Site A-12/Myron StrandHANGAR SITE LEASE
THIS Lease, made and entered into this 22nd day of October,
2006, by and between the City of Kalispell, a municipal
corporation, hereafter referred to as CITY, and Myron Strand, P.O.
Box 166, Kalispell, MT 59903 hereafter referred to as TENANT:
W I T N E S S E T H:
WHEREAS, the CITY operates the Kalispell City Airport, and
WHEREAS, the CITY desires, in order to provide a source of income
for airport maintenance and to increase the utilization
of said airport, to lease tracts of land to various
tenants in order that the tenants may erect structures
for the storage and protection of aircraft based at said
airport.
NOW, THEREFORE IT IS AGREED BETWEEN THE PARTIES HERETO AS FOLLOWS:
1. The City does hereby agree to lease to TENANT, and TENANT
hires from City, those certain premises located at the
Kalispell City Airport, Kalispell, Montana, which are
specifically described in Exhibit "A" is attached to this
Lease and by this reference incorporated herein.
2. The term of this Lease shall be for ten (10) years,
commencing on the 22nd day of October, 2006 and ending on
the 22nd day of October, 2016, unless sooner terminated
by mutual agreement of the parties or by one of the
parties under the specific provisions hereof.
3. TENANT agrees to pay to the CITY for the use and benefit of
the CITY the sum of $.16(sixteen cents) per square foot per
year for the site, which for purposes of this provision
shall be one hundred and fifty percent (150%) of the actual
square footage occupied by the hangar(60'x80'), herein
authorized, payable as follows:
W
Upon the commencement date,
rata portion of the annual
from the commencement date
TENANT shall pay the pro -
rent for the time period
to July 1 next succeeding.
On each July 1, TENANT, without demand, shall pay the
annual rental to the next succeeding fiscal year.
2003 Airport Lease
Page 1 of 9
C. On -July 1, at the commencement date of the fiscal year
during which this Lease terminates, TENANT, without
demand, shall pay the pro-rata portion of the annual
rent for the time period from July 1 to the termination
date of the Lease.
d. During the ten-year term of the lease, the annual lease
payment shall increase 3% annually, from the previous
year's payment.
e. The Airport Manager or his designee will be responsible
for the collection of lease payments or administrative
fees for existing hangar and ground leases.
4. TENANT agrees the property shall contain only one building
for the purpose of housing light aircraft on said land.
a. TENANT shall have the right, upon the termination of
this Lease, unless a lease for a further term be
negotiated, to remove the hangar structure, but shall
do so within 90 days and shall leave the premises in a
restored condition, except that any paving shall be
left.
b. If TENANT does not remove said building within such
allotted time, it shall then become the property of
CITY without further action on the part of the CITY.
c.TENANT may not expand the square footage of the building
constructed on the Airport site.
5. TENANT shall use said property for the storage of light
aircraft and other lawful purposes necessarily incidental
thereto and for no other purpose.
a. TENANT may sublet the premises for aviation
purposes, subject however to the prior written
consent of CITY. Any such sublease shall be in
writing and shall be reviewed by CITY prior to
approval.
b. CITY'S approval of any sublease shall not relieve
TENANT of any obligation imposed by this agreement.
TENANT shall provide to CITY a signed copy of the
final sublease agreement for its file.
C. Upon approval by CITY of any sublease, an
administrative fee equal to 20 of the rental fee
2003 Airport Lease Page 2 of 9
imposed by TENANT on the sublessee, shall be paid
by TENANT to CITY throughout the term of the
sublease. This administrative fee shall terminate
upon termination of the sublease.
6. TENANT shall have the right and privilege of sale,
assignment or transfer of this Lease for the purpose
defined in 15, hereof, upon written notice to the CITY
stating the name and address of the proposed buyer,
assignee, or transferee.
a. If the CITY shall determine that said proposed
buyer, assignee, or transferee is objectionable,
any such reasonable objection shall be stated in
writing to the TENANT within twenty (20) days after
said notice.
b. The CITY shall not unreasonably withhold consent to
sell, assign, or transfer this Lease, but reserves
the right to adjust the annual rental payments
following assignment.
C. After sale or assignment by TENANT of its interest
here, TENANT shall be relieved from liability for
rental payments accruing thereon, and the buyer,
assignee, or transferee shall thereafter be liable.
d. Transferee under this paragraph shall only acquire
the balance of the term of the lease and shall be
subject to all terms and conditions of this lease,
including the obligation to provide CITY with proof
of insurance coverage as required by 18.
7. If, for any reason, the CITY discontinues aviation
operations on Kalispell City Airport site, the CITY may
terminate this lease and may elect to pay TENANT the
unamortized portion of the cost of the hangar, herein
authorized to be built. That amortization is to be
computed on a straight-line basis over the period from
the completion of the improvement up to 15 years.
8. TENANT shall hold harmless and indemnify the CITY from
any and all liability claims of any kind or nature,
whatsoever, arising out of the erection or expansion of
the building upon the premises contemplated, herein, or
the use of said premises by TENANT or TENANT's invitees
or licensees.
2003 Airport Lease Page 3 of 9
a. As evidence of TENANT'S covenant herein, TENANT at
TENANT expense shall keep in force, during the term
of this Lease, insurance, issued by an insurance
company, licensed to do business in Montana,
protecting the CITY against all liabilities,
judgments, costs, damages and expenses which may
accrue against, be charged to, or recovered from
the CITY, by reason of damage to property of,
injury to or death of any person or persons on
account of any matter or thing which may occur on
the demised premises.
b. Policy or policies in the amount of Seven Hundred
and Fifty Thousand Dollars ($750,000.00) with
respect to any one person, and One Million and Five
Hundred Thousand Dollars ($1,500,000.00) with
respect to any one occurrence shall be held. Said
insurance policy shall name the CITY, its officers,
employees and agents as additional named insureds,
and shall not be canceled or materially changed
without at least thirty (30) days prior notice to
the CITY, and shall be subject to approval as to
coverage by the CITY.
C. Proof of insurance coverage required by this Lease
shall be provided by TENANT to CITY at the time of
execution of this agreement. CITY reserves the
right at any time during the primary lease term or
any extension thereof, to require TENANT to provide
to CITY proof of continued insurance coverage.
d. Policy limits are subject to change in accordance
with 12-9-108, MCA, ALimitations on Governmental
Liability for Damages in Tort.@ TENANT shall file
certificates of said insurance with the CITY, and
said insurance shall be in full force and effect,
throughout the term of this Lease.
e. Failure or refusal by the TENANT to obtain or
maintain said insurance as required hereunder shall
constitute a material breach of this Lease and, in
such event, CITY, in its sole discretion, may
terminate this Lease without liability to TENANT
hereunder, or elect to obtain like coverage and the
cost for such coverage shall be paid by TENANT.
2003 Airport Lease Page 4 of 9
9. TENANT shall be responsible for acquiring whatever
insurance TENANT deems necessary to safeguard TENANT'S
interest in the TENANT's building, herein authorized, and
personal property stored in said building, and TENANT
expressly covenants and agrees to assert no claim against
CITY as a result of the loss or damage to the building or
personal property belonging to TENANT or anyone else
resulting from the action of any third party.
a. TENANT herein covenants and agrees to take whatever
steps TENANT sees fit to take in protecting
TENANT'S property and persons from loss or damage
as a result of vandalism, malicious mischief, theft
or kindred losses, and agrees to assert no such
claim against the CITY incident thereto.
b. All losses suffered by TENANT resulting from criminal
activity or others shall be reported to the police. The
CITY assumes no responsibility for such losses.
10. In the event that soils or other material are found on the
leased site that are AHazardous or Deleterious Substances@ as
defined by the Montana Comprehensive Environmental Cleanup and
Responsibility Act, '75-10-701 et seq. MCA (ACECRA@),
AHazardous Substances@ as defined by the Comprehensive
Environmental Response, Compensation and Liability Act, 42 USC
19600, et seq. (ACERCLA@), AHazardous Waste@ as defined by the
Montana Hazardous Waste and Underground Storage Tank Act, '75-
10-401 et seq., MCA or the Solid Waste Disposal Act, as amended
by the Resource Conservation Recovery Act, 42 USC '6901 et
seq., or which require special remediation or disposal or
disposal pursuant to any other applicable law, TENANT shall
excavate, handle and dispose of such soils or other material
only in compliance with such statutes and regulations.
a. In the event TENANT leaves any of the above described
materials on the property, the CITY may, at its option,
have wastes properly disposed of and assess the costs of
removal, storage, transport and disposal to TENANT.
b. All Hazardous Materials must be appropriately labeled and
stored.
C. In the event Hazardous Materials are spilled upon the
property, it is the responsibility of TENANT to have the
spill cleaned up according to State and Federal laws and
regulations. In the event that drains or floor sumps are
2003 Airport Lease Page 5 of 9
co,,caminated, it will be the responsibility of TENANT to
clean up those systems.
d. TENANT is aware that there are significant penalties for
improperly disposing of wastes or submitting false
information, including the possibility of fine and
imprisonment for knowing violations. TENANT must comply
with all state, federal and local laws pertaining to the
handling and storage of hazardous materials.
11. No construction or installation of any underground fuel storage
tank dispensing system shall be allowed upon the premises.
12. Any utility services required by TENANT's building or for its
use shall be obtained by TENANT at TENANT's expense.
13. a. TENANT agrees that the building will be maintained in good
order, repair and safe condition and in compliance with
the law. TENANT shall make any and all additions to, or
alterations or repairs in and about the land and/or
improvements which may be required and, in doing so,
TENANT shall observe and comply with all existing or
future public laws, ordinances and regulations applicable
to the land or public airport land upon which the leased
premises are located.
b. TENANT shall maintain an area of ten (10) feet from the
exterior walls of the hangar or of the median point
between hangars if there is less than twenty (20) feet
between hangars, free from brush and weeds. If TENANT
fails to keep and maintain the leased premises and
improvements as required hereunder, CITY may in its
discretion following written notice undertake to do or
have done such and any expenses incurred by CITY shall be
paid by TENANT.
C. TENANT shall not store personal property, equipment of any
kind, or vehicles, outside of the hangar.
14. TENANT shall be responsible for all taxes levied upon the
structure erected hereunder and any equipment or property
located therein. The land is owned by the CITY and is exempt
from taxes, and the CITY agrees to maintain such tax exempt
status.
15. TENANT shall comply with all State and Federal laws and
regulations and with the Operating Regulations of the City of
Kalispell. CITY shall have the right, through its agents or
employees, for reasonable ingress and egress to inspect
2003 Airport Lease Page 6 of 9
premises to ascertain that the terms of this Lease are being
adhered to.
16. Notices to CITY shall be sent by certified mail, postage
prepaid to City Manager, City of Kalispell, P.O. Box 1997,
Kalispell, MT 59903-1997, and notices to TENANT shall be sent
by certified mail, postage prepaid to:
Myron Strand
PO Box 166
Kalispell, MT 59903
17. TENANT shall have the right to cancel and terminate this Lease
and any obligations arising hereunder by written notice to the
CITY delivered within 60 days hereafter.
18. CITY reserves the right to further develop or improve, or not
develop or improve, the landing area of the airport as it sees
fit, regardless of the desires or view of the TENANT, and
without interference or hindrance.
19. This Lease shall be subordinate to the provisions and
requirements of any existing or future Lease between the CITY
and the United States, relative to the development, operation
or maintenance of the airport.
20. TENANT agrees to comply with the notification and review
requirements covered by Part 77 of the Federal Aviation
Regulations in the event any future structure or building is
planned for the leased premises, or in the event of any planned
modification or alteration of any present or future building or
structure situated on the leased premises.
21. It is mutually agreed and understood that if TENANT should fail
to make the annual lease payments as described above, or fail
to perform any condition or covenant or condition of this Lease
or fail to maintain the leased premises in a manner
satisfactory to the CITY, and such condition or conditions
exist for more than ninety (90) days after written notice is
given to the TENANT, CITY may then terminate and end this Lease
and re-enter and retake possession of the premises. All
buildings and improvements placed on the premises shall
thereupon revert to the CITY. This paragraph shall not apply to
failure of TENANT to obtain or maintain insurance under 18,
above.
22. It is mutually agreed that this Lease shall inure to the
benefit of and be binding upon the respective parties, their
2003 Airport Lease Page 7 of 9
heirs, s-,2cessors and assigns. It i_. further agreed that time
is of the essence of this Lease.
23. Any change or modification of this Lease, in order to be
effective, must be in writing and signed by the respective
parties.
24. In the event either party to this Lease shall be required to
bring an action against the other party to enforce this Lease,
or any portion thereof, the prevailing party shall be entitled
to reasonable attorney's fees and cost therefore in addition to
any damages that might be awarded.
25. Tenant will abide by all rules and regulations established by
the City of Kalispell for the City Airport.
IN WITNESS WHEREOF, said CITY has caused this Lease to be signed on
its behalf by the Manager of said CITY and said TENANT has executed this
Lease this 22nd day of October 2006
CITY OF KALISPELL
/ By:
By: �! �.�� By:
TENANT
STATE OF MONTANA )
: ss
Manager
Tenant
County of Flathead )
,`
On thisov& day of clO -e2 2006, before me, a Notary Public
in and for the State of Montana, personally appeared
known to me to be the person whose name is subscribed to the foregoing
Instrument, and acknowledged to me that he/she executed the same.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
Notarial Seal, the day and year first above written.
SEAL
2003 Airport Lease Page 8 of 9
Notary P 'lic, tate of Montana
Residing at .
My Commission ex Tres
IN WITNESS WHEREOF, said CITY has caused this Lease to be signed on its behalf
by the Manager of said CITY and said TENANT has executed this Lease this ay of
eiv1—
CITY OF KALISPELL
�j
ager
By:
STATE OF MONTANA )
Tenant
ss
County of Flathead )
1 l�
On this � day of �7 2006, before me, a Notary Public in and for
the State of Montana, personally appeared known to me to be
the person whose name is subscribed to the Olforegomg instrument, and acknowledged to
me that he/she executed the same.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my Notarial Seal,
the day and year first above written.
Notary Pu tic, tate of Montana
SEAL Residing at
My Commission expired ,7.
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