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HomeMy WebLinkAboutMt. Ashland Lease MT. ASHLAND SKI AREA LEASE , This Lease Agreement is made and entered into this 4bA day of V 1992 (hereinafter the -effective date of this Agreement17iiY arld between ASHLAND ("lassO....) and the MT ASHLAND ASSOCIATION, an Oregon corporation (-lessee~). . In consideration of the mutual promises set forth herein. the Lessor and Las.see ~:lgree as follows: 1. Dmn. The initial term of this Lease shall begin on the.date Indicated above and shall terminate on June 30, 2017. At any time on or before June 30. 2017. L.essE~ shaD have the right. if the Lease has not theretofore been terminated by either pclrty and if Lessee is not then in default with respect to any obligation under this .Agreement, to notify Lessor in writing that the term of the Lease shall be exterlfJed for an additional twenty-five (25) years. until June 30. 2042, In which case the Le~ term shall be so extended. Notwithstanding the two preceding sentences, Lessee's leasehold rights under this Agreement shall terminate upon the expiration or othEtr termination of Lessor's rights under the Permit. 2. Definitions: Description of leased Property: Permit: and lease Agreement. 2.1. Definitions: Description of Leased Property. As. used in this Agreement, the following tenns shall have the indicated meanings: 2.1.1. -Permit- shall mean and refer to that certain United States Department of Agrlcutture Forest Service Special Use Permit which is attached te) this Agreement as Exhibit "A", and any subsequent permit which may be issued as 8 replacement or renewal of the permit attached hereto as Exhibit · A.. 2. 1.2. -Permit Property" shall mean and refer to that certain real property located on Mt. Ashland, In Jackson_ County. Oregon which .Is described In . and is subjeCt to the. Permit, together with all improvements owned by Lessor and now or hereafter constructed or existing thereon. 2.1.3. "Equipment- shalt mean and refer to all personal property, fixtures. fumishings. inventory and items of equipment owned by Lessor which are now attached to or located on or about the Permit Property, including but not linrlited to the items of personal property identified on Exhibit -Bit attached hereto. As SC>On as practicable after the execution of this Agreement. lessor and Lessee shall caUSE~ to be taken a physical inventory of all personal property, fixtures. furnishings, inventor,( and items of equipment owned by Lessor which are now attached to or located on e)r about the Permit Property, and shall amend Exhibit 118" to conform with that phy:sical ,. inventory, it being the intention of the parties that this Agreement apply only to ~hose items of personal property verified by the physical inventory and listed on exhibit -B- as so amended. PAGE 1-MT. ASHLAND SKI AREA LEASE (p:dally\lkIash\maa-ffdJIe) ./ T '- ......, P~. -.:: 4. .". .- 2.1.4. -Leased Property" shall mean and refer to the Pennit Property and the Equipment. 2.1.5. -IndeX- shall refer to the following index published by the Bureau of Labor Statistics of the United States Department of Labor: Consumer Price Index. All Urban Consumers (CPI-U). u.s. City Average. CPI-Allltems C-standard reference base period- 1982-84 = 100). -Base CPllndex Figure- shall refer to the Index number indicated for the month of January. 1992. and the -CPllndex Figure- fOI" any other month shall refer to the Index number for that month. If the "IndeX- is no IOlnger being published as of a particular date, then the -CPI Index Figure- for that date ~~hall be th~ figure' reported in the U.S. Department of Labor's most recent comprehensive . official index then In use and most nearly answering the description of the Index (or, if the u.s. Department of Labor is not then publishing any such similar Index, shall be determined under another comparable. authoritative. generally recognized Index to be selected by mutual agreement of Lessor and Lessee). If the Index is calculptes;t from a base different from the base 1982-84 = 100. then the figures to be used In calbullating any adjustment mandated under this Agreement first shall be converted (If possible, under a formula supplied by the Bureau of Labor Statistics of the U.S. Department of labor) to account for that difference. 2. 1.6. For purposes of this Agreement,.the .Mlnlmum Uquldatlon .Value" for the Leased Property with respect to any particular calendar year shall be determined as follows: 2.1.6.1. With respect to the 1992 calendar year, the IIMinlmum Uquldation Value- shall be $200.000.00. 2.1.6.2. With respect to the 1993 calendar year and each subsequent calendar year throughout the Lease term. the .Minlmum liquidation Value" for 8 particular calendar year shall be determined by multiplying $200,000.00 by 1:1 fraction, the numerator of which Is the CPI Index Fagure for the month of January of that subject calendar year, and the denominator of which Is the Base CPI Index Figure. To Illustrate the preceding sentence. the "Minimum Uquidation Value" for the 1998 calendar year wm be equal to the product determined by multiplying $200.000.00 by a fraction, the numerator of which is the CPllndex Figure for the month of January. 1998. and the denominator of which is the Base CPllndex Figure. 2.1.6.3. Notwithstanding the provisions of Paragraph 2.1.6.2, the Minimum Uquidation Value of the Leased Property shan never decrease. regardl~~ of any decline In the Index. 2.1.7. "Ski Area Trust Fund- shall mean and refer to a segregated trust fund which shall be held, invested and maintaIned by the City of Ashland, as trustee. and shall be administered and distributed for the benefit of the Lessee and the Lessor in accordance with the provisions of this Agreement The Initial principal of the Ski Area Trust Fund shaH be contributed to the Fund by the. City of Ashland on the PAGE 2-MT. ASHLAND SKI AREA LEASE (p:datty\IIda8h\mu-ffd.lse) "- ""'-' ~ l, " effective date of this Agreement, and shall consist of those assets which are identified on Exhibit "C" attached to this Agreement. 2.2. Permit. The terms, covenants. provisions and conditions of the Perm,it are incorporated into this Lease and Lessee assumes responsibility for payment and. performance of all obligations of the City of Ashland under the Permit. Lessee agrees to hold harmless, defend and indemnify Lessor from and against any loss, clai.m lor liability suffered by or asserted against Lessor as a result of Lessee's failure to fully pay and perform the obligations of the Permit. 2.3. Lease Agreement. Lessor hereby leases the Leased Property to Lessee, and Lessee leases the Leased Property from Lessor, subject to all of the terms and conditions contained in this Agreement 2.3.1. Lessee is thoroughly familiar with the Leased Property. and its condition and state of repair, and agrees to take the Leased 'Property in its PreSern condition, and specifically agrees that all of the Leased Property is in an accepUlble condition for the purpose for which leased. Lessor makes no warranty of merchantability or fitness of the Leased Property for any purpose. Neither Lessc:>r nor its agents have made any representations with respect to the Leased Property e>ecept _ as expressty set forth in this Lease, and no rights are acquired by Lessee by knpIlcation In fact or, in law, or otherwise, except as expressty set forth In this ~1S8. Taking possessIon of the Leased Property shall be conclusive evidence that ~;ee accepts the Leased Property -as Is. and 'With any and ail faults-. 3. Use of Leased Property. Lessee shall have sole and exclusive possession and use of the Leased Property during the entire term of this Lease for the purpose Of constructing, improving, maintaining and operating year-round educational and/c>r recreationai -facilities for the benefit of the general public ~ncluding but not limited to a ski area and/or winter sports resort). 4. ConsIderation. Lessee Is 8 not-for-proflt corporation, all assets of which will devolve to Lessor in the event of Lessee's dissolution and liquidation. In addition, Lessee has assisted Lessor in Obtaining the funds necessary to purchase the Lelased Property. Under these circumstances the parties have determined that a lease payment of $1.00 per year is full and adequate consideration for this Lease. 5. Title to Assets. Throughout the entire Lease term the Permit Property and the EQuipment shalt be and remain the property of the Lessor. 5.1. All buildings, structures, facilities and improvements of whatever klndl and nature erected upon or made to the Permit Property by Lessee during the term ~Df this Lease, together with any and all additions or alterations thereto and any permanent - fixtures now or hereafter affixed or attached thereto, shall upon termination of thlls Lease become the property of Lessor. PAGE 3...MT. ASHLAND SKI AREA LEASE (p:dally\sIdash\maa.ffd.IH) '- - I., OIA 5.2 Lessor shall not acquire any ownership, title or interest in any machinery, equipment, appurtenance or fixture hereinafter placed by Lessee in or upon ti1e Permit Property which is not so affixed as to become an integral part of the buildings structures, facilities or Improvements located on the Permit Property; provided, however, that if any machinery, equipment, appurtenance or fixture replaces a pclrtion of the Permit Property or the Equipment or serves a similar function to the Permlit Property or the Equipment. or is necessary to preserve the value specified in . Paragraph 7.1, then such machinery. equipment, appurtenance or fixture shall bocome and remain the property of the Lessor. 6. Alterations. Lessee shall have the right to make changes to and alterations c.f the Leased Property. subject to the following conditions: 6.1. Except as herein provided. Lessee may at Lessee's expense make such alterations. Improvements. additions and cI:1anges to the Leased Property as it mlay deem necessary or expedient in the operation of the Leased Property, provldea 'that Lessee, without the written consent of Lessor (which consent shall not be unreasonably withheld) shalf not tear down or materially demolish any of the improvements upon the Permit Property or make any material change or alteratic)n in such Improvements, which. when completed, would substantially diminish the value or substantially alter the use of the Leased Property. 6.2. At all times When any change or alteration is in progress, there shall be maintained, at Lessee's expense. workers' compensation Insurance in accordance with laws covering all persons employed in comedian with the change or altera~on. and general liability Insurance In accordance with laws covering all persons emplloyed in connection with the change or alteration. and general liability insurance for thEt mutual benefit of Lessee and Lessor expressly covering the additional hazards due to the change or alteration. 7. Repair and Maintenance. Lessee shall not cause or permit any waste, damage or injury to the Leased Property. Lessee, at its sole expense shall keep the Leased Property as now or hereafter constituted (with all improvements made thereto) clean and in good condition (reasonable wear and tear excepted) and shall make all rlepairs. including all structural repairs, necessary to maintain the Leased Property. All rEtpairs, replacements. and renewals shall be at least equal in quality of materials and workmanship to that originally existing in the Leased Property. Lessor shall in no event be required to make any repair, alteration. or improvement to the Leased Property. Any fixture, equipment or materials replaced by Lessee shall belong tlD Lessor, and all proceeds from the disposition thereof shall belong to Lessor. LElssee shall indemJ1ify Lessor against all costs, expenses, liabilities. losses. damages, suits. claims and demands because of Lessee's failure to comply with the requirements of this Paragraph 7. and Lessee shall not call upon Lessor for any disbursement or outlay whatsoever in connection therewith, and hereby expressly releases and discharges Lessor of and from all liability therefor. PAGE 4-MT. ASH~ND SKI AREA LEASE (p:dahy\sklaah\maa-ffd.lu) -- ~ ,. 7.1. Lessee shall perform its obligations for maintenance and repair. shall make improvements to the Permit Property, and shaH replace portions of the Equipment, as required to ensure that the actual liquidation value of the Leased Property is no~ I~ess than the Minimum Uquidation Value of the Leased Property. 7.1. 1. Lessee shall not be required under this Paragraph 7.1 to .replace any portions of the Equipment which are not needed in Lessee's operations, except that this provision shall not operate as a waiver of Lessee's obligation to maintain the .aCtualliquidation value of the Leased Property at a level not IE~ss than the Minimum Uquidation Value of the Leased Property. If for any reason the actual fiquidation value of the Leased Property declines below the Minilmum Uquldation Value of the Leased Property. then Lessee shall deposit Into the Ski Area Trust Fund a sum of money ("the Restoration .Sum-) equal to the difference between the actual Uquidation value of the Leased Property and the Minimum Uquidation Value of the Leased Property. The Restoration Sum shall be so deposited within ninety days after delivery to. Lessee from oLesSor tn written demand therefor. olf Lessee disputes the Lessor's determination of defici~ncy. then Lessor shall proceed as provided in Paragraph 7.1.3. Exc~pt ~ provided in Paragraph 7.1.2 or as otherwise agreed in writing by Lessor and Lessee, amounts deposited by Lessee Into the Ski Area Trust Fund pursuant to this Paragraph shall be used only for costs of restoration of the Pennlt prctperty as required under the Permit, and the trustee shall not use or permit the use of the assets of the Ski Area Trust Fund for any. other purpose. . 7.1.2. In recognition and support of Lessee's intention to provide educational and recreational programs to residents of the City of Ashland and to operate the Leased Property in 8 manner which will stimulate the econcmy of the GitY, and. in recognition of Lessee's inability to commence ski area open1tions for the 1992 - 1993 ski season without financial support from the City t Lessor authorizes the trustee to pay and distribute to Lessee. wlthln :30 days after the effective date of this Agreement, the entire principal of the Ski Area Trust Fund. During 1993 and aU subsequent years throughout the Lease term, the trustee shall distribute to Lessee, promptly upon demand from Lessee, all amounts of principal theretofore deposited by the Lessee to the Ski Area Trust Fund pursuant to Paragraph 7.1.1, but only if and to the extent that the sum of the value of the assets remaining in the Ski Area Trust Fund (~lfter making that withdrawal) plus the actual liquidation value of the Leased Prc)perty at that time exceeds the Minimum Uquidation Value of the Leased Property at that time. Lessee shall not under any circumstances be entitled to receM~ any income earned with respect to the Ski Area Trust Fund. All income earned with res~ to the Ski Area Trust Fund shall be credited to (and shall be deooned for all purposes to have been earned by) the City of Ashland, but shall bel held and retained by the trustee in the Ski Area Trust Fund for use in connecUon with the eventual restoration of the Permit Property. All income and principal remaining in the Ski Area Trust Fund upon termination of the Lease shall be distributed by the trustee to the City of Ashland. PAGE 5-MT. ASHLAND SKI AREA LEASE (p:dally\skiash\maa.ffd.lse) '- .-- ,. 7.1.3. Whenever Lessor reasonably determines that the sum of the actual liquidation value of the Leased Property plus the amounts then heJd by the City of Ashland in the Ski Area Trust Fund is less than the Minimum Uquidation Value of the Leased Property. Lessor may request an appraisal of the Leased Property by an independent quarlfied appraiser chosen by Les~~ee from a list of not f~wer than three submitted by Lessor in conjunction with the request. If Lessee does not make the choice within five days. Lessor may do so. The appraiser shall have access to an of Lessee's records as neCessa,ry for the appraisal and shall take such steps .as the appraiser deems necessary to make a competent appraisal. The appraiser shall report to the parties within 30 days after being chosen. The report shall be final and binding upon both parties. The cost of the appraisal shall be borne by the Lessee if the sum of the actual liquidation value of the Leased Property plus the amounts then held by the City of Ashland in the Ski Area Trust Fund is less than 110% of the Minimum Liquidation Value of the Leased Property. Othe~se the cqst pf the appraisal shall be borne by the Lessor.' · 7.2. Lessee shall be solely responsible for any improvements. alterations ()r repairs to the Leased Property required pursuant to the Americans with Disabilities Act. 8. Utilities. Lessee shall be responsible for. and shall pay all charges for janitoriEll services, garbage removal. gas. electricity. fight, heat. power. telephone. sewage disposal and domestic water used. rendered or supplied upon or In connedion ~fith the Leased Property. 9. Rre and casualty insurance. Lessee covenants and agrees to keep the Le~KI Property Insured against loss by fire with extended coverage endorsement, Including risk of loss resulting from collapse of the structures. nghtning. vandalism and malicious mischief. Sucn insurance policies shall at aU times be maintained in force in an amount equal to the full insurable replacement value of the premises and properties Insured. It Is a condition o~ payment of such insurance premiums by Lessee tha1t the proceeds of any such insurance shall be applied to the repairing or restoration o~f the property damaged whether the loss is partial or total. The City of Ashland shall be named as an additional Insured on such policies. 10. Uability insurance. Lessee shall procure. and during the term of this Lease lshall continue in force. at lessee's cost, public liability and property damage insuraoo9. including ski operators liability coverage. issued by a responsible company with limits of not less than $500.000 per occurrence (combined single limit for bodily injury land property damage claims) or $500.000 per occurrence for bodily injury and $100.000 per occurre,nce for property damage. Such insurance shall cover all risks arisintl directly or indirectly out of Less~e's activities on. or as -a result of-the condition of. the Leased Property and shall protect lessor and Lessee against all claims of third persons. Certificates evidencing such insurance and bearing endorsements requiring 30 days written notice to Lessor prior to any change or cancellation shall be fumlished to Lessor. It Is agreed that the Lessor shan not be liable to any third persons as! a result of the use of the Leased Property by the Lessee. its employees or agents. and PAGE 6-MT. ASHLAND SKI AREA LEASE (p:dally\8klash\maa-ffd.lse) '- --- ..... I' the Lessee covenants and agrees to save the Lessor harmless from the claims o'f said third person~ by reason' of the use of said premises by the Lessee herein. 11. Real property taxes. In the event any property subject to this Lease shall be assessed for property taxes, such taxes shall be paid by the Lessee on or beforEt the 15th day of November of the taxable year. 12. Default or breach. In the event the Lessee commits any default or breach air any of the tenns or conditions of this Agreement and fails or neglects to correct the same within six months after notice thereof by the Lessor, then and in such event, the Lessor shall have the right to immediately expel the Lessee from the Leased Property and declare this Lease terminated. In the event the Lessee fails to operate the LJeased Property as a ski area and/or winter recreation resort at any time during 8 period of twelve consecutive months, except for war, catastrophe, natural causes (mcludlniJ but not limited to lack of sufficient snow for reasonably profitable oper~ons), or othelr 'circumstances beyond the control 91 the Lessee, the Lessor shall have the ligt\t to immediatelY terminat~ this Lease. 13. Le~ Compliance with Environmental Laws. . 13.1. Definition of -M7Ardous materlal-. As used Is this Paragraph, the term -hazardous material- means any hazardous or toxic substance, material. orwasb~. IncIud1ng, but not limited to, those substances, materials, and wastes listed in thEt United States Department of Transportation Hazardous Materials Table (49 C.F.Ft S 172.101) or by the United States Environmental Protection Agency as hazardous substances (40 C.F.R. Part 302) and any amendments, ORS 466.567,466.205. 466.640 and 468.790 and regulations of the Oregon State Department of ,EnvIronmental Quality J petroleum products and their derivatives, and such other substances. materials and wastes as become regulated or subject to cleanup authority under any envlronmental.laws. Environmentallsws means those laws cited in this subparagraph. 13.2. Lessee's compliance with laws and permits. Lessee shall cause the Leased Property and all operations conducted on the Leased Property ~ncluding operations by any subtenants) to comply with all environmental laws. 13.3. Umitation on uses of hazardous materials. Lessee shall not use or allow any agents. contractors or subtenants to use the Leased Property to generate, manu1acture, refine, transport, treat, store, handle, recycle, release or dispose 01: any hazardous materials, other than as reasonably necessary for the operation of Lessee's activities asr~ntemplated under this Agreement. 13.4. Lessor's Rights. Lessor shall have the right to conduct reasonable .- inspections and investigations of the Leased Property and the operations conducted .,/ on the Leased Property at any time and from time to time, and Lessee shall cooperate fully with Lessor during such inspections and investigations. PAGE 7-MT. ASHLAND SKI AREA LEASE (p:daIIy\lkIash\maa.ffdJse) --- "',- , " . 13.5. Indemnification. Lessee agrees to defend (with counsel approved by Lessor). fully indemnify, and hold entirely free and harmless Lessor from and ag.ainst all claims, judgments, damages, penalties, fines, costs, liabilities, or losses Qncluding, without limitation, diminution in value of the Leased Property, damages for the Io$s or . restriction on the use of rentable or usable space or of any amenity of the LeasEKt Property, damages arising from any adverse impact on marketing of space, surns paid in settlement of claims, attorney fees, consultant fees, and expert fees) which ~ise during or after the lease term and which are imposed on, or paid by or asserted against Lessor by reason or on account of. or in connection with. or arising out of lessee's generation, manufacture, use, transportation, refinement, treatment, stc)rage, or disposal of hazardous materials, or any release of hazardous materials as a result of Lessee's use or activities, or of Lessee's agents, contractors, or subtenants. 14. Umitation On Asslonment Or Sublease By Lessee. Lessee shall not assign this Lease or sublease any portion of the Leased Property without obtaining in each instance the written consent In advance of Lessor, which consent shall not be withheld unreasonably, and which consent shall be deemed for all purposes to have been given by Lessor if not expressly given or withheld within thirty (30) days after rec:eipt by Lessor of Lessee's written request for that consent. In determining whether consent is reasonable, Lessor may consider any and all relevant factors, including, but not imited to, the financial stability of the proposed sublessee or assignee and the extent to which the pubfic Interest is affected by the sublease or the assignment. Consent by Lessor in any one instance shall not constitute a waiver or consent 'to any subsequent instance. . 15. Miscellaneous. Nothing contained in this Agreement shall create between the parties hereto, or shall be relied upon by any other person as creating, any relationship of partnership, association, joint venture, principal and agent, or otherwise. The sole relationship of. the parties hereto shall be that of landlord and tenant. "rhere are no oral agreements or representations between the parties hereto which aff~~ this Agreement, and this Agreement supersedes and c;:ancels any and all previous negotiations. arrangements, agreements, warranties, representations and understandings, if any, between the parties. The paragraph headings set forth in this Agr~ement are set forth for convenience purposes only, and do not in any way define, limit or construe the contents of this Agreement. If any provision of this Agreerrlent shall be determined to be void by any court of competent jurisdiction, then that determination shall not affect any other provisions of this Agreement, and all such other provisions shall remain in full force and effect. It is the intention of the patties that if any provision of this Agreement is capable of two constructions, only one, of which would render the provision valid, then the provision shall have the meaning which renders It valid. If suit or action is instituted in connection with any contr()versy arising out of this Agreement, the prevailing party in that suit or act10n or any appeal therefrom shall be entitled to recover, in addition to any other relief, the sum which the court may judge to be reasonable attorney fees. Any notice required or permitted under this Agreement shall be deemed to have been given and delivered when personally delivered or when deposited in the United States mail. as certified mail, postage prepaid. and addressed to the last-known address of the party being PAGE 8-MT. ASHLAND SKI AREA LEASE (p:dalty\skfash\maa-ffd.lse) - -- ---" t .. provided with the notice. This Agreement shall inure to the benefit of and shall be binding upon the successors. assigns. heirs and personal representatives of Le~ror and Lessee. This Lease Agreement is being executed in two counterparts, each of which shall be an original, and. both of, which shall constitute a single Instrument, when signed by both of the parties. Waiver by either party of strict performance .of an~r of the provisions of this Agreement shall not be a waiver of, and shall not prejudice the party's right to subsequently require strict performance of, the same provision or Wly other provision. The consent or approval of either party to any act by the other party . of 8 nature requiring consent or approval shall not be deemed. to waive or rendel" unnecessary the consent to or approval of any subsequent similar act. This lease ~hall be govemed and performed in accordance with the laws of the state of Oregon. Each of the parties hereby irrevocably submits to the Jurisdiction of the courts of Jackson County, Oregon, and agrees that any legal proceedings with respect to this Agreement shall be filed and heard in the appropriate court in Jackson County, Oregon. & .' It 16. Nondiscrimination. In connection with any operations of Lesse~ under this lease, Lessee shall not discriminate against any employee or applicant for employment because of race, color, religion, sex. national origin, age, or disability. Lessee shall not discriminate by segregation or otherwise against any person on the basis or race, color. religion, sex. national origin, age, or disability by curtailing ~ refusing to furnish accommodations. facilities. services, or use privileges offered to the public gener,ally.. Lessee: Lessor: MT. ASHLAND ASSOCIATION :~~d~- BY Its CITY OF ASHLAND ~~ Mayor Cathy Golden B4~~~~~ Nan Franklin, City Recorder PAGE 9-MT. ASHLAND SKI AREA LEASE (p:daily\skialh\maa-ffd.lae) <I: w a: < ~... (1):3 Q~ z~ <t~ ..J ~z e l.X"'~... t . -.