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Bill Burke Batting Cages LEASE AGREEMENT This Lease Agreement, ("Agreement") dated February:Jldi, 1996, is entered into between the CITY OF SALINA, KANSAS, a municipal corporation ("City"), and Jim Shirack, a resident of Saline County, Kansas ("Lessee"). Recitals A. The City's public park system includes Bill Burke Park (the "Park"), which consists predominately of baseball and softball facilities. B. As an added service to the general public, the City wishes to provide for public access to mechanized batting practice equipment ("batting cages") in immediate proximity to those baseball and softball facilities. C. Lessee owns the specialized equipment necessary to properly operate the batting cages. D. The City believes that the public interest is best served by leasing to Lessee only that square footage in Bill Burke Park necessary to safely operate the batting cages. The parties agree as follows: 1. Description. City hereby leases to Lessee, subject to the covenants and conditions contained in this Agreement, the square footage upon which the batting cages are currently located at Bill Burke Park (the "Batting Cage Site"). 2. Rent. (a) Lessee agrees to pay to City, as rent for the Batting Cage Site, the sum of Two Hundred and no/lOO Dollars ($200) per month, or eight percent (8%) of the monthly gross revenue, whichever is greater, during the months of April through September, inclusive. During the months of October through March, the rent shall be limited to eight percent (8%) of the monthly gross revenue. (b) Monthly rent payments shall be due on the 5th day of the month following the month for which the rent is payable. All rent payments shall be accompanied by a report of hours of operation and gross revenues for the prior month. (c) Lessee agrees that complete financial records regarding this operation on the Batting Cage Site shall be maintained and segregated from any other business or personal financial records of the Lessee and that the City Manager or his designated representative may examine the financial records for the operation upon request. 3. Lease Term and Renewal Option. The initial term of this lease shall be five (5) years commencing March 1, 1996, and ending midnight February 28, 2001. The Lessee shall have the right to elect for an additional five (5) year term by giving written notice to the City of such election no less than sixty (60) days prior to the end of the initial five (5) year term. It is agreed that the monthly rent for the additional term shall be the sum of Two Hundred Twenty and nollOO Dollars ($220) per month, or nine percent (9%) of the monthly gross revenue, whichever is greater, during the months of April through September, inclusive. During the months of October through March, the monthly rent shall be limited to nine percent (9%) of the monthly gross revenue. 4. Use of the Batting Cage Site. The Batting Cage Site shall be used as the site for a mechanical pitching machine operation. The Batting Cage Site shall not be used or occupied for any other purpose, or in a manner that constitutes a nuisance. The mechanical pitching machines and accessories shall be furnished by Lessee at his sole expense, subject to approval of the equipment by the Director of the Parks and Recreation Department. 5. Maintenance. (a) City's Responsibilities. City shall maintain and repair any access roads to the Batting Cage Site and adjacent parking areas. (b) Lessee's Responsibilities. Lessee shall maintain the Batting Cage Site in accordance with City's maintenance standards attached and incorporated by reference as Exhibit "A". 6. Hours of Operation and Supervision. The hours of operation for the Batting Cage Site shall be determined jointly by the City and the Lessee. A qualified attendant shall be on duty at all times of operation. 7. Licenses. Lessee agrees to strictly comply with federal, state, and local laws and regulations, and to obtain, at its expense, all necessary licenses and certificates for the operation of the Batting Cage Site. 8. Utilities. Lessee agrees to pay for all utility expenses incurred in the operation of the Batting Cage Site. 9. Cost of Operation. Lessee shall be solely responsible for all of the costs of operating the Batting Cage Site not specifically excluded herein. 10. Advertising. The Batting Cage Site must be identified as publicly owned in all signs, literature, and advertising, and the concessionaire identified as such. II. Nondiscrimination. City must retain control over charges to the public to ensure nondiscrimination. While the lessee is entitled to a reasonable return, the general public cannot be denied use of the facility because of excess of fees or an inequitable fee structure. 12. Alterations. Lessee shall not alter, improve, or change the Batting Cage Site without the prior written consent of City. In the event the Lessee chooses to light the Batting Cage Site, any such lighting shall be according to City's specifications, and shall be placed in a manner determined by City. Lessee, unless otherwise agreed in writing, shall pay all costs associated with any alterations, improvements, or changes. -2- 13. Ownership of Improvements. The reinforced concrete pad and galvanized chain link fence and any other improvements made to the Batting Cage Site shall be the property of the Lessee during the term of this Agreement. Upon termination of this Agreement (whether by expiration of the term or by operation of the default provision), the reinforced concrete pad, the galvanized chain link fence, and any other improvements shall become the property of City. 14. Ownership of Pitching Machines. Notwithstanding any provisions in this Agreement to the contrary, the pitching machine equipment purchased by the Lessee shall remain the property of the Lessee. 15. Assignments. Lessee shall not assign this Agreement, without the prior written consent of City, which consent shall not be unreasonably withheld. 16. Relationship of the Parties. The relationship of the parties is solely that of lessor and lessee, and nothing herein contained shall create any other relationship or liability. Specifically, the Lessee is not the agent of City for purposes of any contracts for improvement of the Batting Cage Site. 17. Extended Coverage Insurance. Lessee shall maintain extended insurance coverage on the property owned by Lessee located on the Batting Cage Site in such amounts as Lessee deems appropriate to fully insure himself. 18. Untenantability. If the Batting Cage Site is made untenantable for any reason whatsoever, this Agreement and all obligations hereunder shall be null and void, and all future performances by either party, including the payment of rent, shall terminate. 19. Public Liability Insurance. Lessee agrees to carry public liability insurance coverage in an amount equal to the maximum exposure to City under the Kansas Tort Claims Act over the term of the Agreement (currently $500,000). The City shall be named as an additional insured on such policy. The policy shall also contain a provision that City shall be given at least thirty (30) days written notice by the insurance company before the policy is substantially changed or canceled. Lessee shall maintain on file with City a current certificate of such insurance. 20. Indemnification. If either party fails to pay any obligations which that party is required to pay according to the terms and conditions of this Agreement and the other party is required to pay the same, the paying party will be entitled to reimbursement from the defaulting party. In the event any claim is made against either party for damages arising out of the relationship, the party responsible for such claim shall indemnify and hold harmless the other party from any loss on account thereof, including reasonable attorney's fees and any other costs of defense against such claim. 21. Property Tax. If the Saline County Appraiser determines that continued operation of the batting cages pursuant to this Agreement will result in the loss of the tax exempt status of part or all of the Park, City may direct Lessee to immediately cease operations and terminate this Agreement by giving written notice to Lessee, along with a copy of the Saline County Appraiser's determination upon which the termination is based. -3- 22. Time is of the Essence. It is mutually agreed to by the parties that time is of the essence of this Agreement, and all the terms and conditions of this Agreement, including the payment of rent, must be performed and paid as specified in this Agreement. 23. Default. In the event either party fails to perform any of the promises and covenants under this lease, the non-defaulting party shall give notice of such default in writing to the other party specifying the nature of the default. In the event such default remains uncured for ten (10) days after deliver of the notice specifying the nature of the default, the Agreement shall terminate at the sole option of the non-defaulting party. In the event of termination based upon default of the Lessee, the Lessee shall immediately discontinue operations and shall be required to remove all of the pitching machine equipment from the Batting Cage Site within ten (10) days from the date of the termination. 24. Written Notices. All written notices, as provided herein, shall be delivered by certified mail, return receipt requested, mailed as follows: City: City of Salina Office of the City Clerk City-County Building 300 West Ash Salina, KS 67401 Lessee: Jim Shirack 3000 South Drew Avenue Salina, KS 67401 25. Applicability. This Agreement shall be binding upon the parties hereto, and their heirs, beneficiaries, personal representatives, successors, and assigns. IN WITNESS WHEREOF, the parties have executed this Agreement on the date first above written. CITY OF SALINA, KANSAS BY~ct)~ Joh Divine, Mayor ATTEST: ~ill_~ J y . on ity Clerk -4-