HomeMy WebLinkAboutRES 091 Draft 01 2014-2016COUNTY OF HAWAII
RESOLUTION NO.
STATE OF HAWAII
91 15
RESOLUTION ACCEPTING THE NEGOTIATED LEASE AGREEMENT FOR HAMAKUA
LANDS IDENTIFIED AS TAX MAP KEYS: (3) 4-3-009-055,056,057 & 058 WITH CROWN
PACIFIC INTERNATIONAL LLC, PURSUANT TO SECTION 2-114 OF THE HAWAII
COUNTY CODE.
BE IT RESOLVED BY THE COUNCIL OF THE COUNTY OF HAWAII:
WHEREAS, Resolution 38-11 authorized the lease of certain County of Hawaii owned lands
in the District of Hamakua, County and State of Hawaii, and required that the negotiated lease
agreement for those lands be accepted by the County Council pursuant to Section 2-114(d) of the
Hawaii County Code; and
WHEREAS, pursuant to Resolution 38-11 negotiated agreements for those lands identified
within said resolution were obtained and are hereby presented for acceptance by the County Council;
and
WHEREAS, the negotiated lease agreement with Crown Pacific International LLC attached
hereto as Exhibit "A" for Tax Map Keys (3) 4-3-009-055, 056, 057 & 058 is presented to the County
Council pursuant to Resolution 38-11; and
WHEREAS, pursuant to Section 2-114(d) of the Hawaii County Code, the Council may
require in the initial resolution that the negotiated agreement be accepted by the Council; now,
therefore,
BE IT RESOLVED BY THE COUNCIL OF THE COUNTY OF HAWAII that the
negotiated lease of Tax Map Keys (3) 4-3-009-055, 056, 057 & 058 to Crown Pacific International
LLC under the terms and conditions as noted in the Lease attached hereto as Exhibit "A" is hereby
accepted.
BE IT FINALLY RESOLVED that a copy of this resolution be forwarded to: (1) Mayor
William P. Kenoi; (2) Deanna S. Sako, Director of Finance; (3) Craig T. Masuda, Deputy Corporation
Counsel, and (4) Crown Pacific International, LLC, 355 Luakaha Street, Hilo, Hawaii 96720.
Dated at Kona , Hawai`i, this 18th day of March , 2015.
INTRODUCED BY:
e�
COUNCIL MEMBER, OUNTY OF HAWAII
COUNTY COUNCIL
County of Hawaii
Hilo, Hawaii
I hereby certify that the foregoing RESOLUTION was by
the vote indicated to the right hereof adopted by the COUNCIL of the
County of Hawaii on March 18, 2015
ATTEST
NTY CLERK CHAIRPERSON & PRESIDING OFFICER
ROLL CALL VOTE
Reference: C-135/FC-9
RESOLUTION NO. 91 15
AYES NOES ABS EX
CHUNG
X
DAVID
X
EOFF
X
ILAGAN
X
KANUHA
X
ONISHI
X
PALEKA
X
POINDEXTER
X
WILLE
X
90 0 0
J-
Reference: C-135/FC-9
RESOLUTION NO. 91 15
LAND COURT
REGULAR SYSTEM
(AREA ABOVE RESERVED FOR RECORDING INFORMATION)
After Recordation, Return by ® Mail or ❑ Pick-up Phone#:
FILL IN NAME AND ADDRESS BELOW:
Office of the Corporation Counsel (CTM)
333 Kilauea Avenue, 2nd Floor
Hilo, Hawaii 96720
DOCUMENT CONTAINS PAGES
TITLE OF DOCUMENT: LEASE
PARTIES TO DOCUMENT
LESSOR: COUNTY OF HAWAII
25 Aupuni Street
Hilo, Hawaii 96720
LESSEE: CROWN PACIFIC INTERNATIONAL, LLC
355 Luakaha Street
Hilo, Hawaii 96720
AFFECTS TAX MAP KEY: (3) 4-3-009:055,056,057 & 058
EXHIBIT A
TABLE OF CONTENTS
Page
TERM OF LEASE ............................................ 1
ANNUAL RENTAL ............................................ 1
REOPENING OF ANNUAL RENTAL ............................... 2
RESERVATIONS:
1. Minerals and waters ............................ 2
2. Ownership of improvements ...................... 2
AGREEMENTS AND COVENANTS BETWEEN PARTIES:
1.
Payment of rent ................................
2
2.
Taxes, assessments, etc .........................
3
3.
Utility services ...............................
3
4.
Covenant against discrimination ................
3
5.
Sanitation .....................................
3
6.
Waste and unlawful, improper or offensive
use of premises ..............................
3
7.
Compliance with laws ...........................
3
8.
Inspection of premises .........................
4
9.
Improvements ...................................
4
10.
Repairs to improvements ........................
4
11.
Liens ..........................................
4
12.
Character of use ...............................
4
13.
Assignments, etc ................................
4
14.
Subletting .....................................
4
15.
Indemnity ......................................
4
16.
Costs of litigation ............................
5
17.
Liability insurance ............................
5
18.
Bond, performance ..............................
6
19.
Lessor's lien ..................................
7
20.
Mortgage .......................................
7
21.
Breach .........................................
7
22.
Right of holder of record of a security
interest .....................................
8
23.
Condemnation ...................................
9
24.
Right to enter .................................
9
25.
Inspection by prospective bidders ..............
10
1
TABLE OF CONTENTS (cont'd)
Page
26.
Acceptance of rent not a waiver ................
10
27.
Extension of time ..............................
10
28.
Justification of sureties ......................
10
29.
Waiver, modification, reimposition of
14
45.
bond and liability insurance provisions ......
11
30.
Quiet enjoyment ................................
11
31.
Surrender ......................................
11
32.
Non -warranty ...................................
12
33.
Hazardous materials .............................
12
34.
Hawaii law .....................................
12
35.
Exhibits - Incorporation in lease ..............
13
36.
Headings .......................................
13
37.
Partial invalidity .............................
13
38.
Time is of the essence .........................
13
39.
Historic preservation ..........................
13
40.
Incorporation by reference .....................
13
41.
Full utilization of the land ...................
13
42.
Good husbandry and conservation program ........
13
43.
Boundary fences ................................
14
44.
Exclusion of animals from forest lands .........
14
45.
Withdrawal .....................................
14
46.
Clearances .....................................
15
47.
Restriction on residential use .................
15
48.
Hunting ........................................
15
49.
Audit and examination of books, etc. ...........
15
50.
Commercial operations ..........................
15
51.
Abandoned vehicles .............................
15
52.
Environmental regulations ......................
16
53.
Fire and extended coverage insurance ...........
16
54.
Removal of trash ...............................
16
55.
Phase I environmental site assessment ..........
17
56.
Survey and boundary stakeout ...................
17
57.
Improvements ...................................
.17
58.
Bond, improvement ..............................
17
59.
Fire and extended coverage insurance ...........
18
DEFINITIONS ..............................................
18
SIGNATURE
PAGE ...........................................
20
ii
NOTARY PAGE.............................................. 21
iii
LEASE
THIS LEASE, made this day of
2015, by and between the COUNTY OF HAWAII, a municipal
corporation, 25 Aupuni Street, Hilo, Hawaii hereinafter
referred to as the "Lessor," and CROWN PACIFIC INTERNATIONAL,
LLC, whose address is 355 Luakaha Street, Hilo, HI 96720,
hereinafter referred to as the "Lessee."
WITNESSETH:
The Lessor, pursuant to Resolution 38-11, for and in
consideration of the rent to be paid and of the terms, covenants
and conditions herein contained, all on the part of the Lessee
to be kept, observed and performed, does lease unto the Lessee,
and the Lessee does lease from the Lessor the premises situate
at Hamakua Hawaii, and identified as TMK(s) (3)4-3-009:055,
056, 057, 58" containing an area of 66.416 acres
, as shown on the map marked Exhibit "A" attached hereto and
made parts hereof.
NOTICE: THE PREMISES SHALL NOT BE UTILIZED IN ANY
MANNER FOR RESEARCH, DEVELOPEMENT PRODUCTION OR CULTIVATION OF
GENETICALLY MODIFIED ORGANISM (GMO) PRODUCTS.
TO HAVE -AND -TO HOLD the leased premisesuntothe
Lessee for the term of Ten ("10 ) years, commencing on the
day of up to and including the day
of unless sooner terminated as
hereinafter provided, the Lessor reserving and the Lessee
yielding and paying to the Lessor at the Department of Finance,
County of Hawaii, an annual rental as provided herein below,
payable in advance, without notice or demand, in equal quarterly
installments on January 1St, April 13t, July 13t, October 1st
of each and every year during the term as follows:
A. For the first ten (10) years, the sum of three
thousand three hundred twenty and 80/100 DOLLARS ($ 3,320.80)
per annum with an option of two additional ten (10) year terms.
B. The annual rental reserved shall be reopened and
redetermined on or before sixty (60) days prior to the
expiration of the lease.
C. Determination of rent upon reopening. The rental
for any ensuing period shall be the fair market rental
1
negotiated at the time of reopening.
RESERVING UNTO THE LESSOR THE FOLLOWING:
1. Minerals and waters. (a) All minerals as
hereinafter defined, in, on or under the premises and the right,
on its own behalf or through persons authorized by it, to
prospect for, mine and remove the minerals and to occupy and use
so much of the surface of the ground as may be required for all
purposes reasonably extending to the mining and removal of the
minerals by any means whatsoever, including strip mining.
"Minerals," as used herein, shall mean any or all oil, gas,
coal, phosphate, sodium, sulphur, iron, titanium, gold, silver,
bauxite, bauxitic clay, diaspore, boehmite, laterite, gibbsite,
alumina, all ores of aluminum and, without limitation thereon,
all other mineral substances and ore deposits, whether solid,
gaseous or liquid, including all geothermal resources, in, on,
or under the land, fast or submerged; provided, that "minerals"
shall not include sand, gravel, rock or other material suitable
for use and used in general construction in furtherance of the
Lessee's permitted activities on the premises and not for sale
to others. (b) All surface and ground waters appurtenant to
the premises and the right on its own behalf or through persons
authorized by it, to capture, divert or impound the same and to
occupy and use so much of the premises required in the exercise
of this right reserved; provided, however, that as a condition
precedent to the exercise by the Lessor of the rights reserved
in this paragraph, just compensation shall be paid to the Lessee
for any of Lessee's improvements taken.
2. Ownership of improvements. The ownership of all
improvements of whatever kind or nature, including but not
limited to fences and stockwater system(s) located on the land
prior to or on the commencement date of this lease, excluding
those improvements constructed during the term of this lease
unless provided otherwise.
SUBJECT TO the rights of native tenants and to
regulatory rights and ownership rights (if any) of the State of
Hawaii established pursuant to state law including chapter 6E,
Hawaii Revised Statutes, over prehistoric or historic remains
found in, on, or under the land.
2
THE LESSEE COVENANTS AND AGREES WITH THE LESSOR AS FOLLOWS:
1. Payment of rent. The Lessee shall pay the rent
to the Lessor at the times, in the manner and form provided in
this lease and at the place specified above, or at any other
place the Lessor may from time to time designate, in legal
tender of the United States of America.
2. Taxes, assessments, etc. The Lessee shall pay or
cause to be paid, when due, the amount of all taxes, rates, and
assessments of every description as to which the premises or any
part, or any improvements, or the Lessor or Lessee, are now or
may be assessed or become liable by authority of law during the
term of this lease; provided, however, that with respect to any
assessment made under any betterment or improvement law which
may be payable in installments, Lessee shall be required to pay
only those installments, together with interest, which becomes
due and payable during the term of this lease.
3. Utility services. The Lessee shall be
responsible for obtaining any utility services and shall pay
when due all charges, duties and rates of every description,
including water, sewer, gas, refuse collection or any other
charges, as to which the premises or any part, or any
improvements, or the Lessor or Lessee may become liable for
during the term, whether assessed to or payable by the Lessor or
Lessee.
4. Covenant against discrimination. The use and
enjoyment of the premises shall not be in support of any policy
which discriminates against anyone based upon race, creed, sex,
color, national origin, religion, marital status, familial
status, ancestry, physical handicap, disability, age or HIV
(human immunodeficiency virus) infection.
5. Sanitation. The Lessee shall keep the premises
and improvements in a strictly clean, sanitary and orderly
condition.
6. Waste and unlawful, improper or offensive use of
premises. The Lessee shall not commit, suffer or permit to be
committed any waste, nuisance, strip, or unlawful, improper or
offensive use of the premises or any part, nor, without the
prior written consent of the Lessor, cut down, remove or
destroy, or suffer to be cut down, removed or destroyed, any
3
trees now growing on the premises.
7. Compliance with laws. The Lessee shall comply
with all of the requirements of all municipal, state, and
federal authorities and observe all municipal, state and federal
laws applicable to the premises, now in force or which may be in
force.
8. Inspection of premises. The Lessee shall permit
the Lessor and its agents, at all reasonable times during the
lease term, to enter the premises and examine the state of its
repair and condition.
9. Improvements. The Lessee shall not at any time
during the term construct, place, maintain or install on the
premises any building, structure or improvement of any kind and
description except with the prior written approval of the
Director, including any adjustment of rent, unless otherwise
provided in this lease. The Lessee shall own these improvements
until the expiration or other termination of the lease, at which
time the ownership shall, at the option of the Lessor, remain
and become the property of the Lessor or shall be removed by
Lessee at Lessee's sole cost and expense.
10. Repairs to improvements. The Lessee shall, at
its own expense, keep, repair, and maintain all buildings and
improvements now existing or hereafter constructed or installed
on the premises in good order, condition and repair, reasonable
wear and tear excepted.
11. Liens. The Lessee shall not commit or suffer any
act or neglect which results in the premises, any improvement,
or the leasehold estate of the Lessee becoming subject to any
attachment, lien, charge, or encumbrance, except as provided in
this lease, and shall indemnify, defend, and hold the Lessor
harmless from and against all attachments, liens, charges, and
encumbrances and all resulting expenses.
12. Character of use. The Lessee shall use or allow
the premises leased to be used solely for Intensive
Agriculture " purpose(s).
13. Assignments, etc. The Lessee shall not transfer,
assign, or permit any other person to occupy or use the
premises, or any portion, or transfer or assign this lease or
2
any interest, either voluntarily or by operation of law, except
by way of devise, bequest, or intestate succession, and any
transfer or assignment made shall be null and void.
14. Subletting. The Lessee shall not rent or sublet
the whole or any portion of the premises.
15. Indemnity. The Lessee shall indemnify, defend,
and hold the Lessor harmless from and against any claim or
demand for loss, liability, or damage, including claims for
bodily injury, wrongful death, or property damage, arising out
of or resulting from: 1) any act or omission on the part of
Lessee relating to Lessee's use, occupancy, maintenance, or
enjoyment of the premises; 2) any failure on the part of the
Lessee to maintain the premises and sidewalks, roadways and
parking areas adjacent thereto in Lessee's use and control, and
including any accident, fire or nuisance, growing out of or
caused by any failure on the part of the Lessee to maintain the
premises in a safe condition; and 3) from and against all
actions, suits, damages, and claims by whomsoever brought or
made by reason of the Lessee's non -observance or non-performance
of any of the terms, covenants, and conditions of this lease or
the rules, regulations, ordinances, and laws of the federal,
state, municipal or county governments.
16. Costs of litigation. In case the Lessor shall,
without any fault on Lessor's part, be made a party to any
litigation commenced by or against the Lessee (other than
condemnation proceedings), the Lessee shall pay all costs,
including reasonable attorney's fees, and expenses incurred by
or imposed on the Lessor; furthermore, the Lessee shall pay all
costs, including reasonable attorney's fees, and expenses which
may be incurred by or paid by the Lessor in enforcing the
covenants and agreements of this lease, in recovering possession
of the premises, or in the collection of delinquent rental,
taxes, and any and all other charges.
17. Liability insurance. The Lessee shall procure
and maintain, at its cost and expense and acceptable to the
Lessor, in full force and effect throughout the term of this
lease, comprehensive general liability insurance, or its
equivalent, workers compensation insurance in accordance with
Hawaii law, and automobile/motorcycle insurance with an
insurance company or companies licensed or authorized to do
business in the State of Hawaii with an AM Best rating of not
5
less than "A-" or other comparable and equivalent industry
rating, in an amount of at least $500,000.00 for each occurrence
and $1,000,000.00 aggregate, and with coverage terms acceptable
to the Director. The policy or policies of insurance shall name
the County of Hawaii as an additional insured and a copy shall
be filed with the County of Hawaii, Department of Finance. The
insurance shall cover the entire premises, including all
buildings, improvements, and grounds and all roadways or
sidewalks on or adjacent to the premises in the use or control
of the Lessee.
The Lessee, prior to entry and use of the premises or
within fifteen (15) days from the effective date of this lease,
whichever is sooner, shall furnish the Lessor with a
certificate(s) showing the policy(s) to be initially in force,
keep the certificate(s) on deposit during the entire lease term,
and furnish a like certificate(s) upon each renewal of the
policy(s). This insurance shall not be cancelled, limited in
scope of coverage, or nonrenewed until after thirty (30) days
written notice has been given to the Lessor. The Lessor may at
any time require the Lessee to provide Lessor with copies of the
insurance policy(s) that are or were in effect during the lease
period.
The Lessor shall retain the right at any time to
review the coverage, form, and amount of the insurance required
by this lease. If, in the opinion of the Lessor, the insurance
provisions in this lease do not provide adequate protection for
the Lessor, the Lessor may require Lessee to obtain insurance
sufficient in coverage, form, and amount to provide adequate
protection. The Lessor's requirements shall be reasonable but
shall be designed to assure protection for and against the kind
and extent of the risks which exist at the time a change in
insurance is required. The Lessor shall notify Lessee in
writing of changes in the insurance requirements and Lessee
shall deposit copies of acceptable insurance policy(s) or
certificate(s) thereof, with the Lessor incorporating the
changes within thirty (30) days of receipt of the notice.
The procuring of the required policy(s) of insurance
shall not be construed to limit Lessee's liability under this
lease nor to release or relieve the Lessee of the
indemnification provisions and requirements of this lease.
Notwithstanding the policy(s) of insurance, Lessee shall be
obligated for the full and total amount of any damage, injury,
1.1
or loss caused by Lessee's negligence or neglect connected with
this lease.
It is agreed that any insurance maintained by the
Lessor will apply in excess of, and not contribute with,
insurance provided by Lessee's policy.
18. Bond, performance. The Lessee shall, at its own
cost and expense, within fifteen (15) days from the effective
date of this lease, procure and deposit with the Lessor and
thereafter keep in full force and effect during the term of this
lease a good and sufficient surety bond, conditioned upon the
full and faithful observance and performance by Lessee of all
the terms, conditions, and covenants of this lease, in an amount
equal to two times the annual rental then payable. This bond
shall provide that in case of a breach or default of any of the
lease terms, covenants, conditions, and agreements, the full
amount of the bond shall be paid to the Lessor as liquidated and
ascertained damages and not as a penalty.
19. Lessor's lien. The Lessor shall have a lien on
all the buildings and improvements placed on the premises by the
Lessee, on all property kept or used on the premises, whether
the same is exempt from execution or not and on the rents of all
improvements and buildings located on the premises for all
Lessor's costs, attorney's fees, rent reserved, for all taxes
and assessments paid by the Lessor on behalf of the Lessee, and
for the payment of all money provided in this lease to be paid
by the Lessee, and this lien shall continue until the amounts
due are paid.
20. Mortgage. Except as provided in this lease, the
Lessee shall not mortgage, hypothecate, or pledge the premises,
any portion, or any interest in this lease without the prior
written approval of the Director and any mortgage,
hypothecation, or pledge without the approval shall be null and
void.
Upon due application and with the written consent of
the Director, the Lessee may mortgage this lease, or any
interest, or create a security interest in the leasehold of the
public land. If the mortgage or security interest is to a
recognized lending institution in either the State of Hawaii or
elsewhere in the United States, the consent may extend to
foreclosure and sale of Lessee's interest at the foreclosure to
7
any purchaser, including the mortgagee, without regard to
whether or not the purchaser is qualified to lease, own, or
otherwise acquire and hold the land or any interest. The
interest of the mortgagee or holder shall be freely assignable.
The term "holder" shall include an insurer or guarantor of the
obligation or condition of the mortgage, including the
Department of Housing and Urban Development through the Federal
Housing Administration, the Federal National Mortgage
Association, the Veterans Administration, the Small Business
Administration, Farmers Home Administration, or any other
Federal agency and their respective successors and assigns or
any lending institution authorized to do business in the State
of Hawaii or elsewhere in the United States; provided, that the
consent to mortgage to a non-governmental holder shall not
confer any greater rights or powers in the holder than those
which would be required by any of these Federal agencies.
21. Breach. Time is of the essence in this
agreement. If the Lessee shall fail to pay the rent, or any part
thereof, at the times and in the manner provided in this lease
and this failure shall continue for a period of more than thirty
(30) days after delivery by the Lessor of a written notice of
breach or default and demand for cure, by personal service,
registered mail or certified mail to the Lessee and to each
holder of record having a security interest in the premises, or
if the Lessee shall become bankrupt, or shall abandon the
premises, or if this lease and premises shall be attached or
taken by operation of law, or if any assignment is made of the
Lessee's property for the benefit of creditors, or if Lessee
shall fail to observe and perform any of the covenants, terms,
and conditions contained in this lease and on its part to be
observed and performed, and this failure shall continue for a
period of more than sixty (60) days after delivery by the Lessor
of a written notice of breach or default and demand for cure, by
personal service, registered mail or certified mail to the
Lessee at its last known address and to each holder of record
having a security interest in the premises, the Lessor may, at
once re-enter the premises, or any part, and upon or without the
entry, at its option, terminate this lease without prejudice to
any other remedy or right of action for arrears of rent or for
any preceding or other breach of contract; and in the event of
termination, at the option of the Lessor, all buildings and
improvements shall remain and become the property of the Lessor
or shall be removed by Lessee; furthermore, Lessor shall retain
all rent paid in advance to be applied to any damages.
22. Right of holder of record of a security interest.
In the event the Lessor seeks to forfeit the privilege,
interest, or estate created by this lease, each recorded holder
of a security interest may, at its option, cure or remedy the
default or breach of rent payment within thirty (30) days or any
other default or breach within sixty (60) days, from the date of
receipt of the Lessor's notice, or within an additional period
allowed by Lessor for good cause, and add the cost to the
mortgage debt and the lien of the mortgage. Upon failure of the
holder to exercise its option, the Lessor may: (a) pay to the
holder from any moneys at its disposal, including the special
land and development fund, the amount of the mortgage debt,
together with interest and penalties, and secure an assignment
of the debt and mortgage from the holder or if ownership of the
privilege, interest, or estate shall have vested in the holder
by way of foreclosure, or action in lieu thereof, the Lessor
shall be entitled to the conveyance of the privilege, interest,
or estate upon payment to the holder of the amount of the
mortgage debt, including interest and penalties, and all
reasonable expenses incurred by the holder in connection with
the foreclosure and preservation of its security interest, less
appropriate credits, including income received from the
privilege, interest, or estate subsequent to the foreclosure; or
(b) if the property cannot be reasonably reassigned without loss
to the County, then terminate the outstanding privilege,
interest, or estate without prejudice to any other right or
remedy for arrears of rent or for any preceding or other breach
or default and use its best efforts to redispose of the affected
land to a qualified and responsible person free and clear of the
mortgage and the debt secured; provided that a reasonable delay
by the Lessor in instituting or prosecuting its rights or
remedies shall not operate as a waiver of these rights or to
deprive it of a remedy when it may still otherwise hope to
resolve the problems created by the breach or default. The
proceeds of any redisposition shall be applied, first, to
reimburse the Lessor for costs and expenses in connection with
the redisposition; second, to discharge in full any unpaid
purchase price or other indebtedness owing the Lessor in
connection with the privilege, interest, or estate terminated;
third, to the mortgagee to the extent of the value received by
the County upon redisposition which exceeds the fair market
lease value of the land as previously determined by the County's
appraiser; and fourth, to the owner of the privilege, interest,
or estate.
0
23. Condemnation. If at any time, during the term of
this lease, any portion of the premises should be condemned, or
required for public purposes, the rent shall be reduced in
proportion to the value of the portion of the premises
condemned. The Lessee shall be entitled to receive from the
condemning authority (a) the value of growing crops, if any,
which Lessee is not permitted to harvest and (b) the
proportionate value of the Lessee's permanent improvements so
taken in the proportion that it bears to the unexpired term of
the lease; provided, that the Lessee may, in the alternative,
remove and relocate its improvements to the remainder of the
premises occupied by the Lessee. The Lessee shall not by reason
of the condemnation be entitled to any claim against the Lessor
for condemnation or indemnity for leasehold interest and all
compensation payable or to be paid for or on account of the
leasehold interest by reason of the condemnation shall be
payable to and be the sole property of the Lessor. The
foregoing rights of the Lessee shall not be exclusive of any
other to which Lessee may be entitled by law. Where the portion
taken renders the remainder unsuitable for the use or uses for
which the premises were leased, the Lessee shall have the option
to surrender this lease and be discharged and relieved from any
further liability; provided, that Lessee may remove the
permanent improvements constructed, erected and placed by it
within any reasonable period allowed by the Lessor.
24. Right to enter. The Lessor and their agents or
representatives shall have the right to enter and cross any
portion of the premises for the purpose of performing any public
or official duties; provided, however, in the exercise of these
rights, the Lessor shall not interfere unreasonably with the
Lessee or Lessee's lawful use and enjoyment of the premises.
25. Inspection by prospective bidders. The Lessor
shall have the right to authorize any person or persons to enter
upon and inspect the premises at all reasonable times following
a published notice for its proposed disposition for purposes of
informing and apprising that person or persons of the condition
of the premises preparatory to the proposed disposition;
provided, however, that any entry and inspection shall be
conducted during reasonable hours after notice to enter is first
given to the Lessee, and shall, if the Lessee so requires, be
made in the company of the Lessee or designated agents of the
Lessee; provided, further, that no authorization shall be given
10
more than two years before the expiration of the term of this
lease.
26. Acceptance of rent not a waiver. The acceptance
of rent by the Lessor shall not be deemed a waiver of any breach
by the Lessee of any term, covenant, or condition of this lease,
nor of the Lessor's right of re-entry for breach of covenant,
nor of the Lessor's right to declare and enforce a forfeiture
for any breach, and the failure of the Lessor to insist upon
strict performance of any term, covenant, or condition, or to
exercise any option conferred, in any one or more instances,
shall not be construed as a waiver or relinquishment of any
term, covenant, condition, or option.
27. Extension of time. Notwithstanding any provision
contained in this lease, when applicable, the Director may for
good cause shown, allow additional time beyond the time or times
specified in this lease for the Lessee to comply, observe, and
perform any of the lease terms, conditions, and covenants.
28. Justification of sureties. Any bonds required by
this lease shall be supported by the obligation of a corporate
surety organized for the purpose of being a surety and qualified
to do business in the State of Hawaii, or by not less than two
personal sureties, corporate or individual, for which
justifications shall be filed as provided in Section 78-20,
Hawaii Revised Statutes; provided, however, the Lessee may
furnish a bond in like amount, conditioned as aforesaid,
executed by it alone as obligor, if, in lieu of any surety or
sureties, it shall also furnish and at all times thereafter keep
and maintain on deposit with the Lessor security in certified
checks, certificates of deposit (payable on demand or after a
period the Lessor may stipulate), bonds, stocks or other
negotiable securities properly endorsed, or execute and deliver
to the Lessor a deed or deeds of trust of real property, all of
a character which is satisfactory to Lessor and valued in the
aggregate at not less than the principal amount of the bond. It
is agreed that the value of any securities which may be accepted
and at any time thereafter held by the Lessor shall be
determined by the Lessor, and that the Lessee may, with the
approval of the Lessor, exchange other securities or money for
any of the deposited securities if in the judgment of the Lessor
the substitute securities or money shall be at least equal in
value to those withdrawn. It is further agreed that
substitution of sureties or the substitution of a deposit of
11
security for the obligation of a surety or sureties may be made
by the Lessee, but only upon the written consent of the Lessor
and that until this consent is granted, which shall be
discretionary with the Lessor, no surety shall be released or
relieved from any obligation.
29. Waiver, modification, reimposition of bond and
liability insurance provisions. Upon substantial compliance by
the Lessee with the terms, covenants, and conditions contained
in this lease on its part to be observed or performed, the
Lessor at its discretion may in writing, waive or suspend the
performance bond or improvement bond requirements or both or
may, in writing, modify the particular bond(s) or liability
insurance requirements by reducing its amount; provided,
however, that the Lessor reserves the right to reactivate the
bonds or reimpose the bond(s) or liability insurance in and to
their original tenor and form at any time throughout the term of
this lease.
30. Quiet enjoyment. The Lessor covenants and agrees
with the Lessee that upon payment of the rent at the times and
in the manner provided and the observance and performance of
these covenants, terms, and conditions on the part of the Lessee
to be observed and performed, the Lessee shall and may have,
hold, possess, and enjoy the premises for the term of the lease,
without hindrance or interruption by the Lessor or any other
person or persons lawfully claiming by, through, or under it.
31. Surrender. The Lessee shall, at the end of the
term or other sooner termination of this lease, peaceably
deliver unto the Lessor possession of the premises in a clean
and orderly condition, together with all improvements existing
or constructed thereon or Lessee shall remove such improvements,
at the option of the Lessor. Furthermore, upon the expiration,
termination, or revocation of this lease, should the Lessee fail
to remove any and all of Lessee's personal property from the
premises, after notice thereof, the Lessor may remove any and
all personal property from the premises and either deem the
property abandoned and dispose of the property or place the
property in storage at the cost and expense of Lessee, and the
Lessee does agree to pay all costs and expenses for disposal,
removal, or storage of the personal property. This provision
shall survive the termination of the lease.
32. Non -warranty. The Lessor does not warrant the
12
conditions of the premises, as the same are being leased AS IS.
33. Hazardous materials. Lessee shall not cause or
permit the escape, disposal or release of any hazardous
materials except as permitted by law. Lessee shall not allow
the storage or use of such materials in any manner not
sanctioned by law or by the highest standards prevailing in the
industry for the storage and use of such materials, nor allow to
be brought onto the premises any such materials except to use in
the ordinary course of Lessee's business, and then only after
written notice is given to Lessor of the identity of such
materials and upon Lessor's consent which consent may be
withheld at Lessor's sole and absolute discretion. If any
lender or governmental agency shall ever require testing to
ascertain whether or not there has been any release of hazardous
materials by Lessee, then the Lessee shall be responsible for
the reasonable costs thereof. In addition, Lessee shall execute
affidavits, representations and the like from time to time at
Lessor's request concerning Lessee's best knowledge and belief
regarding the presence of hazardous materials on the premises
placed or released by Lessee.
Lessee agrees to indemnify, defend, and hold Lessor
harmless, from any damages and claims resulting from the release
of hazardous materials on the premises occurring while Lessee is
in possession, or elsewhere if caused by Lessee or persons
acting under Lessee. These covenants shall survive the
expiration or earlier termination of the lease.
For the purpose of this lease "hazardous material"
shall mean any pollutant, toxic substance, hazardous waste,
hazardous material, hazardous substance, or oil as defined in or
pursuant to the Resource Conservation and Recovery Act, as
amended, the Comprehensive Environmental Response, Compensation,
and Liability Act, as amended, the Federal Clean Water Act, or
any other federal, state, or local environmental law,
regulation, ordinance, rule, or by-law, whether existing as of
the date hereof, previously enforced, or subsequently enacted.
34. Hawaii law. This lease shall be construed,
interpreted, and governed by the laws of the State of Hawaii.
35. Exhibits - Incorporation in lease. All exhibits
referred to are attached to this lease and hereby are deemed
incorporated by reference.
13
36. Headings. The article and paragraph headings
herein are inserted only for convenience and reference and shall
in no way define, describe or limit the scope or intent of any
provision of this lease.
37. Partial invalidity. If any term, provision,
covenant or condition of this lease should be held to be
invalid, void or unenforceable, the remainder of this lease
shall continue in full force and effect and shall in no way be
affected, impaired or invalidated thereby.
38. Time is of the essence. Time is of the essence
in all provisions of this lease.
39. Historic preservation. In the event any historic
properties or burial sites, as defined in section 6E-2, Hawaii
Revised Statutes, are found on the premises, the Lessee and the
Lessee's agents, employees and representatives shall immediately
stop all land utilization or work or both and contact the
Historic Preservation Office in compliance with chapter 6E,
Hawaii Revised Statutes.
40. Incorporation by reference. References in this
lease to various parcels of land are in accordance with those
designated in the Notice Of Lease and the Terms and Conditions
Lease of County Lands which, together with the Addendum are
incorporated and made a part of this lease. The terms of this
lease shall govern where there is any inconsistency between the
lease terms and the terms contained in the Addendum.
SPECIAL CONDITIONS
41. Full utilization of the land. The Lessee shall,
within the first year of the lease term, utilize the land under
lease for the purposes for which this lease is sold, all in
accordance with a conservation plan pursuant to paragraph 42,
Good husbandry and conservation program of this lease.
42. Good husbandry and conservation program. The
Lessee shall at all times practice good husbandry and carry out
a program of conservation in cooperation with the appropriate
Soil and Water Conservation District, with which district the
Lessee shall maintain cooperative status. The conservation
NXI!
program shall be in accordance with a conservation plan which
shall be submitted to the Director for acceptance within one (1)
year following lease commencement. The conservation plan shall
include, but not be limited to, those practices as land
clearing, cropping system, irrigation system, drainage, noxious
weed control and others needed to protect the land against
deterioration and to prevent environmental degradation;
provided, however, that this requirement may be waived for
leases with little or no apparent conservation problems when
verified by the appropriate Soil and Water Conservation
District. In the event the activities of the Lessee in this
regard shall be found to be unsatisfactory to the Director, the
Director shall notify the Lessee and the Lessee shall be
required, within sixty (60) days of the notice, to cure the
fault and submit proof satisfactory to the Director.
43. Boundary fences. The Lessee shall, prior to
animal occupation, install stockproof fence along the entire
outside perimeter of the land under lease where the fencing does
not now exist, regardless of whether the Lessee has an interest
or ownership in adjoining lands, and shall maintain these fences
in good order and condition throughout the term of this lease
and those now existing on the premises. The Lessee shall,
wholly at its own cost and expense, stake out the boundaries
wherever necessary in conformance with the legal descriptions
provided in this lease. The cost of installing and maintaining
the boundary fences shall be in accordance with Part II of
chapter 664, Hawaii Revised Statutes, which provides generally
for the sharing of the costs by adjacent landowners or Lessees
for the purpose of confining animals of each adjacent owner or
Lessee unless the adjacent land is owned and not leased by the
government.
44. Exclusion of animals from forest lands. The
Lessee shall at all times during the lease term keep its cattle,
horses, and other grazing animals out of any forest reserve, if
any, adjacent to the premises and shall take all reasonable
precautions to prevent forest fires, and in the event fires
occur, it shall use all reasonable means at its command or under
its control to have the fires speedily extinguished.
45. Withdrawal. The Lessor shall have the right to
withdraw the premises, or any portion, at any time during the
term of this lease upon giving reasonable notice and without
compensation, except as otherwise provided in the lease, for
15
public uses or purposes, including residential, commercial,
industrial, or resort developments, for constructing new roads
or extensions, or changes in line or grade of existing roads,
for rights of way and easements of all kinds, and shall be
subject to the right of the Director to remove soil, rock or
gravel as may be necessary for the construction of roads and
rights of way within or without the premises; provided, that
upon the withdrawal, or upon the taking which causes any portion
of the land originally leased to become unusable for the
specific use or uses for which it was leased, the rent shall be
reduced in proportion to the value of the land withdrawn or made
unusable, and if any permanent improvement constructed upon the
land by the Lessee is destroyed or made unusable in the process
of the withdrawal or taking, the proportionate value shall be
paid based upon the unexpired term of the lease; provided,
further, that no withdrawal or taking shall be had of those
portions of the land harvested, unless the Director pays to the
Lessee the value of those crops.
46. Clearances. The
obtaining all necessary federal,
permits or other authorizations.
Lessee shall be responsible for
state or county clearances,
47. Restriction on residential use. The premises, or
any portion, shall not be utilized for residential purposes.
The construction or placement of any structure on the premises
for residential purposes is strictly prohibited.
48. Hunting. No hunting shall be allowed on the
premises during the term of this lease.
49. Audit and examination of books, etc. The Lessee
shall, at all reasonable times, permit the Lessor or its
authorized agents and employees, upon reasonable notice given by
the Lessor, to audit, examine and to make copies of all books,
accounts, records and receipts of the Lessee concerning its
operations under this lease.
50. Commercial operations. The Lessee, its
employees, customers, guests, agents or invitees shall not
display or offer for sale or sell any article(s) or merchandise
whatsoever within the premises without the prior written
approval of the Lessor and upon such terms and conditions
established by the Lessor. Except as otherwise provided in this
lease, no commercial activities whatsoever shall be allowed
16
within the premises without the prior written approval of the
Lessor.
51. Abandoned vehicles. Lessee shall take all steps
necessary to prevent the placing or storing of abandoned
vehicles within the premises. Any and all abandoned vehicles
within the premises shall be removed by Lessee at Lessee's cost
and expense.
52. Environmental regulations. Lessee shall comply
with all applicable federal, state and county environmental
impact regulations, including but not limited to chapter 343,
Hawaii Revised Statutes, as amended, and regulations governing
historic preservation.
53. Fire and extended coverage insurance. The
Lessee, at its cost and expense, shall procure and maintain at
all times during the term of this lease, fire and extended
coverage insurance with an insurance company(s) licensed to do
business in the State of Hawaii, insuring all buildings and
improvements erected on the leased land in the joint names of
Lessor and Lessee, with the standard mortgage clause for
Mortgagee, if any, as their interest may appear, in an amount
equal to the replacement cost of the facilities, and shall pay
the premiums at the time and place required under the policy.
In the event of total or partial loss, any proceeds
derived from the policy(s) shall be used by the Lessee for
rebuilding, repairing, or otherwise reinstating the same
buildings in a good and substantial manner according to plans
and specifications approved in writing by the Director;
provided, however, that with the approval of the Lessor, the
Lessee may instead surrender this lease and pay the balance
owing on any mortgage. Upon surrender of the lease, the Lessee
shall then receive that portion of the insurance proceeds which
the unexpired term of this lease, at the time of the loss or
damage, bears to the whole of the term, with the Lessor to be
paid the balance of the proceeds.
The Lessee shall furnish the Lessor on or before the
commencement date of this lease, a certificate showing the
policy(s) to be in full force and effect and shall furnish a
like certificate upon each renewal of the policy(s). Each
certificate(s) shall contain or be accompanied by an assurance
of the insurer not to cancel the insurance, limit the scope of
17
the coverage, or fail or refuse to renew the policy(s) until
after thirty (30) days written notice has been given to the
Lessor.
All rights or claims of subrogation against the
County, its officers, employees, and agents are waived.
54. Removal of trash. The Lessee shall be
responsible for the removal of all trash upon the premises,
whether or not placed on the premises by Lessee or with or
without Lessee's consent, and whether or not placed on the
premises prior to the term of this lease.
55. Phase I environmental site assessment. Prior to
termination or revocation of the subject lease or the assignment
of the leasehold, Lessee shall conduct a Phase I environmental
site assessment and conduct a complete abatement and disposal,
if necessary, satisfactory to the standards required by the
Federal Environmental Protection Agency, the Department of
Health, and the Department of Land and Natural Resources.
Failure to comply with the provisions of this paragraph shall
not extend the term of this lease or automatically prevent
termination or revocation of the lease. The Director, at its
sole option, may refuse to approve termination, revocation, or
assignment unless this evaluation and abatement provision has
been performed. In addition or in the alternative, the Director
may, at its sole option if Lessee does not do so, arrange for
performance of the provisions of this paragraph, all costs and
expenses of such performance to be charged to and paid by
Lessee.
56. Survey and boundary stakeout. The Lessee shall
be solely responsible for any survey and boundary stakeout of
the leased premises.
57. Improvements. The Lessee shall, at its own cost
and expense, within ( ) year as of the date of lease
commencement, complete the construction of
, at a cost of not less than and N0/100 DOLLARS
($ ) ("Building Requirement"), in accordance with plans
and specifications submitted by the Lessee to and approved in
writing by the Director and in full compliance with all
applicable laws, ordinances, rules and regulations.
10
58. Bond, improvement. The Lessee, upon submittal
and written approval of the construction plan shall within sixty
(60) days procure and deposit with the Lessor a surety bond,
acceptable to the Director, in an amount equal to the cost of
construction of the Building Requirement, but in no event shall
the amount be less than and N0/100 DOLLARS
($ ), which bond shall name the County as obligee,
conditioned upon the faithful observance and performance of the
Building Requirement contained in this lease, the completion of
the Building Requirement on or before the specified date of
completion free from all liens and claims, and that the Lessee
shall indemnify, defend, and hold the County harmless from all
liens, suits, actions or damages arising out of, caused from or
attributable to the work performed pursuant to the Building
Requirement.
59. Fire and extended coverage insurance. The
Lessee, at its cost and expense, shall procure and maintain at
all times during the term of this lease, fire and extended
coverage insurance with an insurance company(s) licensed to do
business in the State of Hawaii, insuring all buildings and
improvements erected on the leased land in the joint names of
Lessor and Lessee, with the standard mortgage clause for
Mortgagee, if any, as their interest may appear, in an amount
equal to the replacement cost of the facilities, and shall pay
the premiums at the time and place required under the policy.
In the event of total or partial loss, any proceeds
derived from the policy(s) shall be used by the Lessee for
rebuilding, repairing, or otherwise reinstating the same
buildings in a good and substantial manner according to plans
and specifications approved in writing by the Director;
provided, however, that with the approval of the Lessor, the
Lessee may instead surrender this lease and pay the balance
owing on any mortgage. Upon surrender of the lease, the Lessee
shall then receive that portion of the insurance proceeds which
the unexpired term of this lease, at the time of the loss or
damage, bears to the whole of the term, with the Lessor to be
paid the balance of the proceeds.
The Lessee shall furnish the Lessor on or before the
commencement date of this lease, a certificate showing the
policy(s) to be in full force and effect and shall furnish a
like certificate upon each renewal of the policy(s). Each
certificate(s) shall contain or be accompanied by an assurance
19
of the insurer not to cancel the insurance, limit the scope of
the coverage, or fail or refuse to renew the policy(s) until
after thirty (30) days written notice has been given to the
Lessor.
All rights or claims of subrogation against the
County, its officers, employees, and agents are waived.
DEFINITIONS
1. The use of any gender shall include all genders,
and if there is more than one lessee, then all words used in the
singular shall extend to and include the plural.
2. As used in this lease, unless clearly repugnant
to the context:
(a) "Director" means the Director of Finance of the
County of Hawaii or her designee.
(b) "Lessee" means and includes the Lessee, its
officers, employees, invitees, successors or permitted assigns.
(c) "Holder of record of a security interest" means a
person who is the owner or possessor of a security interest in
the land leased and who has filed with the Department of Land
and Natural Resources and with the Bureau of Conveyances of the
State of Hawaii a copy of this interest.
(d) "Premises" means the land leased and all
buildings and improvements now or hereinafter constructed and
installed on the land leased.
(e) "Waste" includes, but is not limited to, (1)
permitting the premises, or any portion, to become unduly eroded
or failure to take proper precautions or make reasonable effort
to prevent or correct the erosion; (2) permitting a substantial
increase in noxious weeds in uncultivated portions of the
premises; and (3) failure to employ all of the usable portions
of the premises.
specified.
(f) "Days" shall mean calendar days, unless otherwise
20
(g) "Noxious weed" means any plant species which is
injurious, harmful, or deleterious or which may be likely to
become so to the agricultural, horticultural, and livestock
industries of the State, as determined by the Department of
Agriculture of the State of Hawaii by administrative rules.
(h) "Pasture" means the conduct of livestock
operation consisting of keeping cattle, primarily, and others,
in a minor role, such as horses and sheep where animals graze
the land for feed produced thereon. Compatible uses as woodland
management, wildlife management and the cultivation of feed
crops to be used strictly within the premises is permitted. The
operation of commercial activities such as feedlots (excepting a
private feedlot designed to feed the Lessee's own cattle), dairy
milking parlors, or boarding of horses is not permitted.
(i) "Timber" means any trees standing within
designated areas of the leased land which are covered by a
woodland management plan.
(j) "Diversified agriculture" means the cultivation
and harvesting of truck, orchard, flower or nursery crops and
shall not include or embrace the cultivation and harvesting of
grasses or forage crops.
(k) "General agriculture" means the cultivation and
harvesting of truck, orchard, flower or nursery crops and the
grazing and pasturing of animals other than pigs.
(1) "Intensive agriculture" means the cultivation of
truck, orchard, flower and foliage crops and any other
agricultural use allowed under the county zoning excluding
pasture, raising of animals, and raising of poultry.
IN WITNESS WHEREOF, the COUNTY OF HAWAII, by its
Mayor, has caused the seal of the County of Hawaii to be
hereunto affixed and the parties hereto have caused these
presents to be executed the day, month and year first above
written.
21
APPROVED
DEANNA S. SAKO
Director of Finance
APPROVED AS TO FORM:
CRAIG T. MASUDA
Deputy Corporation Counsel
Dated:
COUNTY OF HAWAII
By
William P. Kenoi
Its Mayor
LESSOR
CROWN PACIFIC INTERNATIONAL, LLC
Name:
Title:
And by
Name:
Title.
22
LESSEE
STATE OF HAWAII )
COUNTY OF HAWAII )
On this day of
and
SS.
2015, before me personally appeared
to me personally known, who being by me
duly sworn, did say that they are the and of
CROWN PACIFIC INTERNATIONAL, LLC, and that the seal affixed to the instrument is the
corporate seal of the corporation, and that the instrument was signed and sealed in behalf of the
corporation by authority of its board of directors, and
acknowledged the instrument to be the free act and deed of the corporation.
NOTARY CERTIFICATION
Doc.
Date:
Notary
Name:
Doc.
Description:
N
Date
Signature
Print or Type Name
Notary Public, State of Hawaii
My Commission Expires:
No. of Pages:
23
Circuit
STATE OF HAWAII )
SS.
COUNTY OF HAWAII )
On this day of , 2015 before me personally appeared
WILLIAM P. KENOI, to me personally known, who, being by me duly sworn, did say that he is
the Mayor of the County of Hawaii, a municipal corporation of the State of Hawaii, that the
seal affixed to the foregoing instrument is the corporate seal of said County of Hawaii, the
foregoing instrument was signed and sealed on behalf of the County of Hawaii by authority
given to said Mayor of the County of Hawaii by Sections 5-1.3 and 13-13 of the County
Charter, County of Hawaii (2010), as amended, and said WILLIAM P. KENOI acknowledged
said instrument to be the free act and deed of said County of Hawaii.
Signature
Print or Type Name
Notary Public, State of Hawaii
My Commission Expires:
NOTARY CERTIFICATION
Doc.
Date: No. of Pages:
Notary Circuit
Name:
Doc.
Description:
Notary Signature Date
24
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