HomeMy WebLinkAbout1981-06-22 81-197 ORDERSubstituted Copy July 1391981" �I
Introduced by Councilor
,r CITY OF BANGOR
(TITLE.) (or/ler, Authorizing Execution of -Lease Agreementwith swift
By the OUR Couredt of the CITY of Hangar:
ORDERED,
THAT the City Manager is hereby authorized and directed, on behalf
of the City of Bangor, to execute a lease agreement, a copy of which is
attached hereto and made a part hereof, with Swift River Congany for the
lease of the Bangor Dam and related facilities.
R
.} . _ 81_199
FIMAL D Mn 18 JUNE 1981
LEASE made this day of , 198 .between the City of
Bangor, a body politic and corporate duly organized and existing under and by
virtue of the laws of the State of Maine and being located in the County of
EanoEscot, State of Mine (bereinafter referred to as Lessor) and Swift River
Comleny, a Measarhusetts corporation with a place of business in Boston,
County of Suffolk, Comonwealth of lsesadwsetts (hereinafter referred Was
lessee). .
WIT SETH:
In consideration of the mutual covenants contained herein, lessor and
lessee agree as follows:
1. PREMISES: lessor hereby leases to Lessee and Lessee hereby takes from
lessor, upon the terms hereinafter set forth, the property ani rights situated
in Bangor, Brewer, Veazie, and Eddington Maine, consisting of a dam,
buildings, water and riparian rights and other rights, all as described in
Fxbibit A annexed hereto, (hereinafter collectively referred to as the
"Premises").
2. PU1S0.5E: This lease is being executer] in order to provide for the
radevelalment and operation of -a hydroelectric [ower production facility
(hereinafter sometimes referred to as the "Facility") Iocated on the
above-described premises, issues's use of the premises and other areas
permitted under this lease shall he limited to such purposes as may be
specified in a license to be issued by the tederalynergy, aegulatory
Commission (hereinafter soretimes referred to as "£FAC") and such other
cointible uses as may he authorized under the Zoning Ordinance of the City of
Bangor. _
MMIRIx A
3. EFFE M ESTE Aim T : this lease and all obligations on the part of the
parties shall become effective on , 199 , robe teen of this
lease shell commence. with the effective date of this agreement asstated
herein. unless sooner teminated as provided in Articles of this
agreement, the term of Nis lease shall expire on , 203 or upon
the expiration date of the anticipated FM license issued for the premises,
whidaver caxsss first.
4. FEASIBILITY: -
(a) Study: Within six months of Ne date of Nis lease, Lessee will
complete a two-phase feasibility study of The facility N determine whether
the construction and operation of Ube hydroelectric facility is econonical and
otherwise feasible.
The first phase of the study will examine the issues of fisMties, pool
elevation, tides and the historic nature of the existing WiMings. if'the
first phase of the study is satisfactory, in the judgnent of the lessee, then
Ow lessee will conduct a study to determine Ne most feasible alternative for
tow construction and operation of a loo Mad hydroelectric facility for the
generation of electricity. _
(b) petermination of Feasibility: The final date mi:ation of whether the
project is feasible shall -rest in Ne judgment of the Lessee; provided,
Mwever, the facility shall be designed as much as possible N achieve the
maximum pernissible power output as nay be practical from the Premises, giving
due consideration to the -fisheries, the effect on veazie poem and tidal
influence. subject to the aforesaid conditions, Lassee shall Mve sole
discretion to determine Oa size ane. type of facility to be constructed on the
'Premises.
(c) Notification of Intent to Proceed: If Losses determines Nat the
project is feasible it shall notify the lessor of the results of the studies
and That it intends to proceed.
(d) 'termination:. iflassesdetermines that the project isnot feasible,
it shall so notify the Lessor and this lease shall be terminated, as provided
in paragraph. 21 of this agreement.
5. LI(E1 AND PEWAIIS: As soon as is reasonably possible after the execution
of this lease, Out in any event no less flan 120 days after the completion of
the feasibility study, lessee will cmmerce to file appropriate and timely
applications for such licenses and permits with the appropriate federal, state
and municipal authorities as are determined co be necessary far -the
construction arca operation of the facility. In the event lessee is unable to
ottain any license or permit necessary to constructthe facility, lessee may
terminate this lease upon written notice to lessor, as: provided in paragraph
21 of this agreement.
6. O0151RICIION: Promptly after receipt of the permits and licences necessary
to permit construction and Operation of the facility, lasses will Submit to
lessor a construction achedule and within 12 months will begin the
construction thereof. Lessee agrees Hat the power generating facility stall
be coaetructed on property located in the City of parlor..
7. FII14WM: If, prior to construction tropes is unable to secure financing
acceptable to lessee, Lessee shall notify the lessor and this ]ease shall be
terminated, as provided in paragraph 21 of this agreement..
8. ORIbtENNl'S: If this lease is terminated under Paragraphs 4,5,7,20,21 or 22
at anytime prior to construction lessee will make available to lessor copies
of all studies, reports or other documents prepared by or on behalf of Lessee
in connection with the facility, and the premises.
9. d£Nl: a.) lessee agrees to pay to lessor rental based open a percentage
of gross revenues from Operations derived from the facility as follows:
Commenting with start up of operation - Production year 3 1.5%
(It being uraerstocd that the let production year
will dance at the end of the first full quarter
of Operation after start-up.)
Production years _4 - 7 inclusive 36
Production Years 8 -.
10
inclusive
3.58
Production Yews 11 -
15
inclusive
5.58
Production Years 16 -
20
inclusive
68
Production Years 21 -
25
inclusive
- 7.58
Production Years 26 -
50
inclusive
9%
b.) (Ental payments shall he due and payable quarterly
as follows:
April 30 for quarter ending starch 31
July 31 for quarter ending June 30
Cctober 31 for quexter ending Septenber 30
January 31 for quarter ending December 31
It is understood and agreed between lessor and Lessee that the due date
for any quarterly rental payment may be extended for aperiod not exceeding
one month in the event that the dare data for municipal taxes and a rental
payment occur during the same month.
10. TANTS:
(s) The -Lessee agrees for itself, its successors, assigns end sublesses,
that it does hereby waive all right or privilege of exemptionfrau municipal
taxation for both the leased Premises and the Facility, and any improvements
thereto, as may ae available by reason of the City's status as a municipality,
or for any other reason wbatsoecer; and that the City, in its capacity as a
municipal taxing authority, may assess all .taxes as mull otherwise be
applicable ro both the Leased Premises and the Facility, and any ixryrovements
thereto, as if such exemption did not exist.
(b) In the event the waiver of tax exemption provided for in subsection
(a) above is foundto be unenforceable or in the event the City is unable, for
any other reason whatsoever, to assess against the property (real and
personal) or any part thereof included in both the (eased Premises andthe
Facility, and any improvements thereto, the full amount of any tines which'
mull otherwise be assessed against both the Leased Premises and the Facility,
arc] any improvements thereto, then (subject to the lessee's right to contest
the validity of the tax which mull otherwise he assessed) the reseee, its
successors, assigns, or sublessees shall pay to the City in lieu thereof the
amount of such taxes which could have been assessed against both the (easel
Premises and the Facility, and any improvements thereto, if the Leases
Premises and the Facility, and. any improvements thereto, were owned directly
by the Sastre aM were not subject to this lease agreement, the intent of the
Forties being that the lessee shall Iey to the City, as taxes, or Pursuantto
this paragraph, an amount equal to taxes that would have been assessed in
accordance with the City's standard valuation procedures, an a aunt equal to
the amount which would he pyable to the City if the leaned Premises and the
Facility, and any im[ wm hts thereto, were not OMCd by the City.
(c) In the event an alternate nethod of taxation or layrtent in lieu of
taxes is provided by statute and in the event its facility is subject to such
statutory provision, then subparagraphs a and b of this paragraph shall not be -
effective so long as the facility shall be subject to such alternate method of
taxation or Formant in lieu of taxes.
11. MIMWs: lessee shall pay promptly as and when the same becortie due and
Feyable all charges far water, asset, steam, heat, oil, gas, hot water,
electricity, light and power and other services furnished to the Premises or
used by lessee in connection therewith during the term of this lease.
12. PEPAIR$ AM IMPRCVEFI=:
(a) After the emmercenent of construction Lessee shall hare the right,
at its own cost and expense, to construct on the Fissions such improvements
sho to make such alterations to the Premises aid thre structures and
improv encs thereon as lessee shall deteonine to be proper in connection with
the development, construction and operation of the premises, provided that the
seen shall be in coopliame with all applicable federal, state and local
requirements.
(b) After the cosuerceuend of construction, Lessee shall at all times
during the teem of this. lease, and at its own cost and expense,'keep aol
maintain in repair and good and safe cadition (ordinary wear and tear and
damage by fire or other casualty excepted), all structures and improvements at
any time erected on the Premises by lessee and shall use all. reasonable
.precautions to prevent waste, dosage or injury to the Praxises.
(c) within six mutts after completion of construction of the facility
lasses shall remove all temporary structures £ranthe peenises. _
U. T1 1D IMPIt0.>FNeMS: Title W the'Windings, structures and improvements
constructed on the premises during the teem of this lease or airy extensions
thereof, shall he in the Leasee. Upon termination of this lease except as
provided in paragraph 20, title. to the buildings or other structuresshall
revert to the Lessor, provided however, that lassesshallhave 180 days from
the tenmination of the lease to remove pe[nonel property including Wt not
limited W generating equiprent, machinery, furnishings and furniture. Any
such property not so remoted shall became the prcparty of the lessor.. in the
etant lessee chooses to remove the personal property, the buildings and
structures shall he left in suitable repair, reasonable wear anti tear -
excepted. Lessor shall, however, has the option to purchase allor part of
the property to be ramoaed at fair marketvalueas determined by independent
appraisal. lessor may exercise this option by giving written notice to the
Iessee within 90 days after the tenmination of this lease.
14. FiNI M AFfFCTING MMISeS: (a) lessor is cognizant of the needof
lessee or its sublessee to finenm the construction of Wildings, structures
ani improuenrents on the demised premises, and therefore specifically agrees W -
permit the Iessee to mortgage, assign or transfer its leasehold interest in
the premises for the purpose of obtaining construction and permanent loan
finewing for the said buildings, structures, and improa ents, provided: (1)
the term of sudn mortgage, security agreement, asaiguanc or transfer shall
not exceed the initial term hereof (2) Iessee shall give notice to Sesser of
the existeree of such martgage, security agreement, assignment or transfer,
together with the name abu address of the mortgagee, other secured party,
'assignee or transferee and a copy of the mortgage, security agreement,
assignment or transfer doClmant; (3) that in the ewent of foreclosure, anti i
the event that said mortgagee, other security Party, assignee or transferee
shall be woe the owner of the lessee's interest pursuant to such foreclosure,
said mortgagee, other secured party, assignee or transferee shall here the
right to take possession and shall became the legal owner and holder of the
leasehold estate created hereunder and shall hold such estate upon the sane
terms and conditions as held by Lessee from which such mortgagee, other
secured patty, assignee or transferee acquired possession, but in such event,,
said mortgagee, other secured party, assignee or transferee shall only he
liable under the tensa and conditions hereof during the period of time in
wbich said mortgagee, other secured party, assignee or transferee holds such
estate, and rot thereafter, nor shall said mortgagee, other secured party,
assignee or transferee he liable for any default under the terms or conditions
hereof which areae before said estate became tested in said mortgagee, ether
secured party, assignee or transferee, provided however that the Lessor shall
have the right to terminatethislease pursuant to paragraph 22 in the event
that rentals scanning before said estate bernme vested in said mortgagee,
other secured party, assignee or transferee We not paid in full; (4) that
the existeme of such mortgage, security agreement, assignment or transfer, or
any foreclosure by a mortgagee or other secured party shall not relieve the
Lessee from any liability or responsibility for the obligations on its part to
he perfommd.
(b) Issues: agrees to give written notice to any mortgagee, other secured
party, assignee or transferee of which it has written notice. if Lessee.
defaults under any of the .terms or conditions of this lease, end sold
mortgagee,other secured party, assignee or transferee shall have a period of
sixty (60) days after receipt of said notice to core soon default, provided,
however, that where a default by its nature takes longer than sixty,(60) days
to cure,_ such mortgagee, other secured party, assignee or transferee shall be
given the right to commence the curing of such default within sixty (60) days
after notice aforesaid, 'a and to cure default within a reasonable period of time
thereafter:Lessor also agrees that in the event certain defaults of Lessee
are incapable of being cured by anon mortgagee, other secured party, assignee
or transferee, and if Lessor terminates this lease beceuse of such incurable
default, than a new lease will be executed by Lessor with said mortgagee,
other secured party, assignee or transferee as Lessee, open the same terms and
conditions as are contained in this lease. Lessor also agrees with soon
mortgagee, other secured party, assignee or transferee that no charge,
modification, agreement, amendnsmt, termination, or surrender of the said
lease shall be effective without the prior written consent of such mortgagee,
assignee or transferee.
(c) lessor also agrees that Lessee may mortgage, assign, or transfer its
leasehold interest in the premises for the purpose of obtaining capital for
other purposes upon teens and conditions as in (a) s (b) above.
15. ASSIG�T A SU(i.ETTING! Lessee shall not sublet all or any part of the
premises or assign or transfer this lease or any interest therein, except as
follows:
(a) !luring the tens of this Iease Lessee way, with Lessor's written
consent, transfer or assign this lease to a third party which agrees with
lessor to perform all of passee's obligations hereunder. Lessor agrees not to
withhold such concent unless it has reasonable and substantial grounds for
objecting to the assignee.
(b) lessee may mortgage or otherwise create a security interest in
lessee's leasehold estate heaurder as set forth in Section 14 above.
(c) In the case of any such transfer or assignment, the sane shall be
evidenced in writing and duly recorded in the Penobscot Registry of heeds and
said assignment shall provide specifically that the assignee does accept and
assume allof the terms, covenants, and conditions of this lease to be kept
and performed by Masse and will agree to comply with and be brand by them and
thereafter such assignee shall be deemed to he the Iessee hereunder.
16. INSUPAME:
)a) Lessee shall provide at its expense, and keep in force during
the term of this lease, general liability insurance with a good and solvent
insurance company or conganies, reasonably satisfactory to lessor, in
the amount of at least $1,000,000 combined single limit with respect to
bodily injury or property damage for which Lessee may he liable.
Such policy or policies shall include Lessor as insured. it is
understood between lessor and Lessee that until thecamenceent of
construction lasers -shall not be obligated to insure against any liability for
a failure of the existing dam.
(b). commencing with construction, Lessee shall keep all existing
structures and improve rents Wilt or erected by lessee on the premiers insured
for the benefit of Lessee, any secured party, and Lessor as their interest may
appear, against loss or damage by fire or extended coverage in an aountat
least equal to current replacement coat to restore the premises to their
condition prior to such occurrence.
17, � OR DESTRUCTION OF jF@RW@u ; After CMaeR`aRM Of COnstruCtiOn
if the structures Or iaprotaaent6 on the premises, both :he existing
structures and iupoc4caants and structures and inpr0vpmmers placed thereon by
the lossee, are damaged or destroyed by fire or other casualty, lessee may at
its option promptly, and at its expense cause all the danege to be repaired or
may tenmicete. this Isase by written notice to lessor given within ninety (90)
days after such damage or destruction Occurs.
in the event that lessee exercises its Option to repair the premiers,
lessee shall be entitled to all proceeds of insurance payable as aresult
thereof.
In the scant that leasee exercises its option to terminate this lease as
a result of damage or destruction by fire or other casualty than all proceeds
of insurance payableas a result thereof Shall be applied in the following
order:
1.). to pay all sums due any party holding a security interest in the
leasehold premiers.
2.) to pay the cost of restoring the buildings and structures (excluding
the dam) in existence at the outset of this lease to their condition
print to the occurrence.
3.) Any remaining proceeds to he allocated between lessor and Leasee in --
accordance with the following formula.
3a) the Lessor shall he laid an amount equal to said remaining proceeds
multiplied by a fraction, the numerator of which is the number of Morse-
elapsed from the beginning of the lease to the end of the month prior to
the date of the occurrence; and the denceinator of which shall be 600.
3b) all that remains of said proceeds shall be paid aver to the lessee.
18. LESSOR'S REPRESENTATIONS: Issuer represents and warrants to lessee that
this Issue has been duly authorized by. all necessary action on the part of
lessor's governing bodies.
19. LESSEE'S r RESEWATWW: Lessee represents and warrants to lesserOat
this lease has been duly authorized by all necessary action on the part of
Lessee.
20. DEFAULT'
(a) In the event any one or more of the following events shall have
occurred and shall not nave been remedied as hereinafter provided: (1)
lessee's failure to pay any instalhrerk of Fent due hereurder when the some
shall be due and payable and the continuance of such failure for a period of
sixty (60) days after receipt by Lessee 6£ noticein writing from Lessor
specifying such failure; or )2) lessee's failure to perform any of the other
covenants, conditions and agreements herein contained on Lessea's part to be _
kept or performed and the continuance of such failure without the curing of
the same for a period of sixty (60) days after receipt by Lessee of notice in
writing from lessor specifying' such failure; than rouser may, at its option,
terminate this Lease by giving to Lessee at least sixty (60) days written
notice of such termination; and upon the date specified in said notice, this
Lease shall terminate and be of no further force and effect. -
(b) In the event that lessor gives notice of a default of such a nature
Oat it cannot be cured within such period of sixty (60) days, than such
default shall not he deemed to continue so long as Lessee, after receiving
such notice, proceeds to cure the default as soon as is reasonably, possible
aN continues diligently to take all steps necessary to complete the same
within a reasonable period of time under the prevailing circumstances. This
sub paragraph shall not apply to a default arising out of Me non-payment of
rentals due under this lease 'agreement.
(c) upon termination of this [ease as hereinabove provided in this
Section, the lessor may enter and take possession of the premises forthwith -
without further demard or notice without being liable in trespass or for any
damages. In addition, upon such termination aM notwithstaNing the
provisions of paragraph 13 title to the premises and all improvements thereon,
.includingbut not limited to, structures, the dam, turbines, and other power
generating equipment whatsoeoer located on the premises on the data of the
original default notice or osu[rerce giving rise to the default as provided
hereunder shall vest free and clear: of any encumbrances in the Lessor, subject
however to the provisions of paragraphs 14 and 25.
21. LESSEE'S CAPFEL WON RIriP15: lessee shall have the right, in its sole
discretion, to cancel this lease without further obligation to the lessor,
upon ninety (90) days written notice to the lessor, provided it is act in
default of the rents or other obligations on its part to be performed on the
data of such cancellation, in the event of any one of the following:. (1) in
the event issues determines during the Lwo-phase feasibility period provided
in Article 4 herein that the generation of hydroelectric power from the
facility as required by this lease is net feasible; (2) in the event lessee is
unable to obtain any licenses deacribed in Article 5 of this Lease necessary
to construct or operate the facility; (3)inthe event, prior to the
construction phase described in Article f hereof, Lessee is unable to secure
financing for the construction of the hudroelactric maser facilities as
provided in Article ] hereof; (4) in the event the presently. existing
structures or any future improvements on the premises shall he damaged or
destroyed by fire or offer casualty as provided in Article 17; or (5) in the... -
event all or a part of the premises or the facility is taken for public use
under any statute or by right of eminent domain as provided in Article 22 of
this lease, and as a result Lessee's right or ability to use and operate the
facility for hydroelectric power generation purposes is substantially impaired.
22. ¢uNEW o IN:
(a) If all or pant of the Premises or the Facility is taken for public
use under any statute or by right of, eminent domain during the Genn of this.
Lease, and as a result Iessee's right to use ani operate the Facility is
terminated, either party shall have the right to terminate this lease by
written notice to the other. if soon a taking does not terminate Lessee's
right to use and gxrate the Facility hot does result in substantial
interfereme with Lessee's operation Of the Facility or suhstantial impairment
of its ability to derive revenue therefrom (whether because of loss of
available water power or otherwise), Lessee shall have the right to terminate
this Lease by written notice given to Lessor. Any other taking of sane part
of the Premises or the Facility, not having any of the aforesaid results,
shall Out affect the continuation of this Lease.
(b) in the event of any taking of all or any part of the Premiers or the
Facility, the parties hereto agree to m Aerate in applying for and in
prosecuting any claims for sa award for such taking. Lessee shall be entitled
to the proreeds of any such award attributable to the structures constructed
by lessee and improve ots constituting the Facility and to eighty percent
(808) of the proceeds of any such award attributable to loss Of revenues from
the Facility, and Lessor shall he entitled to the proceeds attributable to the
eraniees without suchstructures and IMPLOVellent3 and to twenty percent 1208)
of the proceeds attributable to loss of rental.
23. UTILITY FASEf M: lessor agrees to grant lessee and utility canlanies
sufficient easements or other rights in property and public ways owned or
controlled by lessor to permit necessary utility services to be supplied to
the Premises, and to permit the interconnections necessary for the sale and
delivery of the electric power and other forms of energy generated by the_. ,.
facility, provided always that all installations shall he in accordance with
the reasonable requirements of the lessor with respect to p aramer safety
and public convenience.
24, FURS tt4gEDtd:: In the eventthat Lessor or tosses shall be delayed,
hindered in or prevented from the Performance of any act required hereunder by
reason of fire, floods, storms or other not of God, strikes, labor troubles,
inability to procure materials, failure of paver, riots, insurrection, the act
or failure to act or default of the other party, or any other reason beyond
its control, than performance of such act shall be excused for the period. of
the delay and the period for Meperfomance of any such act shall be extended
fora period equivalent to the period of such delay. Nothing herein shall he
excuse lessee from making timely payment of the basic rent due hereunder.
25. Y AND I%0LWNCY: If, at any time during the term of this tease,
Lessee shall
(a) apply for or consent to the appointment of a receiver, trustee or
liquidator of it or of all or a substantial part of its assets;
(b) admit in writing its inability to pay. its debts as stay mature;
(c) make a general assignment for the benefit of creditors;
(d) be adjudicated bankrupt or insolvent; on
(e) file a voluntary petition in bankruptcy or a petition or an answer
seeking reorgnization or an arcangment with creditors to take advantage
of any insolvency law or any answer admitting the material allegations of
a petiton filed against it in any bankruptcy, reorganization or
insolvency proceedings, or corporate or other action shall be taken by it
for the pup;se of effecting any of the £oregopng;
or an order, judgment or decree small be entered, without the application,
approval or consent of the Lessee, by any court of competent jurisdiction,
approving a petition seeking reorganization of; or appointing a receiver,
trustee or a liquidator of, Lessee or of all or a substantial part of its
assets, and such order, judgment or decree shall continue unstayed and in
effect for any period of sixty (60) consecutive days; then in any such event,
Lessor shall have the right to terminate this lease forthwith by written
notice by lasses; provided, tw.evar, that Lessor shall not have such right of
termination if pursuant to Section 14 hereof a mortgagee, other Secured Party _ ---
or any other person acting for on or behalf of the lessee shall cause to be
cured all defaults of'ressee hereunder, whether in the popment of dont or the
performante of any other agreement, em:epting any default by Lessee under this
paragraph 26, ane shall continue to cause such rent to be paid and Lessee's
caner agreements to be performed.
26. �S:
(a) alis lease may be modified or amended by mutual agreement in writing
signed by lessor and Lessee.
27. NCP UMIL M rNUEIflJW: This lease is made upon the express condition '
that the lessor shall be free from all liabilities and claims for damages,
together with related costs, for or by reason of any injury or injuries to any
person or property of any kind whatsoever relating to the leased premises and
the facility. In futheranue of this condition, the Lessee agrees that it
shall indemnify and save the lessor, its officers, inhabitants, employees, and
agents, from and against arty. and all claims, liability, damage, expense, cause
of action, suits or judgments, by or on behalf of any person or persons, firm
or firms, corporation or corporations, arising from or out of lessee's use,
occupasor', conduct of management of, or from any work or thug whatsoever in
or about the leased premises or the facilities located thereon, except that
-prior to the commarooment of construction lessee is not hereby obligatedto
assume any liability beyond that for acts of its own employees or agents to
indemnify and save harmless the lessor from any liability result from a
failure of the existing dam.
28. [ sANT6'. LIENS: The Lessee agrees to promptly discharge or cause to be
discharged (either by payment or the filing of a necessary bond or otherwise)
any rtechani s', materialmen's or other liensas may be placed against the
demised premises, any buildings, structures or improvements thereon, whicb
liens may arise Out of any payment due for labor, services, materials,
supplies or equip ant which may have been furnished to or for the Lessee, its
contractors and subcontractors.
29. AITORNWS f ; The lessee shall pay to.the Iesso[ a reasonable -
attornney's fee in the event the lessor employs an attorney to collect any
rents due hereunder and secures judgment in connection with collection of
said rent.
30.. NXICES: All Wtices, requests, demands, and other mmunications
hereunder stall be in writing and shall he deemed to have been duly given when
delivered in hand to such party or mailed by certified or registered mail,.
instage prepaid, addressed:
'If to issues: Swift River Company
Attn: Christian A. Herter III
44 Exchange Street
Portland, Maine 04101
If to lessor: City of Mmlor
Attn: City Manager_
City Hall
: Harlow Street
Bangor, Maine 04401
or in each case to such other addresses as may be specified in a written
notice delivered in cocpliance with the foregoing requirements.
31. MISQ.T.nA MUS;
(a) This Lease and the performance thereof shall be interpreted and
governed by the laws of the State of !Hine
(b) The section headings herein are for reference and comenierce only
and shall not affect the interpretation hereof. -
(c) this lease may be executed in any comber of counterparts, each of
which when so executed shall he an original, but all of the counterparts
together shall constitute one and the sate instrument.
(d) lessor agrees Nat lessee My use the land owned by ressor in Brewer,
adjacent to the premises as a staging and storage area during the construction
of the facility, all as shown on exhibit A.
(a) lessee shall hale the sole right and responsibility to operate and
maintain the facility in accordance win the license granted lessee i3' the
tederal Mergy regulatory Commission and all applicable federal, State and
local laws or regulations.
-(£) lessor shall have the tight to annually inspect or audit at its
exlanse all financial statements or reports of lessee pertaining to the
operation of the facility. lessee shall provide lessor with a copy of, its
.annual audited financial statement as soon as the same is available.
(g) Failure on the part of either party to complain of any action or
non -action on the part of the other party no matter how long the sane may
continue shall never be deemed to be a waiver of any of such party's rights
hereunder. FurflleumO[e, it is covenanted and agreed that no waiver at any
time of any of the provisions hereof by either party shall he construed as a
waiver of any of the other provisions hereof and that a waiver at any time of
any of the provisions hereof shall not be construed at any subsequent time a
.waive[ of the same provisions. The approval of either party to or for any
action by the other requiring that party's consent or approval, shall not be
deemad to waiver or render unnecessary the larty's consent or approval to or
of -any subsequent similar act by the other party.
(h) If any tern or provision of this, lease is held to he invalid or
unenforceable, the remainder of this lease shall not he affected thereof and
each other term ant provision of this lease shall be valid and be enforceable
to the fullest extent permitted by law.
(i) Nothing contained herein shall he deemedorconstrued by the parties
hereto, nor by any third party, as creating the relationship of principal and
agent or of partnership or of joint venture between the parties hereto, it
being understood and agreed that neither the methsd of confutation of rent nor
any provision contained herein or any acts of the parties hereto shall be
deemed to create any relationship between the parties hereto other than the
relationship of ladlord and tenant.
IN W4 S MEFFXF, the parties hereto have act their hails and seals the
day and year first written above.
Witness: City of Bangor, lessor
BY
Its City Manager
Swift Rive[ COusany, ICesee
81-19]
OPTION TO LEASE
OPTION granted this 13th day of July, 1981, by the CITY
OF BANGOR, a body politic and corporate duly organized and _
existing under and by virtue of the laws of the State of
Maine and being located in the County of Penobscot, State of
Maine, (hereinafter referred to as the "City"), to SWIFT
RIVER COMPANY, a Massachusetts corporation with a place Of
business in Boston, County of Suffolk, Commonwealth of
Massachusetts, (hereinafter referred to as "Swift River").
W I T N E S S E T H:
1. GRANT OF OPTION. The City, in consideration of the
sum of Twenty -Five Thousand Dollars ($25,000.00) paid by
Swift River, the receipt_whereof is hereby acknowledged,
hereby grants to Swift River the exclusive right, at its
option, for and during the period of one (1) year beginning
July 13, 1981, to lease the premises and rights situated in
Bangor, Brewer, Veazie, and Eddington, Maine, consisting of
a dam, buildings, waterand riparian rights and other rights
upon the termsand as. described in a Lease Agreement at-
tached hereto as Exhibit "A"+
2. EXERCISE OF OPTION. In the, case Swift River shall'
elect to lease said premises, it shall by written notice
deliver, to the City Manager!of the City of Bangor within the ,
time.above limited, and within thirty (30) days thereafter
the City Manager shall deliver to Swift River two (2) copies
of said Lease to beexecuted by authorized representatives,
of both the City and Swift River.
3. TITLE. During the option period Swift Riverunder-
takes to satisfy itself as to the status of City's title to.
the premises and the extent of its existing rights to cause
the development of a hydro -electric project upon the optioned
premises. If Swift River discovers any defects in title o
requires a legislative clarification of City's existing
rights, City agrees in a timely fashion to take all neces-
sary steps to cure said defects and obtain such legislative
clarification.
4. EXPENSES INCURRED BY CITY. During the Option
period, it is understood that the City shall not be obli-
gated to incur any expense for (1) securing and maintaining
-
the premises; and (2) expenses incurred in either curing
title defects or obtaining clarifyinglegislation in excess
of the consideration paid by Swift River for this option.
In addition, it is understood that the City shall be -en-
titled to credit all sums paid to consultants in connection
with the development of said premises. against said option
payment in determining the City's obligation in this regard.
5. PLACE OF PERFORMANCE. All notices Or deliveries
hereunder to the City shall be to the office of the City
Manager, City of Bangor, City Hall, Bangor, Maine. Similarly,
all notices or deliveries to Swift River shall he made to
Christian Herter III, 44 Exchange Street, Portland, Maine.
The parties hereto may specify in writing other addresses
for purposes Of this paragraph.
2 -
6. TERMINATION OF OPTION. If Swift River shall not
elect to lease said property in accordance with the terms
and conditions set forth in Exhibit A attached hereto,
during the option period or any extensions thereof, it shall
forfeit the said sum of Twenty -Five Thousand Dollars ($25,000.00)
paid to the. City.
]. EXTENSION OF OPTION. In the event that in ac-
cordance with the provisions of paragraph 3 hereof, City has
taken action to cure a defect in title or to seek a legis-
lative clarification Of its existing rights and either or
both actions have not been completed during the term of this
option, said option shall automatically be extended for the
period necessary to complete said curative Or legislative
action, and upon the completion of all such actions for a
period of ten (10) days after which this option shall ter-
minate as provided in paragraph 6.
B. ASSIGNMENT PROHIBITED. ,This Option may not be
assigned or the right thereunder transferred to any third
party without the prior written consent of the City, except
that City agrees thatthis option may he assigned by Swift
River to an entity specifically created by and either sub-
stantially o
ub-stantially'o ned or controlled by Swift River, which entity
is established for the purpose of holding the leasehold
interest in the premises.
- 3 -
9. ACCESS TO PREMISES. During the term of this Option,
.'Swift River, its duly authorized representatives, employees,
agents and business invitees shall have the full right and
privilege to enter upon the premises described in Paragraph
I for purposes of inspecting buildings and structures thereon
while conducting feasibility studies and -for the construc-
tion of any temporary structures orfacilitiesas may be
necessary in conjunction with said studies. In considera-
tion of this right ofentry, and during the term of this
option, Swift River agrees to provide general liability
insurance with a good and solvent insurance company or
companies, reasonably satisfactory to the City, with the
City as a named insured and in the following amount:
$1,000.000.00 (One Million Dollars) combined -single limit -
with respect to bodily injury or property damage for which
Swift River may be liable.
In addition, Swift River agrees to indemnify and save
the city, its officers, -inhabitants, employees and agents
harmless from and against any and all claims, liability,,
damage, expense, cause of action, suite or judgments, by or
on behalf ofanyperson or persons, firm or firms, corpor-
ation or corporations, arising as a result or out of its
use, occupancy, entry or from any of its work or activities -
whatsoever in or about the subject premises or the facilities
located thereon.
IN WITNESS WHEREOF, the parties hereto have set their
hands and seals the day and year first above written.
WITNESS: - CITY OF BANGOR
By
Title
City
Manager
SWIFT RIVER COMPANY
Title
_y_
x
{ FINkL DIWF£ 8 JULY 1981
m
LFPSE made this 14th day of July, 1981 between the City of Bangor, a badly
politic and corporate duly organized and existing under and by virtue of the
laws of the State of Maine and being located in the County of Penobscot, State
of (Nine (hereinafter referred to as Lessof am Swift River Company, a
Massachusetts corporation with a place of business in Boston, County of
Suffolk, Cmvmrnealth of Messacusetts (hereinafter referred to as lessee).
- 4u'lelE;g'1B:
In consideration of the mutual covenants contained herein, lessor and
Lessee agree as follows:
1. PRBM[sIs: Lessor hereby -leases -to lessee and lessee -hereby -takes from
Lessor, upon the terms hereinafter set forth, the propertyand rights situated
in Bangor, Breuer, Veazie, and Pddington Maine, consisting of a dam,
buildings, water and riparian rights and other rights, all as described in
Exhibit A annexed bcreto, (hereinafter collectively referred to as the
"Promises").
2. WIMS3: This lease is being ex ted in order to provide for the
redevelopment and operation of a hydroelectric power production facility
(hereinafter sometimes referred to as the "Facility-) lorated on the
atove-descrited premises, lessee's use of the premises and other areas
permitted under this lease shall be limited to such purposes as may be
specified in a license to be issued by the Federal Energy legulatory
Commission (hereinafter sometimes referred to as and so& other
compatible uses as may he authorized under the Wring Ordinance of the City of
Barger. _
- 1 -
3. EFMhIVE DATE ANO TFFl4: This lease and all obligations on the Part of the
parties shall hecane effective on July 14, , 1981. The term of this lease
shall commerce with the effective date of this agreement as stated herein.
nnbess sooner terminated as provided herein, the term of this lease shall
expire an Jure 14, 2036 or upon the expiration date of the anticipated FEIC
license issued for the praniaes, whichever occurs first.
4. LkIWR'S TITLE AND PIMS
a. within b months from date hereof Lessee will undertake -to satisfy
itself -as to the status of iescor's title to. the premises and the extent of
its existing rights to cause the dstrelom a of a hydro -electric project upon
the leased premises. if lessee discovers and notifies lessor prior to the
expiration of said 6 months of ary defects in title or that it requires a
Legislative clarification of features existing rights, Lessor agrees within
one year from date hereof- to take all necessary steps to cure said defects and
ottain such legislative clarification. It isspecificallyunderstood between
Leaser and lessee that lessor's obligation under this paragraph shall not.
require it to employ the services of third parties.
b. In the ere:R that in accordance with the provisions of paragraph 4a
hereof, lessor has taken action to cure a defect in title of to seek a _
legislate clarification of its existing rights and either or both actions
have not been completed during theone year provided for sane, this lease
shall terminate unless said one year period shall ty mutual agrentnt of the
parties be extended for the period necessary to couplets said curative of
legislative action.
c. If during the period provided under paragraph a. above Leser[ is
unable to cure any defect in title or to obtain the required legisiative
clarification within ths. time provided herein this lease may to terminated by
Lessee, as pmvided in paragraph 22 of this agr lent.
_2-
d. It is understood not the lessor shall not be obligated to incur any
expense for (1) securing and maintaining the premises; and (2) expenses
incurred in either curing title defects or obtaining clarifying legislation i _
excess of the rental paid by lessee under paragraph 10a. In addition, it is
understood Nat the lessor shall he entitled to credit all sums paid to
consultants in connection with the development of said premises against said
rental payment in determining the Lessors obligation in this regard.
5. FEASIBILITY .
(a) Sid :_within six months of the data of canpletion by Lessor of any
curative or legislative action required of the lessorunderthe provision of
paragraph 4 aboxe, Lessee will complete a two-phase feasibility study of the
facility to determine wherier Ne construction and operation of the
hydroelectric facility is econrndoal and otherwise feasible.
The first phase of the study will examine the issues of fisheries, pool
elevation, tides and the historic nature of the existing buildings. If the
first phase of the study is satisfactory. in the judgment of the lessee, then,
the lessee will conduct a studyto determine the most feasible alternative for
the construction and operation of a low bead hydroelectric facility for the
.generation of electricity.
(b) Determination of Feasibility: The final determination of whether the
project is feasible shall rest in the judgment of the Lessee; provided,
hoxever, the facility shall be designed as muni as possible to achieve the
maximmum permissible per output as may be practical from the premises, giving
due consideration to the fisFeries, the effect on veazie Dam and tidal
influence. Subject to the aforesaid conditions, lessee shall have sole
discretion to determine the size and type of facility to be constructed on the
premises.
(c) Dotification of Intent to Proceed: If lessee determines that the
project is feasible it shall ratify the Lessor of the results of the studies
and that it intends to proceed.
_I_
(d) m mination: if. Lessee determines that the project is not feasible,
it shall so notify the lessor and this lease shall be temunated, as provided
in paragraph 22 of this agreement.
6. LIDS AM PEMII25: As seen as is reasonably possible after the execution
of this lease, but in any event net more than 120 days after the completion of
the feasibility study, Lessee will cmunence to file appropriate and timely
applications for such licenses and peunits withthe appropriate federal, state
arca municipal authorities as are determined to be necessary for the
construction and operation of rise facility. In the event lessee is unable to
obtain any license or pemalt necessary to construct the facility, lessee may -
tenninate this lease upon written notice to lessor, as providedin paragraph
22 of, this agreenent.
7. C MLCMMZ Promptly after receipt of the FERC- license to permit
.construction and operation of the facility, Isssee will submit to lessor a
construction schedule and within 12 months after receipt of said license will
begin the construction thereof. lessee agrees that the power generating
facility shall he constructed on pnoperty, located in the City of Bangon.
S. FMhCI : if, prior to construction Iessee is unable to secure financing
acceptable to Lessee, lessee stall notify the Lessor and this lease shall be
terminated, as provided in. paragraph 22 of this agreerent.
9. OlL@o;Nl^: If this lease is terminated under Paragraphs 4,5,6,8,21,22, or
23 at anytime prior to construction lessee will make available to lessor
copies of all studies, reports or other dcnments prepared by or on behalfof
lessee in convection with the facility, and Ne premises.
10. Pawl: Lessee agrees to pay to lessor rental as follows: a). the sum of
$25,000 - the receipt whereof is hereby acknowledged, b) a percentage of
gross revenues from operations derived from the Facility as follows:
4-
Commencing with start up of operation thru Production Year 3
1.58
(It heing understood that the 1st production year
will co menre at the end of the first full calendar quarter
of operation after start-up.) - -
-
Production Years 9 - J -inclusive
3.08
Production Years 8 - 10 inclusive-
- 3.58
production Years 11 - 15 inclusive
5.58
production Years 16 - 20 inclusive
6.08
production Rears 21 - 25 inclusive
7.58
Production Years 26 - 50 inclusive -
9.08
Rental payments shall be due and payable quarterly
as follo+6:
April 30 for quarter ending March 31 -
_
- July 31 for quarter ending June 30
october 31 for quarter ending September 30
- - January, 31 for quarter ending tecenber 31
It is understood and agreed between Lessor and lessee that the due date
for any quarterly rental payment may be extended fora period act exceeding
ane month in the event Oat the due data for municipal taxes and a rental
payment occur during the sane month.
11. TAXES:
(a) The lessee agrees afar itself, its successors, assigns and subleases,
Oat it does hereby waive all right or privilege of exegttion from municipal
taxation for both the leased Premises and the Facility, and ay imlcovenents
thereto,. as may be available by reason of the City's status as a municipality,
or for any other reason whatsoever; and that the City, in its capacity as a
municipal taxing authority, may assess all taxes as would otherwise be
applicable to both the Leased Premises andtheFacility, and ay incto rents
hereto, as if such exemption did not exist.
(b) In the event the waiver of tax exemption provided for in subsection
(a) above is found to be unenforceable or in the event the City is unable, for
any other reason whatsoever, to assess against the property (real and
personal) or any part thereof included in both the leased Premises and the
Facility, and any Improvements thereto, the full amount of any taxes which
scald otherwise be executed against hoth the leased Premises and the Facility,
and ay, improvements thereto, than (subject to the lessee's right to contest
the validity of the tax which would otherwise he assessed) the lessee, its
- 5 -
successors, assigns, or sublessees shall pay to the City in lieu thereof the
arount of such taxes which would have been assessed against both the Lsased
Premises and the Facility, and any igpeovenents thereto, if the ceased
Premises and the Facility, and any improv ments'thereto, were owned directly
by the lessee ad were not subject to this cease agreaimnt, the intent of the,
parties teing that the lessee shall pay to the City, as taxes, or pursuant to
this paragraph, an anount equal to taxes that would have been assessed in
accordance with the City's standard valuation procdures, an swunt equal to
the amoiat which would he payable to the City if the ceasd Premises and the
Facility, and any improvsrents thereto, were nut "owned by the City.
(c) In. the event an alternate. methol Of taxation or lsquent in lieu of
taxes is provided by statute and in the event its facility is subject to such
statutory provision, than subparagraphs a and It, of this paragraph shall not be
effective so long as the facility shall besubject to such alternate mettad Of
taxation' Or_ payment in. lieu Of taws.
12. MLITIM: -lessee shall pay promptly as and when the same bac re due ad
payable all changes for water, sewer, steam, haat, oil, gas, hot water,
electricity, light and power and other services furnished to the Premises or
used by lessee in connection therewith during the tens of this lease.
U. LEPAIRS AMID ItMROlF1AEElT15:
(a) After the cogoomorent of construction lessee shall hate the right,
at its Own rest and exp2nse, to cOnstrUCt On the Premises arab ]mprOoarOnra
and to make su 1, alterations to the Premises and the structures and
improtenents thereon as Lessee shall determine to be proper in connection with
the deterrent, construction and operation of the premises, provided that the
sane shall be in compliance with all applicable £decal, state and local
requirements
(b) Aft" the m eroonent of construction, Lessee shall at all times
during the term of this Lease, and at its own cost And expense, keep and
maintain in repair and goad and safe condition (ordinary wear and test and
M
damage by fire or other casualty excepted)', all structures and improvements at
any tine erected on the Premises by lessee and shall use all reasonable
precautions to prevent waste, damage or injury to the Premises.
ke) addrin six months after completion of construction of the facility
Leasee shall remove all temporary structures from the premises.
-
14. TITLE M IMEEVJEFII M, a.) Title to imprcnevents aryl personal property in
existence on the premises as of the date of this lease shall remain in the
Lessorabject to lessee's right to remove and dispose of same in connection ---
with the redemel gment of said facility. -
Lessor shall within 3 mmnths of the date of this lease provide Lessee -
with a list of any scrh property or improvement that will require prior
written approval of Lessor before the same are removed. 'Lessor stall rot
cause any imgrovesent on property so, listed to be removed without giving
fassee'a fust refusai-to aoluire the same at fair market write as determined
by ind p ndant appraisal. Said right of first refusal stall he for a period
of 14 days after receipt of notice by Lessee.
b.)Title to the buildings, structures and improuemerKs constructed on
the premises during the teen of this lease or any extensions thereof, shall he
in the Lessee. Upon terminationof this lease except as provided in paragraph
21, title to the buildings or other structures shall revert to the lessor, -
provided however, that leasee stall have 180 days to tengve personal property
including but not limited to generating, electrical, central am trammcission
equipment, machinery, furnishings and furniture in the event that lessor aces
not exercise its option to purCase as hereinafter set forth. Any such
property, not so reooved shall became the property of the lessor. In the event
Teases clooses to renoia the personal property, the buildings arc] structures
shall be left in suitable repair, reasonable wear and test excepted. Lessor
shall, however, have the option to purchase all or pert of the property to be
removed at fait market value as determined'by independent appraisal. Lessor
may exercise this option by giving written notice to the facers within 90 days
after the termination Of this lease.
15. PRinILsx3 AP M3 pFeA =: (a) lessor is cognizant of the need of
lessee or its sublessee to finance the construction of buildings, structures
and imprcveventz on the demised premises, and therefore specifically agrees to
pewit the lessee to mortgage, assign or transfer its leasetold interest in
the premises for the purpose of obtaining construction and permanent loan
financing for the said buildings, structures, and impres nts, provided: (1)
theterm of such mortgage, security agreement, assignmentor transfer shall
not exceed the initial term hereof: (2) lessee shall give notice to lessor of
the existence of soda mortgage, security agreement, assignment or transfer,
together with the name and address of the mortgagee, other secured party,
assignee or transferee and a copy of any mortgage, security agreement,
assignment or transfer document that is a matter of public record; (3) that in
the event of foreclosure, and in the event that said mortgagee, other security
party, assignee or transferee shall tecme the owner of the laasee's interest
pursuant -to such:foreclosure,-said mortgagee, other secured {arty, assignee or
transferee shall have the right to take possession arxl -shall become the legal
owner and holder of the leasehold estate created hereunder and shall hold such
estate upon the same terms and conditions as tela by lessee from which such
mortgagee, other secured party, assignee or transferee acquired possession,
but in such event, said mortgagee, other secured party, assignee or transferee
shall only be liable under the terms and conditions hereof during the period
of time in which said mortgagee, otter secured party, assignee or transferee
holds such estate, and not thereafter, nor shall said mortgagee, other se. red
party, assignee or transferee be liable for any default under the terms or
conditions hereof which arose before said estate becawxe vested in said
mortgagee, other secured party, assignee or transferee, provided however that
the lessor shall have the right to terminate this lease pursuant to paragraph
23 in the event that rentals accruing he£ore said estate becom vested in said
mortgagee, other secured party, assignee or transferee are not paid in full;
(4) that the existence of such mortgage, security agreement, assignment or
transfer, or arty foreclosure by a mortgagee or other secured party shall not
relieve the lessee from any liability or responsibility for the obligations on
its. part to be performed.
8-
(b) lessor agrees to give written notice to any mortgagee, other secured
party, assignee or transferee of which it has written notice if Lessee _
defaults under any Of the terms or conditions of this lease, and said
mortgagee, other secured party, assignee or transferee shall have a period of
sixty (60) days after receipt of said notice to cure such default, provided,
however, that where a default by its nature takes longer than sixty (60) days
to cure, such mortgagee, other secured party, assignee or transferee -shall be
given the right to commence the curing of such default within sixty (60) days
after notice aforesaid, and to curedefault within -a reasonable period of time
thereafter. Sesser also agrees that intheevent certain defaults of losses
are incapable of being cased by such mortgagee,other secured party, assignee
or transferee, and if reser terminates this lease because of such incurable.
default, then a new lease will be executed by Lessor with said mortgagee,.
other secured party, assignee or transferee as lasses, upon the same terms and
conditionsasare containedinthis lease. Lessor also agrees with such
mortgagee, other secured party, assignee of transferee that no change,
modification, agreement, amendment, termination, or surrender of the said
lease stall be effective without the prior written concent of such mortgagee,
assignee or transferee.
(c) lessor also agrees that lessee may mortgage, assign, or transfer its
'leasehold interest in the promises for the purpose of obtaining capital for
other purposes upon terms and conditions as. in (al 6 (b) atom,
16. ASSGM4]Sf AND 5(1&,El Mr Lessee shall not sublet all or any part of the
Premises or assign Or transfer this lease or any interest therein, except a
follows: ..
(a) Mring the term of this lease Lessee may, with lessor's written
consent, transfer or assign this lease to a third party which agrees with
lessor to perform, all of Lessee's obligations hereunder. Lessor agrees not to
withhold soh consent unless it has reasonable and substantial grounds for
Objecting to the assignee.
(b) Lessee may mortgage or otherwise create a security interest in
ressee's leasehold estate hereunder as set forth in section 14 above. -
- 9 -
(c) lessor agrees that anytime prior to the commencement of construction
this lease may be assigned by lessee to an entity specifically created by and
either substantially owned or controlled by Lessee, which entity is or bas
been established for the purpose of holding the-leasebald interest in the
Premises.
(d) In the case of ary such transfer or assig nt, the sane shall be.
evidenced in writing and duly recorded in the Penobscot Isgistry of reeds and
said assigmnent shall provide specifically that the assignee does accept and
assure all of the trans, covenants, and conditions of this lease to W kept
and performed by lessee and will agree to comply with and be banes by them arca
thereafter such assignee shall W deemed to W the ressee hereunder.
17. IN80klt :
(a) Lessee shall provide at its expense, and keep in force during
the tern of this tease, generalliability insurance with a good and solvent
insurance company or compenies,reasonably satisfactory to Lessor, in
the amount of at least $1,000,000 combined single limitwithrespart to
bodily injury or property damage for which Lessee may be liable.
Such Policy or policies shall include Lessor as insured. It is understood
between lessor any Lessee that until the canrencement of construction Lessee
shall not be obligated to insure against any liability for a failure of the,
existing dam, gate structures, fisMaays or structural integrity of existing
buildings.
(b) COmmancLg with corstruction, Lessee shall keep all existing
structures and improvements Wilt or erected by lessee on the premises insured
for the benefit of lessee, any secured party, and Lessor as their interest say
appear, against loss or danale by fire or extended coverage in an amount at
least equal to current replacement cost to restore the premises to their
condition prior to such occurrence.
18. MlAGE OR DFSTRUMON 0£ AP HIS: After caaercement of construction
if the structures or improvements on the premises, both the existing
- 10 -
structures and improvements and structures and improvements placed thereon by
the lessee, are damaged or. destroyed by fire or other casualty, lassee may at
its option promptly and at its expense cause all the damage to be repaired or
'may terminate this lease by written not ice to lessor given within ninety (90) -
days after such damage or destruction occurs.
In the event that lessee exercises its option to repair the premises,
Lessee shall be entitled to all proceeds of insurance payable as a result
thereof.
In the event that lessee exercises its option to terminate this lease as
a result of damage or destruction by fire or other casualty then all proceeds
of insurance payable as a result thereof shall he applied in the following
order:
1.) to pay all sue due any party holding a security interest in the
lease1hold premises.
2.) to lay the cost of restoring -the buildings and structures (excluding
the dam) in existence at the outset of this lease to their condition
prior to the occurrence.
3.) Any remaining proceeds to be allocated between Lessor and Lessee in
accordance with the following formula.
3a) the lessor shall be paid an amount equal to said remaining proceeds
multiplied by a fraction, the nu erator of which is the number of months
elapsed from the beginning. of the lease to tyre end of the month prior to
the date of the occurrence; and the denominator of which shall be 600.
36) all that remains of'safd proceeds shall he paid over to the lessee.
19. L6 'S nPPPF_4NIATIL : Lessor represents and warrants to lasers that
this lease has been duly authorized by all necessary action on the part of
Lessor's governing bodies.
20. LESSEE'S FEPRE WATICM. Lessee represents and warrants to lessor that
this lease has been duly authorized by all necessary action on the part of
lessee.
- 11 -
21. DEFAULT: .
(a) In tlhe event any ore or =is of the following events shall have
occurred and shall not have been ranodied as hereinafter provided: (1) -
Lessee's failure to pay any installment of hant due heremder when the same
shall he due -and payable and the continuance Of such failure for a period of
sixty, (60) days after receipt by lasses of notice in writing from IOSSCM7
specifying such failure; or (2) lessee's failure to perform any of the other
covenants, conditions and agreements herein contained on Lessee's part to he,
kept or perfomed and the continuance of such failure without the curing of
the sere fora period of sixty (60) days after receipt by Lessee of notice in
writing from lessor specifying such failure; then lessor may, at its option,
-te'minwte this Lease by giving to Lessee at least sixty (60) days written
notice of such fascination; and upon the date specified in said notice, this
lease shall terminate and he of no further force and effect.
(bh in the event that lessor gives notice of a default of such a nature
that it cannot be cured within soon period of sixty (60) days, than soon
defaultshall Out be deemed to coucinue so long as lessee, after receiving
such notice, proceeds to cure the default as soon as is reasmably possible
and continues diligently to take all steps necessary to conplete the same
within a ressowble period of tfem under the prevailing circunstames. Thfs
sub paragraph shall not apply to a default arising out of the ron-payment of
reMals due under this lease agreement. -
(c) Upon tesnination of this lease as hereinabove provided in this
Section, the Lessor may enter and take possession of the premises forthwith
without further demand or notice without being liable in trespass or for arty
damages:.In addition, spun such termination and notwithstanding the
provisions of paragraph 14 title W the Premises and all improvaments thereon,
including but not limited to, structures, the den, turbines, and other power
generating eguipent whatsoever located on the preoises on the date of the
riginal default notice or occurrence giving rise to t:e default as provided
hereunder, shall vest free and clear of any encumbrances in the Lessor, subject
ha¢+er to the -provisions of paragraphs 15 and 26.
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22. L6 'S CAM.FL IIM %tla : Lessee shall have the right, in its sole -
discretion, to cancel this lease without further obligation to the lessor,
upon ninety (90) days written notice to the Lessor, provided it is not in
default of the rants or other obligations on its Fart to be performed on the
date of such cancellation, in the event of any one of the following: (1) in
the event that Lessor is unable to cure any defect. in title or to obtain the
required legislative clarification as provided in paragraph 4 hereof; (2) i
the event lessee detemdnes during the two-phase feasibility period provided
in paragraph 5 herein that the generation of hydroelectric power from the
facility as required by this lease is not feasible; (3) in the event Lessee is
unable to obtain any licenses described in paragraph 6 of this Lease necessary
to construct or operate the facility; (4)in the event, prior to the
constructionphase described in paragraph 7 hereof, Lessee is unable to secure
financing for the construction of the hydroelectric paver facilities as
provided in paragraph 6 hereof; (5) in the event the presently existing -
structures or any future improv nts on the premises shell be damaged or
destroyed by fire or other casualty as provided in paragraph 18; or (6) in the
event all or a part of the premises or tbe facility is taken for pmhlic use
undes.aW statute or by -right of eminent domain as provided in paragraph 23 of
this lease, ami as a result Issses's right or ability to use and operate the
facility for hydroelectric power generation purposes is substantially impaired.
23. FNWkNT MMIN' .
(a) If all or part of the premises or the Facility is taken for public
use under any statute or by right of eminent domain during the term of this
Lease, and as a result lessee's right to use and operate the Facility is
terminated, either party shall have the right to terminate this Lease by
wi then notice to the other. If such a taking does not terminate lessee's
right to use and operate the Facility but does result in substantial ..
interference with Lessee's operation of the Facility or substantial impairment
of its ability to derive revenme therefrom (whether because of loss Of
available water poact or otherwise), lessee shall have the right to terminate
13
this Lease by written notice given to tester. Any odor taking of sore part
of the premises or the Facility, net having any of the aforesaidresults,
shall not affect the continuation of this tease. -
'(b) In hus ehent of any takingofall or any Fern of the Premises or the
Facility, the parties hereto agree to cooperate in applying for and in
prosecuting any claims for an award for such taking. losses shall be entitled
to the proceeds of any such award attributable to the structures constructed
by Lessee and improaanents constituting the Facility and to eighty percent
(80%) of the proceeds of any such awand attributable to loss of revenues from
the Facility, and lessor shall he entitled to the proceeds attributable to the
Promises without such structures and ivprovements and to twenty. percent (20%)
of the proceeds attributable to loss of rental.
24. UTmmw Lessor agrees to grant losses and utility canpanies
sufficient easements or other rights in property and lublic ways awned or
controlled W lessor to permit necessary utility services to he supplied to
the preaiaes,_and to permit the interconnections necessary for the sale and
delivery of the electric power and other forms of energy generated by the
facility, provided always that all installations shall be in accordance with
the reasonable requirements of the reason: with respect to a arame, safety
and Iublic convenience. -'
25. FV fHIE ; In the event that lessor or Lessee shall he delayed,
hirdered in or _prevented from the perforance of any act required hereunder by
reason of fire, floods, storms or other not of God, strikes, labor troubles,
inability to procure materials, failure of paver, riots, insurrection, the act
or failure to act or default of the other party, or any other reason beyond
its control, than perfohmance of such act shall he excused for the period of
the delay and the period for the perfommance of any such act shall be extended
for a period equivalent to the period of such defy,, Mthing herein shall
cause losses from making timely payment of the basic rent due hereunder.
14 -
26, &JBW.RICY ANTI Mgta.V y: If, at any time during the term of this Lease,
lessee shall
(a) apply for or consent to the appointment of a receiver, trustee or
liquidator of it or of all or a substantial part of its assets;
(b) admit in writing its inability to pay its debts as they mature;
(c) make a general assigrmont. for the benefit of creditors;
(d) be adjudicated bankrupt or ireOlWut; or
(e) file a Voluntary petition in bankruptcy or a petition or an answer
seeking reorgnization or an arrangment with creditors to take advantage
of any insolvency, law or any answer admitting the material allegations of
a petiton filed against it in any bankruptcy, reorganization or
insolmancy procsediags, or corporate or otter action shall be taken by it
far the purpose of effecting any of the foregoing;
or an order, judgment or decree shall be entered, without the application,
.approval or consent of the lessee, by any court of competent jurisdiction,
appy g a petitionseeking reorganization of, or appointing a receiver,
trustee or a liquidator of, Lessee or of all ora substantial part of its
assets, and such order, judgment or decree shall continue unstayerl and in
effect for any period of slurry (60) consecutive days; than in any such event,
lwear shall have the. right to terndcote this lease forthwith by written
notice by lessee; provided, however, Oat Iassor shall not have such right of
termination if pursuant to paragraph 15 hereof a mortgagee, other secured
party or any, other person acting for on or behalf of the lessee shall cause to
he cured all defaults of lessee hemonder, whether in the payment of ment or
the performanue of any other agreement, excepting1 any default by lessee under
this paragraph 26, and shall continue to cause sdcM1 Bent to be paid and
lessee's other agreements to be performed.
I
I
27. Alfl DMENn: -
(a) ghfs lease may be modified or amercled by mutual agreement in writing
signed by lessor and lasses.
28. !XP]-LIMIMW A RIDFI lW: Tris lease is made upon tlhe eX¢ess condition
that Uwe lesaor shall be free from all liabilities and claims for damages,
together with related costs, for or by reason, of any injury or injuries to any
- 15 -
person or property of any kind whatscever telating to the leased premises and
the facility. In futherance of this condition; Ne Lessee agrees that it -
shall indearify and sane the Lesson, its officers, inhabitants, employees, and
agents, frm and against any and all claims, liability, damage, exlense, rause
of action, suits or judgments, by or on behalf of any person or persons,: firm
or firms, corporation or corporations, arising from br out of Lessee's use,
occupancy, carriuct or management of, or from any work or thing whatsoever in
of about the leased premises or the facilities located thereon, except that
prior to the commencement of construction Lessee is not hereby obligated to
assume any liability beyond Nat for note of its own_emldoyees or agents to
icdemnify and save harmless the Lessor frwm any liability result from a
failure of theexistingdan, gate structures, fisbways or structural integrity
of existing buildings.
29. hmLIPHICS'. LlII : The lessee agrees. to promptly discharge or cause to be
discharged (either by p yment or the filing of a necessary mrc] or otherwise)
arty mechanics', materialman's or other liens as may be placed against the
demised premises, any buildings, structures or improvements thereon, which
liens may arise out of any payment due for labor, services, materials,
supplies or equipment which nay have been furnished N or for the Lessee, its
contractus and subcontractors.
30. INIFREST ALD A01gi 'S P : In the event Nat lessee is in default for
failure to pay any rental installment due hereulder, Lessee agrees that
interest shall be due until the same is paid, said interest to accrue from Ne
date of default at -a rate egaal to Nat rate which is established annually by
said lessor for late payment of municipal taxes. T lessee shall lay to the
lessor a reasonable attorney's fee in the event the lessor employs an attorney
to collect any rents due hereumler. and secures a judgment in connection with
collection of said rent.
- 16 -
31. HCIIcHS: All notices, requests, demands, and oflcf cammnications
hereunder shall be in writing andshall be deemed to have been duly given when
delivered in hand to soon party or mailed by certified or registered mail,
postage Prepaid, addressed:
if to Lessee: - Swift River Company
Attu: Christian A. Herter III
44 FXclange Street
rortland, mine 04101,
I£ to Lesser: City of Bangor
.. Attu: City Manager
City Hall
Harlow Street
Isomer, Mine 04401
or in each case to such other addresses as may be specified in a written
notice delivered in compliance with the foregoing requirements.
(a) This Lease and the performaee thereof stall be interpreted and
governed by the laws of the State of Maine
(b).lta Section headings herein are for reference and convenience only
and shall not affect the interpretation Mreof.
(c) This lease may he executed in any ouster of counterparts, each of
which when so exemated shall be an original, tot all of the counterpsrts
together shall constitute one and the same inStrUMost.
(d) lessor agrees that lessee may use the land Owned by lessor_ in Brewer,
adjacent to the premises as astaging and storage area during the construction
of the facility, all as shown on Hxbibit A.
(e) lasses shall have the sole right and responsibility to operate and
maintain the facility in accordance with the license granted lessee by the
pedural FTergy Regulatory Commission and all applicable Federal, Stateand
local laws or regulations.
(f) Lessor shall have the right to annually inspect or audit at its
expense all £iwrcial statements or [skirts of lessee pertaining to the
operation of the facility. lesseeshall provide Lesser with a copy of its
annual audited financial statement as socwi as the same is available.
- 17_
(g) Failure on tha part-ofeither party to cunplain of any action or
non -action on the part of the other party no matter taw IoW the seta may
.cautious shall neer be deemed to be a Waiver of any of such party's. rights
hereunder.. Furthermore, it is covenanted and agreed that no waiver at any
tine of any of the provisions hereof by either party shall be construed as a
waiver of any of the other provisions hereof and that a waiver at any time of
any of the provisions hereof shall not be construed at arty subsequent time a
waiver of the sane provisions. TT approval of either party to or for any
action by the other requiring that party's consent of approval, shall not be
neared to waiver of render unnecessary the party's consent or approval to ot.
of any subsequent similar act by the other party. _
(h) If any term or provision of this Issue is held to be invalid or
unenforceable, the reminder of this lease shall not be affected thereby and
each other term and provision of this Cease stall be valid and be enforceable
to the fullest extent pemmitted by lay..
(i) Nothing contained herein shall f deemed w construed ty the parties
hereto, nor by any third party, as creating the relationship of principal and
agent or of partnership or of joint venture between the parties hereto, it
being understand and agreed that neither the mthcd of confutation of rent nor
any provision contained herein or any acts of the parties hereto shall be
neared to create any relationship between the parties hereto other than Oe
relationship of landlord and tenant. - I -
In wr'R s mayor, the parties hereto have
set their
hands and
seals
the
day and year first written above.
witness: city of Bargor, Lessor
By
Its City Manager
Swift River company, Lessee
By
Its
- 18 -
�.
81-19➢
Introduced by Councilor Soucy, Dune 22, 1981
CITY OF BANGOR
(TITLE.) @YDBYa _._ Authorizing Rx,eyption of Option to lease with .. ...
Swift River Company - Bangor Dam
BY dw City Cowneil of the City of Bangor:
ORDERED,
TEAT the City Manager is hereby authorized and directed, on
behalf of the City of Bangor, to execute an Option with Swift River
Company for the lease of the Bangor Dam and related facilities, e
true copy of said Option being on file in the office of the City
Clerk.
In City Council Jwe ]2,1981 81-197
Comeider next meeting 0 R 0 E R
(Work Shop July 1,1981 7SP.B.-
City manager g CffdaB ) nese, 'dl .7<W 18 P3:16
Authorising Execution of Cptiunito.ease
..... ......... el•...b
C" C erc with swift River Co. — Bangor TY CL RK
......................................
u City Cannon July Uj lqn
Amended by SnbetituEloe and Passed Intr; duced d fiVy
substituted ccry/w attecIn/ z
City Cies
f