Mountain Street Fayetteville, AR 72701 Union National Bark of Little Rock, Trustee c/o First Vice President and Trust Officer 3rd Floor, Union. National Bank ..::Little Rock, AR 72201 -_Section. 11. Taxes and Assessments tnc::As additional -rental hereurder, Lessee shall pay and discharge as they may become due, promptly and before delinquency,all taxes and assessments, whether general or special, which may become a lien or charge on or against the lard hereby demised, or any part thereof, or any building, or other improvementnow or hereafter located thereon; provided,:. if Lessee shall in good faith desire to contest the validity or amount of any such tax or assessment, Lessee shall be permitted to do'sorand-to defer-ravine^t-of-"such- tak dr assessment, the validity or amount of which Lessee is so contesting, until final determination of the contest. Lessee shall give Lessor written notice of such contest prior to the ccrrencement thereof, which shall be at least ninety (90) days prior to 'delinquency. On demand by Lessor, Lessee shall protect Lessor by a good and sufficient surety bond approved by Lessor against any such tax or assessment, and from any cost, liability, Or damage arising out of any such contest. Section 12. Condemnation. If, during the term of this agreement, all or substantially all of the solid waste disposal and resource recovery facility to be con- structed on the premises shall be taken by eminent domain, Lessee shall have the right to terminate this agreement. If substantially less than all of said facility shall be taken by eminent domain and if the award on such taking is in an amount which will fully recompense the Lessee for the cost of reconstructing the facility and if the facility can thereafter be operated without substantially increasing the operating cost thereof, Lessee shall not have the right to terminate this lease. If the award received by Lessee is less than the estimated cost of reconstructing the facility, or if the operating cost would thereafter be substantially higher, Lessee shall have the right to terminate this agreement within thirty days of the taking by eminent domain; provided, this Lease may only be terminated under this Section, or Sections 13 or 20, if Lessee provides the Trustee for Lessee's Bonds with sufficient funds to redeem all outstanding bonds under the Indenture and such bonds shall be defeased. The City hereby assigns to the Trustee for Lessee's bords all condemnation proceeds received by the City, which proceeds shall be used in accordance with the terms of the Trust Irdenture for Lessee's bonds. Section 13. Casualty. if, during Ehe term of this agreement, the solid waste disposal and resource recovery facility to be constructed on the premises is damaged by fire or other casualty and if the insurance proceeds received by Lessee are in an amount which will fully recoMpense Lessee for the cost of reconstructing the facility, and if the Facility can thereafter be operated without substantially increasing the operating cost thereof, Lessee shall not have the right to termi..ate this lease. If the insurance proceeds received by the operator of the facility are less than 75% of the estimated cost of -reconstructing the facility, on account of any changes in environmental laws frau the date hereof or any changes in building codes from the date hereof, or if the operating costs would thereafter be substantially higher on account of any such changes, Lessee shall have the right to terminate this agreement within thirty (30) days after insurance proceeds are received. The City hereby assigns to -the Trustee for Lessee's bards all insurance proceeds received by the -City for damage to or destruction of the facility; said proceeds shall be 'used dn accordance with the teti'o of the Trust ' I^denture for.Lessee's bonds. Section 14. Indemnification. Lessee shall indemnify Lessor from and against all liabilities, losses., damages (excluding special or consequential damages), costs, 'expenses and disbursements, including reasonable legal fees and expenses, imposed on, asserted against or incurred by Lessor as a result of the act, failure to act, or omissions of Lessee (or any sublessee or assignee) in any way relating to or arising out of the operation of the solid waste disposal and resource recovery facility to be located on the premises; :provided, the amount of indemnification shall be limited to the amount of liability insurance proceeds received by Lessee; provided further Lessee shall not be liable to Lessor for any loss resulting from the act or Failure to act or neglect of Lessor or Lessor's agents or employees. Section 15. Option to Renew. Lessor grants to Lessee the right and option to renew this lease for a period of five (5) years beginning on January 1, 2013, and expiring on December 31, 2019, subject to all of the terms and conditions herein contai'-ed. This option must be exercised by the giving to Lessor, on.or before January 1, 2014, a written notice of the exercise thereof by Lessee, but Lessee shall in`no event be entitled to renew the term hereof, even though such notice be timely given, unless Lessee shall have timely performed all of its obligations hereunder, and shall .not -be in default in the performance of any term hereof, on the date of the expiration of the initial term hereof. Section 16. Insurance. During the term of this lease, Lessee shall cause the following • insurance to be maintained in accordance with the laws of the State of Arkansas and with insurers acceptable to Lessor: (i) Luring construction of the solid waste disposal and resource recovery facility to be constructed on the premises, Lessee shall cause to be maintained All Risk Installation: Floater insurance for loss, damace or destruction to the Facility or Facility Site caused by the "all risks" perils subject to the policy at the replacement cost value with the agreed value provision.- The proceeds of such insurance to the extent they are intended to compensate for damages or loss to the Facility, shall be applied toward the repair and rebuilding of the Facility, unless the Authority and the Contractor shall otherwise agree in writing. (ii) -From the date on which the operator of the aforesaid facility commences commercial operation and notifies Lessee in writing that it is prepared to receive acceptable waste at the facility, •Lessee shall cause to be maintained broad All Risk Permanent- Property/Boiler and Machinery insurance for loss, damage - or -destruction.'to- the -Facility or Facility Site caused by the'"all risks" ---perils; subject to the policy Provisions, at the replacement cost value with the agreed value provision. The proceeds of such insurance to the extent they are intended to compensate for damages or loss to the Facility, shall be applied toward the repair and rebuilding of the Facility, unless the Authority and the Company shall•otherrise agree in writing Section 17. Utilities. Lessee shall arrange for, and shall fully and promptly pay for all water, gas, heat, light, power, telephone service and other public utilities of every kind furnished to the premises throughout the term hereof. Section 18. Liens. Lessee shall keep all of the premises, and every part thereof, and all building and other -improvements of any kind located thereon free and clear of any and all liens. Lessee shall at all ti. -nes promptly and fully pay and discharge any and all claims on which any lien may or could be based and shall indemnify Lessor against all such liens; provided, Lessee may contest any lien but shall notify Lessor in writing of its intention to do so within thirty (30) days after the Filing of such lien.. On demand by Lessor, Lessee protect Lessor by a good and sufficient surety bad against any such lien or any cost, liability, or damage arising out of such contest. Section 19. Notice of Default. Lessee shall not be deemed to be in default hereunder Lessor snail.:-tsrst give: to Lessee fifteen unless (15) days written notice of sucn aerault, and- Lessee -raiis to cure sucn aerauit wltnin such tifteen (15) day perioa, or,.ir, the aer:ault is of sucn a nature that it cannot be curea within fifteen (15) days, Lessee fails to commence to cure such default within such period of fifteen. (15) days or fails -9 - thereafter to proceed to cure any such default with all possible diligence. Section 20. Default. In the event of any breach of this lease by Lessee, Lessor, in addi- tion to the other rights or remedies it may have, shall have the immedi- ate right of re-entry and may remove all persons and property from the premises; such property may be removed and stored in a public warehouse .or elsewhere at the cost of, and for the account of Lessee. Should Lessor elect to re-enter, as herein provided, or should it take posses- sion pursuant to legal proceedings or pursuant to any notice provided for . by law,. Lessor may either terminate this lease (subject to compliance with Section 12 hereof) or it may from time to time, without terminating this. lease, re -let the demised premises or any part thereof for such term or terms (which may be for a term extending beyond the term of this lease) and at such rental or rentals and on such other terms and condi- tions as Lessor in the sole discretion of Lessor may deem advisable with the right to make alterations and repairs to the demised premises. On each such re -letting (a) Lessee shall be immediately liable to pay to Lessor, in addition to any indebtedness other than rent due hereunder the expenses ofi such re -lettering and of such alterations and repairs, incurred by Lessor, and the amount, if any, by which the rent reserved in this lease for the .period of such re -letting (up to but not beyond the term of this lease) exceeds the amount agreed to be paid as rent for the demised premises for such period on such re -letting; or (b) at • -10- the option of Lessor, rents received by such Lessor frau such re -letting shall be applied, first, to the payment of any indebtedness, other than ret due hereunder frau Lessee to Lessor; second, to the payment of any expenses of such re -letting and of such alternations and repairs; third, to the payment of rent due and unpaid hereunder, and the residue, if any, shall beheldby Lessor and applied in payment of Future rent as the same may became due and payable hereunder. If Lessee has been credited with any rent to be received by such re -letting under option. (a) hereof, and such rent shall not be promptly paid to Lessor by the new tenant, or if such rentals received from such re -letting under option (b) hereof during any month is less than that to be paid during that month by Lessee hereunder, Lessee shall pay any such deticiency to Lessor. Such deficiency shall be calculated and paid monthly. Nor such re-entry or taking possession of the demised premises by Lessor shall be construed as an election on the part of Lessor to terminate this lease unless a written notice of such intention is given to Lessee or unless the termination thereof is decreed by a court of competent jurisdiction. Notwithstanding any such re -letting without termination, Lessor may at any time thereafter elect to terminate this lease for such previous breach. Should Lessor at any tine terminate this lease for any breach, in addition to any other remedy it may have,. Lessor rray recover from L..scee all damages incurred by reason of such breach, including the cost of recovering the premises, and including the worth at the tire of such termi..ation of the excess, -11 - if any, of the amount of rent and charges equivalent to rent reserved in this lease for the remainder of the stated term over the then reasonable rental value of the premises for the remainder of the stated tern, all of which amounts shall be immediately due and payable from Lessee to Lessor. Section 21. Lessor's Right to Pertorm. In the event that Lessee by tailing or neglecting to do or perform any act or thing herein provicea by it to be done or pertormea, shall be in aerauit.-hereunaer ana such failure shall continue tor a period of fifteen (15) days after written notice from Lessor specifying the nature of the act or thing to be done or performed, then Lessor may, but shall not be required to, do or perform or cause to be done or performed such act or thing (entering on the demised premises for such purposes, if Lessor shall so elect), and Lessor shall not be or be held liable or in any way responsible for any loss, inconvenience, annoyance, or damage resulting to Lessee on account thereof, and Lessee shall repay to Lessor on demand the entire expense thereof, including campersation to the agents and employees of Lessor. Any act or thing done by Lessor pursuant to the provisions of this section shall not be or be construed as a waiver of any such default by Lessee, or as a waiver of any covenant, term, or condition herein contained or the performance thereof, or of any other right to remedy of Lessor, hereunder or otherwise. All amounts payable by Lessee to Lessor under any of the provisions of this lease, if not paid when the same become due -12 - as in this lease provided, shall bear interest from the date they become due until paid at the maximum rate allowed by law. Section. 22. Surrender of Lease. The voluntary or other surrender of this lease by Lessee, or a mutual cancellation thereof, shall not work a merger, and shall, at the option of Lessor, terminate all or any existing subleases or subtenancies, or may, at the option of Lessor, operate as an assignment to it of any -or all such subleases or subtenancies. Section 23. Disposition of Improvements on Termination of Lease. On termination of this lease for any cause, Lessor shall become the owner of the solid waste disposal and resource recovery facility to be located bn the premises and shall be the owner of any other -building or -improvements constructed on the premises; provided all bonds issued by Lessee have been redeemed or an amount sufficient to redeem all of Lessee's outstanding bonds has been deposited with the Trustee and such bonds have been defeased. Section 24. Waiver. The waiver by Lessor of, or the failure of Lessor to take action with tespect to any breach of any term, covenant, or condition herein contained shall not be deemed to be a waiver of such term, covenant, or condition, or subsequent breach of the same, or any other term, or condition therein contained. The subsequent acceptance covenant, of rent hereunder by Lessor shall no: be deemed to be a waiver of any preceding breach by Lessee of any term, covenants, or condition t. -13- of this lease, other than the failure of Lessee to pay the particular rental so accepted, regardless of Lessor's knowledge of such preceding breach at the time of acceptance of.such rent. IN WITNESS WHEREOF, this lease agreement has been executed on the date first above written. ATTEST: CITY OF FAYETTEVILLE, ARKANSAS LESSOR By Mayor NORTHWEST ARKANSAS RESOURCE RECOVERY AUTHORITY - LESSEE By: /// 0% Chairperson -14- EXH BTT "A" A part or the Southeast. quarter (SE i/4) ot the Northwest quarter (NW 1/4) ot Section Twenty-three (23), Township -Sixteen (16) North, Range Thirty (30) West, more particularly described as follows, to -wit: Beginning at a point which is 693.00 feet North of the Southwest corner of said forty (40) acre tract, and running, thence North 519.416 feet, thence East 416.00 feet, thence South 110.00 feet, thence East 244.00 feet, thence South 409.416 feet, thence West 660.00_feet to the point of beginning, containing 7.25 acres, more or less, less and except that portion on the West side thereof embraced in State Highway No. 16.