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Home My WebLink About1997-09-08 97-385 ORDERDIINCH. ACTION Item No Rak!ii Date: 9 97 Item/Subject: ORDER, Authorizing lie City Manager to Execute a Lease Termination Agreement with Bangor Youth Hoclmy Responsible Department: City Manager Commentary: The attached agreement will terminate the cannot armvgwent with Bangor Youth Hockey fir the lease of Sawyn Anna. The City will dnectly assume full operation and control of the facility with youth hockey as one of our primary users. The agreement will also: f give rent payments called for order the lease auangemem relating in an original capital contribution made by the City toward construction of the arena; authorize the City to assume youth hockey's debt associated with the purchase of a new compressor and ice mat, and arrange for a surcharge on youth hockey ice time to go toward other outstandng amounts owed the City. We believe that this agreement will address the immediateimancial problems of Bangor Youth Hockey and allow Sawyer Arena m continue to operate as aconnmunity asset I recommend your approval, as does the Finance Committee Depm4nent Head Manager's Comments: City Manager Associated foformation: Order, Lease Termination Agreement Budget Approval: Finance Director Legal Approval: V,f h City Soficim introduced for 2rraesage First Reading Page—of Referral Amigaed to Coundlor Farnham September 8, 1997 rM M-1 CITY OF BANGOR (TITLE.) (pratra ..........._ Adumizing the City Man I ager toE I Keentoa Levee Termination Agreement with Bangor Youth Hockey By the My Council of tM City OfBanyor. ORDERED, TEAT the City Manager is hereby autlwrized m execute the attached Lease Termination Agreement with Bangor Youth Hockey. eoik,y ad IN CITY COUNCIL September 8, 1997 Passed P3 9]-385 ORDER Titie, Authorizing the City Manager to Execute Lease TenovtaHOn Agreement with Bangor Youth Hockey ..... �a..... . gn Mtn Councilman 3L3BY LEASE TERMINATION AGREEMENT THIS AGREEMENT, made and executed in duplicate, this day of September, 1997 by and between: CITY OF BANGOR, a body politic and corporate, duly organized and existing under and by virtue of the laws of the State of Maine, located in the County of Penobscot, State of Maine (hereinafter referred to as "CITY") and THE BANGOR YOUTH HOCKEY ASSOCIATION, a non-profit corporation, duly organized and existing under the laws of the State of Maine, and having an office or place of business in said City of Bangor (hereinafter referred to a6 "BYHA"), W I T N E S S E T H: WHEREAS, the City of Bangor and the Bangor Youth Hockey Association are parties to certain agreements as follows: • Lease dated April 1, 1991 as amended by a "Amendment to Lease" dated October 7, 1993; ° "Facility Maintenance and Management Agreement" dated October 7, 1993 as amended by an "Amendment to Agreement" dated January 5, 1996 relating to the financing, maintenance and operation of an ice arena ("Sawyer Arena") located at the City of Bangor's Hayford Park; and WHEREAS, the parties' Lease dated April 1, 1991 as amended October 7, 1993 contains a schedule of structured annual rental payments by the BYHA to the City intended to amortize the Cost of certain capital improvements to Sawyer Arena that were financed by the City of Bangor; and WHEREAS, the principal balance remaining unpaid for capital improvements to Sawyer Arena to be amortized under the parties' April 1, 1991 Lease as amended was $61,632.59, following BYHA'9 scheduled payment of $11,500.00 to the City of Bangor on August 1, 1996; and WHEREAS, BYHA is the Borrower under a certain Promissory Note dated December 2, 1994, in favor of Merrill Merchants Bank, in the original principal amount of $172,804.20, as modified by an Allonge dated August 29, 1995, true copies of which are collectively attached to this Agreement as Exhibit "A", the sr3a�, proceeds of which Promissory Note were used to purchase and install a chiller mat and compressor at Sawyer Arena; and WHEREAS, as of June 30, 1999, BYHA owed $141,045.31 to Merrill Merchants Bank under BYHA's Promissory Note dated December 2, 1994; and WHEREAS, in addition to the foregoing agreements and Promissory Nate, ByHA is indebted to the City in a total amount of $62,349.06 consisting of $52,186.05 owed for ice time during the 1996-99 skating season and $10,159.01 owed as a refund of excess distributions of prior -year surpluses from the operation of Sawyer Arena; and WHEREAS, the parties wish to terminate the existing Lease and the Facility Maintenance and Management Agreement and to restructure BYHA's existing indebtedness, NOW, THEREFORE, the parties hereby mutually agree as follows: (1) The parties' Lease dated April 1. 1991, as previously amended, and the parties' Facility Maintenance and Management Agreement dated October 9, 1993, as previously amended, are hereby terminated. All accounts and liabilities of the parties under both agreements shall be accounted, closed out and settled as of June 30, 1997. (2) All amounts scheduled to be paid by BYHA to the City of Bangor as rent under the parties' Lease dated April 1, 1991, as amended October ], 1993, on or after August 1, 1999, are hereby forgiven. (3) The City of Bangor hereby agrees to assume BYBA's indebtedness to Merrill Merchants Bank under the December 2, 1994 Promissory Note. In consideration of the City of Bangor's assumption of this indebtedness, BYHA, upon execution of this Agreement, also shall execute and deliver a bill of sale conveying title to the chiller matand compressor to the City of Bangor, subject only to the security interests of Merrill Merchants Bank, if any, under the December 2, 1994 Promissory Note. (4) All net amounts owed by BYHA to the City of Bangor as rent, management fees, or reimbursement of excess distributions or expenses under the parties' Lease dated April 1, 1991, as amended, or under the parties' Facility Maintenance and Management Agreement dated October ], 1993 as amended, or for ice time charges, accrued prior to July 1, 1999, shall be carried forward as an account receivable by the City of Bangor. No interest or late payment fees shall be charged on receivables accrued Prior t0 July 1, 1999. The net amounts owed shall be collected by the City of Bangor as a $10.00 per session rcharge on ByHA's use of Sawyer Arena ice for the 1999-98 and subsequent skating seasons. BYHA may, at its option, make additional payments at any time to pre -pay these accrued charges. In consideration of the City of Bangor's -2- forbearance of other collection action with respect to such amounts, BYHA hereby agrees that it shall exclusively utilize Sawyer Arena for all scheduled on -ice practices and home games Of all BYRA ice hockey teams, to the extent of available ice time, for a period of ten (10) years or until all amounts owed are paid, whichever is sooner, following execution of this Agreement. It is further agreed that during such period BYES shall pay to the City of Bangor the City's established rates for use of Sawyer Arena ice time, without discount, plus a 510.00 per session surcharge for scheduled practices and regular season and playoff games. This surcharge shall not apply to tournaments and special events coordinated by BYHA and which primarily serve other groups Or non-BYHA users. (5) The City agrees to grant BYHA priority in scheduling of e time at Sawyer Arena, consistent with BYRA's practice, game, playoff and tournament schedules, for so long as BYHA remains current on its payment of ice time charges and surcharges to be paid to the City under paragraph (4) above. (6) Upon any default of this Agreement by BYHA remaining uncured for a period of thirty (30) days following written notice, the City of Bangor shall be entitled to declare a default of the entire Agreement, and to declare as imediately due and payable all indebtedness to be assumed or forgiven by the City of Bangor hereunder, in addition to other amounts owed by BYES, for ice time and surcharges. In such event, the City of Bangor shall have all remedies that may be available in law or equity for the collection of all such mounts from BYRA, to include collection of prejudgment interest, court costs and reasonable attorneys fees thereon. IN WITNESS WHEREOF, the parties hereto have set their hands and seals the day and year first written above. CITY OF BANGOR (By) Witness (Title) THE BANGOR YOUTH HOCKEY ASSOCIATION -3-