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Lease Agreement 2004-2007 LEASE AGREEMENT THIS LEASE AGREEMENT made and entered into this ~ay of September, 2004, by and between CITY OF SALINA, KANSAS, a municipal corporation, hereinafter referred to as "City", and EASTRIDGE DEVELOPMENT, INC., a Kansas corporation, hereinafter referred to as "Lessee". RECITALS WHEREAS, City is the current fee title holder of the following described real estate, to-wit: See Attached "Exhibit A"; together with appurtenances thereunto belonging, said real estate hereinafter referred to as the "Premises"; WHEREAS, 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. Lease and Term. In consideration of the rentals to be paid by Lessee and the terms, covenants and conditions of this Agreement to be kept and performed by Lessee, City hereby leases, demises and lets to Lessee the real property described in "Exhibit A" attached hereto and incorporated herein by reference. The term of this Agreement shall commence on October 1, 2004, or immediately following harvest of the existing soybean crop, whichever event last occurs, and shall continue until November 1, 2007, subject to earlier termination as specified in paragraph 7 hereof. 2. Rental. As rental for the Premises Lessee agrees to pay to City the annual sum of $2,580.00 (calculated by multiplying $40.00 per acre times the number of acres constituting the Premises). Rental shall be due and payable to City from Lessee on November 1 of each year commencing November 1, 2005. 3. Fertilizer and Weed Control. In addition to the rental stated in paragraph 2 hereof Lessee agrees to furnish all material, labor and equipment to properly apply all necessary fertilizer and weed eradicator in the treatment of noxious weeds on the Premises, all at Lessee's sole cost and expense. 4. Cultivation. Lessee shall cultivate the Premises in a good é;¡nd workman- like manner in accordance with the best methods of cultivation practiced in Saline County, Kansas, and further agrees to not allow waste upon the Premises by virtue of failure to properly protect the Premises from wind or water erosion. 5. Governmental Aqricultural Proqrams. 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. City further agrees that Lessee shall receive 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 Loan Deficiency Payment Program, the Production Flexibility Contract, and the Market Loss Assistance Program. 6. Possession. Lessee shall be entitled to possession of the Premises immediately following execution of this Agreement and may remain in said possession for and during the term of this Agreement. 2 7. Early Termination. City reserves the right to terminate this Agreement on all or any portion of the Premises from the terms of this Agreement by delivery to Lessee of 90 days prior written notice of its intention to do so, 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. 8. Riqht of Entry. City reserves the right to enter the Premises as reasonable and proper times for the purpose of inspecting the Premises or for the purpose of installation or maintenance of utilities. 9. Surrender of Possession. Lessee shall on the last day of the term of this Agreement, or any permitted extension or renewal thereof, or upon earlier termination and forfeiture of the Agreement, peaceably and quietly surrender anal deliver the Premises to the City, free of all permitted subtenancies. 10. Taxes. City agrees to pay all real estate taxes and assessments which may be levied against the Premises during the term of this Agreement. 11. Seed, Labor, Machinery and Chemicals. Lessee shall furnish at Lessee's sole expense all seed to be used on the Premises, all labor, machinery and chemicals during the term of this Agreement, and shall plant, raise, cultivate and thresh all crops grown on the Premises at Lessee's own expense. 3 12. Partnership. It is expressly agreed that this Agreement is one of lease and not of partnership, and that City shall not become responsible for any debts contracted by Lessee. 13. Liability Insurance. Lessee agrees to secure and maintain at Lessee's sole expense In full force and effect until the completion of this Agreement such liability insurance for Lessee's operations which may arise from the conditions of this Agreement. Such insurance shall be written by a reliable insurance company authorized to do business within the State of Kansas in such amount as the City and Lessee shall subsequently agree. Upon request Lessee shall deliver to the City a certificate of such Insurance. 14. Waiver. Waiver by the City of any breach of this Agreement shall not be construed as a continuing waiver of any subsequent breach nor imply further indulgence. 15. Breach of Lease. In the event Lessee shall fail to comply with any substantial term, condition or covenant of this Agreement following 10 days written notice of 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 and assignment for the benefit of creditors or commits any act of bankruptcy, any of such events shall be deemed an immediate breach and forfeiture of this Agreement and all unpaid installments of rent and other expenses herein provided for shall immediately become due and payable. 16. Liens. Lessee shall pay, satisfy and discharge all liens and obligations of any nature and kind whatsoever created by Lessee which shall attach to or be imposed 4 upon the Premises and shall indemnify, save and hold harmless City from payment for such damages and expenses intended thereto. 17. Assiqnment. Lessee shall not assign this Agreement or any interest thereunder, nor shall Lessee sublet the Premises or any part thereof, without the prior written consent of the City. 18. Notices. All notices to be given pursuant to this Agreement shall be in writing. Except as otherwise specifically provided herein, each notice shall be either hand delivered or sent by United States mail, certified, postage prepaid, to the party to be notified at the address set forth as follows: "CITY" "LESSEE" City of Salina A TIN: City Manager 300 W. Ash, .PO. Box 1736 Salina, KS 67402-1736 Eastridge Development, Inc. A TIN: Daniel C. King, President 1190 Columbine Circle Salina, KS 67401 Every notice shall be deemed to have been given either at the time it is hand delivered or at the time it shall be deposited in the United States Mail in the manner prescribed herein. 19. Huntinq. Lessee shall not permit any person to hunt upon the Premises. 20. Compliance with Law. Lessee shall comply with all applicable laws, ordinances and regulations of the State of Kansas, Saline County, and the municipality wherein the Premises are located. 21. Quiet 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. 5 22. Liability of City. Lessee shall be in exclusive control and possession of the Premises and 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. 23. Inspection. Lessee has inspected the Premises and accepts them in their present and existing condition. 24. Nuisance. Lessee shall not during the term hereon maintain, commit or permit the maintenance or commission of any nuisance on the Premises. 25. Access. City and Lessee acknowledge that the eastern boundary of the Premises is or will be appurtenant to a railroad right-of-way maintained by the Union Pacific Railroad Company and that access across said right-of-way shall be obtained but shall be limited by the availability of such access permitted by the Union Pacific Railroad. City further agrees to establish a second access along the west boundary line of the Premises along Woodland Avenue in the event that access across the Union Pacific Railroad right-of-way shall be generally unavailable. 26. Entire Aqreement. This Agreement constitutes the entire agreement between City and Lessee and any prior understanding or representation of any kind preceding the date of this Agreement shall not be binding on either party except to the extent incorporated in this Agreement. 27. Modification. Any modification of this Agreement or additional obligation assumed by either City or Lessee in connection with this Agreement shall be binding only if in writing executed by each party or an authorized representative of each party. 6 28. Paraqraph Headinqs. The title to the paragraphs of this f\greement are solely for the convenience of the parties and shall not be used to explain, modify, simplify, or aid in the interpretation of the provisions of this Agreement. 29. Time of Essence. Time is of the essence in all provisions of this Agreement. 30. Governinq Law. This Agreement shall be governed by, construed and enforced in accordance with the laws of the State of Kansas. 31. Bindinq Aqreement. This Agreement and the terms and conditions hereof shall apply to and be binding upon the parties hereto, and their respective heirs, successors, legal representatives, personal representatives, and permitted assigns and sublessees of the parties hereto. IN WITNESS WHEREOF, the parties have hereunto executed this Agreement at Salina, Kansas, the day and year first hereinabove written. "CITY" ~Z:N~ DENNIS M. KISSI , City Manager , INC. 7 STATE OF KANSAS ) ) ss: ) COUNTY OF SALINE The foregoing Agreement was acknowledged before me thisr1Qt:Á. day of September, 2004, by Dennis M. Kissinger, City Manager of City of Salina, a municipal corporation, as the act and deed of said municipality. ft ~ laDONNA BENNETT ~ Notary Public. State of Kansas M Ap t. Expires October 23. ~~¿ en~£tC Notary Public My Appointment Expires: If) -J-3-o,=- STATE OF KANSAS ) ) ss: ) COUNTY OF SALINE The foregoing Agreement was acknowledged before me this ;?flffJay of September, 2004, by Daniel C. King, President of Eastridge Development, Inc., a Kansas corporation, as the act and deed of said corporation. t\ . KELSI R. STEINLE .. Notary Public. Sate 0' Kan.. I.'y Ao¡::t. Expires .~~ My Appointment Expires: 5 - , -06 8 "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, 1964, in Book A-3 of Plats at Page 36, lying in the Northeast Quarter (NE Yt) 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 830 feet thereof, which tract is more particularly described as follows: Beginning at a stone found at the N % corner of said Section 7; thence westerly along the north line of the NW % 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 RMI line of the Missouri Pacific Railroad, a distance of 315.0 feet; thence southerly along the east RMlline of the Missouri Pacific Railroad a distance of 1,022.32 feet to a point on the south line of the NE Yt of the NW % 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 east RMlline of the Missouri Pacific Railroad a distance of 74.4 feet to a point on the curve of the north RMlline 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 RMlline of the Missouri Pacific Hailroad main line a distance of 289.0 feet; thence easterly along the north RMlline of the Missouri Pacific Railroad main line a distance of 2,677.8 feet to a point on the east line of the NE % of said Section 7; thence northerly along the east line of the NE % of Section 7 a distance of 1,346.66 feet 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 64.5 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 aI., 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) -I :::u :t> (") r-l rrl :t>- (/')-J rrl~ OJo °rrl C(/') z- OG') :t>z :::u:t> rrl-l (/')0 Z 0 " ill --L ~ ¡- "" ~ CO " L.'" q'" ..~ ::1;:", ~C: S\~ ~S\ !!¡.r- "1:>2 ~!£ ~~ ~-- ~'" \~:Ì ,~? ~ ,Þ-:, - . ~~ .~ . '? :~ li J:î ' 'II~':! : .'}, I- ..:.:;' ". ~:& J...:-' . :~ .,"~~" r. 'J ~ '. . 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