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Agricultural Lease Agreement for Tracts 1-4 AGRICULTURAL LEASE AGREEMENT for TRACTS 1, 2, 3 & 4 • This Agricultural Lease Agreement ("Agreement") is entered into August 1, 2019, by and between the City of Salina, Kansas, (the "City-) and Mattison and Son Farms, LLC, a Kansas Limited Liability Corporation (the "Lessee"). The City, in consideration of the rents, covenants, and agreements of Lessee herein set forth does hereby grant, lease and rent to Lessee the following described and depicted real estate; See attached "Exhibit A" for Legal Descriptions; See attached "Exhibit B" for Map; Together with appurtenances thereunto belonging, all of which are referred to herein as the "Premises". WHEREAS, the Lessee desires to lease for farming purposes the Premises, and City is willing to grant said lease; NOW, THEREFORE, City and Lessee agree as follows: 1. Term of Lease. The term of this Agreement shall be for a period of approximately three and one half(3.5) years, which shall commence on the 1" day of August, 2019, and shall expire, subject to the potential for prior termination pursuant to the terms of this Agreement, on February 28, 2023, or as soon thereafter as the crops planted as of February 28, 2023 have been harvested (excludes harvesting by grazing), but in no event later than August 1, 2023. 2. City's Right of Early Termination. The City reserves the right to terminate this Agreement at any time, with respect to all or any portion of the Premises, upon a determination by the City Commission of the City of Salina, that the Premises will be used other than for agricultural purposes. If such a determination is made by the City Commission, written notice shall be delivered to the Lessee describing specifically the portion of the Premises affected by said termination notice. Lessee agrees to surrender possession of the Premises, or the identified portion of said Premises subject to termination, no later than the last day identified in said termination notice or following harvest of any crop planted in the Premises or the portion thereof subject to the termination notice, whichever event last occurs. 3. Rental. (a) Lessee agrees to pay the City as rental for the Premises a cash rental which shall be equal to 51.2% of the amount received by Lessee from the sale of all crops raised on the Premises during the each lease year and 51.2% of all government payments and crop insurance proceeds received by Lessee which are applicable to the Premises, less 51.2% of the cost of purchasing any fertilizer, herbicides and crop insurance premiums in connection with the production of said crops. (b) In addition to the cash rental stated above, Lessee agrees to furnish, at Lessee's sole cost arid expense: i. All material, labor, and equipment to properly apply all necessary fertilizer and herbicides in the treatment of noxious weeds on the Premises; ii. All seed to be used on the Premises, and all labor and equipment to plant, raise, cultivate, and thresh all crops grown on the Premises; and (c) The cash rentals provided for herein shall be due and payable on or before year end of each lease year; provided, however, that in the event that the crops grown on the Premises during said lease year have not been sold or in the event the government payments or crop insurance proceeds applicable thereto have not been received by year end, then in that event the additional amounts due hereunder shall be payable on or before the 10th day of the month following the month in which the crops are sold and/or the government payments or crop insurance proceeds received. (d) The City shall have the right to examine, or cause to be examined, the books and records of the Lessee for the purpose of determining whether there has been compliance with the requirements of this paragraph. 4. Possession: Lessee shall be entitled to possession of the Premises commencing on August 1, 2019, subject to the right of the City's existing lessee to harvest any crops that are growing as of August 1, 2019, and may remain in said possession thereafter for and during the term of this Agreement. 5. Right to Re-enter Premises and Surrender of Possession. The parties agree that upon termination of this Agreement for any reason, Lessee shall peaceably and quietly surrender and deliver possession of the Premises to the City. If Lessee fails to perform any provision of this Agreement within ten (10) days after receipt of written notice from the City to cure such default, or in the event Lessee abandons the Premises before the end of the term of the Agreement, or in the event Lessee is adjudged bankrupt or insolvent or makes an assignment for the benefit of creditors or commits any act of bankruptcy, the City shall have the right to pursue any remedy at law or in equity available to it under the laws of the State of Kansas, including without limitation terminating this Agreement and taking possession of the Premises without additional demand or notice and without any court order or other process of law. 6. Liability of City. _: - • • - • : e': - .- .- , ---. 2 . . area and Lcsscc assumes such risk of loss. 7. Easement: City (or its agent) retains the right to enter upon the Premises, while making reasonable efforts to limit damage to crops: (a) To perform any and all necessary maintenance in connection with its utility lines (water, sewerage, gas) located thereon; or to install any new lines which may be necessary; (b) To remove, replace, salvage or modify such existing utility lines and appurtenances; (e) To maintain the access road to the oil well location, and emergency weather siren. 8. Compliance with Law. Lessee shall comply with all applicable laws, ordinances and regulations of the State of Kansas, Saline County, and the City of Salina. 9. Ouiet Enjoyment. City warrants that Lessee shall be granted peaceful and quiet enjoyment of the demised Premises free from any eviction or any interference by City if Lessee pays the rent and other charges provided herein and otherwise fully and punctually performs the terms and conditions imposed on Lessee. 10. Care and Use of Premises; No Sublease by Lessee. Lessee covenants to farm and care for the Premises in a good and workmanlike manner and in accordance with good farming and soil conservation practices. Lessee shall not change the current use of the Premises, e.g., going from tilled acreage to pasture, without the advance rewritten approval from the City. Lessee shall not commit or permit waste thereon by virtue of failure to properly protect the Premises from wind or water erosion. Further, without the prior written consent of the City, Lessee shall not have the right to sublet the Premises or any part thereof, and no assignment shall be allowed without written consent of the City. 11. Hunting. Lessee shall not permit any person to hunt upon the Premises. 12. Nuisance. Lessee shall not during the term hereof maintain, commit or permit the maintenance or commission of any nuisance on the Premises. 3 13. Inspection. Lessee has inspected the Premises and accepts them in their present and existing condition. 14. Government and Agricultural Programs. Lessee agrees to comply with all farm crop programs promulgated by the United States Department of Agriculture. City agrees that it will cooperate with Lessee in abiding by all terms and conditions of any governmental agricultural programs which are now in effect or which may be applicable during the term of this Agreement. All benefits of all farm programs pertaining to the Premises during the term of this Agreement, including but not limited to programs administered by the Farm Service Agency, which include the Load Deficiency Payment Program, the Production Flexibility Contract, and the Market Loss Assistance Program, shall be payable to Lessee, to be divided and distributed as provided in paragraph 3 of this Agreement. 15. Insurance. Lessee agrees to procure and maintain commercial general liability insurance covering its use and operations of the Premises which policy shall name City as an additional insured thereunder, with limits of not less than $500,000.00 for claims of bodily injury, death, property damage, and personal injury which could be asserted against any one or more of such parties for any number of claims arising out of a single occurrence or accident on the Premises. The Lessee shall provide the City with proof of such insurance. 16. Taxes and Liens: City agrees to pay any real estate taxes and assessment which may be levied against the Premises during the tenn of this Agreement. City shall pay when due all fees, assessments charges, and taxes of any kind that may now or hereafter be imposed upon ownership, leasing, renting, possession, or use of the Premises, excluding, however, all taxes on or measured by Lessee's income. When the Premises are in Lessee's permission, Lessee shall keep it free and clear of all levies, liens, and encumbrances, other than those being contested which do not adversely threaten the City's title to the Premises. 17. Liability of City: Lessee shall be in exclusive control and possession of the Premises and the City shall not be liable for any injury or damage to any property or to any person on or about the Premises or for any injury or damage to any property of Lessee or any other person. 18. Indemnification. Lessee shall hold harmless and indemnify the City against all liability, loss, damage, expense, and judgment relating to Lessee's use of the Premises, including but not limited to any damage, neglect, or misadventure arising from or in any way growing out of the use, misuse, or abuse of the Premises, or any failure of Lessee to comply with the terms of this Agreement. Each party agrees that it shall give the other prompt notice of the assertion of any such claim or the institution of any such action, suit or proceeding. 19. Expenses by City or Lessee. If either party is in default of this Agreement, the defaulting party shall pay all costs and expenses incurred by the non-defaulting party in exercising any of its rights or remedies hereunder or enforcing any of the terms, conditions or provision of this Agreement. 4 20. Ownership. The Premises are, and shall at all times, be and remain, the sole and exclusive property of the City. Lessee shall have no right, title or interest in the Premises except as expressly set forth in this Agreement. 21. Partnership. It is expressly agreed that this Agreement is one of lease and not of partnership, and that the City shall not become responsible for any debts contracted by Lessee. 22. Improvements. Lessee shall not make any alternations or additions to the Premises unless otherwise approved in writing by the City in advance of the proposed alteration or addition. 23. Merger Clause. The parties intend these terms to be a complete, conclusive and final expression of all the conditions of their agreement. No other promises, statements, warranties, agreements or understandings, oral or written, made before or at the signing thereof, shall be binding unless in writing and signed by all parties and attached hereto. Any amendment to this Agreement, including an oral modification supported by new consideration, must be reduced to writing and signed by both parties before it will be effective. 24. Paragraph Headings. The title to the paragraphs of the Agreement are solely for the convenience of the parties and shall not be used to explain, modify, simplify, or aid in the interpretation of this Agreement. 25. Binding Effect. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, personal representatives, successors and authorized assigns and may be executed in any number of counterparts, each of which shall be deemed an original, or in multiple originals, and all such counterparts or originals shall for all purposes constitute one Agreement. 26. Severability and Waiver. No waiver by either party of any default hereunder shall operate as a waiver of any other default. If a court of competent jurisdiction determines any provision of the Agreement to be contrary to law, the remaining provisions of this Agreement shall remain in full force and effect. 27. Notice. Service of all notices under this Agreement shall be sufficient if given personally or mailed by certified mail, return receipt requested, to the party involved or at its respective address stated below, or at such address as such party may provide in writing from time to time. Any such notice mailed to such address shall be effective when deposited in the United States mail, duly addressed, and with postage prepaid, to the party to be notified at the address set forth as follows: CITY: City of Salina Attn: Mike Schrage, City Manager 300 W. Ash St., P.O. Box 736 • Salina, KS 67402-0736 5 LESSEE: Mattison and Son Farms, LLC 900 N Simpson Salina, KS 67401 28. Governing Law. This Agreement shall be governed by the laws of the State of Kansas. This Agreement shall be interpreted according to its fair meaning, and not in favor or of against any party. IN WITNESS WHEREOF, the parties have hereunto set their hands the day and year herein stated. CITY OF SALINA, KANSAS MATTISON AND SON FARMS, LLC By. ` / By: - ' , M' hael r chrage, City Manager 0 ,nALD Y, a/nd e) Co , 0 W 7 i'c (title) Attest: 44a.i1di tudth Shandi Wicks, CMC, City Clerk • Form: ;1f I ;,Vi -g.- Co" 6 EXHIBIT A LEGAL DESCRIPTIONS Min=A I. A fire the oia interest n t:Unci of land in la bidet bind 1:1/44:1; >-:.5:i inf!toib p z.(O,catfia.O;dni in the olfios of the RscidWutDeadt of Sauce O7.Inty,JS"no-or en April 1,i%4,in I3uuiA-5 of Plata atPago 36,lying Strath and Wal of Use City of Std(nn Plood Control tight of wz.y,ritaata itt the Root Mt(S02)of the Southeast(1uuta(SW4)of Section Six(6),Turemsbip Tally=(I 4) Sash‘Rage Two(2.)West of the 6t 1321£.in Rano Cat*,Zemn,End Met pxtfeltltaiY daatibad w fa8lotn: Beginning t gin Sotgkt*1%taaref slid Southeast Qaatta; tat lieu afy' the Basfllna of said SoaOssas!Quetta,as wi tanned bas:ar g aftl OnS'Ol"W,eluate th61897.59 fad; Maya S6744'3g"W,oftgtheta &line ofDad Mood Wottoltight ohm Ulm wditnoonof 25S.2afeet; ;luta K 24'24'2?"V7,tlntg add tight of way tae,a dh4eaac of 395.111 feet to aptly/on the aadtitost.oe.r yffaioaPrc6alrs:teoaddgl<ofvery tn=; nitaztFmot,2,8,e_ty' ",W,fat,o;/Aid i +t of la*stdrklnoeufti2.Uft4 7ferue St:rlltAa.0ahem a 65e.t6dtatt mina antldaagted.==you)the tiali tx nun 1E2011 o: 827,52 fed no5lmwia o cttri which bar S Wine B +.&amu of?7431 fel: nal=Sab2AtS"tt,aMate:ten51far.;, Thre.gt,gtfl'4 V W,/distract:of123Mftr€losJzztatra$aottIiacof'tti4Ccairatr,•;x-rte; Thou=N s9' l4"E,uta ueid Saat%tisk u edema a!75323 fax to the POINT OP BL1Qt!`N331G. Said gnat muteins 19,87twro,Mart or loos,fadading stealing.toadttght of sasy. AND 2. A Sot timftta ittatet fa tTtst afloat In[aeenaduzrisi Vast,teaotdteg tothaplat thawfraoosded lathe date oftlm Bagidar olDeods of Solite Courtly,Kama,on April 1,1964,is SockA-3of PittsatPogo$4lyi g Seta=Meet dale C4z'ofgaahtaPb dMeatalright away,dusted in Ota South Eelf(S12)of the Sautuad Qarte r(SE/4)of Sectoa Six(6);Were*Pc+tttteo(i 4) South,Range Two(2)West of lb*6t Pit in Selina County,Kenna rad mom Ply demabed as fbifascst el this South=moor&eai9 Son hast(beaten TboxrailerlisatfysionglSEastfintetfsaidt t @titer,or on wonted bating ufN OO,15•01"W,a til tater or K97.59 flag Matto B 8744"59"W,along the Sate lige ofcaid flood Coated right of way llu,a dinned of 114.23`W,tions etdd right of linty Jure,a dtataaxt of 3055 i feet to repo l on the Salim aaatbarlythntar Ps18oBiiboad xfat1 of wry lima Thmao t 68'20'38"W,along told right of mynas,a diaurae of 1112733 Stet; 00.i atilt W.am*aid light ofday lino,adistant of9041 fes touts Polio at Beginalso nitres N 00"13'48"W,along axlddgld of tray lint,is distance of Z?-56 foe.; Theses S 68120'718"W,tame satd ght of wayUm,a ifatstaa of 64.07 Po* 'lhtctan Soot easterly abatge 653.E 6toot ratios mtntattfem curve to fbt 413,twat length of $9.81 fact alai having a chord witfah batut s 6615`04"C a atom=of 59.79 fist to tttr POihlf OPBEON MBIG: Said mug cordeins 0.02 aces,(794 seputtee(l,Mare or lea. • The East WI Rot of The Lee !ndordr;aI Park,according to the flu thsrnct recorded In the Office of the Register at Deeds of Saline County, Kansas, on April 5, 1%4, in Book MI of Plaits al Pttgo 3C, lying In the Northeast Quetta(ifE'47 and the Eat Half (E;t,) of rho•Nntthweut Qoattar iSW ii)at Section Simon(7),Township Fourteen;14) Lauth, Rw!ge TWO (2) West of the t PM,.,in Sainte County, Itmasee, which treat ht trnrre f>hrticutarly derailed as follows: Beginhing at +a mane found at the N % isomer of mad Sateen 1; thane* westerly elong.i lit north dee of the NW*4 of said S*Ltton eilletantw of 210.11est to a point on the. cast line of the hilrcourt Pacific Railroad rigithof•Way: filches rtohlwrestody along the east RAY line of Ilia Miasmal Pzic;flo Rnilrbttd, a distance of 348.0 fret; thence southerly along the met RAN line ni the Missouri ?Silo Reitroad u dlsfar.� of 1,t'82 2 ferd'ia t.point on the eolith litre,(Witt WE it of the IM'ci said tinction 7; thence westerly along the r of h arm o';(fir:.l4?%of the NW',t of tad Stxiiian 7:, distenoa of aa.*feet;thence seullieety along the cues P1W tin,of the tido.raid Pude Railroad a distimes of 14,e tom to a point on the rant;of the north ItM Hoe of the main Ilno of lite Missouri erudite Refiroud; thanes ntutttoettody Song the aro of h curve, baring u rrdlu: of g,S1d.94 lett, time raa igloo. the !melte Path? nue nt the itissouri,r'mule Railroad mole'lima rtthatattu^of 18tt:01aid;Thence eostrrfy along ileo hnr$)12i1'J floe of 1110 Miesn art}'otitic Raikofai mein Ileo n distance of 2;Ei7',S root to a point on the caul lino of the NE%at cold Stratton-+;thence nodhetly along the test tine of the 111)i of Section 7 a diatnrtca+of 4,344.80 feat more ni less to the northeast earner of Wel 9eatlon 7;thence westerly along the north line of meld Suction.)to the point of beginning; %NCLUDiNG OWL? THE EAST 830 FEET THEREOF; Laid tract containing:Mf7*ores more or less. Babied to reeQIvation of all mineral rights In and under the above deecrtbe reel estate by Dental 4`.King and Nanny L.Ring,husband and wife,thole belts,t xsctrters, and assigns,anti the right to enter said real mon v for the ptnpose of extreotion of cit oil, gee and *that MInbedi, on, In, and under.said read estate as eat forth In Corroothc Gu* Claire tios4 from Banlof C. fling et at, to Eattridge Devctopttent, Mo.,dated January 1, 1991,end recorded to Deed Book$0,at pages 48'49 and aft existing roll4and eacetncnia artdfar dgfg-ofuvay. NO!OE: Set attached aerial drawing loading the *have loosed ground. (Lcesad ground Is referred to as Tracts t,2,end a,respectively) Alt leased"Mind,Inobadlog tracts 1 through 3 above, to eubject to existing rall•raad easements endkr rightoi- way. "EXHIBIT A" All that part of The Lee Industrial Park, according to the plat thereof recorded in the office of the Register of Deeds of Saline County, Kansas, on April 1, 1984, in Book A-3 of Plats at Page 38, lying In the Northeast Quarter (NE '!) and the East Half (E %) of the Northwest Quarter (NW %) of Section Seven (7), Township Fourteen (14) South, Range Two (2) West of the 6th P.M., in Saline County, Kansas, except the East 630 feet thereof,which tract is more particularly described as follows: Beginning at a stone found at the 14 % corner of said Section 7; thence westerly along the north line of the NW Y, of said Section a distance of 210.9 feet to a point on the east line of the Missouri Pacific Railroad right-of-way; thence southwesterly along the east RAW line of the Missouri Pacific Railroad, a distance of 315.0 feet; thence southerly along the east RAN line of the Missouri Pacific Railroad a distance of 1,022.32 feet to a point on the south line of the NE '/4 of the tvW Y of said Section 7; thence westerly along the south line of the NE % of the NW % of said Section 7 a distance of 33.0 feet; thence southerly along the Baal RAN tine of the Missouri Pacific Railroad a distance of 74.4 feet to a point on the curve of the north RAM line of the main line of the Missouri Pacific Railroad; thence northeasterly along the arc of a curve having a radius of 2,914.93 feet, said arc being the north RAN line of the Missouri Pacific Railroad main line a distance of 289.0 feat; thence easterly along the [Drat RAM line of the Missouri Pacific Railroad main line a distance of 2,677.8 feet to a point on the east line of the NE Y.of said Section 7; thence northerly along the east line of the NE Y of Section 7 a distance of 1,348.66 feat more or less to the northeast corner of said Section 7; thence westerly along the north line of said Section 7 to the point of beginning; except the East 830 feet thereof; said tract containing 84.5 acres more or less. Subject to reservation of all mineral rights in and under the above described real estate by Daniel C. King and Nancy L. King, husband and wife, their heirs, executors, and assigns, and the right to enter said real estate for the purpose of extraction of all oil, gas and other minerals, on, in, and under said real estate as set forth in Corrective Quit Claim Deed from Daniel C. King et al., to Eastridge Development, Inc., dated January 1, 1997, and recorded in Deed Book 380, at pages 48-49. NOTE: See attached aerial drawing locating the above leased ground. (Leased ground is referred to as Tract 17) EXHIBIT B MAP ? xts+.r�+ Sr t '4` • .;ts 4 � r , - If _ -a s, i m _ 1, 1!: Lt qtq„ _ , •• .,, \ 7• .rxs . r .� Y '4 \ _ G F V`"Sr' 4f �+4 y _ ' g..yr .,, ' ;.} Yl •L 4� 4 O • Jr k S ii 4lity, 1 t s • tom ' -3 citil 4,s.t� .mr� igt'I-# .a.e5 " • '' 4t}1 ' \` sjf�r�'t V.: . ' _— _27 t � G-` irk. 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"t 4a1 a` _ .i ,— - - -Marymount Rd • Jun. 24. 2019 10: 29AM FARM BUREAU — BELMONT OFFICE No. 6131 P. 1/1 • S FARM BUREAU • MS. FINANCIAL SERVICES FARM BUREAU MEMBER'S CHOICE PERSONAL PACKAGE POLICY LIABILITY INSURANCE CERTIFICATE POLICY#: 0000000007398896 CERTIFICATE ISSUED TO: FIRST NAMED INSURED: CITY OF SALINA RISK MANAGEMENT DEPARTMENT DONALD MATTISON P. 0. BOX 736 900 NORTH SIMPSON RD SAUNA, KS 674020736 SALINA, KS 674010000 EFFECTIVE DATE: 10-26-201B EXPIRATION DATE: 10-26-2019 INSURANCE COVERAGES ❑ Personal Vehicle Liability • © Farm/Ranch Employer Liability ❑ Personal Liability ❑ Business Liability" • ❑ Personal Injury Liability ❑ Umbrella Liability ❑X Farm/Ranch and Personal Liability'•• This certificate certifies liability insurance is afforded as shown above. It is issued as a matter of information only and does not amend, alter or extend any of the coverages in the Farm Bureau Member's Choice Personal Package Policy. COVERAGE LIMIT FARM/RANCH AND PERSONAL LIABILITY Bodily Injury/Property Damage $500,000 Each Occurrence S1,000,000 Aggregate Limit ' Personal Vehicle includes any of the following: An auto of the private passenger type designed solely to cony persons and their luggage. An auto of the pickup, panel truck, van or motorhomc type not customarily used in any luminaire or occupation other then farming or ranching for: delivery of products or supplies; carrying of tools or equipment hauling for hire; office, store or display purposes. An auto of the truck or truck tractor type owned by a farmer or rancher and used exclusively in connection with their farming or ranching operation, for exchange purposes with neighbors or for personal pleasure. A motorcycle or recreational motor vehicle. A snowmobile or a watercraft. For a certificate issued to a lessor for the above described vehicle,the lessor Is also named as en additional insured for legal ' liability,but only with respect to the ownership,maintenance or use of the vehicle. • Business Liability includes bodily injury,property damage and personal in uryladvertising injury. "• For certificates issued to lessors or lienholders of equipment under Farm/Ranch end Personal Liability, -insured"includes the 'personlsl" or orgartaetionlsl to whom this certificate is issued, but only with respect to their liability 'caused by" the maintenance,operation or use by the Insured'of equipment leased by them to the 'Insured'. Coverage with respect to said 'person'or organization does not apply to: — Any'occurrence'that takes place after the equipment lease expires; . — Any'damages' arising out of the negligence of the additional insured;or ' — 'Bodily Injury'to any employee of said'person' or organization arising out of and In the course of their employment by said'parson'or organization. • 5400 thaveaSny MENUS•Warr LEc Mooers,IOWA 50266-5997•515.225.5400•www.fbfs.com rem new Lae hennas Oscar I rem Onto Fropmy it Cordy baa Cmgany'I Waw sfeemiel Meiners Camay I'Comm rest a Fa amen FioadL Ser'ico PKKS.NF002.1017 Ubt-- cS- 1eIagI/