HomeMy WebLinkAbout2.65 Original Contract
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PORT OF PORT ANGELES
Lease Agreement
THIS LEASE made as of the foli. day of Not/I'u-.. l(Jl>.r-
, 2007 by and
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between the PORT OF PORT ANGELES, a Washington municipal corporation, as Lessor,
hereinafter referred to as "the Port" and/or "Lessor", and the City of Port Angeles, hereinafter
referred to as "Lessee."
WITNESSETH:
In consideration of their mutual promises the parties hereto do hereby mutually agree as
follows:
1. LEASED PREMISES:
(a) The Port hereby leases to Lessee, and Lessee hereby hires and leases from
the Port, the fol!owing described premises situated in Clallam County, State of Washington: That
portion of the William R. Fairchild International Airport Industrial Park building containing
approximately 10,000 square feet of floor space and office, located at 2130 S. 0 Street, Suites A
and B, as shown in Exhibit A hereto (hereinafter referred to as the "premises"), and:
(b) Together with the right to utilize in common with other tenants of the
building known as William. R. Fairchild International Airport' Industrial Park building (of which
the leased premises are a part), the common areas.
2. TERM:
(a) This lease shall be for a term of six (6) months, beginning upon
completion and acceptance of building modifications as set forth in Section 37 and ending six (6)
months thereafter.
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(b) OPTION TO EXTEND: The Port hereby grants to the Lessee an option to
renew said lease on the same terms and conditions, except as to rent and options to renew, for
three (3) additional five (5) year terms, provided that at the commencement of each renewal term
Lessee is in compliance with all provisions of the lease. Lessee shall notify the Port of its
intention to renew in writing at least 30 days prior to the expiration of the first six month term
and at least one hundred twenty (120) days prior to the expiration of the second and third five (5)
year renewal terms. Lessee may terminate the remainder of the lease during the third five (5)
year renewal term, without penalty for early termination, upon one year's written notice to
Lessor.
3. RENT:
(a) Lessee agrees to pay the Port as rental for said premises a monthly rental
of Four Thousand One Hundred Dollars, ($4,100.00). The monthly rental shall be paid in
advance on the first day of each and every calendar month of the lease term and shall be payable to
the Port of Port Angeles at the Port General Offices located at 338 West First Street, Port
Angeles, Washington, or such other place as the Port may hereafter designate.
(b) The rental stated in Section 3 (a), above, shall be subject to adjustment
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effective at the end of five (5) years and six (6) months following the commencement of this
lease and every five (5) years thereafter. The rental adjustment shall not be less than the
cumulative CPI B/C index over the term of the lease. If the CPI B/C index is no longer published
during the term of the lease then the replacement index for the B/C index shall be used. Said
renegotiation shall take place after the Port gives to the Lessee written notice of the Port's
election to renegotiate the rent applicable to the forthcoming rent period. If said notice is given
prior to the date of commencement of the next rental period applicable to this lease, then the
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renegotiated rent shall be applicable from the date of commencement of said new rental period.
Should the notice to renegotiate the rent be delivered after the date of the commencement of the
new rental period, then the renegotiated rent as ultimately determined through agreement or
arbitration as hereinafter set forth, shall be applicable from the date the Port's election to
renegotiate the rent was actually received by the Lessee. Promptly following delivery of notice
of renegotiation, the parties shall negotiate in good faith for a renegotiated rent for the
forthcoming rental period. Unless expressly provided to the contrary in another section of this
lease, such renegotiated rent shall be the fair market rental of the premises, but shall in no time
be less than a minimum rental specified in Section 3(a), above.
(c) The value of any improvements to the premises made by the Lessee at no
cost to the Port shall be excluded from such determination. In the event the parties cannot agree
on the rent within thirty (30) days from the date notice ofreneg~tiation is delivered to the Lessee,
then the rents to be paid for the new rental period shall be determined by three arbitrators, each
of whom shall be a member of the American Institute of Real Estate Appraisers. The arbitrators
shall be promptly appointed in the following manner: one by the Port, one by the Lessee and a
third appointed by the other two. Either the Port or the Lessee shall have the right to request
arbitration of the rents to be paid for the new rental period if agreement is not reached thereon
within the thirty-day period specified above. The Port and the Lessee shall share equally the
compensation of the three arbitrators. The arbitrators will promptly decide the fair market rental
value which, subject to the minimum rentals heretofore set forth, shall be the rents to be paid by
the Lessee during the ensuing rental period. The decision of the arbitrators shall be binding on
both parties and shall be effective as of the date of commencement of the new rental period
contemplated by this lease. Should the arbitration of rentals or the adjustment thereof byt
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agreement of the parties not be completed until after the date specified herein for commencement
of the new rental period, the new rents ultimately determined or agreed upon shall be applicable
retroactively to the date of commencement of the new rental period as specified in this lease or at
the date notice of renegotiation was delivered to the Lessee, whichever date occurs later.
Simultaneous with its request for arbitration, the party requesting arbitration shall notify the
other party of its appointment of an arbitrator. Within ten (10) days thereafter, the second party
shall appoint an arbitrator and within five (5) days thereafter the two arbitrators so appointed shall
appoint a third and thereafter the arbitrators shall render a decision in as prompt a manner as is
reasonable under the circumstances. Should a party fail to appoint an arbitrator within the time
allowed after notice in writing by the other party, then the arbitrator appointed by the initiating party
shall within twenty-five (25) days after his appointment, determine the reasonable fair market
value of rents in accordance with the terms hereof which determination shall be binding on both
parties. Should the two arbitrators appointed by the parties fail to agree upon appointment of a
third arbitrator within the time allowed, the third arbitrator shall be appointed by the presiding
Judge of the Superior Court of Clallam County. The conduct of the arbitration proceedings shall be
in accordance with the State of Washington Arbitration Statutes except insofar as the procedures
specifically set forth herein are inconsistent therewith, in which event, the specific provisions of
this lease shall control the arbitration proceedings.
4. USE OF PREMISES:
(a) Lessee shall use the premises for an electrical maintenance facility and
shall not use them for any other purpose without the written consent of the Port. Lessee shall use
the entire premises for the conduct of said business in a first-class manner and shall do so
continuously during the entire term of this lease, with the exception of temporary closures for
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such periods as may reasonably be necessary for repairs or redecorating or for reasons beyond
Lessee's reasonable control. Should the Lessee fail for a period of nine (9) consecutive months to
conduct and carryon in good faith the enterprise hereinabove described, then and in that event
this lease and all of the rights of the Lessee herein shall, upon sixty (60) days written notice from
the Port be forfeited and canceled forthwith.
(b) Lessee agrees that it will not disturb the Port or any other Lessee of the
Port by making or permitting any disturbance or any unusual noise, vibration or other condition
on or in the premises not reasonably necessary to the conducting of Lessee's business.
(c) Lessee shall not undertake any modification, change, addition or
installation on or to the leased premises without the prior written consent of the Port, which
consent shall not be unreasonably or untimely withheld.
(d) Lessee specifically agrees that this use and improvement section shall be
strictly construed to assure that the premises and operations or activities conducted on said
premises are in full compliance with all applicable environmental or other law and regulation.
Lessee shall at all times operate on the premises in a manner which will assure the safe, lawful
and healthful use of the premises. Lessee shall obtain prior written approval from the Port before
installing or using any new or different processes, which result in air or water pollution (as those
terms are defined in state and federal law), or in a release of hazardous substance (as those terms
are defined in CERCLA, 42 USC 9601, et. seq.).
(e) Lessee shall be solely responsible for obtaining all permits, approvals or
licenses required to install, erect or operate any structures, facilities or equipment, including but
not limited to, items defined as trade fixtures on the leased premises. Lessee shall be solely
responsible for complying with all laws, related to its business activities conducted during the
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period of this lease including but not limited to the Clean Water Act, the Clean Air Act, the
Comprehensive Environmental Response Compensation and Liability Act (CERCLA), the
Resource, Conservation and Recovery Act (RCRA), the American With Disabilities Act (ADA)
and all amendments thereto, and all equivalent state statutes, all ordinances, regulations,
guidance, rules, policy statements, orders of all governmental authorities applicable to the
Lessee's use and occupancy or ownership of the leased premises.
(f) Lessee shall notify Port within twenty-four (24) hours of any release of a
reportable quantity of any hazardous substance (as those terms are defined in CERCLA, 42 USC
9601, et. seq.), or of the receipt by Lessee of any notices, orders or communications of any kind
from any governmental entity which relate to the existence of or potential for environmental
pollution of any kind existing on or resulting from the use of the leased premises or any activity
conducted thereon. Failure of Lessee to comply with any of the requirements of this Section 4
shall authorize but not obligate the Port to take, on the Lessee's behalf, any actions necessary to
assure prompt compliance with such laws. Lessee shall reimburse the Port for the full reasonable
cost of such action within thirty (30) days of receipt of billing therefore or shall be in default
hereunder.
(g) Lessee shall indemnify and save the Port harmless from all damage, law
suits, governmental proceedings, fines, judgments, claims, and liabilities related to
environmental incidents or damage arising out or connected with any activities on or resulting
from Lessee's (or Lessee's agents, employees, invites or contractors) occupancy and use of the
leased premises, or as a result of the Lessee's breach hereof. Lessee acknowledges that it
expressly and specifically waives immunity under the industrial insurance statute of the state of
Washington, Title 51 RCW, for purposes of this indemnification provision and further
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acknowledges that this waiver was mutually negotiated by the parties. Lessee further agrees to
provide insurance as required by Section 13 of this lease for losses or expenses arising as a result
of environmental incidents, including environmental damage to these leased premises at such
times during the term hereof that such insurance becomes available at an annual rate of
$2,000.00 for a minimum coverage of $500,000.00 which the parties now agree would be a
reasonable cost. The parties acknowledge that such coverage is not available at reasonable cost at
the time or execution of this lease.
(h) Lessee further acknowledges that its compliance with this Section 4 shall
be subject to review by the Port prior to further extensions of this agreement.
5. PARKING AND USE OF COMMON AREAS:
Lessee's customers and employees shall have the exclusive use of twenty (20)
reserved common area parking spaces adjacent to the premises, as shown in Exhibit A hereto,
and the rightin common with others to use all other common areas appurtenant to the building of
which the premises are a part, solely in connection with the conduct of Lessee's business. All
common areas shall be subject to the exclusive control and management of Port and subject to
reasonable rules and regulations with respect to all facilities and common areas. Lessee and its
employees shall do no act which will increase the Port's liability within parking areas or areas of
common use.
6. UTILITIES:
Lessee shall be liable for, and shall pay throughout the term of this lease, all
charges for all utility services furnished to the premises, including, but not limited to, light, heat,
electricity, gas, water, sewerage and garbage disposal services.
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7. ACCEPTANCE OF PREMISES:
Lessee has examined the premises, accepted them in their present condition, and
agrees to make any changes in the premises necessary to conform to federal, state and local law
applicable to Lessee's use of the premises. Lessee recognizes that this acceptance is based on the
Lessor fulfilling the building modifications as set forth in Section 37 of this Agreement.
8. MAINTENANCE AND REPAIR:
(a) The Lessee will at all times during the term of this agreement maintain the
property in good condition and shall, at its own expense, keep the entire premises, and the
adjoining sidewalks neat, clean and in a safe and sanitary condition and in compliance with all
federal, state and local environmental and other laws and regulations applicable to Lessee's use
of the premises. Provided, however, Port shall maintain in reasonably good order and condition:
(b) The foundation, bearing and exterior walls, and roof of the building; the
unexposed electrical, plumbing and sewage systems in the building lying outside the premises;
window frames, gutters and downspouts on the building; and the common areas. In the event any
repair or maintenance described in this Section is occasioned by the act, omission, or neglect of
Lessee or any persons who may be in or upon the premises or the project with the express or
implied consent of Lessee (including Lessee's officers, contractors, agents, invitees, guests,
employees), Lessee shall pay to Port the costs of such maintenance and repair on demand by
Port. Port shall not be in default under this lease and shall not be liable to Lessee for any loss or
damage to person or property, or any inconvenience or interference with Lessee's business
caused by or resulting from Port's failure to perform its obligations under this section unless such
failure shall persist, due to Port's negligence, for an unreasonable period of time after written
notice of the need for repair or maintenance has been given by Lessee to Port. There shall be no
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abatement of rent (except as provided in Section 11) and Port shall not be liable or responsible to
Lessee for any loss or damage to person or property or for inconvenience to, or interference with
Lessee which may arise through repair, maintenance or alteration of any part of the project.
(c) Lessee agrees that if, as a result of its use, occupancy or operations on the
premises, or because of any action of its agents, invitees, employees, contractors or others, any
environmental or health hazard occurs on the premises, said Lessee shall take promptly all
necessary remedial action to bring the premises and operations or activities conducted thereon
into full compliance with applicable federal, state and local laws and regulations.
(d) Lessee specifically warrants that its business or other activities on the
premises as authorized by Section 4 of this lease shall be conducted in a manner which includes
standards of maintenance and repair which insure continued compliance with all applicable
environmental and other laws and regulations.
(e) At the expiration or sooner termination of this lease, Lessee shall return
the Port's property to the Port in the same condition in which received (or, if altered by Lessee
with the Port's consent, then the premises shall be returned in such altered condition), reasonable
wear and tear and damage by fire or unavoidable casualty not resulting in environmental or
health hazard excepted.
(t) In addition to any other rights it may have hereunder, Port reserves the
right to periodically inspect the premises for compliance with this section "Maintenance and
Repair" and after thirty (30) days notice or such lesser time as a danger to the Port or public may
require, to make necessary repairs and charge the Lessee therefore. Failure by the Lessee to
make repair after notice shall constitute a default hereunder.e
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9. ALTERATIONS AND IMPROVEMENTS:
Lessee shall make no alterations or improvements to or upon the premises or
install any fixtures (other than trade fixtures which can be removed without injury to the
premises) without first obtaining written approval from the Port and subject to any and all
conditions contained in such approval. In the event any alterations or improvements shall be
made or fixtures (other than trade fixtures which can be removed without injury to the premises)
installed by Lessee, they shall at the termination of the lease become a part of the realty and
become the property of the Port, if the Port, at its sole election, accepts transfer of ownership
thereof and, subject, however, to the provisions of Section 35 herein.
10. INSPECTION:
The Port reserves the right of reasonable access to the leased premises: (i) to enter
and inspect the same and to conduct any testing, sampling, borings and analysis it deems
necessary to assure compliance with environmental or other laws and regulations; (ii) in the
event of an emergency, to comply with lawful orders or to reduce or mitigate environmental loss
or damages, to take such reasonable actions on the premises as may be necessary to bring the
premises or operations on the premises in compliance with environmental or other laws and
regulations. Lessee agrees to cooperate with the Port and all appropriate authorities to assure that
operations on the premises and the use of the premises, shall at all times be in full compliance
with all applicable laws and regulations, including but not limited to those established for the
purpose of protecting the environment and public health. The right of inspection reserved to the
Port hereunder shall impose no obligation on the Port to make inspections to ascertain the
condition of the premises, and shall impose no liability upon the Port for failure to make such
inspections.
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11. POSSESSION:
If the Port shall be unable for any reason to deliver possession of the premises, or
any portion thereof, at the time of the commencement of the term of this lease, the Port shall not
be liable for any damage caused thereby to Lessee, nor shall this lease thereby become void or
voidable, nor shall the term specified herein be in any way extended, but in such event Lessee
shall not be liable for any rent until such time as the Port can deliver possession. If Lessee shall,
in the interim, take possession of any portion of the premises, Lessee shall pay as rent the full
rent specified herein reduced pro rata for the portion of the premises not available for possession
by Lessee. If the Port shall be unable to deliver possession of the premises at the commencement
of the term of the lease, Lessee shall have the option to terminate this lease by at least thirty (30)
days' written notice, unless the Port shall deliver possession of the premises prior to the effective
date of termination specified in such notice. If Lessee shall, with the Port's consent, take
possession of all or any part of the premises prior to the commencement of the term of this lease,
all of the terms and conditions of this lease shall immediately become applicable, with the
exception that Lessee shall not be obligated to pay any rent for the period prior to the
commencement of the term of this lease unless otherwise mutually agreed.
12. DAMAGE AND DESTRUCTION CLAUSE:
(a) Should the premises or Port buildings or structures of which the premises
are a part be partially damaged by fire or other casualty, or rendered partially unfit for use by
reason of fire or other casualty, Lessee shall give immediate notice thereof to the Port and the
premises shall be repaired with due diligence by the Port. The monthly rent shall be abated in the
same proportion that the untenantable portion of the premises bears to the whole thereof, for, the
period from the occurrence of the damage to the completion of the repairs. Lessee shall
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cooperate fully in obtaining and making available proceeds of insurance provided by Lessee
pursuant to Section 13 hereof in furtherance of such repairs.
(b) Should the premises or Port buildings or structures of which the premises
are a part be completely destroyed by fire or other casualty, or should they be damaged to such
an extent that the premises are rendered wholly unfit for their accustomed uses the Lessee shall
give the Port immediate notice thereof. Upon the giving of said notice by Lessee, the Port shall
have the option to terminate this lease on thirty (30) days' notice, effective as of any date not
more than sixty (60) days after the occurrence. In the event that this section shall become
applicable, the Port shall advise Lessee within forty-five (45) days after the happening of any
such damage whether the Port has elected to continue the lease in effect or to terminate it. If the
Port shall elect to continue this lease in effect, it shall commence and prosecute with due
diligence any work necessary to restore or repair the premises. Lessee shall cooperate fully in
obtaining and making available proceeds of insurance provided by Lessee pursuant to Section 13
hereof in furtherance of such repairs. If the Port shall fail to notify Lessee of its election within
said forty-five (45) day period, the Port shall be deemed to have elected to terminate this lease,
and the lease shall automatically terminate sixty (60) days after the occurrence of the damage.
For the period from the occurrence of any damage to the premises to the date of completion of
the repairs to the premises (or to the date of termination of the lease if the Port shall elect not to
restore the premises), the monthly rent shall be abated in the same proportion as the untenantable
portion of the premises bears to the whole thereof. _
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13. INDEMNIFICATION AND INSURANCE:
(a) Indemnity: The Port, its employees and agents shall not be liable for any
injury (including death) to any persons or for damage to any property regardless of how such
injury or damage be caused, sustained or alleged to have been sustained by Lessee or by others
as a result of any condition (including existing or future defects in the premises) or occurrence
whatsoever related in any way to the premises and the areas adjacent thereto or related in any
way to Lessee's use or occupancy ofthe premises and of the areas adjacent thereto. Lessee agrees
to defend, indemnify and to hold and save the Port harmless from all liability or expense
(including expense of litigation) damage, law suits, governmental proceedings, fines, judgments,
claims, and liabilities arising out of or connected with any damage or any activities on the leased
premises or resulting from Lessee's (or Lessee's agents, employees, invitees or contractors)
occupancy and use of the leased premises, or as a result of the Lessee's breach hereof. Lessee
acknowledges that it expressly and specifically waives immunity under the Industrial Insurance
Statute of the State of Washington, Title 51 RCW, for purposes of this indemnification provision
and further acknowledges that this waiver was mutually negotiated by the parties.
(b) Liability Insurance: Lessee represents that it is self-insured. Lessee shall,
at no expense to the Port, maintain and provide proof of Washington Cities Insurance Authority
Self- Insured Coverage, in the minimum limits described in Exhibit B hereto (Washington Cities
Insurance Authority Self-Insured Coverage Document CT-2007), and hereafter in such increased
amounts as the parties may from time to time mutually agree upon, to indemnify both the Port
and Lessee against any such liability or expense.
(c) Miscellaneous: The Port shall be furnished with appropriate evidence to
establish (i) that Lessee's obligations as herein provided have been met, and (ii) that the coverage
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as herein required is not subject to cancellation without at least ninety (90) days' advance written
notice to the Port. Lessee's Self Insured Coverage documents shall be made available to the Port.
If either party fails to comply with any of the provisions of this section, the other party, at any
time thirty (30) or more days after mailing notice, may without prejudice to any other rights it
may have, purchase the insurance required to be carried and the cost thereof shall be billed to the
refusing or neglecting party and shall be additional rent.
14. WAIVER OF SUBROGATION:
The Port and Lessee hereby mutually release each other from liability and waive
all right of recovery against each other for any loss from perils insured against under their fire
insurance contracts, or self insured coverage, as the case may be, including any extended
coverage endorsements thereto: provided, that this Section 14 shall be inapplicable if it would
have the effect of invalidating any coverage of Port or Lessee.
15. INCREASE IN COST OF INSURANCE:
Lessee shall not use the premises in such a manner as to increase the existing rates
of insurance applicable to the buildings or structures of which the premises are a part. If it
nevertheless does so, then, at the option of the Port, the full amount of any resulting increase in
premiums paid by the Port with respect to the buildings or structures of which the premises are a
part, and to the extent allocable to the term of this lease, may be added to the amount of rent
hereinabove specified and shall be paid by Lessee to the Port upon the monthly rental day next
thereafter occurring.
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16. TAXES:
Lessee shall be liable for, and shall pay throughout the term of this lease, all
license and excise fees and occupation taxes covering the business conducted on the premises
and all taxes on property of Lessee on the premises whether imposed on Lessee or on the Port.
Lessee shall also pay, or reimburse the Port for all taxes, other than any net income taxes payable
by the Port, including ad valorem taxes or taxes levied in lieu of an ad valorem tax. All other tax
amounts for which the Port is or will be entitled to reimbursement from Lessee shall be payable
by Lessee to the Port at least fifteen (15) days prior to the due dates of the respective tax amounts
involved: Provided, that Lessee shall be entitled to a minimum often (10) days written notice of
the amounts payable by it.
17. COMPLIANCE WITH PORT REGULATIONS AND WITH ALL LAWS:
(a) Lessee agrees to take reasonable action to comply with all applicable
rules and regulations of the Port pertaining to the building or other realty of which the premises
are a part now in existence or hereafter promulgated for the general safety and convenience of
the Port, its various Lessees, invitees, licensees and the general public upon receipt of notice of
the adoption of such regulations.
(b) Lessee agrees to comply with all applicable federal, state and municipal
laws, ordinances, and regulations, including without limitation those relating to environmental
matters. Any fees for any inspection of the premises during the lease term by any federal, state or
municipal officer related to Lessee use and occupancy of the building and the fees for any so-
called "Certificate of Occupancy" shall be paid by Lessee.
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18. ASSIGNMENT OR SUBLEASE:
(a) Lessee shall not assign or transfer this lease or any interest therein nor
sublet the whole or any part of the premises, nor shall this lease or any interest hereunder be
assignable or transferable by operation of law or by any process or proceeding of any court, or
otherwise, without the written consent of the Port first had and obtained. If Lessee is a
corporation, Lessee further agrees that if at any time during the term of this lease more than one-
half (1/2) of the outstanding shares of any class of stock of Lessee corporation shall belong to
any stockholders other than those who own more than one-half (1/2) of the outstanding share of
any class of stock at the time of the execution of this lease, such change in the ownership of the
stock of Lessee shall be deemed an assignment of this lease within the meaning of this section.
(b) If the Port shall give its consent to any assignment or sublease, this section
shall nevertheless continue in full force and effect and no further assignment or sublease shall be
made without the Port's consent.
19. DEFAULTS:
(a) Time IS of the essence of this agreement. Lessee shall pay interest
monthly at the annual rate of twelve percent (12%), on all sums owing to the Port under this
lease, commencing thirty (30) days after the date each sum is due and payable. In the event of the
failure of Lessee to pay the rents, interest, and any and all other charges provided for in this lease
at the time and in the manner herein specified, or to keep any of the covenants or agreements
herein set forth to be kept and performed, the Port may elect to terminate this lease and re-enter
and take possession of the premises with or without process of law: Provided, however, that
Lessee shall be given thirty (30) days notice in writing stating the nature of the default in order to
permit such default to be remedied by Lessee within said thirty (30) day period.
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(b) Payment by Lessee to the Port of interest on rents and/or any other
charges due and owing under this lease shall not cure or excuse Lessee's default in connection
with such rents and/or charges. Interest, default and all other remedies of the Port hereunder are
cumulative and not alternative. If upon such re-entry there remains any personal property of
Lessee or of any other person upon the premises, the Port may, but without the obligation so to
do, remove said personal property and hold it for the owners thereof or may place the same in a
public garage or warehouse, all at the expense and risk of the owners thereof, and Lessee shall
reimburse the Port for any expense incurred by the Port in connection with such removal and
storage. The Port shall have the right to sell such stored property without notice to Lessee, after it
has been stored for a period of thirty (30) days or more, the proceeds of such sale to be applied
first to the cost of such sale, second to the payment of the charges for storage, and third to the
payment of any other amounts which may then be due from Lessee to the Port, and the balance,
if any, shall be paid to Lessee. Notwithstanding any such re-entry, the liability of Lessee for the
full rents and interest provided for herein shall not be extinguished for the balance of the term of
this lease, and Lessee shall make good to the Port any deficiency arising from a reletting of the
premises at a lesser rental than that hereinafter agreed upon. Lessee shall pay such deficiency
each month as the amount thereof is ascertained by the Port.
20. TERMINATION:
In the event the United States Government, the State of Washington, or any
agency or instrumentality of said government shall take title, possession, the rights of possession
of the premises, or any part thereof, the Port shall have the option to terminate this agreement
and if the taking has substantially impaired the utility of the premises to Lessee, Lessee shall
have the option to terminate this agreement. Both options shall be exercisable as of the date of
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said taking. If Lessee is not in default under any of the provisions of this agreement on the date
of such taking, any rental prepaid by Lessee shall be promptly refunded to Lessee to the extent
allocable to any period subsequent to said date, and all further obligations of the parties shall
terminate except liabilities, which shall be accrued prior to such date. To the extent Lessee has
paid for improvements to the premises, Lessee shall receive a fair allocation of any award
received by the Port due to the termination for government use which award includes the value
of such improvements for the remaining lease term. Should the parties be unable to agree on said
"fair allocation", fair allocation shall be determined by arbitration. Either the Port or the Lessee
shall have the right to request arbitration of the fair allocation to be paid. The arbitrators will
promptly decide the fair market of the value of such improvements for the remaining lease term.
The decision of the arbitrators shall be binding on both parties. The arbitrators shall be promptly
appointed in the following manner: one by the Port, one by the Lessee and a third appointed by
the other two. Simultaneous with its request for arbitration, the party requesting arbitration shall
notify the other party of its appointment of an arbitrator. Within ten (10) days thereafter, the
second party shall appoint an arbitrator and within five (5) days thereafter the two arbitrators so
appointed shall appoint a third and thereafter the arbitrators shall render a decision in as prompt a
manner as is reasonable under the circumstances. Should a party fail to appoint an arbitrator
within the time allowed after notice in writing by the other party, then the arbitrator appointed by
the initiating party shall within twenty-five (25) days after his appointment, determine the
reasonable fair allocation in accordance with the terms hereof which determination shall be
binding on both parties. Should the two arbitrators appointed by the parties fail to agree upon
appointment of a third arbitrator within the time allowed, the third arbitrator shall be appointed
by the presiding Judge of the Superior Court of Clallam County. The conduct of the arbitration
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proceedings shall be in accordance with the State of Washington Arbitration Statutes except
insofar as the procedures specifically set forth herein are inconsistent therewith, in which event,
the specific provisions of this lease shall control the arbitration proceedings.
21. TERMINATION BECAUSE OF COURT DECREE:
In the event that any court having jurisdiction in the matter shall render a decision
which has become final and which will prevent the performance by the Port of any of its
obligations under this lease, then either party hereto may terminate this lease by written notice,
and all rights and obligations hereunder (with the exception of any undischarged rights and
obligations that occurred prior to the effective date of termination) shall thereupon terminate. If
Lessee is not in default under any of the provisions of this lease on the effective date of such
termination, any rent prepaid by Lessee shall, to the extent allocable to any period subsequent to
the effective date of the termination, be promptly refunded to Lessee.
22. SIGNS:
No signs or other advertising matter, symbols, canopIes or awnmgs shall be
attached to or painted on or within the premises, including the windows and doors thereof,
without the approval of the Port first had and obtained. At the termination or sooner expiration of
this lease, all such signs, advertising matter, symbols, canopies or awnings attached to or painted
by Lessee shall be removed by Lessee at its own expense, and Lessee shall repair any damage or
injury to the premises and correct any unsightly condition caused by the maintenance and
removal of said signs.
19
23. INSOL VENey:
If Lessee shall file a petition III bankruptcy, or if Lessee shall be adjudged
bankrupt or insolvent by any court, or if a receiver of the property of Lessee shall be appointed in
any proceeding brought by or against Lessee, or if Lessee shall make an assignment for the
benefit of creditors or if any proceedings shall be commenced to foreclose any mortgage or any
other lien on Lessee's interest in the premises or on any personal property kept or maintained on
the premises by Lessee, the Port may, at its option, terminate this lease.
24. NONWAIVER:
The acceptance of rent by the Port for any period or periods after a default by
Lessee hereunder shall not be deemed a waiver of such default unless the Port shall so intend and
shall so advise Lessee in writing. No waiver by the Port of any default hereunder by Lessee shall
be construed to be or act as a waiver of any subsequent default by Lessee. After any default shall
have been timely cured by Lessee, it shall not thereafter be used by the Port as a ground for the
commencement of any action under the provisions of Section 19 hereof.
25. ATTORNEYS' FEES:
If either party shall be required to bring any action to enforce any of the
provisions of this lease, or shall be required to defend any action brought by the other party with
respect to this lease, and in the further event that one party shall substantially prevail in such
action, the losing party shall, in addition to all other payments required therein, pay all of the
prevailing party's actual costs in connection with such action, including such sums as the court or
courts may adjudge reasonable as attorneys' fees, expert witness fees and other costs incurred in
furtherance of such litigation in the trial court and in any appellate courts.
20
26. HOLDING OVER:
If Lessee shall, with the consent of the Port, hold over after the expiration or
sooner termination of the term of this lease, the resulting tenancy shall, unless otherwise
mutually agreed, be for an indefinite period of time on a month-to-month basis. During such
month-to-month tenancy, Lessee shall pay to the Port the same rate of rent as set forth herein,
unless a different rate shall be agreed upon, for the first sixty (60) days of any such holding over
and thereafter the rent shall increase by five percent (5%) and Lessee shall be bound by all of the
additional provisions of this lease insofar as they may be pertinent.
27. ADVANCES BY PORT FOR LESSEE:
If Lessee shall fail to do anything required to be done by it under the terms of this
lease, except to pay rent, the Port may, at its sole option, do such act or thing on behalf of
Lessee, and upon notification to Lessee of the cost thereof to the Port, Lessee shall promptly pay
the Port the amount of that cost.
28. LIENS AND ENCUMBRANCES:
Lessee shall keep the premises free and clear of any liens and encumbrances
arising or growing out of the use and occupancy of the said premises by Lessee. At the Port's
request, Lessee shall furnish the Port with written proof of payment of any item which would or
might constitute the basis for such a lien on the premises if not paid.
29. NOTICES:
(a) All notices and payments hereunder may be hand delivered or mailed. If
mailed, they shall be sent to the following respective addresses:
To Lessor:
Port of Port Angeles
P.O. Box 1350
Port Angeles, W A 98362
21
To Lessee:
City of Port Angeles
P.O. Box 1150
Port Angeles, W A 98362
or to such other respective addresses as either party hereto may hereafter from time to time
designate in writing. If hand delivered, notice shall be delivered as follows:
To Lessor:
Port of Port Angeles
338 West First Street
Port Angeles, W A 98362
To Lessee:
City of Port Angeles
321 East 5th Street
Port Angeles, W A 98362
(b)
Notices and payments sent by certified or registered mail and subsequently
received by the Port shall be deemed to have been given when and if properly mailed, and the
postmark affixed by the United States Postal Service shall be conclusive evidence of the date of
mailing.
30. JOINT AND SEVERAL LIABILITY:
Each and every party who signs this lease, other than in a representative capacity,
as Lessee, shall be jointly and severally liable hereunder.
31. INVALIDITY OF PARTICULAR PROVISIONS:
If any term or provision of this lease or the application thereof to any person or
circumstance shall, to any extent, be invalid or unenforceable, the remainder of this lease or the
application of such term or provision to persons or circumstances other than those as to which it
is held invalid or unenforceable shall not be affected thereby and shall continue in full force and
effect.
22
32. NONDISCRIMINA nON-SERVICES:
(a) Lessee agrees that it will not discriminate by segregation or otherwise
against any person or persons because of race, sex, sexual orientation, age, creed, disability,
color or national origin in furnishing, or by refusing to furnish, to such person, or persons, the
use of the facility herein provided, including any and all services, privileges, accommodations
and activities provided thereby.
(b) It is agreed that Lessee's noncompliance with the provisions of this clause
shall constitute a material breach of this lease. In the event of such noncompliance, the Port may
pursue such remedies as may be provided by law.
33. NONDISCRIMINA nON-EMPLOYMENT:
(a) Lessee covenants and agrees that III all matters pertaining to the
performance of this lease, Lessee shall at all times conduct its business in a manner which
assures fair, equal and nondiscriminatory treatment of all persons without respect to race, sex,
sexual orientation, age, disability, color, creed or national origin and, in particular:
(b) Lessee will maintain open hiring and employment practices and will
welcome applications for employment in all positions from qualified individuals who are
members of racial or other minorities, and
(c) Lessee will comply strictly with all requirements of applicable federal,
state and local laws or regulations issued pursuant thereto relating to the establishment of
nondiscriminatory requirements in hiring and employment practices and assuring the service of
all patrons or customers without discrimination as to any person's race, sex, age, creed, disability,
color or national origin.
23
34. LABOR UNREST:
Lessee agrees to join with the Port and use its best efforts in avoiding labor unrest
in any business it conducts on premises, or in the event of a wild-cat strike or other labor
difficulty, to use its good offices in negotiating and bringing to a swift and satisfactory conclusion
any kind of labor dispute that may affect the interest of the Port.
35. TITLE TO IMPROVEMENTS:
(a) On the commencement date of the term of this Lease, all existing structures,
installations, and improvements of any kind located on the leased premises are owned by and
title thereto is vested in Lessor. All structures, installations and improvements of any kind placed
on the leased premises by'Lessee subsequent to the commencement date of the term of this Lease
shall, at the option of Lessor, be removed by Lessee at Lessee's expense prior to the termination
of this Lease. Lessor may exercise said option as to any or all of the structures, installations and
improvements by notifying Lessee that any such structure, installations and improvements must
be removed at any time prior to the termination of this Lease. If Lessor exercises such option,
Lessee shall remove such structures, installations or improvements within sixty (60) days after
the expiration of the term of this Lease or sooner termination thereof. If Lessee fails to remove
such structures, installations, or improvements within said sixty (60) days, Lessor shall have the
right to have such structures, installations or improvements removed at the expense of Lessee. As
to any or all structures, installations or improvements owned by Lessee, for which Lessor does
not exercise option for removal, title thereto shall vest in Lessor without cost to Lessor and
without any payment to Lessee at the time the lease terminates.
(b) Machines, appliances, equipment and trade fixtures of any kind hereafter
placed on the leased premises by Lessee are owned by and title thereto is vested in Lessee and
24
the same shall be removed by Lessee within sixty (60) days after the expiration of the term of
this Lease or sooner termination thereof; provided, however, Lessee agrees to repair any and all
damage occasioned by the removal thereof. If any such machines, appliances, equipment and
trade fixtures are not removed within sixty (60) days after the termination of this Lease, the same
may be considered abandoned and shall thereupon become the property of Lessor without cost to
the Lessor and without any payment to Lessee; except that Lessor shall have the right to have the
same removed at the expense of Lessee.
.
( c) During any period of time employed by Lessee under this paragraph to
remove structures, installations, improvements, machines, appliances, equipment and trade
fixtures, Lessee shall continue to pay the full rental to Lessor in accordance with this Lease
which said rental shall be prorated daily.
(d) Lessor warrants and defends good title to the leased premises. Lessee, at
its sole option and expense may obtain title insurance for the leasehold for the term of this Lease
at any time during this Lease.
36. EASEMENTS:
(a) The parties recogmze that the Port facilities are continuously being
modified to improve the utilities, services and premises used and provided by the Port to its
Lessees and customers. The Port, or its agents, shall have the right to enter the premises of
Lessee, and to cross over, construct, move, reconstruct, rearrange, alter, maintain, repair and
operate the sewer, water, and drainage lines, and the electrical service, access roads, and all other
services and facilities required by the Port for its use located upon or under the premises. The
Port is hereby granted a continuous easement or easements as the Port believes necessary within
the premises of Lessee, without any additional cost to the Port for the purposes expressed
25
hereinabove. Provided, however, iJwt the Perthy virtue of such use, does not materially deprive
Lessee of its beneficial use or occupancy of its leased ar~a for a period in excess of thirty (30)
working days.
(b) [n the event that the Port substantially clepri ves Lessee of beneficial use
or occupancy of a portion of its prernises for more than thirty (30) days, then an equitable
adjustment in rent shall be made by the Port. In the event that such deprivation is temporary in
nature, the Port shall also reimburse Lessee for the cost required to modify its premises for the
temporary period that Lessee is inconvenienced by su(~h Port entry, The Port wil! not be
responsible to Lessee for any reduced efficiency or loss of business occasioned by such entry,
37. BUILDING MO:QJF1(AJJQNQ~
Lessor agrees to make building modifications tothe leased premises as set forth in
Exhibit C, which is attached hereto and incorporated herein. Upon completion of I:h,,; described:'
rnodifications and acceptance by Lessee, I.vbicb acceptance shall not be umeasonably \vithheld,:
:. p,,,~
L-.""..' 'f"","""'^""')~'("'h "T1 "./eF,"F'. 'T'~., 'Ci""l(<1'J:.:() f'lO() 00) 'I'~q "
<;:,s"t,.t;; iJ'::'LCvCl 1.\, pd} ",\,S",OI. t ,le Sldd ()., ILLY 1 dOUSc.l1~ 4).)' ,It J ," (UJ.lalS,
;.
,
LESSOR:
LESSEE:
PORT OF FOKTANGELES
CITY OF PORT ANGELES
BY:
~h0!:~.
Executive Director
~y,
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La: .en A. J.\l)gers
M<Jyor
STA.TF OF\;VI'~Sj-fn\J(-(ro:<J
CCH.TN'rY' (iF CLALLAlvl
On this,,,__'_~~__day of _.,IJ!..PJl..f,l11b,e,t-, 20G'!
1.--. :~f"n.':'t: "['n" (."'\ +l~ :-, ;:'!"1C.t~T.I:'; {'j-( ~.:. "4 .0,
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Notary Public in and for the State. of:\V ashingtcri,' dl~ly commissioned and. swam, personally
appeared ROBERT McCHESNEY,]!\ 11'&~' k:nownU\ h6 The Executive Director, of Port of Port
Angeles, . the entity that executed the -vi i,biri m,d n)rcgolng instrument, and acknowledged the
said instrument to be the free and vO!t,r.t2ry ~lst aId deed' of said entity for the uses and purposes
therein mentioned, and on oath stated t}U1ih~;i.s authorized to execute the said instmment
VtTfTNESS my hand and offioifj}.seeJ hereto (j.ffi):f:d the day and year first above written.
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NOT' Y PUBLIC in and for the State of
V/ashi~on,resi~g .
at __JJ.r_L,.L:L~,.f_. i} ~;-;!-.~'~i.. -..-
My Commission Exptres:._(}JLLflL/l!~
STA TE OF WASHINGTON
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COUNTY OF CLALLAM
On tbis.E~__._._ day of H'_;{'!..~.?_'!J/:>~_._-___, lUCi!; before me the undersigned, ;;1
Notary Ptiblie in and for the State of Washington, duly commissioned and SV,?['1H, personally
appeared KAREN A. ROGERS, to me known to be the Mayor of the ;)f Porl .'\Dgr.,ks. :;w
entity that executed the within and foregoing instrument, ,kkll0'i,'I~';ged the s::J;d);~l,,~n;IiJ1Ijnt
to be the free and voluntary act and deed of said cnrdy for the uses and lytnf~OSi::;S i:llf;JC;:n
.melitior:ed, ar,don oath stated th;JT ;:hC ic; 2.uthorized to execute the said instmUIGI1t.
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WITNESS r ~1~P 3[1(} diJ('ial seal hereto affixed the day and year D:-st ':th;ve wr.t1.en
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W/\SHINGT01'i CiTiES IN,SUR/\UCE AUTHORITY
Se!f.ln~urac! r':c'J8rc:pr-: DOCUrilGYH cr~2DO
Jnrll/rJry 'I) ,2001, t~ January 1,2008
1 .2:{h ~lt"r\ Pflcjfie StC\rJd::ii"(:! Ti~e
L1MITS/UL TlrvlATE ~JET LOSS:
SELF-INSURED U\ YER LIMIT:
$3,000,000 PER OCCiJF::~ENCE
REINSURED EXCESS LAYER LIMiT:
,~'12,OOO,OOO PER OCCURRENCE
TOTAL LIMIT:
m'/5,OQO,OOO PER OCCURRENCE, subject b C'lgr)r0gales anti sub,limlts
below and 11'1 Section i,D, (CoVtmlge Limits) in the WCIA .Join!
Protection Program.
AGGREGA TE L1MITS/SUB-LIIVIITS:
Above $4,000, nOD Per OCCUi'r8nOe if, 'I G,ODD,OOO 8ilnual aOUl'eOcdn Fr-ocluct
Uabiiiiy coverage per iviembel', $'IO,OUO,DOO Publio Official Liability annual
aggregate per Member, $'10,000,000 Ernployment Practioe Liability annual
aggreg2te per Member anda $25,000,000 annual aggregate pei' Member for
Law Enforcem::nt l.IClbi/ity arising ou! of Mernb8r owned jails or holding fClcil!ties
witl'] overnight or greater length of stay for ttlFJ connnornent of inmates,
$3,000,000 per occurrence limit and :Pel,OOO,noo annual aggregate pel' iv1embel"
applying to TSITorism,
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$'1,000,000 per occurrenoe limit and :51,000,000 annual aggregate limit per
Member applying for the reiease, discharge DC backup of liquids and/or effluents
from wasle waleI' and/or sanitary sewer lines owned, based, maintained or
opera led by a "Ivlember",
to
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DESCRIPTION OF COVERP,GE: General Liability, Automobile Uabliily, Stop-Gap Coverage, Errors I)( Omissions
Liability and Employee Benefits Liability,
LIMITS OF LIABiLiTY FOR ALL COVERAGE.
The Limits/Ultimate Net Loss staled herein ilncl the rules beiD'.'V set the maxlmuiT! the Authority
will p'ay regardless of the number of:
a, members;
b, claims made or lawsuits brought; or
,. persons or organizations maicino claims Q( bdngir:U lawsuits
TEgRITOHY: This cOl/erage applies to General Liability, Automobile Liability, Slop,Gap Covsrage, E:rrors or
OmIssions Liability and Employee Benefit UeJbill!y occulTin!] ;;lfIywhere in thel United States of AmeriGi'l, its territorise;
and possessions or Canada. '
. :.~
MEMBERS COVERED BY THIS AGREEMENT:
AberdeeTi
r~J1acortcs
jI, Regiona! C08Htion for Housing
Arlington
Auburn
Bainbridge lsiwid
So,tile Ground
Benton City
Benton County Emergency Services
Bonney L~ik8
Bothe!i
Burien
Ca!TJ8E!
CaShn!erD
Cenlraiia
Chehali,:
2h:~:y
c..h!,:;!cJ:l
Clark "R,e9jnj,'18~ En;oJ'Q. S~1rv, AU. (CREGA)
Cj;~rkston .
C-:it;; 1::ium
C!yd€:; HW
Cfn:pS\iiHe
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WCIA COv8raqe Document #CT-2007
Covington
Cowlitz-Wahkiakum Council of Gov.
Des Moines
Eastside Public Safety Communications
BCity GO\l Allianoe
Edgewood
Edmonds
Elma
Emergenoy Servioes Coord. AJJenoy
Enumclaw
Fife
George
Goldendale
Grandview
Grays Harbor 911 Communications
Hoquiam
Issaquah
Kelso
Kenmore
Kent
Kirkland
Lacey
La Conner
Lake Forest Park
Lake Stevens
Leavenworth
l_ong Beach
Longview
LOTI Alliance
Mabton
Maple Valley
Marysville'
Marysville Fire District
McCleary
Medical Lake
Medina
Mercer Isiand
Metropoiiian Parle District ofTacoma
Ivlill Creek
Millon
Ivlonroe
Monroe Fire District
Ivlonlesano
Ivloses Lake
/VIountlake TsrrEloe
Mount Vernon
Ivluleilteo
l\Jewcastle
Normandy Park
l\Jorth Bonneville
j\Jorthshore Utility District
Oak Harbor
Ocean Shores
Olympia
Othello
Pasco
PEN COM
Pori Angeles
Pori Townsend
Pullman
Pullman-Moscow Regional Airport
Pullman Metropolitan Park District
Puyallup
Renton
Richland
Ridgefield
Sammamish
Shelton
Shoreline
Skagit 911
Paqe 2
Snohomish
Snohomish Co. Emergency Radio Sys.
SI\JOCOlvl/lvledic 7
SNOPAC
Snoqualmie
Soap Lake
Spokane Valley
Stanwood
Steilacoom
Sumner
Three Rivers Reg. Wastewater Auth.
Thurston Regional Planning Council
Toppenish
Tulcwila
Tumwater
Union Gap
University Place
Valley Communications
Walla WaIJE
WA Cities Insurance Authority
Warden
Washougal
Water Operating Board
Westport
WHITCOlvl 911
Woodinville
Woodway
Yakima Valley Conference of Gov.
Valley Regional Fire Authority
Yarrow Poiot
Zillah
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This document is not an insurance policy. Tile Washington Cities Insurance Authority (Authority) is not an insurance
company. This document is an agreement by the Authority and its members to pay all covered losses subject to the
limits and other terms and conditions of this Agreement and any addenda attached. In consideration of the
assessments paid by the members, ihis Agreement provides the following coverages:
1. COVERAGE AGREEMENTS
A. GENERAL & AUTOMOBILE LIABILITY COVERAGE
1. Coverage
-In consldel'alian of the assessment herein provided, the Authority hereby agrees, subject to the
limitations, terms and conditions hereinafter mentioned, to pay on behalf of the member all sums
which the member shail be obligated to pay by reason of liability:
a. imposed upon the member by Jaw; or
b. assumed under contract or agreement by the member and/or any Dfficer, director,
_ official, or employee of the member, while ac:ting in his or her capacity as such:
for damages, direct or consequential and expenses, all as more fully defined by the term "ultimate
Det loss" on account of;
L personal injury,
iI. property damage,
Construction to be done by Port of Port Angeles in new Light Operations facility for the
$50,000 quoted price:
The Port of Port Angeles will provide the improvements to Suite A shown on drawings
delivered to the Port, dated August 20,2007, consisting specifically of sheets AI.I, A2.I,
A2.2, A3.1, E1.I, and E1.2. Such work is summarized as follows:
1. Construction of new 192 Sq. Ft. Foreman's office
2. Construction of new 380 Sq.f<'t. Line Room
3. Convert part of upper level storage space to 250 Sq. Ft. Office
4. Convert part of upper level storage space to 144 Sq. Ft. Mechanical Room
5. Provide heating, ventilating, and air-conditioning in spaces 1, 2, and 3 listed
above.
6. Finish spaces 1, 2, and 3 listed above with suspended acoustical ceilings, new
recessed fluorescent lighting, power receptacles, power wiring, [mish painting,
vinyl flooring, and conduit rough-ins for data and telephone outlets.
7. Extend fire sprinkler coverage into spaces 1,2, 3, and 4 listed above.
8. Building permits for above work.
All construction to comply with current construction and energy conservation codes.
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~ORTPl~GELES
WASH INGT ON, 'lJ. $'. A.
City Manager's Office" ',',
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. ... ", .~ .
Robert McChesney,
Executive Director
Port of Port Angeles
338West.First Street
Port Angeles,W A98362 ,
" ,
Re: Light Operations Lease
Dear Bob:
" - ,
, ,
.r wIiteto~cknowledge and thank you for your letter of F ebruary8, 2008 concerning the lea~e'
,at the Multi-Tenant Industrial Building by the Light Operations Division of the City's Public
Works & Utilities Department. Thi~ letter will formally acknow~edge completiona~d
acceptance of the building modifications as setJorth in SectionJ70fthe lease., Acceptance' of
the buildirigmodificationsand tOInmericement of the lease is to be effective February 1, 2008. ..
. . ' '.,'.
Also, perthe lease, the City aclmowledgespaymentduetothe~ortofthe lump sum of$50,000.'
This payment is being processed and will be remitted to the Port as. soon' as feasible:
. ,. -. ,
We thank you for the opportunity to work;;ith thePortonthisPfojec(andl;ok fo~ward to
", . . , .
continuing our good working relationship into the future;
Very truly yours
)rJ~~
Mark E. Madsen
City Manager
cc: Yvonne Ziomkowski, Finance Director
GleIm A. Cutler, Director of Public Works & Utilities,
MEM\DCD:dl
G:ILEGALILETTERS,2008\McChesney@Port,Light OpsLease, 022708, wpd
Phone: 360-417-4500/ Fax: 360-417-4509
Website: www.cityotpa.us / Email: citymanager@cityofpa.us
321 East Fifth Street - P,O, Box 1150/ POli Anqeles, WA 98362-0217