HomeMy WebLinkAboutSealaska letter of intent to lease WSC land Sept 2020Ali
SEALVALUES IN
ARS KA
September 24, 2020
Ms. Jodi Mitchell, Chief Executive Officer
Inside Passage Electric Cooperative
12480 Mendenhall Loop Road
Juneau, Alaska 99801
jmitchell@insidepassageelectric.org
Re: Letter of Intent - Hoonah Ground Lease for Water Supply Creek Hydroelectric
Project
Dear Ms. Jodi Mitchell:
This Letter of Intent ("LOI") is submitted on behalf of Sealaska Corporation
("Sealaska") to establish a framework by which Sealaska will lease land to the Inside Passage
Electric Cooperative ("IPEC") for the Water Supply Creek Hydroelectric Project (the
"Project") near Hoonah, Alaska. This LOI is intended to reflect the discussions between
Sealaska and IPEC between September 14 - 24, 2020, but does not constitute a legally
binding agreement. Rather, it is the parties' commitment to work together in good faith to
negotiate a proposed ground lease by which all remaining terms and conditions pertaining
to a lease of Sealaska's land for the Project shall be resolved. The final terms and conditions
of the proposed lease will be set forth in a comprehensive ground lease agreement to be
executed by the parties on or before the closing date.
The contemplated terms and conditions for the proposed lease are as follows:
1. Sealaska will lease to IPEC and IPEC will lease from Sealaska the land depicted
on the attached exhibit A, at and around the area on exhibit A labeled "Water
Supply Creek Hydro Project" (the "Premises") to have the legal right to use and
access the Premises for the Project infrastructure, transmission, distribution, and
roads, and all other uses and accesses that are necessary for the Project. Sealaska
provides the attached exhibit B describing the interim conveyance of the Premises
to Sealaska under the Alaska Natives Claims Settlement Act. Exhibits A and B are
a part of and incorporated into this LOI.
2. Sealaska and IPEC will sign a ground lease agreement providing the
comprehensive terms and conditions of this proposed transaction.
3. The term of the ground lease will be for fifty (50) years.
4. The parties agree to negotiate the terms and conditions of compensation and
rental rate for the ground lease prior to the Closing Date.
S. IPEC will be responsible for retaining all federal, state and municipal permits
and permissions regarding use of the Premises for the Project, and will be
responsible for resolving any land ownership disputes between or necessary
permits and leases from federal, state and municipal entities, local landowners,
adjoining landowners, and other entities.
Sealaska
• One Sealaska Plaza, Suite 400, Juneau, Alaska 99801-1276
907.586.1512 • Fax: 907.586.2304
6. Sealaska will confirm that there are no liens or encumbrances on the Premises
for purpose of the Project, provide horizontal and vertical control basis and
monuments for the Premises, and a complete legal description and plat references
for the Premises.
7. Selaska will confirm proof of ownership of Premises by title report, or
whatever mechanism is reasonably necessary for IPEC to retain funding for
Project.
8. The parties shall use their respective best efforts to complete the
documentation of the transaction contemplated herein on or before November 30,
2020, and closing shall be November 30, 2020, and shall be effective as of such
date.
9. IPEC will indemnify and hold harmless Sealaska from any and all claims,
actions, suits, damages, or other liabilities arising from or relating to any action or
inaction occurring at the Premises after the Closing Date. Unless such claims,
actions, suits, damages, or other liabilities are created by Sealaska.
10.IPEC will retain all necessary insurances to comply with the terms and
conditions of paragraph 9 herein and protect Sealaska from all liabilities and harm
arising from or relating to any action or inaction occurring at the Premises after
the Closing Date.
11. IPEC at IPEC's sole expense shall comply with all applicable local, state and
federal laws a regulations and requirements affecting the Premises, the breach of
which might result in any penalty on Sealaska or forfeiture of Sealaska's title to
the Premises. IPEC shall likewise observe and comply with the requirements of
all policies of public liability, fire and other policies of insurance at any time in
force with respect to the Premises. IPEC shall not commit, or allow to be
committed, any waste, destruction or nuisance on or to the Premises.
12. IPEC shall permit Sealaska and the agent, representative or employee(s) of
Sealaska to enter into and upon the Premises at all reasonable times during usual
business hours for the purpose of inspecting the same, or for the purpose of
posting notices of nonresponsibility for alterations, additions, or repairs, without
any rebate of rent and without any liability to IPEC for any loss of occupation or
quiet enjoyment of the Premises thereby occasioned.
13.IPEC may not encumber the Premises without the written consent and
approval of the Sealaska Chief Executive Officer.
14.IPEC shall pay and discharge as they become due, promptly and before
delinquency, all taxes, assessments and municipal liens which may be levied,
assessed, charged or imposed or which may become a lien or charge on or against
the Premises referred to in exhibit A and any building or buildings or any other
improvements now or hereafter thereon, or on or against IPEC's estate hereby
created which may be a subject of taxation, during the entire term of the lease
contemplated hereby.
Letter of Intent Page 2 of 3
15. IPEC, upon Sealaska's written approval of plans or specifications, shall have
the right to make such alterations, improvements, and changes to the Premises or
any improvements, building or utilities which may from time to time be on the
Premises as IPEC may deem necessary. The parties will negotiate terms and
conditions regarding IPEC's responsibilities regarding repair, replacement and
maintenance of improvements, removal of dangerous conditions, and condition
and ownership of improvements at the end of lease.
16. These terms of this LOI are available only to IPEC.
17. Sealaska hereby covenants and agrees that Sealaska shall not market or
engage in discussions regarding the sale or lease of the Premises with any parties
other than IPEC until December 31, 2020, following the execution of this LOI.
18. Each party agrees to bear its own costs associated with the transaction
contemplated hereby.
19. This LOI, the ground lease, and any other transaction documentation shall be
governed by the laws of the state of Alaska, without regard for principles of
conflict of laws. Each party irrevocably consents to and submits itself exclusively
to the jurisdiction of the courts in the First Judicial District of Alaska at Juneau for
the purpose of any suit, action or other judicial proceeding arising out of or
connected with the performance of this LOI and the transaction documentation.
20. The obligations of IPEC and Sealaska to consummate the transaction
contemplated by this LOI is subject to a mutually agreeable ground lease
agreement being finalized and executed on or before November 30, 2020.
Sealaska shall be responsible for drafting the initial draft of the ground lease
agreement.
21. This LOI supersedes all previous proposals and offers and is valid for
acceptance until the close of business on September 28, 2020.
Sealaska will prepare a proposed draft of the ground lease agreement by October 9,
2020, consistent with what we have described in this LOI, for your consideration and review,
with the intent that it will be completed and executed by the end of November.
If these terms are agreeable to IPEC, please indicate your approval by signing in the
space below, and we will proceed as stated above.
Sincerely,
Sealaska Corporation
Anthony Mallott, Chief Executive Officer
Approved and agreed as of September_, 2020.
Inside Passage llElectric Cooperative
f�Ukk
ib�i Mitchell, Chief Executive Officer
Letter of Intent Page 3 of 3
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WHEREAS
INTERIM Ct3MY L'NCE
Sealaska Corporation
is entitled to a conveyance pursuant to Secs. 14(h)(8) and 22(j) of the Alaska
dative Claims SettlementAct of December 18, 1971, 43 U.S.C. 1601, 1613(h)(8),
:621(j), of the surface and subsurface estates in the following -described
lands:
Copper River Meridian, Alaska
T. 44 S., R., 51 E., unsurveyed,
See. 1, L11h ;
Secs. 2 and 3;
Sec. 4 (fractional);
Sec. 5 (fractional), E'h;
Sec. 8, excluding U.S. Survey No
No, 1354;
Secs. 9, IO and 11;
Secs. 14 to 17, inclusive;
Sec. 18, DAVA;
Sec. 19•, EIANEY4 ;
Secs. 20 to 23, inclusive;
Sec. 26, N%, EIASWA , WIASE:/+;
Sec. 27, N%;
Sec. 2a , iIft
Secs. 29 and 32-
Qxrtaining approximately 12,581 acres
1353 and U.S. Survey
'Excluded from the above -described lands are the -submerged lands. if any,
up to the ordinary high water mark, beneath rivers 3 chains wide (1.98 feet)
and wider and lakes 50 acres and larger, which are meanderable according to
the 1973 Bureau of Land ;Management Manual of Surveying Instructions, as
mWifLed by Departmental regulation 43 CFR 1650.5-1.
Excluded from the above -described lands herein conveyed are lands covered
by tidal waters up to the iiae of mean high tide. The actual limits of tidal
influence for those -water bodies, if any, will be determined at the time of
survey.
Interim Conveyance No. IL36 I
Date GOT 9 1567
57r,I I2"
LOI - Exhibit B, Page 1 of 6
2
NOW KNOW YE, that there is, therefore, granted by the UNITED STATES DF
AMERICA, unto the above -named corporation the surface and subsurface estates
in the lands above described; TO HAVE AND TO HOLD the said estates with all
the rights, privileges, immunities, and appurtenances, of whatsoever nature,
thereunto belonging, unto the said corporation, its successors and assigns,
forever,
EXCEPTING AND RESERVING TO THE UNITED STATES from the lands so granted:
Pursuant to Sec. 17(b) of the Alaska Native Claims Settlement Act of
December 18, 1971, 43 U.S.C. 1601, 1516(b). the following public
easements, referenced by easement identification number (EIN) on the
easement map attached to this document, are reserved to the United
States. All easements are subject to applicable Federal. State, or
municipal corporation regulation. The following is a listing of uses
allowed for each type of easement. Any uses which are not
specifically listed are prohibited.
25 Foot Trail - The uses allowed on a twenty-five (25) foot
wide trail easement are: travel by foot, dogsleds.
animals. snowmobiles. two- and three -wheel vehicles, and
small all -terrain vehicles (ATVs) (less than 3.0oo lbs.
Gross Vehicle Weight (GVW)).
60 Foot Road - The uses allowed on a sixty (6o) foot wide
road easement are: travel by foot, dogsleds, animals.
snowmobiles, two- and three -wheel vehicles, small and large
ail -terrain vehicles (ATVs), track vehicles, four-wheel
drive vehicles, automobiles and trucks.
100 Foot Exis-tin /Pro osed Road - The uses allowed on a one
hundred (1o0) foot wide road easement are: travel by foot,
dogsleds. animals, snowmobiles, two- and three -wheal -
vehicles, small and large all -terrain vehicles, four-wheel
drive vehicles. automobiles and trucks. if. after the road
has been constructed and a lesser width is sufficient to
accommodate the road. the easement shall be reduced to a
lesser width and the uses allowed will be those listed
above for a sixty t6o) foot wide road easement.
a. (EIN 2 G C5) An easement sixty (60) feet in width for an
existing road linking the Whitestone'Logging Camp and EIN 5 G in
Sec. 4, T. 44 S.. R. 61 E.. Copper River Meridian. The uses
allowed are those listed above for a sixty (60) foot wide road
easement.
Interim Conveyance No. IL36 1
Date
OCT 8 M7
LOI - Exhibit B, Page 2 of 6
3
b. (EIN 5 G) An easement one hundred (100) feet in width for an
existing road which enters the selection in Sec. 2. T. 44 S.,
R. 61 E.. Copper River .Meridian, and extends southerly through
Sec. 32, T. 44 S.. R. 61 E., Copper River meridian. The uses
allowed are those listed above for a one hundred (100) foot wide
existing/proposed road easement.
c. (EIN 6 G) An easement sixty (60) feet in width for an existing
road from Hoonah which branches easterly from EIN 5 G in Sec. 2,
T. 44 S.. R. 61 E., Copper River Meridian, and continues
southeasterly to public land in Sec. 6, T. 44 S., R. 62 E..
Copper River Meridian. The uses allowed are those listed alcove
for a sixty (60) foot wide road easement.
d. (EIN 9 G) An easement twenty-five (25) feet in width for an
existing trail from Mt. nether in Sec. S. T. 44 S.. R. 61 E.
Copper River ,Meridian. easterly to ETN 14 G. The uses allowed
are those listed above for a twenty-five (25) foot wide trail
easement.
e. (EIN 14 G) An easement sixty (60) feet in width for an existing
road from EIN 5 G in Sec. 8, T. 44 S., R. 61 E.. Copper (liver
;Meridian, northerly to the marine coastline on the southern
boundary of T. 43 S., R. 61 E., Copper River Meridian. The uses
allowed are those listed above for a sixty (60) foot wide road
easement.
f.. (EIN 16 G) ,in easement one hundred (100) feet in width for an
existing road from EIN 6 G in Sec. 1, T. 44 S.. R. 61 E.. Copper
River Meridian, southerly and easterly to public land in
Sec. 19, T. 44 S., R. 62 E.. Copper River ,Meridian. The uses
allowed are those listed above for a one auudred (100) foot wide
existing/proposed road easement.
THE GRANT OF THE 1BOVE-DESCRIBED LANDS IS SUBJECT TO.
1. Issuance of a patent after approval and filing by the Bureau of Land
Management of the official plat of survey confirming the boundary
description and acreage of the lands hereinabove granted;
2. Valid existing rights therein. if any, including but not limited to
those created by any lease (including a lease issued under Sec. 6(g)
of the Alaska Statehood Act of July 7, 1958, 48 U.S.C. Ch. 2,
Sec. 6(g)), contract, permit, right-of-way, or easement, and the
right of the lessee. contractee, permittee, or grantee to the
complete enjoyment of all rights. privileges, and benefits thereby
Interim Conveyance No.
Dates OCT 9
1361
9 : 7
3
LOI - Exhibit B, Page 3 of 6
0
granted to him. Further. pursuant to Sec. 17(b)(2) of the Alaska
Native Claims Settlement ,Act of December 18. 1971 (ANCSA),
43 U.S.C. 1601, 1616(b)(2),-any valid existing right recognized by
.ANCSA shall continue to have whatever right of access as is now
provided for under existing law: and
3. The following third -party interests, created and identified by the
U.S Forest Service. as provided by Sec. 14(g) of the Alaska Native
Claims Settlement :act of December 18, 1971, 43 U.S.C. 1601, 1613(g):
a. TimberSaleContract, 12-11-010-1545. as modified, awarded
to the Alaska Lumber and Pulp Company, Inc. (now Alaska
Pulp Corporation) on January 25, 1956;
b. Road Right -of -Say Construction and Use (Cost Share)
.agreement between Huna Totem Corporation and the United
States of America, dated June 10, 1982;
(1) An easement, dated September 10. 1982. granted to Huna
Totem Corporation for the following roads:
(a) FDR 8570, located in Secs. 4 and 5. T. 44 S.,
R. 61 E., Copper River Meridian, Alaska:
(b) FOR 8502, located in the NEIA, Sec. 2. T. 44 S..
R. 61 E., Copper River Meridian, Alaska;
(c) FDR 8502. located in Secs. 2. 3 and 4, T. 44 S.,
- R. 61 E.. Copper River Meridian. Alaska;
(d) FDR 8530. located in Secs. 1 and 2. T. 44 S.,
R-. 61 E., Copper River Meridian, Alaska;
(e) FDR 8530, located in Sec. 1. T. 44 S., R. 61 E,.,
Copper River Meridian. Alaska;
c. United -States Department of Agriculture, (USDA), Forest
Service - Huna Totem Road Maintenance Agreement, as
amended. between Huna Totem Corporation and the United
States of America, executed January 25, 1984;
d. Memorandum of Agreement between Sealaska Corporation,
Juneau, Alaska. and USDA, Forest Service. Tongass ;National
Forest, Sitka. .Alaska, executed June 10, 1982, a copy of
which is recorded in the Sitka Recording District in
book 56, pages 812-819;
Interim Conveyance No.. _1361.
Date OCT 9 W7
V
LOI - Exhibit B, Page 4 of 6
5
e Special Use Permit issued to the Alaska Lumber and Pulp
Company. Inc. (now Alaska Pulp Corporation) on August 17.
1982, as amended. for a logging camp located in Sec. i.
T. 44 S., R. 61 E., Copper River Meridian. Alaska:
Special Use Perrciz authorizing construction, operation. and
maintenance of a water supply system including the water
intake structure. pipeline, access road and ;ate issued by
USDA, Forest Service, to the City of Hoonah on March 26.
1984,.iocated in Secs. 2 and i1, T. 442 S.. R. 51 E., Copper
River Meridian. Alaska.
Special Use Permit issued to the Alaska Lumber and Pulp
Company, Inc. on July 18, 1982, for a Class D Road, located
in Sec. 2. T. �4 S.. R. 61 E. Copper River Meridian. Alaska.
IN WITNESS WXEREO'. the undersigned authorized officer of -the Bureau of
Land Management has. in the name of the United States. set his hand and caused
the seal of the Bureau to be hereunto affixed on this 9th day of October.
1987. in Anchorage, 'Alaska.
Interim Conveyance No.
Date! OCT 9 M7
UNITED STATES OF AMER I C.,
/a/ TERRY R. HASS9T;
Terry R. Massett
Chief, Branch of KCS Adjudication
5
LOI - Exhibit B, Page 5 of 6
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LOI - Exhibit B, Pag;� 3 66 IL