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Signed Interlocal Agr 11.16.15 # 16-0194New Hanover County Contract #16 -0194 Prepared by and return to: Wayne A. Bullard, General Counsel New Hanover County Board of Education 6410 Carolina Beach Road, Wilmington, NC 28412 NORTH CAROLINA NEW HANOVER COUNTY INTERLOCAL AGREEMENT THIS AGREEMENT ( "Agreement ") is made and entered into this /G 't" day of AMI/emkolr2015 by and between County of New Hanover ( "the County ") and the New Hanover County Board of Education, a county board of education organized and existing pursuant to N.C. Gen. Stat. § 115C et seq. ( "the School Board "). WHEREAS, the School Board has substantial need for new and improved buildings and equipment; and WHEREAS, it is the intent of the County to assist the School Board in obtaining these buildings and equipment within the constraints imposed by limited financial resources; and WHEREAS, the County and the School Board shall be co- developers of identified new school and renovation projects; and WHEREAS, as part of the co- development of certain identified projects, the School Board shall convey by lease acceptable to the parties identified school sites to the County in order to enable the County to reclaim sales and use taxes paid by the various contractors and vendors; and WHEREAS, the County is authorized to reclaim sales and use taxes paid to the State of North Carolina (N.C. Gen. Stat. §105- 164.14 et. seq), to acquire real and personal property for the use by the School Board (N.C. Gen. Stat. §153A- 158.1), and to construct, equip, expand, improve, and renovate property for use by the School Board (N.C. Gen. Stat. §153A- 158.1); and WHEREAS, pursuant to N.C. Gen. Stat. Chapter 160A, Article 20, Interlocal Cooperation, the County desires to designate the School Board as its agent to carry out the construction projects, and the School Board is willing to accept the appointment pursuant to the terms of this Agreement; and WHEREAS, the County intends to claim the sales and use tax refunds on the construction projects, and appropriate the same to the School Board as supplemental funding for school capital building and renovation projects approved by the County; and WHEREAS, the School Board and the County are authorized to enter into an interlocal agreement pursuant to N.C. Gen. Stat.§ 160A -461 et seq.; and WHEREAS, the School Board and the County entered into an interlocal agreement dated J(4 Me 11?, /q9g, recorded in Book4230 Page Gof the New Hanover County Registry (hereinafter the "Veterans Park Interlocal Agreement), whereby the County acquired title to the property now known as Veterans Park upon which Ashley High School, Murray Middle School, and Anderson Elementary School campuses were later built, leased such school sites to the School Board, and agreed to convey title to such school sites to School Board once the County's indebtedness secured by such school sites is paid and satisfied (hereinafter the "Veterans Park School Sites "); and WHEREAS, the County remains the owner of the Veterans Park School Sites as of the effective date of this Agreement and the School Board continues to lease the Veterans Park School Sites from the County; and WHEREAS, as part of the co- development of the Veterans Park School Sites, the County desires to designate the School Board as its agent to carry out construction projects on those sites and the School Board is willing to accept the appointment pursuant to this Agreement; and ORIGINAL WHEREAS, the School Board and County wish to enter into an agreement to govern the rights and obligations of the parties with regard to sales and use tax refunds on certain construction projects commencing subsequent to the effective date of this Agreement. NOW, THEREFORE, for and in consideration of the mutual promises contained herein, the parties agree as follows: 1. Agency Created. The County irrevocably appoints the School Board as its sole agent to carry out all phases of any construction or renovation project undertaken pursuant to this Agreement. The School Board, as the County's agent, assumes all of the County's rights, duties, and responsibilities regarding any construction or renovation project undertaken pursuant to this Agreement. Notwithstanding previous arrangements, this Agency shall govern all phases of any construction or renovation project undertaken pursuant to this Agreement. a. Negotiate and Execute Contracts, The School Board, as the agent of the County, shall have sole and exclusive authority to negotiate and execute on behalf of the County all contracts for the construction or renovation of school sites undertaken pursuant to this Agreement, as long as the funds to be expended pursuant to those contracts are within the project budget established by the School Board and approved by the Board of County Commissioners. b. Supervise Construction and Renovation Projects The School Board, as agent for the County, shall be solely responsible for carrying out and maintaining the construction and renovation projects and the School Board shall have all rights to supervise the construction and renovation projects. The County shall have no supervisory authority for the construction and renovation projects. C. Administer Contracts. The School Board, or the Superintendent or his designee, provided the applicable procedures prescribed in paragraph 1(a) are followed, as agent for the County Commissioners, shall issue any required purchase orders for the identified projects. The School Board shall have authority to approve and enter into any change orders for any and all identified projects as long as the funds are within the project budget established by the School Board and approved by the County, including change orders establishing the Guaranteed Maximum Price on CM at Risk projects. The School Board shall act as the County's designated representative for administering the contracts and award process. All procurement activities shall comply with this Agreement, the North Carolina public procurement laws and any other State law applicable to the School Board. The School Board shall ensure that all contractors provide applicable sales and use tax certificates, on a form similar to that incorporated as Exhibit A. The School Board shall approve all proper requests for payment and shall pay the contractors from the funds provided by the County. d. Enforce Contracts. The School Board shall have the right to enforce in its own name or in the County's name such purchase orders, contracts, or change orders entered into in the County's name or the School Board's name for the identified construction and renovation projects. e. Pre -Audit Certification. Pursuant to N.C. Gen. Stat. § 159 -28, the County hereby authorizes the Finance Officer of the School Board to act as the Deputy Finance Officer of the County for the limited purpose of pre - auditing the contracts and change orders executed pursuant to this Agreement as required by the Local Government Budget and Fiscal Control Act, on behalf of the County. f. Leases. Easements. Roadway Dedications and Rights of —Way., The School Board, for itself as owner of the underlying property and as agent for the County when necessary, shall have the right to negotiate and execute any lease, easement contract or dedication, or right of way contract or dedication upon a portion of the identified projects that it deems in its best interest to provide access for public infrastructure or other purposes over the identified projects. Should the School Board need the County's execution of any document for leases, easements or other partial interests, the School Board, as agent for the County, shall have the authority to execute any such documents it deems necessary. 2. Implementation of Agreement. The County Manager and Superintendent or their designees shall establish policies and procedures to implement this Agreement not inconsistent with the terms of this Agreement. 3. Property Affected., The property or properties to which this Agreement include the Veterans Park School Sites and those identified in the attached Exhibit B. Properties may be added to or removed from this Exhibit at any time by written agreement(s) between the County Manager and Superintendent as further described in the Master Lease Agreement. 4. Ownership of Prop. The School Board shall convey a leasehold estate interest in the property or properties identified on Exhibit B to the County. Conveyance by the School Board to the County shall be by execution and delivery of a Master Lease Agreement. The County shall retain a leasehold interest in the identified site(s) as provided in the Master Lease Agreement and any properties that may be added pursuant thereto. The Master Lease Agreement shall be substantively similar to the form attached hereto as Exhibit C. The Superintendent and County Manager are hereby authorized to execute the Lease Addition or Removal forms subsequently made between the parties pursuant to the terms of this Agreement. 5. Obligations and Rights of the School Board a. Board as Agent. The School Board shall act as the County's sole agent for the construction and renovation projects covenedbythis Agreement. b. Insurance/Bonds. The School Board shall ensure that all architects, engineers, and other contractors maintain the adequate liability insurance on any identified project during the design and construction of each project. The School Board shall also require all architects, engineers, and other contractors to provide the necessary insurance and bonds as required by law. Notwithstanding any provision of this Agreement, the School Board shall retain the sole power to control and direct the application and distribution of insurance proceeds applicable to the construction projects and affected property. C. Use of Site. During the term of this Agreement, the School Board shall have the exclusive right to possess, use, occupy, and improve any properties identified and made subject to this Agreement for public school purposes, including without limitation the right to conduct surveys, soil borings and other necessary testing upon the property prior to construction, and the right to use, operate, maintain, and repair said property for such public school purposes thereafter until termination as hereinafter provided. In addition to the above, the School Board shall have the right to authorize the use of any properties identified as being subject to this Agreement by third parties for non - school use pursuant to School Board policies. d. Indemnity. To the extent allowed by law, the School Board shall indemnify, defend and hold harmless the County from and against all claims, suits, actions and proceedings whatsoever which may be brought or instituted on account of, growing out of, occurring from, incident to or resulting from, directly or indirectly any and all damages, claims or losses arising from any injuries or damages (including without limitation, death) to persons or property arising out of the construction, use, and/or management of any contracts and/or properties under this Agreement, and the negligent or willful acts and omissions of the School Board and those for whom it is legally liable, and all losses, costs, damages and expenses (including, without limitation, reasonable attorneys' fees), unless and to the extent such injuries or damages (including, without limitation, death) result from, or are claimed to have resulted from the negligent acts or omissions of the County, the County's agents or others for whose acts the County may be legally responsible. The School Board shall assume, on behalf of the County, and conduct with due diligence and in good faith, the defense of all such claims, suits, actions and proceedings against the County whether or not the School Board is joined therein, even if such claims, suits, actions or proceedings be groundless, false or fraudulent, and School Board shall bear the costs of all judgments and settlements in connection therewith; provided, however, the County may defend or participate in the defense of any or all of such claims, suits, actions or proceedings. 6. Obligations and Rights of the Cou oty. a. Right to Inspect. The County and their representatives and agents shall have the right to enter upon the site and inspect any identified construction or renovation project from time to time during construction. The County and their representatives and agents shall also have the right to review and inspect any contract, change orders or other contract amendments approved by the School Board or its authorized employees. b. Sales Tax Refunds. The County shall promptly take all steps to obtain the sales and use tax refixed from the State of North Carolina, and further, shall, upon request, provide the School Board with timely notice of its efforts and receipts. Any sales and use tax refimds received by the County as a result of the construction projects shall be utilized exclusively to provide supplemental funding for school capital building and renovation projects approved by the County. The intent of this Agreement is to provide additional resources for the School Board and the County for use in the construction and maintenance of school buildings. 7. Amendment. This Agreement may not be amended without the mutual written consent of both parties. 8. Consideration. The County and the School Board acknowledge that this Agreement is supported by mutual and adequate consideration. 9. Termination of Agreement. This Agreement may be terminated by mutual agreement of the parties or upon one hundred eighty (180) days written notice to the other party. In the event of a breach of this Agreement by either party, the non - breaching party shall notify the breaching party of the nature of the breach. The breaching party shall have 45 days to cure said breach. The failure to cure any breach shall be grounds for immediately terminating this Agreement and all leasehold interests conveyed herein. The termination of the Agreement shall not affect the County's obligation to appropriate refunds to the School Board as required by Paragraph 6(b). In the event any portion of this Agreement is rendered invalid or unenforceable by a court of competent jurisdiction or by an act of the Legislature the parties may negotiate the termination of all or a portion of this Agreement and any leasehold interest of the County. Termination of this Agreement shall not affect the Veterans Park Interlocal Agreement, which shall remain in effect unless it is terminated by its own terms. 10. Severability. If any provision of this Agreement shall be held invalid or unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provision hereof. 11. Governing .aw. This Agreement shall be governed by and in accordance with the laws of the State of North Carolina. All actions relating in any way to this Agreement shall be brought in the General Court of Justice in the County of New Hanover and the State of North Carolina. 12. Register of Deeds. This agreement shall be recorded with the Register of Deeds as soon as practicable following its execution. 13. Effects on Previous Agreements. This contract, including its Attachments A -C, shall constitute the entire understanding between the County and the School Board regarding the subject matter hereof. This Agreement shall not affect any pre - existing Interlocal Agreement between the parties except as expressly provided herein IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed in their corporate names by their duly authorized officers, all as of the date first above written. ATTEST: Teresa Elmore Clerk to the Board of Commissioners [CORPORATE SEAL] NEW HANOVER COUNTY, NORTH CAROLINA By: Awlxk - Pod", a:t�&t4f I M6 i 5 Approved as to form /Co nor Attorney NEW HANOVER COUNTY BOARD OF EDUCATION ATTEST: BY: rA S. Donald yes, Chairperson r. im ar ey, ee t uperinten ent [CORPORATE SEAL] 0 0 9 d Z a H w A x 0 a W Q w d a U x� �O z °U o� dU � H A O w a Ow O H U z O U U ti � a �a O w U O H � �a O� wa U d O O O ww a a O� �z zd >z I ' W xH A � a ti a� a� a s~ 0 U 0 a� 0 0 U 0 0 0 EXHIBIT B A lease -hold interest shall be conveyed to the County for the following projects which shall be made subject to this Interlocal Agreement with the understanding that additional schools may be added from time to time in accordance with the terms of the Agreement: Porter's Neck Elementary School (new) College Park Elementary School Blair Elementary School Laney High School Hoggard High School New Hanover High School Roland Grise Middle School Noble Middle School Trask Middle School Myrtle Grove Middle School Wrightsville Beach Elementary School Sunset Park Elementary School Johnson Elementary School Pine Valley Elementary School Codington Elementary School Eaton Elementary School Holly Tree Elementary School Freeman Elementary School Bradley Creek Elementary School Sidbury Road Complex 7 EXHIBIT C LEASE AGREEMENT BY AND BETWEEN NEW HANOVER COUNTY BOARD OF EDUCATION (AS LANDLORD) AND NEW HANOVER COUNTY (AS TENANT) TABLE OF CONTENTS Page ARTICLE I. BASIC LEASE INFORMATION ............................... ............................... ARTICLE II. PREMISES, TERM, TERMINATION AND USE ...... ............................... ARTICLE III. LANDLORD'S COVENANTS ................................... ............................... ARTICLE IV. TENANT'S COVENANTS ........................................ ............................... ARTICLEV. MUTUAL COVENANTS: ADDITIONAL MATTERS ............................ ARTICLEVI. DEFAULT .................................................................. ............................... ARTICLE VII. MISCELLANEOUS ................................................... ............................... STATE OF NORTH CAROLINA LEASE AGREEMENT COUNTY OF NEW HANOVER THIS LEASE AGREEMENT, made and entered into the day of 1�pY`P•,v -,� 2015, by and between the New Hanover County Board of Education, a body corporate being a county board of education organized and existing pursuant to N.C. Gen. Stat. §115C et seq. (hereinafter called "Landlord "), and New Hanover County, a body politic and corporate (hereinafter referred to as "Tenant "). WHEREAS, the Tenant and the Landlord seek to co- develop the construction and renovation of some or all schools owned by Landlord; WHEREAS, the Tenant and the Landlord shall be co- developers of identified new school and renovation projects; WHEREAS, as part of the co- development of the identified projects, the Landlord shall lease identified school sites to the Tenant in order to enable the County to reclaim sales and use taxes paid by the various contractors and vendors; WHEREAS, the Tenant has designated the Landlord as its agent to carry out the construction projects, and the Landlord has accepted the appointment pursuant to the terms of an interlocal agreement executed by the Landlord and the Tenant on t4a V rwbC -- 10, , 2015, and as may be amended from time to time (the "2015 Interlocal Agreement "); WHEREAS, the Tenant intends to claim the sales and use tax refunds on the construction projects, and appropriate the same to the Landlord pursuant to the terms of the 2015 Interlocal Agreement as supplemental funding for school capital building and renovation projects approved the Tenant; and WHEREAS, N.C. Gen. Stat. §115C-518, §160A-272 and §160A-274 authorize the Landlord to lease its property to the Tenant, and N.C. Gen. Stat. §153A-11 and § 153A -158 authorize the Tenant to lease property from the Landlord; NOW, THEREFORE, for and in consideration of the mutual promises contained herein, the parties agree as follows: ARTICLE I BASIC LEASE INFORMATION 1.1 Basic Lease Information. In addition to the terms that are defined elsewhere in this Lease, these terms are used in this Lease: 1.1.1 LANDLORD'S ADDRESS: Superintendent's Office New Hanover County Board of Education 6410 Carolina Beach Road Wilmington, North Carolina 28412 1.1.2 TENANT'S ADDRESS: County Manager's Office New Hanover County 230 Government Center Drive Suite 175 Wilmington, North Carolina 28403 1.1.3 LAND: The land described in Section 2. 1, which is more specifically shown on Exhibit 1. 1.1.4 IMPROVEMENTS: The improvements now or hereafter located on the Land whether placed thereon by Landlord, Tenant, or their respective agents. 1.1.5 PREMISES or LEASED PREMISES: The Land together with all easements and rights of access over and upon the Land, as defined more particularly in Section 2.1. 1.1.6 2015 WTERLOCAL AGREEMENT: The Interlocal Agreement, dated NflJc t J{e�,� 201 lo entered into by the Tenant and the Landlord and fully incorporated by reference herein. 1. 1.7 Exhibits. The following exhibits are attached to this Lease and are made a part of this Lease: EXHIBIT 1: Properties Subject to Lease EXHIBIT 2: Property Additions Form EXHIBIT 3: Property Removal Form 1.1.8 Consideration. The parties' mutual desire to seek reimbursement of sales tax shall serve as consideration of this Lease. ARTICLE II PREMISES, TERM, TERMINATION AND USE 2.1 Leased Premises. Under the limited terms, provisions and conditions hereof, and each in consideration of the duties, covenants and obligations of the other hereunder, Landlord hereby leases to Tenant and Tenant hereby leases from Landlord that certain land(s) owned by Landlord located in and more particularly described in Exhibit 1, attached hereto and made a part hereof (the "Land "), together with all easements, rights -of -way, streets, alleys, passages, sewer /water rights, tenements, hereditaments, appurtenances and rights belonging or relating or appertaining to the Land and all rights, title and interest in, if any, of the Landlord, now or hereafter affecting the Land (collectively, with the Land, hereinafter referred to as the "Leased Premises" or the "Premises "). 2.1.1 Additional Property. Landlord and Tenant may add properties that shall be subject to this Lease by executing the preapproved form attached hereto as Exhibit 2, which shall then be recorded in the New Hanover County Registry. Pursuant to the 2015 Interlocal Agreement, the Superintendent and New Hanover County Manager are authorized to execute any Property Addition forms. The addition of any property shall not affect the Term of this Lease Agreement. The additional properties shall be subject to the same terms and conditions set forth in this Lease Agreement and shall terminate pursuant to the terms of this Lease. 2.1.2 Removal of Properties. Landlord and Tenant may remove a property that is subject to this Lease Agreement by executing the pre- approved form attached hereto as Exhibit 3, Upon receipt and execution of such notice by Tenant, this Lease Agreement shall no longer apply to the property or properties identified in that notice. Notwithstanding the foregoing, this Lease Agreement shall remain in full force and effect with respect to any other properties made subject to the Lease Agreement according to the terms and conditions herein. Pursuant to the 2015 Interlocal Agreement, the Superintendent and New Hanover County Manager are authorized to execute any Property Removal forms. And such removal form shall be recorded in the Register of Deeds Office. 2.2 Title To Leased Premises. Landlord represents and warrants that as of the time of the execution of this Lease it has title to the Leased Premises and that it has full power and authority to grant this Lease to Tenant. 2.3 Term. To have and to hold said Premises, together with all privileges and appurtenances thereunto belonging, subject to the terms, provisions and conditions hereof, this Lease shall continue in force for a term (the "Term ") commencing upon execution of this Lease by all parties and recordation (fees to be paid by the Landlord) of a memorandum of such in the Office of the Register of Deeds (the "Commencement Date "), and terminating pursuant to the terms and conditions as stated in Section 2.4. 2.4 Expiration and Termination. This Lease shall automatically expire ten (10) years from the commencement of the Term. Notwithstanding the foregoing, upon the effective date of legislation enacted by the North Carolina General Assembly that provides authority for school districts or school systems to reclaim sales and use taxes paid to the State of North Carolina or that removes the authority for counties to reclaim sales and use taxes paid to the State of North Carolina, either party may terminate this Lease Agreement with provision of sixty (60) days notice of termination to the other party. Further, in the event the lnterlocal Agreement between Landlord and Tenant expires or is terminated for any reason before the expiration of this Lease, then this Lease shall be immediately terminated. ARTICLE III LANDLORD'S COVENANTS 3.1 Landlord's Obli ate. Subject to Tenant's performance of its obligations hereunder, Landlord makes the following assurances to Tenant: 3.1.1 Leases, Easements, Roadway Dedications, and Rights of Way. Landlord has the absolute right to negotiate and execute any lease, easement contract or dedication, or right of way contract or dedication upon a portion of the Premises that it deems in its best interest to provide access for public infrastructure or other purposes over the Premises. Any such grant will not terminate this Lease but the Lease will continue subject to the portion of the Premises conveyed or dedicated. Should Landlord require Tenant's execution of any document for leases, easements or other partial interests, the Landlord, as agent for the Tenant, shall have the authority to execute any leases, easements, rights of way, and roadway dedications it deems necessary. 3.1.2 Use of Site. During the term of this Agreement, the Landlord shall retain exclusive rights to possess, use, occupy, improve and insure any properties and all improvements thereon identified pursuant to Section 2.1 as subject to this Agreement for public school purposes, including without limitation the right to conduct surveys, soil borings and other necessary testing upon the property prior to construction, and the right to use, operate, maintain, and repair said property for such public school purposes as Landlord determines in its discretion thereafter until termination as hereinafter provided, subject only to Tenant's limited grant of access to and use of the Leased Premises as described in Section 4.1. In addition to the above, the Landlord shall have full discretion and the sole right to authorize the use by third parties for non - school use, pursuant to Landlord's policies, of any properties identified in Section 2.1 as being subject to this Agreement. Tenant's limited rights of access to and use of the Leased Premises shall be subordinate to such third -party use, unless otherwise indicated in writing by the Landlord. 3.1.3 Utilities. Landlord shall be responsible for electrical, gas, telephone, water, sewer, and garbage removal with respect to the Leased Premises. 3.1.1 Insurance. Landlord shall be responsible for carrying adequate property and general liability insurance on all the Leased Premises. Tenant shall not be required to carry any insurance covering the Leased Premises. ARTICLE IV TENANT'S COVENANTS 4.1 Use of Site. During the term of this Agreement, Tenant shall have the limited right to access and use the Leased Premises only to extent necessary to effectuate the performance of the construction or renovation projects authorized by the Landlord under the terms of the 2015 Interlocal Agreement, including the limited right to enter upon the site and inspect any identified construction or renovation project from time to time during construction or renovation. This limited right of access and use shall be subject to any and all applicable written policies of the Landlord regarding access to and conduct on school properties, and shall be subordinate to any other interests in the subject properties granted by the Landlord to third parties pursuant to any other deeds, leases, conveyances, or joint use agreements of any kind, whether those interests are transferred by the Landlord before or after the subject properties are made subject to this Lease Agreement, unless otherwise expressly indicated by the Landlord in writing. 4.2 Alterations. Tenant shall not make any alterations, additions or improvements to the Premises, unless made by Landlord as agent for Tenant, without the prior written consent of Landlord. Tenant shall not make any alterations, additions or improvements to the Premises which will contravene Landlord's policies insuring against loss or damage by fire or other hazards, including but not limited to commercial general liability, or which will prevent Landlord from securing such policies in companies acceptable to Landlord. 4.3 Assignment/Subletting. Tenant may not assign or encumber this lease, and may not sublet any part or all of the Leased Premises. ARTICLEV MUTUAL COVENANTS: ADDITIONAL MATTERS 5.1 Alterations, Improvements, and Changes Permitted. Landlord shall have the right to make such alterations, improvements, and changes to any building which may from time to time be on the premises as Landlord may deem necessary, subject to all other applicable municipal regulations. 5.1.1 Disposition of New Improvements. Any and all improvements constructed upon the Leased Premises by Tenant or by Landlord as agent for Tenant pursuant to the lnterlocal Agreement shall automatically become the property of Landlord upon completion of the construction or renovation project, subject to Tenant's leasehold interest therein. Such improvements shall remain upon the Premises upon expiration or termination of the Lease. All other alterations, improvements, changes, or additions made by Landlord in or to the Leased Premises shall be the property of Landlord, subject to Tenant's leasehold interest therein. 5.2 Fire or Other Casualty. In the event the Leased Premises is damaged by fire or other casualty, Landlord at its option may, either in its own capacity or as agent for Tenant pursuant to the 2015 Interlocal Agreement, rebuild or restore its improvements on the said Leased Premises to as good or better condition than that existing immediately prior to said fire or other casualty, and this Lease shall not terminate. 5.3 Eminent Domain. In the event a portion of Leased Premises shall be acquired by taking (any acquisition by any government authority in the legal and valid exercise of its power of eminent domain or by private purchase in lieu thereof) and such taking relates to a portion of the fee simple title to Leased Premises, as well as to the right, title and interest of Tenant, the rights and obligations of the parties hereunder shall continue except as to that portion of the Leased Premises that has been taken. All compensation awarded for any taking (or the proceeds of a private sale in lieu thereof) shall be the property of Landlord whether such award is for compensation for damages to the Landlord's or Tenant's interest in the Leased Premises, and Tenant hereby assigns all of its interest in any such award to Landlord. 5.4 Waiver of Subro ag tion. Landlord and Tenant hereby release each other from any loss or damage to property caused by fire or any other perils insured through or under either by way of subrogation or otherwise for any loss or damage to property caused by fire or any other perils insured in policies of insurance covering such property, even if such loss or damage shall have been caused by the fault or negligence of the other party, or anyone for whom such party may be responsible; provided, however, that this release shall be applicable and in force and effect only with respect to the loss or damage occurring during such times as the releasor's policies shall contain a clause or endorsement to the effect that any such release shall not adversely affect or impair said policies or prejudice the right of the releasor to recover thereunder and then only to the extent of the insurance proceeds payable under such policies. 5.5 Recording. Landlord and Tenant agree that a memorandum of this Lease will be recorded in the New Hanover County Public Registry but that this Lease itself will not be so recorded. 5.6 Compliance with 2015 Interlocal Agreement. The respective obligation of the parties regarding construction and renovation projects on any part of the Leased Premises and the mechanism for recovering sales tax reimbursement for those construction and renovation projects shall be governed by the 2015 Interlocal Agreement, and any amendments thereto, which are incorporated herein by reference. 5.7 Indemnity. To the extent allowed by law, Landlord shall indemnify, defend and hold harmless Tenant from and against all claims, suits, actions and proceedings whatsoever which may be brought or instituted on account of, growing out of, occurring from, incident to or resulting from, directly or indirectly any and all damages, claims or losses arising from any injuries or damages (including without limitation, death) to persons or property arising out of the construction, use, and/or management of the Leased Premises (including, without limitation, reasonable attorneys' fees). Landlord shall assume, on behalf of Tenant, and conduct with due diligence and in good faith, the defense of all such claims, suits, actions and proceedings against Tenant whether or not the Landlord is joined therein, even if such claims, suits, actions or proceedings are groundless, false or fraudulent, and Landlord shall bear the costs of all judgments and settlements in connection therewith; provided, however, Tenant may defend or participate in the defense of any or all of such claims, suits, actions or proceedings. ARTICLE VI DEFAULT 6.1 Default. The failure by either party in the performance or compliance with any of the agreements, terms, covenants or conditions under this Lease, for a period of thirty (30) days after written notice, shall constitute a breach of this Lease. If the breaching party cannot cure the event of noncompliance within thirty (30) days, then in such event the non - breaching party may begin such actions as are necessary to cure the default within the thirty (30) day period from receipt of written notice and diligently pursue the cure of such default to completion, and the non- breaching party may pursue any other remedy available at law, or in equity. ARTICLE VII MISCELLANEOUS 7.1 Notices. Any notice which may or shall be made under the terms of this Lease shall be in writing and shall be either delivered by hand or sent by United States Registered or Certified Mail, Return Receipt Requested, or by any overnight mail service (e.g. Federal Express, United Parcel Services), postage prepaid, to the address set out in Article 1.1 hereof or to such address as may be contained in a notice given as provided above. 7.2 Entire Agreement. This Lease and all exhibits hereto and other agreements referred to herein (which are expressly incorporated herein by this reference) shall constitute the entire agreement between Landlord and Tenant and no other prior written or prior or contemporaneous oral promises or representations shall be binding. Subject to sections 2.1.1 and 2.1.2, this Lease shall not be amended, changed or extended except by written instrument signed by both parties hereto. 7.3 Intemretation: Governing Law. Pronouns, where used herein, of whatever gender, shall include natural persons, corporations, and associations of every kind and character, and the singular shall include the plural and vice versa where and as often as may be appropriate. Article and section headings under this Lease are for convenience of reference and shall not affect the construction or interpretation of this Lease. Whenever the terms "hereof;" "hereby," "herein," or words of similar import are used in this Lease, they shall be construed as referring to this Lease in its entirety rather than to a particular section or provision, unless the context specifically indicates to the contrary. Any reference to a particular "Article" or "Paragraph" shall be construed as referring to the indicated Article or Paragraph of this Lease. Statements herein in respect to compliance with applicable law or text of similar import shall be construed to require compliance with applicable law as now or hereafter in effect. The law of the State of North Carolina shall govern the validity, performance and enforcement of this Lease and this Lease shall be construed pursuant to such laws. 7.4 Binding Effect. The provisions of this Lease shall be binding upon and inure to the benefit of the successors and assigns of the parties, but this provision shall in no way alter the restrictions on assigmnent and subletting applicable to Tenant hereunder. 7.5 Severability. In the event any term, covenant or condition 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, covenant or condition to persons or circumstances other than those as to which it is held invalid or unenforceable, shall not be affected thereby, and each term, covenant or condition of this Lease shall be valid and enforceable to full extent permitted by law. 7.6 No Waiver. The waiver by either party of any agreement, condition, or provision contained in this Lease will not be deemed to be a waiver of any subsequent breach of the same or any other agreement, condition, or provision contained in this Lease, nor will any custom or practice that may grow up between the parties in the administration of the terms of this Lease be construed to waive or lessen the right of one party to insist upon the performance by the other party in strict accordance with the terms of this Lease. 7.7 Non - Merger of Fee and Leasehold Estate. If both the Estate of Landlord and the Estate of Tenant in the Premises or improvements located thereon or both become vested in the same owner, this Lease shall not be terminated by application of the doctrine of merger, except by mutual consent of Tenant and Landlord. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed in their corporate names by their duly authorized officers, all as of the date first above written. THE COUNTY OF NEW HANOVER ATTEST: By: !s' y" Teresa Elmore Gom opt Clerk to the Board of Commissi s �t. y [CORPORATE SEAL] °rA11 LISI A T T: By: _ r. Ti ar ey, ecretary upermtendent [CORPORATE SEAL] OF EDUCATION Approved as to form -11 Attorney STATE OF NORTH CAROLINA NEW HANOVER COUNTY , K �' Pa2i� I , a Notary Public of said State and County, do hereby certify that--M. •s- ou fan - eresa Elmore personally came before me this date and acknowledged that they are the C anager and Clerk to the Board of Commissioners of New Hanover County, North Carolina respectively, and that by authority duly given and as the act of the County of New Hanover, the foregoing instrument was signed in the County's name by the County Manager, sealed with its corporate seal, and attested by such Clerk. Witness my hand and official seal this day of Q aft6zr- , 2015. ,_ a 0 Nofdry Public gm6elrl OZ. (Juae,(� I (Printe• Name of Notary) My Commission Expires: Kymberleigh G. Crowell Notary Public (SEAL) New Hanover CO µy NC My Commission Expires STATE OF NORTH CAROLINA NEW HANOVER COUNTY I, _VQj,,,6-t A- 1 eta Notary Public of said State and County, do herebv certifv that Dr. Tihi Markldv. with whom I am bersonally acouainted. who. being by me duly sworn, says that he is the Secretary of the New Hanover County Board of Education and that Donald S. Hayes is the Chairperson of such Board of Education, the Board described in and which executed the foregoing instrument; that he knows the common seal of said Board; that the seal affixed to the foregoing instrument is said common seal, and the name of the Board was subscribed thereto by the said Chair; and that said Chair and Secretary subscribed their names thereto, and said common seal was affixed, all by order of the Board and that the said instrument is the act and deed of said Board. Witness my hand and official seal this a"rd day of DeCetwb4,v-- —_, 2015. Notary PutWc " v (Printed : ame of N tart') My Commission Expires: li_aE-a°11 (SEAL) e � KIMBERLY H. JOYS Notary Public s view Hanoye- -ff'-'o IN f EXHIBIT 1 PROPERTIES SUBJECT TO MASTER LEASE: Porter's Neck Elementary School (new) College Park Elementary School Blair Elementary School Laney High School Hoggard High School New Hanover High School Roland Grise Middle School Noble Middle School Trask Middle School Myrtle Grove Middle School Wrightsville Beach Elementary School Sunset Park Elementary School Johnson Elementary School Pine Valley Elementary School Codington Elementary School Eaton Elementary School Holly Tree Elementary School Freeman Elementary School Bradley Creek Elementary School Sidbury Road Complex EXHIBIT 2 PROPERTY ADDITION FORM Pursuant to Section 2. 1.1 of the Lease Agreement by and between The New Hanover County Board of Education (as Landlord) and New Hanover County (as Tenant), signed the day o f , 20_, a memorandum of which is recorded in Book ___ Page , New Hanover County Registry, the following property or properties are hereby added to the lease agreement: This the day of ATTEST: Secretary /Superintendent [CORPORATE SEAL] ATTEST: Clerk, Board of Commissioners [CORPORATE SEAL] NEW HANOVER COUNTY BOARD OF EDUCATION By: Donald S. Hayes, Chairperson THE COUNTY OF NEW HANOVER BY: Chris Coudriet, County Manager (EXHIBIT 2, Page 2) STATE OF NORTH CAROLINA NEW HANOVER COUNTY I, , a Notary Public of said State and County, do hereby certify that Dr. Tim Markley, with whom I am personally acquainted, who, being by me duly sworn, says that he is the Secretary of the New Hanover County Board of Education and that Donald S. Hayes is the Chairperson of such Board of Education, the Board described in and which executed the foregoing instrument; that he knows the common seal of said Board; that the seal affixed to the foregoing instrument is said common seal, and the name of the Board was subscribed thereto by the said Chair; and that said Chair and Secretary subscribed their names thereto, and said common seal was affixed, all by order of the Board and that the said instrument is the act and deed of said Board. Witness my hand and official seal this day of , 2015. Notary Public (Printed Name of Notary) My Commission expires: (SEAL) STATE OF NORTH CAROLINA NEW HANOVER COUNTY I, , a Notary Public of Said State and County, do hereby certify That Chris Coudriet and Teresa Elmore personally came before me this day and acknowledged that they are the County Manager and Clerk to the Board of Commissioners of New Hanover County, North Carolina respectively, and that by authority duly given and as the act of the County of New Hanover, the foregoing instrument was signed in the County's name by the County Manager, sealed with its corporate seal and attested by such Clerk. Witness my hand and official seal this _day of , 2015. Notary Public (Printed Name of Notary) My Commission expires: (SEAL) Exhibit 3 PROPERTY REMOVAL FORM Pursuant to Section 2.1.2 of the Lease Agreement by and between New Hanover County Board of Education (as Landlord) and New Hanover County (as Tenant), signed the_ day of , 20_, and recorded in Book Page , New Hanover County Registry, the following property or properties are hereby deleted from the lease agreement: This the day of , 2015. ATTEST: Secretary ]CORPORATE SEAL] ATTEST: NEW HANOVER COUNTY BOARD OF EDUCATION By. — Chair, Board of Education THECOUNTYOF NEW HANOVER By: — — — Clerk, Board of Commissioners County Manager [CORPORATE SEAL] STATE OF NORTH CAROLINA NEW HANOVER COUNTY I, , a Notary Public of said State and County, do hereby certify t h at D r. Tim M ark 1 e y, with whom I am personally acquainted, who, being by me duly sworn, says that he is the Secretary of the New Hanover County Board of Education and that Donald S. Hayes is the Chair of such Board of Education, the Board described in and which executed the foregoing instrument; that he knows the common seal of said Board; that the seal affixed to the foregoing instrument is said common seal, and the name of the Board was subscribed thereto by the said Chair; and that said Chair and Secretary subscribed their names thereto, and said common seal was affixed, all by order of the Board and that the said instrument is the act and deed of said Board. Witness my hand and official seal this day of , 20_ Notary Public (Printed Name of Notary) My Commission expires: (SEAL) STATE OF 14ORTH CAROLINA NEW HANOVER COUNTY I, , a Notary Public of Said State and County, do hereby certify that Chris C o u d r i e t and Teresa Elmore personally came before me this day and acknowledged that they are the County Manager and Clerk to the Board of Commissioners of New Hanover County, North Carolina respectively, and that by authority duly given and as the act of the County of New Hanover, the foregoing instrument was signed in the County's name by the County Manager, sealed with its corporate seal and attested by such Clerk. Witness my hand and official seal this day of , 20 Notary Public (Printed Name of Notary) My Commission expires: (SEAL)