LEASE AGREEMENT
THIS Lease Agreement is made this ___ day of August, 2014, by and between the City of Lawrence, Kansas, a municipal corporation, and Black Hills/Kansas Gas Utility Company, LLC d/b/a Black Hills Energy, a Delaware corporation.
RECITALS
A. The City of Lawrence, Douglas County, Kansas, (“the City”) is a municipal corporation that holds various property interests throughout the City, including a tract of land located generally on the northwest corner of 31st Street and Louisiana Street, planned for a pump station, and a tract of land located generally on the northeast corner of 31st Street and Louisiana, commonly known as Broken Arrow Park.
B. Black Hills Energy/Kansas Gas Utility Company, LLC d/b/a Black Hills Energy, a Delaware corporation ("Black Hills Energy"), is a utility that, among other things, sells and delivers natural gas to its customers within the City through natural gas distribution facilities located in various easements and, pursuant to a natural gas utility franchise agreement with the City, through facilities located within the City's rights of way.
C. As a result of the construction of the South Lawrence Trafficway, Black Hills Energy has consented to relocate a portion of its natural gas distribution facilities and seeks to relocate those facilities on City property located generally on the northwest corner of 31st Street and Louisiana Street, planned for a pump station, and a tract of land located generally on the northeast corner of 31st Street and Louisiana, commonly known as Broken Arrow Park.
D. Accordingly, Black Hills Energy and the City wish to enter into a lease agreement governing the new location of Black Hills Energy's natural gas distribution facilities on City property, as described herein.
E. The City and Black Hills Energy agree that Black Hills Energy's lease of City property for this project is contingent, inter alia, upon the execution of this Lease Agreement and compliance with its terms.
TERMS
NOW, THEREFORE, in light of the mutual promises and obligations contained herein, and in exchange for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged by the parties, the parties agree as follows:
SECTION 1. Leased Properties. The property interests hereby leased by the City to Black Hills Energy (collectively, “the Leased Properties”) shall include the following:
(a) A strip of land approximately 20 feet wide that passes under and through the City's property located generally on the northeast corner of 31st Street and Louisiana Street and planned for a pump station. (A map of the leased property and its legal description are affixed hereto as Exhibits A and B and are incorporated herein by reference).
(b) A strip of land approximately 20 feet wide that passes under and through the City's property located generally on the northwest corner of 31st Street and Louisiana Street and commonly known as Broken Arrow Park. (A map of the leased property and its legal description are affixed hereto as Exhibits C and D and are incorporated herein by reference).
(c) Non-exclusive licenses under and through the Leased Properties, sufficient for the location, installation, and maintenance of underground natural gas lines and other facilities.
(d) Non-exclusive licenses across the Leased Properties for access (the “Access Licenses”), but only as approved in writing by the City, which approval shall not be unreasonably denied, delayed, or conditioned. See Section 14, infra.
SECTION 2. Use. Black Hills Energy may use the Leased Properties only as follows:
(a) Black Hills Energy may use the Leased Properties to survey, construct, install, maintain, inspect, operate, alter, add pipes, repair, and remove, on, under and over said Leased Properties, natural gas distribution facilities and all appurtenances and appliances necessary in connection therewith, for the sale, transmission, or distribution of natural gas (collectively, “Facilities”), in accordance with those specifications set forth in Exhibits E and F, which are affixed hereto and incorporated herein by reference, and for no other purpose.
(b) Black Hills Energy agrees that all earth, turf, shrubbery, trees, sidewalks, paving, fences, public improvements, or improvements of any kind, that are either damaged or removed by Black Hills Energy, its contractors, subcontractors, or agents, during the installation, repair, maintenance, and/or replacement of the Facilities or any other use of the Leased Properties shall be fully repaired or replaced within a reasonable time by Black Hills Energy at Black Hills Energy’s sole cost and expense and to the reasonable satisfaction of the City.
SECTION 3. Construction.
(a) Prior to commencing any construction, Black Hills Energy shall submit all plans and specifications for all improvements to the City and receive the City’s written approval, which approval shall not unreasonably be withheld or delayed. Also, prior to commencing construction, Black Hills Energy must obtain all permits (including building permits) required by law. No improvement, construction, installation, replacement, or major modification shall commence until plans for such work have been reasonably approved by the City, the City has given written consent thereto, and Black Hills Energy has procured all necessary Governmental Approval.
(b) Plans submitted by Black Hills Energy to the City shall include: fully dimensioned site plans that are drawn to scale and show (i) the proposed location and depth of the Facilities, (ii) the proposed clearing and landscaping, and (iii) any other details that the City may request. Black Hills Energy construction shall conform to the plans and specifications (Exhibits E and F).
(c) Additionally, prior to commencement of construction, Black Hills Energy shall provide to the City the name of the contractor, if any, that will be overseeing the construction of the improvements. All improvements shall be constructed in a workmanlike manner, without the attachment of any liens to the Leased Properties, and shall be completed in compliance with all applicable laws, ordinances, rules, and regulations.
(d) No improvements or major modifications to the Leased Properties shall be made without the City’s written consent. Such written consent shall not unreasonably be withheld or delayed by the City.
SECCTION 4. Taxes.
(a) Subject to any exemptions provided for in its natural gas franchise agreement with the City, Black Hills Energy shall pay all personal property taxes assessed against its Facilities location on the Leased Properties as a result of Black Hill’s use or ownership of the Facilities. The City is a municipal corporation and is exempt from the payment of real property taxes. Thus, except for any exemptions provided for in its natural gas franchise agreement with the City, Black Hills Energy shall be responsible for any real property taxes assessed against the Leased Properties as the result of the use or development of the Leased Properties by Black Hills Energy.
(b) The City shall provide to Black Hills Energy a copy of any notice, assessment, or billing relating to real estate taxes, for which Black Hills Energy is responsible under this Lease Agreement, upon receipt of the same. Black Hills Energy shall have no obligation to make payment of any real estate taxes until Black Hills Energy has received the notice, assessment, or billing relating to such taxes as provided in the preceding sentence. Should any such taxes or assessments be levied or assessed directly against the City and be paid by the City, Black Hills Energy shall reimburse the City for the full amount thereof within thirty (30) days of receipt of the City’s notice to Black Hills Energy of its payment of such taxes or assessments.
(c) Black Hills Energy shall have the right, at its sole option and its sole cost and expense, to appeal, challenge, or seek modification of any tax assessment or billing for which Black Hills is not exempt under its natural gas franchise agreement with City and for which Black Hills Energy is responsible for payment under this Lease Agreement. The City shall reasonably cooperate with Black Hills Energy in filing, prosecuting, and perfecting any such appeal or challenge to such taxes as provided in the preceding sentence, including but not limited to executing any consent to appeal or other similar documents.
(d) Except for an exemptions provided for in its natural gas franchise agreement with the City, failure by Black Hills Energy to pay any taxes or assessments within thirty (30) days after the City has given written notice of the same, shall result in the immediate termination of this Lease Agreement and the removal of Black Hills Energy’s Facilities from the Leased Properties.
SECTION 5. Liens. Black Hills Energy shall not allow any mechanic’s or materialmen’s liens to be placed on the Leased Properties as the result of its activities on the Leased Properties.
SECTION 6. Hazardous Substances.
(a) Definitions:
(i) “Environmental Law or Environmental Laws” means all applicable federal, state or local laws, including any plans, rules, regulations, orders, or ordinances adopted, or other criteria and guidelines promulgated pursuant to the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C. §906 et seq.; the Toxic Substance Control Act 15 U.S.C. §2601 et seq.; the Hazardous Materials Transportation Act, 49 U.S.C. §1802 et seq.; the Resource Conservation and Recovery Act 42 U.S.C. §6901 et seq.; the Clean Water Act, 33 U.S.C. §1251 et seq.; the Safe Drinking Water Act, 42 U.S.C. §300F et seq.; the Clean Air Act, 42 U.S.C. §7401 et seq., or other applicable federal, state, or local laws, including any plans, rules, regulations, orders or ordinances adopted pursuant to the preceding laws or other similar laws, regulations, rules, orders or ordinances in effect as of the date of this Agreement relating to the protection of human health and environment.
(ii) “Hazardous Materials” means any wastes, substances, or materials, whether solids, liquids or gases, that are deemed hazardous, toxic, pollutants, or contaminants, including, but not limited to, substances defined as “hazardous wastes”, “Toxic substances”, “radioactive materials”, or other similar designation in, or otherwise subject to, regulations under any of the Environmental Laws. “Hazardous Materials” also includes, but is not limited to, polychlorinated biphenyls (“PCBs”), petroleum and its products, including but not limited to, crude oil or any fraction thereof, asbestos-containing materials, mercury and lead-based paints.
(iii) “Loss” means any claims, damages (including, without limitation, diminution in value), remediation obligations, losses, liabilities and expenses, lawsuits, deficiencies, interests, penalties, attorneys’ fees and all amounts paid in defense or settlement of the foregoing. “Loss” shall not include any special, consequential, indirect or loss of profit damages.
(iv) “Release” means any emission, spill, seepage, leak, escape, leaching, discharge, injection, pumping, pouring, emptying, dumping, disposing or release of Hazardous Materials from the Pipeline into the environment.
(b) Environmental Indemnification:
(i) City represents and warrants to Black Hills Energy that there is no suit, action, claim, arbitration, administrative or legal proceeding or governmental investigation pending or, to City’s knowledge, threatened against or related to the Property.
(ii) The City warrants that it has no knowledge of any substance, chemical, or waste on the Leased Properties that is identified as hazardous, toxic, or dangerous in any applicable Federal, State, or Local law, ordinance, or regulation as of the date of the Lease Agreement.
(iii) Black Hills Energy represents and warrants that its use of the Leased Properties will not generate any hazardous substance, and that it will not store or dispose on the Leased Properties, nor transport to or over the Leased Properties, any hazardous substance in violation of applicable laws.
(iv) Black Hills Energy shall indemnify, defend, and hold harmless City, its subsidiaries, affiliates, successors and assigns and their respective directors, officers, employees, shareholders, representatives and agents from and against any and all loss which may be imposed upon or incurred by City arising out of, relating to, or resulting from environmental conditions of the Property arising out of, relating to, or resulting from (i) a violation of Environmental Law or (ii) an unauthorized Release of Hazardous Materials or (iii) the off-site disposal of Hazardous Materials or (iv) third party personal injury, death or property damage including toxic torts, which were caused after the Closing Date.
(v) City shall indemnify, defend, and hold harmless Black Hills Energy, its subsidiaries, affiliates, successors and assigns and their respective directors, officers, employees, shareholders, representatives and agents from and against any and all loss which may be imposed upon or incurred by Black Hills Energy arising out of, relating to, or resulting from environmental conditions of the Property arising out of, relating to, or resulting from (i) a violation of Environmental Law or (ii) an unauthorized Release of Hazardous Materials or (iii) the off-site disposal of Hazardous Materials or (iv) third party personal injury, death or property damage including toxic torts, which were caused or occurred on or before the Closing Date.
(c) Contingency based upon Environmental Assessment: Black Hills Energy’s obligations under this Agreement are subject to Black Hills Energy conducting a Phase I environmental study or other environmental assessments of the Property. If it elects to pursue an environmental assessment, then Black Hills Energy agrees to commence a Phase I environmental study or other environmental assessment of the Property within 60 days of the execution of this Agreement. Black Hills Energy may terminate this Agreement and have no further obligation to City under this Agreement in the event that the Phase I environmental study or other environmental assessment of the Property is unacceptable to Black Hills Energy for any reason or Black Hills Energy deems the Property unsuitable for the purposes of Black Hills Energy to meet current and future needs. Black Hills Energy shall provide written notice to City within fifteen (15) days of completion of such Phase I Environmental study or other environmental assessment, or within a reasonable time after Black Hills Energy deems the Property unsuitable for purposes intended by this purchase, notifying City of Black Hills Energy’s intention to cancel this Agreement based on the same.
SECTION 7. Casualty. If any portion of the Leased Properties is damaged by any casualty and such damage adversely affects Black Hills Energy’s use of or access to the Leased Properties, then Black Hills Energy may terminate this Lease as of the date of the casualty, provided that Black Hills Energy gives written notice of the same within thirty (30) days after the occurrence of such casualty.
SECTION 8. Condemnation. If a condemning authority takes any portion of the City’s Leased Properties and such taking adversely affects Black Hills Energy’s use of or access to the Leased Properties, then Black Hills Energy may terminate this Lease as of the date the title vests in the condemning authority, provided that Black Hills Energy gives written notice of the same within thirty (30) days after Black Hills Energy receives notice of the taking. The parties shall be entitled to make claims in any condemnation proceeding for the value of their respective interests in the Leased Properties.
SECTION 9. Quiet Enjoyment.
(a) Black Hills Energy, upon executing this Lease Agreement, shall peaceably and quietly have, hold, and enjoy the Leased Properties. At the City’s option, this Lease Agreement shall be subordinated to any mortgage or other security interest by the City, which from time to time may encumber all or part of the Leased Properties or the rights of way; provided, however, every such mortgage or other security interest shall recognize the validity of this Lease Agreement in the event of a foreclosure of the City’s interest and also Black Hills Energy’s right to remain in occupancy of and to have access to the Leased Properties so long as Black Hills Energy is not in default under this Lease Agreement.
(b) Black Hills Energy shall execute whatever instruments may reasonably be required to evidence this subordination clause.
(c) In the event that one or more of the Leased Properties is encumbered by a mortgage or other security interest, the City immediately after this Lease Agreement is executed will obtain and furnish to Black Hills Energy a non-disturbance agreement in recordable form for each such mortgage or other security interest.
(d) In the event that the City defaults in the payment and/or other performance of any mortgage or other security interest encumbering the Leased Properties, Black Hills Energy may, at its sole option and without obligation, cure or correct the City’s default and, upon doing so, Black Hills Energy shall be subrogated to any and all rights, titles, liens, and equities of the holders of such mortgage or security interest and Black Hills Energy shall be entitled to seek from the City any sums paid by Black Hills Energy to cure or correct such defaults.
SECTION 10. Term. The Initial Term of this Lease Agreement shall be fifteen (15) years, commencing on the date that this Lease and License Agreement is executed by the parties (“the Commencement Date”).
SECTION 11. Option Terms. Black Hills Energy and the City shall have the mutual option to extend the initial term of this Lease Agreement for two (2) additional and successive ten (10) year option periods (individually, “the Option Term” and, collectively, “the Option Terms”). The Lease Agreement shall, at the end of the Initial Term or any Option Term, unless it is the second Option Term, automatically be extended an additional Option Term, unless either party notifies the other party of its intent to terminate or to renegotiate this Lease Agreement at least one hundred eighty (180) days prior to the termination of the then-current Term. Option Terms shall be deemed a continuation of this Lease Agreement and shall not be considered a new Lease Agreement or an amendment hereto.
SECTION 12. Renegotiation.
(a) Upon written request of Black Hills Energy or the City, this Lease Agreement may be renegotiated (i) if there is a change in Federal, State, or Local laws, ordinances, regulations, or rules that materially affects any rights or obligations of Black Hills Energy or the City as set forth in this Lease Agreement or (ii) if a party requests renegotiation in accordance with Section 11, supra.
(b) In the event that the parties are actively renegotiating this Lease Agreement or any amendment to this Lease Agreement at the time that the current Term expires, the parties may by written mutual agreement extend the termination date of the current Term to permit further negotiation. Such extension period shall be deemed a continuation of this Agreement and shall not be considered a new agreement or an amendment.
SECTION 13. Accommodation. The lease granted to Black Hills Energy under the Lease Agreement is given for good and valuable consideration. However, the lease is also granted as an accommodation to Black Hills Energy and shall be made without requiring the payment of rent or any money in addition to that which Black Hills Energy pays to the City in franchise fees pursuant to its natural gas utility franchise agreement with the City.
SECTION 14. Conflict.
(a) In the event of conflict between the City's future use of its properties upon which the Leased Properties are located and Black Hills' use of the Leased Properties, Black Hills agrees to move, at Black Hills' sole cost and expense, its facilities located on the Leased Properties. In the event of conflict, the City agrees to provide to Black Hills, if possible, a reasonable location in which to re-locate its facilities.
(b) If the City orders or requests Black Hills Energy to relocate its natural gas distribution facilities for the primary benefit of a commercial or a private project, or as a result of the request of a commercial or a private developer or other non-public entity, and such relocation is necessary to prevent interference with such commercial or private project, then Black Hills Energy shall be reimbursed for the costs of such relocation.
SECTION 15. Access. The City shall provide Black Hills Energy with access to the Leased Properties twenty-four (24) hours a day, seven (7) days a week, for the purpose of constructing, operating, inspecting, adding pipe, rebuilding, repairing, maintaining, removing, or replacing its Facilities. To obtain access to the Leased Properties, Black Hills Energy shall first contact the City and coordinate its use of the Leased Properties with the City. However, in the case of an emergency situation, Black Hills Energy make have immediate access to the Leased Properties and may take such immediate unilateral action as Black Hills Energy deems necessary to protect the health, safety, and welfare of the general public and, in which case, Black Hills Energy will notify the City as soon as reasonably possible
SECTION 16. Condition of Property. The City represents that it will maintain the Leased Properties and in as good repair as required by all Federal, State, and Local laws. However, nothing in this Lease Agreement shall be construed or interpreted as creating a guarantee or warranty enforceable against the City that the Leased Properties of will remain suitable for Black Hills Energy's use.
SECTION 17. Insurance.
(a) Black Hills Energy, at its sole cost and expense, shall, until such date as all personal property, equipment, and installations of Black Hills Energy have been removed by Black Hills Energy from the Leased Properties, insure itself against liability for personal injury, death, or damage to personal property arising out of its use of the Leased Properties, either through a commercial general liability insurance with a minimum combined single limit of One Million and No/100 Dollars ($1,000,000) or through self-insurance. On or before the Commencement Date, and annually thereafter, Black Hills Energy shall provide to the City an insurance certificate evidencing the fact that Black Hills Energy maintains the insurance required by this Lease Agreement or a financial statement evidencing that it has the financial wherewithal to meet the requirements of self-insurance.
(b) In addition to the insurance requirements listed above, Black Hills Energy shall self-insure, maintain, or cause to be maintained, in full force and effect and at its sole cost and expense, the following types and limits of insurance:
(i) Worker’s compensation insurance meeting applicable statutory requirements and employer’s liability insurance within minimum limits of One Hundred Thousand and No/100 Dollars ($100,000.00) for each accident, One Hundred Thousand and No/100 Dollars ($100,000.00) for each employee, and Five Hundred Thousand and No/100 Dollars ($500,000.00) policy limits.
(ii) Automobile liability insurance covering all owned, hired, and non-owned vehicles in use by Black Hills Energy, its employees and agents, with personal protection insurance and property protection insurance to comply with the provisions of state law with minimum limits of One Million and No/100 Dollars ($1,000,000.00) as the combined single limit for each occurrence for bodily injury and property damage.
(c) All policies, except for worker’s compensation policies, shall name the City as an additional insured (“Additional Insured”).
(d) Except in those instances where it is self-insured, Certificates of Insurance for each insurance policy maintained by Black Hills Energy under this Section shall be filed and maintained with the City annually during the Initial Term or any Option Term of this Lease and Agreement. Black Hills Energy shall immediately advise the City of any claim or litigation that may result in liability to the City.
(e) Except to the extent that Black Hills Energy is self-insured, all insurance shall be effected under valid and enforceable policies, insured by insurers licensed to do business by the State of Kansas or surplus line carriers on the State of Kansas Insurance Commissioners approval list of companies qualified to do business in the State of Kansas.
(f) Black Hills Energy shall require that each and every one of its contractors and their subcontractors, who perform work on the Leased Properties, to carry, in full force and effect, worker’s compensation, comprehensive commercial general liability, and automobile liability insurance coverage of the type which Black Hills Energy is required to obtain -- excluding self-insurance -- under the terms of this Section, with appropriate limits of insurance.
(g) Once during each calendar year during the Initial Term or any Option Term of this Lease Agreement, the City may review the insurance to be carried by Black Hills Energy. If the City and Black Hills Energy mutually agree that higher limits of coverage are necessary to protect the interest of the City or any Additional Insured, or that Black Hills Energy has failed to comply with the insurance requirements as set forth in this Lease Agreement, then Black Hills Energy shall obtain the additional limits of insurance, at its sole cost and expense.
SECTION 18. Default.
(a) It shall be a default if Black Hills Energy defaults in the performance of any covenant or condition of this Lease Agreement and does not cure or make reasonable attempts to cure, such other default within thirty (30) days after written notice from the City specifying the default complained of. It shall also be a default if Black Hills Energy abandons or vacates the Leased Properties; if Black Hills Energy is adjudicated as bankrupt or makes any assignment for the benefit of creditors; or if Black Hills Energy becomes insolvent.
(b) In the event of a default by Black Hills Energy, the City shall have the right, at its option, in addition to and not exclusive of any other remedy the City may have by operation of law, without any further demand or notice, to re-enter the Leased Properties and eject all persons therefrom, and terminate this Lease Agreement, in which event Black Hills Energy shall immediately vacate the Leased Properties or abandon its natural gas distribution facilities in place (and proceed as set forth in Section 20, infra).
(c) In the event of a default by the City, Black Hills Energy shall have the right, at its option, in addition to and not exclusive of any other remedy Black Hills Energy may have by operation of law, without any further demand or notice, to terminate this Lease Agreement.
SECTION 19. Cure. In the event of any default of this Lease Agreement by Black Hills Energy, the City may at any time, after notice, cure the default for the account of and at the expense of Black Hills Energy. If the City is compelled to pay or elects to pay any sum of money or to do any act which will require the payment of any sum of money or is compelled to incur any expense in instituting, prosecuting, or defending any action to enforce the City’s rights under this Lease Agreement, the City may elect, at its sole option, to charge the sums so paid by the City, with all interest, costs (including but not limited to actual attorney's fees) and damages and the same shall be due from Black Hills Energy to the City on the first day of the month following the incurring of the respective expenses, provided the City’s payment, performance or enforcement of rights is due to Black Hills Energy's breach of the Lease Agreement, intentional misconduct, or negligence.
SECTION 20. Termination.
(a) Notwithstanding anything to the contrary contained herein, provided Black Hills Energy is not in default hereunder, Black Hills Energy shall have the right to terminate this Agreement upon the anniversary of the Commencement Date of this Lease Agreement, provided that ninety (90) days prior written notice is given the City.
(b) (i) Notwithstanding anything to the contrary contained herein, the City may terminate this Lease Agreement upon at least one (1) year’s prior written notice to Black Hills Energy (unless an emergency or imminent danger exists) if the City determines, in its reasonable discretion, that continued use of the Leased Premises by Black Hills Energy is a threat to the public health, safety, or welfare or violates applicable laws or ordinances.
(ii) Notwithstanding anything to the contrary contained herein, the City shall have the right to terminate this Lease Agreement upon at least five (5) years’ prior written notice to Black Hills if, in the sole but reasonable discretion of the City, it becomes necessary to do so for reasons other than leasing the Leased Properties to a company or companies that are in competition with Black Hills.
SECTION 21. Removal. The City agrees and acknowledges that all Facilities of Black Hills Energy shall remain the personal property of Black Hills Energy and Black Hills Energy shall have the right to remove the same, whether or not said items are considered fixtures and attachments to real property under applicable law.
SECTION 22. Indemnification.
(a) Black Hills Energy agrees to indemnify, defend, save, and hold harmless the City, its officers, commissioners, agents, employees, contractors, grantees, and assigns, from and against all claims, actions, liabilities, damages, costs, expenses, and judgments, including attorneys’ fees, which relate to, arise out of, or are in any way related to Black Hills Energy's use or occupancy of the Leased Properties on account of any injury to persons or damage to property. This indemnification clause shall not apply to any injury or damage caused by the City’s own negligence.
(b) The City agrees to indemnify, defend, save, and hold harmless the Black Hills energy, its directors, officers, agents, employees, contractors, grantees, and assigns, from and against all claims, actions, liabilities, damages, costs, expenses, and judgments, including attorneys’ fees, which relate to, arise out of, or are in any way related to the City's use or occupancy of the Leased Properties on account of any injury to persons or damage to property. This indemnification clause shall not apply to any injury or damage caused by Black Hills Energy’s own negligence.
SECTION 23. Assignment. This Lease Agreement may not be sold, assigned, transferred, or sublet without the prior written approval or consent of the City’s governing body.
SECTION 24. Bankruptcy. The parties to this Lease Agreement hereby expressly agree and acknowledge that it is the intention of both parties that in the event that, during the term of this Lease Agreement, Black Hills Energy shall become a debtor in any voluntary or involuntary bankruptcy proceeding under the United States Bankruptcy Code, 11 U.S.C. § 101, et seq., this Lease Agreement is and shall be treated as an “unexpired lease of nonresidential real property” for purposes of Section 365, 11 U.S.C. § 365, and, accordingly, shall be subject to the provision of subsections (d)(3) and (d)(4) of said Section 365.
SECTION 25. Signs. Black Hills Energy shall not place signs or advertising signs, except safety-related signage, on the Leased Properties. The placement of such signs shall be coordinated with and approved by the City.
SECTION 26. Acceptance. Except as may be provided in this Lease Agreement, by taking possession of the Leased Properties, Black Hills Energy accepts the Leased Properties in the condition existing as of the Commencement Date of this Lease Agreement. Except as may be provided in this Lease Agreement, the City makes no representation or warranty with respect to the condition of the Leased Properties and the City shall not be liable for any latent or patent defects in those properties.
SECTION 27. Authorization. Each of the persons executing this Lease Agreement, in behalf of the respective parties, represents and warrants that he or she has the authority to bind the party in behalf of whom he or she has executed this Lease Agreement, and that all acts required and necessary for authorization to enter into and to execute this Lease Agreement have been completed.
SECTION 28. Notice. All notices, requests, demands, and other communications hereunder shall be in writing and shall be deemed given if personally delivered or mailed by first class mail:
If to the City, to:
City of Lawrence, Kansas
Attn: City Clerk
6 East 6th
P. O. Box 708
Lawrence, KS 66044
With a copy to:
City of Lawrence, Kansas
Attn: City Attorney
6 East 6th
P. O. Box 708
Lawrence, KS 66044
If to Black Hills Energy, to:
Operations Manager
601 N. Iowa St., Lawrence, KS 66044
chuck.hoag@blackhillscorp.com
(785) 832-3944
With a copy to:
Property Documents Clerk
Black Hills Energy
1102 E. 1st Street
Papillion, NE 68046
sandy.hough@blackhillscorp.com
Either party may change where notices, requests, demands, or other communications are to be given by giving written Notice to the other party of any said change.
SECTION 29. Successors and Assigns. This Lease Agreement shall be binding upon and inure to the benefit of the parties, their respective heirs, personal representatives, successors, and assigns.
SECTION 30. Non-waiver. Failure of either party to insist on strict performance of any of the conditions, covenants, terms, or provisions of this Lease Agreement or to exercise any of its rights hereunder shall not waive such rights, but the party shall have the right to enforce such rights at any time and to take such action as might be lawful or authorized hereunder, whether in law or equity.
SECTION 31. Immunities. No personal recourse shall be had for the creation of this Lease Agreement, for any claim arising out of this Lease Agreement, nor for any representation, obligation, covenant, or agreement set forth in this Lease Agreement, against any past, present, or future officer, member, employee, or agent of the City, under any rule of law or equity, any statute or constitution, or by the enforcement of any assessment or penalty, or otherwise, and any liability of any such officer, member, employee, or agent is hereby expressly waived and released by Black Hills Energy as a condition of and in consideration for the execution of this Lease Agreement. Furthermore, Black Hills Energy agrees that no past, present, or future officer, member, employee, or agent of the City shall be personally liable to Black Hills, or any successor in interest of Black Hills Energy, for any default or breach under this Lease Agreement by the City.
SECTION 32. Severability. If any section, sentence, clause, or phrase of this Lease Agreement is found to be invalid by any court of competent jurisdiction, it shall not affect the validity of any remaining provision of this Lease Agreement.
SECTION 33. Governing Law. This Lease and License Agreement shall be governed by the laws of the State of Kansas.
SECTION 34. Miscellaneous.
(a) This Lease Agreement supersedes all prior discussions and negotiations and contains all agreements and understandings between the City and Black Hills Energy with respect to the subject matter hereof. This Lease Agreement may only be amended in writing signed by all parties.
(b) The Recitals set forth at the beginning of this Lease Agreement are hereby adopted and incorporated herein by reference as if set forth in full.
(c) All Exhibits referenced within this Lease Agreement are incorporated into this Lease Agreement by reference.
(d) The provisions of the Lease Agreement relating to indemnification shall survive any termination or expiration of this Lease Agreement. Additionally, any provisions of this Lease Agreement which require performance subsequent to the termination or expiration of this Lease Agreement shall also survive such termination or expiration.
(e) This Lease Agreement may be executed in duplicate counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. The signature pages from one (1) or more counterparts may be removed from such counterparts and such signature pages all attached to a single instrument.
(f) The prevailing party in any litigation arising hereunder shall be entitled to reimbursement from the other party of its reasonable attorneys’ fees and court costs, including appeals, if any.
(g) The titles or captions of paragraphs in this Lease Agreement are provided for convenience only, and shall not be considered a part hereof for purposes of interpreting or applying this Lease Agreement and such title or captions do not define, limit, extend, explain, or describe the scope or extent of this Lease Agreement or any of its terms or conditions. This Lease Agreement is the result of negotiations between the parties and, as such, shall not be construed in favor of one party over another. Rather, this Lease Agreement shall be construed in accordance with its ordinary meaning.
IN WITNESS WHEREOF, the undersigned have caused this Lease Agreement to be executed as of the date noted above.
CITY: City of Lawrence, Kansas, a municipal corporation
________________________________
DAVID L. CORLISS
City Manager
ACKNOWLEDGMENT
THE STATE OF KANSAS )
) ss:
THE COUNTY OF DOUGLAS )
BE IT REMEMBERED, that on this ____ day of __________, 2014, before me the undersigned, a notary public in and for the County and State aforesaid, came David L. Corliss, as City Manager of the City of Lawrence, Kansas, who is personally known to me to be the same person who executed this instrument in writing, and said person fully acknowledged this instrument to be the act and deed of the aforementioned entity.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my notarial seal, the day and year last written above.
________________________________
Notary Public
My Appointment Expires:
BLACK HILLS ENERGY: Black Hills/ Kansas Gas Utility Company, LLC d/b/a Black Hills Energy, a Delaware corporation
________________________________
Lon Meyer
Director Business Operations
ACKNOWLEDGMENT
THE STATE OF ___________ )
) ss:
THE COUNTY OF __________ )
BE IT REMEMBERED, that on this ____ day of __________, 2014, before me the undersigned, a notary public in and for the County and State aforesaid, came Lon Meyer, Director Business Operations for Black Hills/Kansas Gas Utility Company, LLC d/b/a Black Hills Energy, a Delaware corporation, who is personally known to me to be the same person who executed this instrument in writing, and said person fully acknowledged this instrument to be the act and deed of the aforementioned entity.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my notarial seal, the day and year last written above.
________________________________
Notary Public
My Appointment Expires: