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New Building Construction ... LICENSE AGREEMENT This License Agreement is entered into this 10th day of June, 2004, by and between the CITY OF SALINA, KANSAS (the "City"); and HOFF'S MACHINE and WELDING CORPORATION, INC., a Kansas corporation, ("Hoffs, Inc."). Recitals A. Hoffs, Inc. has sold to the City pursuant to a Contract of Sale of Real Estate (the "Contract") dated May 28, 2004, the Saline County, Kansas, real estate legally described on the attached and incorporated Exhibit A, together with all appurtenances, permanent improvements and fixtures (the "Property"). B. While closing on the sale of the Property by Hoff s, Inc. to the City has closed this 10th day of June, 2004, Hoffs, Inc. desires to remain in possession of the Property and the City agrees to allow Hoff s, Inc. to remain in possession of the property strictly for the purposes and under the conditions set forth in this License Agreement. THE PARTIES THEREFORE AGREE: 1. Grant of License. On the condition that Hoff s, Inc. shall diligently pursue construction of its new building on East North Street (the "New Building") on a schedule and in a manner that will allow for issuance of an occupancy permit by the City on or before December 31, 2004, the City grants a license to Hoff s, Inc. permitting it to continue to occupy the Property until December 31, 2004, exclusively for the purposes of diligently completing the transition of its business operations to the New Building and removing from the Property those items listed on Exhibit A to the Contract (the "License"). Under no circumstances shall Hoffs, Inc. occupy any portion of the Property after December 31, 2004. 2. Term of License. The License shall commence upon execution of this License Agreement and shall continue until the earlier of: A. Expiration of the License as set forth in Paragraph 1 above; or B. Notification of the City by Hoffs, Inc. that it has vacated the Property and that the items listed on Exhibit A to the Contract have been removed from the Property. 3. Indemnification and Hold Harmless. Hoffs, Inc. shall indemnify and hold the City and its current and former elected officials, agents, and employees harmless from all claims, liability, loss, damage, expense, or judgment, including attorneys' fees so incurred, arising from its continued occupancy pursuant to the License (the "Indemnification"). Hoffs, Inc. shall maintain in effect commercial general liability coverage of no less than $500,000 on a per occurrence basis, which includes coverage extending to the Indemnification, and shall provide the City with ongoing written proof of such coverage. Hoff s, Inc. agrees to defend against all .. claims brought or actions filed against the City with respect to its occupancy of or access to the Property pursuant to the License, whether such claims are rightfully or wrongfully brought or filed. The City agrees that Hoff s, Inc. may employ attorneys of its own selection to appear and defend the claim or action on behalf of the City, at the sole expense of Hoffs, Inc. Hoffs, Inc. shall have control of the defense in any such lawsuit and negotiations relating to its settlement. The City shall assist Hoff s, Inc. as reasonably requested by Hoff s, Inc. regarding such lawsuit. Hoff s, Inc. agrees to reimburse the City for all expenses, costs, and attorneys' fees incurred by the City in the enforcement of any part of Hoff s, Inc.' s agreement to indemnify the City. 6. Assignment of License. The assignment of any rights under this License Agreement by Hoffs, Inc. shall be subject to the prior written consent of the City. 7. Binding Effect. This License Agreement shall be binding upon the parties, their successors and authorized assigns. Executed the day and year first above written. CITY OF SALINA, KANSAS BY:~~ Dennis M. Kissinger, i HOFF'S MACHINE and WELDING CORPORATION, INC. By: /~ /?;;?r Henry ~eSf¡ ent ' -2- .. , Appendix A - Legal Description LOT FOUR (4) IN EAST GARDENS, A SUBDIVISION OF THE CITY OF SALINA, SALINE COUNTY, KANSAS, EXCEPT THAT PORTION THEREOF CONDEMNED BY THE CITY OF SALINA, KANSAS AND ALSO EXCEPT THE WEST TWO (2') FEET THEREOF AND ALSO A PORTION OF LOT THREE (3), EAST GARDENS ADDITION, IN THE CITY OF SALINA, KANSAS; MORE FULLY DESCRIBED AS FOLLOWS: BEGINNIN GONE THOUSAND ONE HUNDRED SIXTY-SIX AND TWENTY HUNDREDTHS (1166.20') FEET NORTH AND FORTY-TWO AND THIRTEEN HUNDREDTHS (42.13') FEET WEST-SOUTH-WEST OF THE SOUTHEAST CORNER OF THE NORTHEAST QUARTER, SECTION TWELVE (12), TOWNSHIP FOURTEEN (14) SOUTH, RANGE THREE (3) WEST, IN SALINE COUNTY, KANSAS, SAID POINT OF BEGINNING BEGIN AT THE INTERSECTION OF THE WEST LINE OF OHIO STREET AND THE NORTH LINE OF LOT FOUR (4), EAST GARDENS ADDITION IN SALINA, KANSAS; THENCE NORTH SEVEN (7') FEET TO A POINT ON THE WEST LINE OF OHIO STREET; THENCE WEST TWO HUNDRED NINETY-TWO AND THIRTY HUNDREDTHS (292.30') FEET; THENCE SOUTH ONE HUNDRED THREE AND SIXTY-SEVEN HUNDREDTHS (103.67') FEET THENCE NORTHEASTERLY ALONG THE NORTH LINE OF LOT FOUR (4), EAST GARDENS ADDITION, THREE HUNDRED SEVEN AND EIGHTY-SEVEN (307.87') FEET TO THE POINT OF BEGINNING. SAID PORTION OF LOT THREE (3) CAN ALSO BE DESCRIBED AS FOLLOWS: BEGINNING AT THE SOUTHEAST CORNER OF SAID LOT THREE (3), SAID POINT OF BEGINNING ALSO BEING THE NORTHEAST CORNER OF SAID LOT FOUR (4), ALL IN EAST GARDENS ADDITION TO THE CITY OF SALINA; THENCE NORTH ALONG THE EAST LINE OF SAID LOT THREE (3) AND THE WEST LINE OF OHIO STREET, A DISTANCE OF SEVEN (7') FEET; THENCE WEST TWO HUNDRED NINETY-TWO AND THIRTY HUNDREDTHS (292.30') FEET; THENCE SOUTH ONE HUNDRED THREE AND SIXTY-SEVEN (103.67') FEET TO THE SOUTH LINE OF SAID LOT THREE (3), ALSO BEING THE NORTH LINE OF SAID LOT FOUR (4), THENCE NORTHEASTERLY ALONG SAID SOUTH LINE OF SAID LOT THREE (3) A DIST ANCE OF THREE HUNDRED SEVEN AND EIGHTY-SEVEN HUNDREDTHS (307.87') FEET TO THE POINT OF BEGINNING. TOGETHER WITH ALL APPURTENANCES AND RIGHTS OF GRANTORS IN AND TO THE REAL ESTATE, INCLUDING ALL RIGHT, TITLE, AND INTEREST OF GRANTORS IN THE LAND UNDERLYING ANY DEDICATED ROADWAY EASEMENTS OR RIGHT -OF - WAY.