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Town Council Resolution 15 2015TOWN OF SNOWMASS VILLAGE TOWN COUNCIL RESOLUTION NO. 15 SERIES OF 2015 A RESOLUTION APPROVING AMENDMENTS TO THE KRABLOONIK LEASE AND OPTION DATED SEPTEMBER 21, 2006 AND AUTHORIZING THE TOWN MANAGER TO EXECUTE THE REVISED AND AMENDED KRABLOONIK LEASE AND OPTION, COVENANTS, RECEIVER AGREEMENTS AND OTHER DOCUMENTS TO EFFECTUATE THE AMENDMENT OF THE LEASE WHEREAS, Section 14 of the Home Rule Charter grants to the Town the power to lease or sell property, and WHEREAS, the Town Council has determined that it is in the best interests of the Town to lease and potentially sell certain real property owned by the Town, and WHEREAS, the Town has negotiated certain lease amendments to the Krabloonik Lease and Option with the new potential owners of the Krabloonik Kennel and Restaurant, and WHEREAS, the Town Council has determined that it is in the best interests of the v Town to revise and amend the lease and option, and WHEREAS, the Town Council finds that the adoption of this Ordinance is necessary for the immediate preservation of the public health, safety and welfare NOW, THEREFORE BE IT RESOLVED by the Town Council of the Town of Snowmass Village, Colorado 1 That the Revised and Amended Krabloonik Lease and Option attached to this Resolution as Exhibit "A" is hereby approved subject to the following conditions a) that the criminal case involving Krabloonik Inc's former owner is completed, and b) that the Agreement for Appointment of a Receiver that constitutes Exhibit "B" to the Revised and Amended Krabloonik Lease and Option has been completed and executed 2 Once the foregoing conditions have been satisfied, the Town Manager is hereby authorized to execute on behalf of the Town of Snowmass Village a) the Revised and Amended Krabloonik Lease and Option, and �./ b) the Agreement for Appointment of a Receiver, and Resolution No. 15-2015 Page 2 of 2 c) any covenants or other documents necessary to effectuate the Revised and Amended Krabloonik Lease and Option. INTRODUCED, READ AND ADOPTED by the Town Council of the Town of Snowmass Village, Colorado, on the 16th day of March, 2015 upon a motion made by Council Member Madsen and seconded by Council Member Sirkus and by a vote of 5 in favor to 0 opposed. ATT ST. L'��a Rhonda B Coxon, Town Clerk FORM: Johne' Dresser, Jr., TOWN OF SNOWMASS VILLAGE REVISED and AMENDED KRABLOONIK LEASE AND OPTION THIS REVISED AND AMENDED LEASE (the "Lease") is effective the /5 -/-day of June, 2015 between the TOWN OF SNOWMASS VILLAGE, a Colorado home -rule municipality ("Landlord"), whose address is P.O. Box 5010, Snowmass Village, CO 81615 and KRABLOONIK, Inc., a Colorado corporation, whose address is P.O. Box 5517, Snowmass Village, CO 81615 ("Tenant"). WITNESSETH THAT, Landlord does hereby lease to the Tenant and the Tenant does hereby rent from the Landlord the Premises and Inclusions described below. TO HAVE AND TO HOLD for the term and at the rental and upon the conditions and covenants hereinafter set forth. 1. TERM AND RENEWAL. This Lease shall supersede and replace the prior Krablo nik Lease and Option dated September 25, 2006 and shall commence on June "T, 2015 and shall expire on September 25, 2026 or on a later or earlier date as this Lease may terminate or be extended as provided below. 2. PREMISES AND INCLUSIONS. The Premises consist of Lots 45 and 51, The Divide Subdivision, according to the First Amended Plat of Lots 42, 45 and 47 of The Divide Subdivision (the "Amended Plat") thereof recorded September 25, 2006 as Reception No. 528952 of the Pitkin County records. The Inclusions consist of all `-' improvements on the Premises and all fixtures and equipment located upon or within the improvements. 3. USE. Tenant shall not occupy or use the Premises or any part thereof, nor permit or suffer the same to be occupied or used for any purpose except as a restaurant and sled dog kennel similar in scope and nature to the current operation, known and referred to as "Krabloonik Restaurant" and "Krabloonik Kennels." Consistent with past operations, the Krabloonik Restaurant shall be open for dinner business at least one hundred (100) days during each ski season. Except where prevented by weather or other circumstances beyond the control of Tenant, the Krabloonik Kennels dog sled operation shall be open for business at least one hundred (100) days during each ski season and will not operate during the summer season. The extent of the operation of the Krabloonik Restaurant during the summer months shall be determined by Tenant, in its sole discretion. 4. RENT. Tenant has paid Landlord the rent for the entire Lease Term the amount of $200.00. 5. EXPENSES. a. Tenant shall pay all expenses relating to utility services provided to or for �.. the Premises during the term of the Lease. Tenant shall pay such utility Revised and Amended Krabloonik Lease and Option Page 2 of 12 charges in a timely fashion and shall not permit any liens to be asserted or filed against the Premises. Tenant shall be solely responsible for posting any deposits required by utility providers and for paying any service initiation fees. b. Tenant shall reimburse Landlord for all real estate taxes assessed to the Premises. The parties anticipate that the Premises will be exempt from real estate taxes since it is owned by a municipality, but that Tenant will be responsible for the payment of property taxes based upon its personal property and/or leasehold improvements. Tenant shall also reimburse Landlord for the cost incurred by Landlord for its casualty and liability insurance for the Premises. At such time as Landlord is able to determine the amount of real estate taxes and insurance reimbursement for which Tenant is responsible, Landlord shall provide Tenant with a statement of such expenses. Tenant shall provide payment of the amount due within thirty (30) days following receipt of such a statement. The obligation to reimburse Landlord for real estate taxes and insurance expenses shall survive the expiration of the term of this Lease and shall be considered additional rent and the failure to pay such additional rent within the time provided above shall be considered a default of this Lease. 6. INSURANCE. a. Tenant, at Tenant's expense, shall obtain and keep in full force for the benefit of L/ the Landlord, during the term hereof, general public liability insurance, insuring the Landlord against any and all liability or claims of liability arising out of, occasioned by or resulting from any accident in or about the Premises, for injuries to any person or persons. The policy shall be written on an occurrence basis and contain coverage at least as broad as that provided under the then most current Insurance Services Office (ISO) commercial general liability insurance form which provides the broadest coverage. Each policy shall specifically include the Premises and all areas, including sidewalks, adjoining or appurtenant to the Premises. The insurance coverage shall be in an initial amount of not less than $1 million per occurrence limit, $l million general aggregate limit, $1 million personal and advertising limit, and $l million products/completed operations limit, which coverage limits may be effected with umbrella coverage. b. The policy or policies of insurance shall be delivered to the Landlord, together with evidence of the payment of the premiums therefore, not less than thirty (30) days after commencement of the term hereof or of the date when the Tenant shall enter into possession, whichever occurs sooner. At least fifteen (15) days prior to the expiration or termination date of any policy, the Tenant shall deliver a renewal or replacement policy with proof of payment of the premium thereof. c. The Tenant also agrees to and shall save, hold and keep harmless and indemnify the Landlord from and for any and all payments, expenses, costs, attorney fees Revised and Amended Krabloonik Lease and Option Page 3 of 12 and from and for any and all claims and liability for losses or damage to property or injuries to persons (collectively, "Claims") occasioned wholly or in part by or resulting from any acts or omissions by the Tenant or the Tenant's agents, employees, guests, licensees, invitees, subtenants, assignees or successors, or for any cause or reason whatsoever arising out of or by reason of the occupancy by the Tenant and the conduct of the Tenant's business. d. The Tenant waives all rights of recovery against the Landlord or Landlord's agents, employees or other representatives, for any loss, damages or injury of any nature whatsoever to property or persons for which the Tenant is insured. The Tenant shall obtain from the Tenant's insurance carriers and will deliver to the Landlord, waivers of the subrogation rights under the respective policies. Landlord shall be named as an additional insured under all policies of insurance called for herein. 7. ASSIGNMENT. Except as provided below, there shall be no assigning of this Lease, or subleasing of any part of the leased property without the specific written consent of the Landlord. After June 1, 2025, Tenant may assign this Lease to a qualified operator of the Krabloonik Restaurant and dog sled business upon the consent of Landlord, which consent shall not be unreasonably withheld. 8. MAINTENANCE AND REPAIRS. The Tenant has examined the Premises and the Inclusions and has entered into this Lease without any representation on the part of the Landlord as to the condition thereof. Tenant is relying upon its own inquiry as to applicable zoning and other land use regulations, if any, governing the permitted uses of the Premises. In addition to the obligations described above, Tenant shall take good care of the Premises and Inclusions and shall, at the Tenant's own cost and expense, make all repairs, including painting and decorating, and shall maintain the Premises and Inclusions in good condition and state of repair, and at the end or other expiration of the term hereof, shall deliver up the Premises and Inclusions in good order and condition, ordinary wear and tear from a reasonable use thereof, and damage by the elements not resulting from the neglect or fault of the Tenant, excepted. The Tenant shall neither encumber nor obstruct the sidewalks, driveways, yards, entrances and stairs, but shall keep and maintain the same in a clean condition, free from debris, trash and refuse. In addition.. Tenant shall be responsible, at its expense, to plow snow from the parking lot to be constructed on Lot 51 of the Divide Subdivision, as needed, in order for the parking lot to provide vehicle parking for permitted day skiers when the Campground Lift is in operation in addition to patrons of the Krabloonik Restaurant and Krabloonik Kennels. In case of destruction of, or any damage to the glass in the Premises, or the destruction of, or damage of any kind whatsoever to the Premises or Inclusions, caused by the carelessness, negligence or improper conduct on the part of the Tenant or the Tenant's agents, employees, guests, licensees, invitees, subtenants, assignees or successors, or any cause not directly attributable to the neglect of Landlord, the Revised and Amended Krabloonik lease and Option Page 4 of 12 Tenant shall repair the said damage or replace or restore any destroyed parts of the Premises, as speedily as possible, at the Tenant's own cost and expense. 9. ALTERATIONS. Subject to the terms and conditions of prior land use approvals, including the Divide PUD Approval, Ordinance No. 13, Series of 2004, and the provisions of the Amended Plat, Tenant may alter, improve, install fixtures upon or expand the Krabloonik Restaurant and structures utilized in the sled dog kennel operation, including the construction of an additional dwelling unit for an employee of the Krabloonik Restaurant and/or dog sled operation without Landlord's consent. Unless otherwise provided by separate written agreement of the parties, all such alterations, additions or improvements when made, installed in or attached to the said Premises, shall belong to and become the property of the Landlord and shall be surrendered with the Premises as part thereof upon the expiration or sooner termination of this Lease. All work with respect to any permitted alterations, additions, or improvements shall be done at Tenant's sole expense in a good and workmanlike manner, strictly in accordance with the plans and specifications approved by Landlord. Tenant shall, at its own expense, obtain all necessary building or other permits or approvals required by appropriate governmental authorities prior to beginning such work. If any mechanics' or other liens shall be created or filed against the leased Premises by reason of labor performed or materials furnished for the Tenant in the alteration, addition or repair to any building or improvement, the Tenant shall within ten (10) days thereafter, at the Tenant's own cost and expense, cause such lien or liens to be satisfied and ... discharged of record together with any Notices of Intention that may have been filed. Failure to do so shall entitle Landlord to resort to such remedies as are provided herein in the case of any default of this Lease, or to remove or discharge of record any lien or liens together with any Notices of Intention at Tenant's sole cost and expense, in addition to such as are permitted by law. Any goods, inventory, or other personal property of Tenant not affixed to the Premises and not removed by Tenant upon termination of this Lease, or upon any quitting, vacating or abandonment of the Premises by the Tenant, or upon the Tenant's eviction, shall be considered abandoned and Landlord shall have the right, without any notice to the Tenant, to sell or otherwise dispose of the same, at the expense of the Tenant, and shall not be accountable to the Tenant for any part of the proceeds of such sale, if any. 10. BEST PRACTICES. Tenant has been and will continue to adhere to the Best Practices described on Exhibit A, as the same may be modified, clarified or amended by mutual consent, which will not be unreasonably withheld by either Party. In the event that Tenant exercises the option to purchase the Premises and Inclusions pursuant to Section 16 of the Lease resulting in its termination, the obligation to adhere to the Best Practices as they exist on the date of conveyance of the Premises and Inclusions, and the operation of the Best Practices Review Committee pursuant to Section 11 of the Lease, shall survive such conveyance as a covenant running with title to the Premises. The parties, including successors, shall execute and record an appropriate instrument memorializing such covenant at the Revised and Amended Krabloonik Lease and Option Page 5 of 12 closing of the conveyance of the Premises from the Landlord to the Tenant, or its successors or assigns. 11. BEST PRACTICES REVIEW COMMITTEE. The Landlord and Tenant shall establish a Best Practices Review Committee (the "BPRC") comprised of six members. The members of the BPRC shall either be residents of the Town of Snowmass Village or shall be residents of the Roaring Fork Valley who are knowledgeable and experienced in the care and treatment of dogs. The owners of the Krabloonik, Inc. shall not be members of the BPRC. The Landlord shall select three members and Tenant shall select three members of the BPRC and both Landlord and Tenant shall select committee members with the intent to create a fair and balanced committee. a. No less than quarterly, the members of the BPRC, either collectively or individually, shall inspect and review the operation of the Krabloonik Kennels to determine the extent to which Tenant is complying with the Best Practices. The BPRC shall annually prepare a report on Best Practices compliance which shall be addressed to the Town Manager and distributed to the Town Council. The annual report may include suggestions for modifications or clarifications to the Best Practices. b. In addition, the BPRC may submit reports to the Town Manager describing any circumstances or events which the BPRC believes violate the Best Practices or jeopardize the health, safety or well-being of the Krabloonik sled dogs. The Town Manager shall review the annual report and any other reports provided by the BPRC with the Tenant within a reasonable time after receipt. Based upon such reports, Landlord and Tenant shall periodically evaluate, in good faith, the need to modify or clarify the Best Practices for the purpose of implementing reasonable measures to improve the quality of life of the Krabloonik sled dogs. 12. PACFA RULES AND REGULATIONS. At all times during the term of this Lease, and any extensions, Tenant shall comply with the licensing requirements and the rules and regulations of the Pet Animal Care Facilities Act, as the same may be amended. 13. DISPOSAL OF DOG WASTE. Dog waste will be collected on a daily basis, placed in heavy duty plastic bags or other suitable containers and either (i) deposited in the dumpster located Lot 44 of the Divide Subdivision which is shared with the Aspen Skiing Company for subsequent transfer to the Pitkin County Landfill no less often than weekly, or (ii) hauled directly to the Pitkin County Landfill on a daily basis. Tenant shall insure that the contents of the shared dumpster shall be collected at least weekly for transfer to the Pitkin County Landfill. Dog waste shall not be allowed to accumulate or be stored on the Premises. Subject to Landlord's approval, `.% which shall not be unreasonably withheld, dog waste which is placed in heavy duty Revised and Amended Krabloonik Lease and Option Page 6 of 12 plastic bags or other suitable containers may be deposited in a dumpster to be located on Lot 51 for subsequent transfer to the Pitkin County Landfill no less often than weekly. 14. RECEIVER AGREEMENT. The parties acknowledge and agree that, as long as the financial obligations of Daniel and Regina Phillips to Dan MacEachen are secured by a pledge of stock in Krabloonik, Inc., or other security which includes a pledge of this Lease, that the Receiver Agreement between Dan MacEachen and the Town of Snowmass Village, which has been executed contemporaneously with this Amendment and is attached as Exhibit B, shall remain in full force and effect. 15. NUMBER OF SLED DOGS. The provisions of Town of Snowmass Village Zoning or Land Use Regulations to the contrary, notwithstanding, the number of sled dogs residing on the Leased Premises shall not exceed 225 dogs for the first year of this Lease and shall be reduced according to the Adoption and Reduction Plan Section of the Best Practices Plan that is attached as Exhibit "A" such that on April 30, 2020 and carrying forward from that date forward the number of sled dogs will not exceed 175. Further, in the event Tenants exercise the Purchase Option, they agree to include this limit on the numbers of dogs in the covenant for Best Practices included in Section 10 of this Lease. 16. PURCHASE AND LEASE EXTENSION OPTIONS. a. Provided that Tenant, by and through its stock holders and operators, Daniel and Regina Phillips, have continuously operated the Krabloonik Restaurant and Kennels pursuant to this Lease until June 1, 2025, Tenant will have the option (the "Purchase Option") during the remaining term of the Lease (the "Purchase Option Period") to purchase Lot 45 of the Divide Subdivision and all improvements located thereon from the Landlord. The "Option Price" is $2,300,000.00 plus the increase, if any, in the Boulder, Colorado Consumer Price Index or three percent (3%) annually, whichever is lower, from September 26, 2006 to the date that the Option is exercised. During the Option Period, Tenant may exercise the Option by providing written notice of election ("Notice of Election") to the Landlord and by tendering the Option Price within ninety (90) days thereafter. Upon tender of the Option Price, Landlord shall convey Lot 45 to Tenant, or its assigns, by special warranty deed, free and clear of monetary liens and subject only to those encumbrances and title exceptions of record as of the date of this Lease and any further covenants and encumbrances that are provided for upon purchase herein. b. Further provided that Tenant, by and through its stock holders and operators, Daniel and Regina Phillips, have continuously operated the Krabloonik Restaurant and Kennels pursuant to this Lease until June 1, 2025, Tenant will have the option (the "Extension Option") during the remaining term of the Revised and Amended Krabloonik lease and Option Page 7 of 12 Lease (the "Extension Option Period") to extend the Lease for a period of ten .� (10) years upon the same terms and conditions as set forth in the Lease, this Amendment and any subsequent amendments. Tenant shall provide written notice to the Landlord of its intent to extend the Lease no later than June 1, 2024 and pay all rent due for the extension on said date. If Tenant elects to extend the term of the Lease, the option to purchase as set forth in this Section of the Lease shall be extended for ten (10) years as well. c. Lastly, Landlord and Tenant may further extend this Lease for two (2) subsequent terms of ten (10) years each upon the same terms and conditions as set forth in the Lease, this Amendment and any subsequent amendments herein by mutual written consent. Tenant shall provide written notice to the Landlord of its intent to extend the Lease for the first extension provided in this Subsection no later than June 1, 2034 and should the extension be mutually agreed upon by Landlord and Tenant, the term of the Lease shall run until June 1, 2045 and Tenant shall pay all rent due for the extension on the date such written mutual consent is executed. Tenant shall provide written notice to the Landlord of its intent to extend the Lease for the second extension provided in this Subsection no later than June 1, 2044 and should the extension be mutually agreed upon by Landlord and Tenant, the term of the Lease shall run until June 1, 2055 and Tenant shall pay all rent due for the extension on the date such written mutual consent is executed. 17. COMPLIANCE WITH LAW. The Tenant shall promptly comply with all laws, ordinances, rules, regulations, requirements, and directives of the federal, state, and municipal governments or public authorities and of all their departments, bureaus and subdivisions, applicable to and affecting the said Premises, their use and occupancy, and, in particular, the requirements of Ordinance No. 13, Series of 2004 (including any amendments thereto or modifications thereof), and the provisions of the Amended Plat and shall promptly comply with all orders, regulations, requirements and directives of the Board of Fire Underwriters or similar authority and of any insurance companies which have issued or are about to issue policies of insurance covering the said Premises and its contents, for the prevention of fire or other casualty, damage or injury, all at Tenant's own cost and expense. Tenant shall not use the Premises for any purposes deemed unlawful, disreputable, or extra hazardous. 18. CASUALTY. In case of fire or other casualty, the Tenant shall give immediate notice to the Landlord. If the Premises shall be partially damaged by fire, the elements or other casualty, the Landlord shall repair the same as speedily as practicable, but the Tenant's obligation to pay the rent hereunder shall not cease. If, in the opinion of the Landlord, the Premises be so extensively and substantially damaged as to render them untenantable, then the rent shall cease until such time as the Premises shall be made tenantable by the Landlord. In no event, however, shall Revised and Amended Krabloonik Lease and Option Page 8 of 12 the provisions of this clause become effective or be applicable if the fire or other casualty and damage shall be the result of carelessness, negligence or improper conduct of the Tenant or Tenant's agents, employees, guests, licensees, invitees, subtenants, assignees or successors. In such case, the Tenant's liability for payment of rent and the performance of all the covenants and conditions and terms hereof on the Tenant's part to be performed shall continue and the Tenant shall be liable to the Landlord for the damage and loss suffered by the Landlord. If the Tenant shall have been insured against any of the risks herein covered, then the proceeds of such insurance shall be paid over to the Landlord to the extent of the Landlord's costs and expenses to make the repairs hereunder, and such insurance carriers shall have no recourse against the Landlord for reimbursement. 19. INSPECTION AND REPAIR OF PREMISES. The Tenant agrees that the Landlord and the Landlord's agents, employees or other representatives, shall have the right to enter into and upon the said Premises or any part thereof, at all reasonable hours, for the purpose of examining the same or making such repairs or alterations therein as maybe necessary for the safety and preservation thereof. This clause shall not be deemed to be a covenant by the Landlord nor be construed to create an obligation on the part of the Landlord to make such inspection or repairs. Tenant expressly waives and releases any claim, demand, or cause of action it might have by reason of any inconvenience, annoyance to Tenant, his guests, licensees, or invitees arising from any maintenance, alteration or repair to any portion of the Premises, the building in which it is located, or the property upon which it is situated. Tenant grants to Landlord the right to temporarily discontinue utilities or any of them at any such time or times as may be necessary by reason of any such maintenance work, alteration or repair. In the event Landlord makes repairs to the Premises, where such repairs are necessitated by circumstances other than Tenant's negligence or willful acts or omissions, such repairs shall be performed as diligently as possible so as to cause a minimum of interference with Tenant's use and enjoyment of the Premises. 20. REIMBURSEMENT. If the Tenant shall fail or refuse to comply with or perform any conditions or covenants of this Lease, the Landlord may, if the Landlord so elects, carry out and perform such conditions or covenants, at the cost and expense of the Tenant, which cost and expense shall be payable to Landlord on demand as additional rent. This remedy shall be in addition to such other remedies as the Landlord may have under this Lease. 21. DEFAULT a. If there should occur any default on the part of the Tenant in the performance of any conditions or covenants herein contained, or if, during the term hereof, the Premises or any part thereof shall be or become abandoned or deserted, vacated or vacant, or should the Tenant be evicted by summary proceedings or otherwise, the Landlord, in addition to any other remedies herein contained or Revised and Amended Krabloonik Lease and Option Page 9 of 12 as may be permitted by law, may either by force or otherwise, without being liable for prosecution therefor, or for damages, and whether or not this Lease has been terminated, re-enter the said Premises and again possess the same; and as agent for the Tenant or otherwise, re -let the Premises and receive the rents therefor and apply the same, first to the payment of such expenses, reasonable attorneys' fees and costs, as the Landlord may have incurred in reentering and repossessing the same and in making such repairs and alterations as may be necessary; and second to the payment of the rents due hereunder. The Tenant shall remain liable for such rents as may be in arrears and also the rents as may accrue subsequent to the re-entry by the Landlord, to the extent of the difference between the rents reserved hereunder and the rents, if any, received by the Landlord during the remainder of the unexpired term hereof, after deducting the aforementioned expenses, fees, and costs; the same to be paid as such deficiencies arise and are ascertained each month. b. Upon any default, or if Tenant be adjudicated a bankrupt, insolvent or placed in receivership, or should proceedings be instituted by or against the Tenant for bankruptcy, insolvency, receivership, agreement of composition or assignment for the benefit of creditors, or if this Lease or the estate of the Tenant hereunder shall pass to another by virtue of any court proceedings, writ of execution, levy sale, death of Tenant, or by operation of law, the Landlord may, if the Landlord so elects, at any time thereafter, terminate this Lease, upon giving to the Tenant or to any trustee, receiver, assignee, personal representative, or other person in charge of or acting as custodian of the assets or property of the Tenant, fifteen (15) days notice in writing, of the Landlord's intention to do so. Upon the giving of such notice, this Lease and the term here -of shall end on the date fixed in such notice as if the said date was the date originally fixed in this Lease for the expiration hereof; and the Landlord shall have the right to remove all persons, goods, fixtures and chattels therefrom, by force or otherwise, without liability for damages. Provided, however, during said fifteen (15) day period, Tenant shall be entitled to cure any default for which Landlord has issued notice, and if such default is cured within the fifteen (15) day period, Landlord shall not be entitled to terminate this Lease. Furthermore, should a default exist which requires more than fifteen (15) days to cure, with the exception of default in the payment of rent or the maintenance of required insurance, Tenant shall within said fifteen day period, provide Landlord with a written plan to cure said default in such a reasonable additional period of time within which to effect such cure so long as Tenant diligently, continuously and in good faith executes such plan to cure such default at the earliest possible time. c. No right of redemption shall be exercised under any present or future law of the State of Colorado, in case the Tenant shall be dispossessed for any cause, or if the Landlord shall, in any other manner, obtain possession of the Premises in consequence of the violation of any of the covenants and agreements of the Tenant. To the extent that statutorily required three (3) day demand for possession or payment of rent may be deemed a right of redemption, the right of Revised and Amended Krabloonik Lease and Option Page 10 of 12 Tenant to pay rent and cure a default in the payment of rent hereunder shall not be deemed waived by this paragraph. d. With the exception of Tenant's failure to pay rent as required herein, for which no notice or demand is required, Tenant shall not be deemed to be in default unless and until Landlord has issued a written notice of default to Tenant in accordance with the terms of this Lease Agreement. 22. ATTORNEY'S FEES. Tenant shall pay, upon demand, reasonable attorneys' fees and all other expenses incurred by the Landlord in enforcing any provision of this Lease, or in any action or proceeding by reason of a default under this Lease or incurred by reason of any action to which Landlord shall be made a party because of this Lease, all of which may be awarded to Landlord as part of any such action or proceeding. In the event of any litigation between the parties surrounding the enforcement of any term or condition of this Lease, the party ultimately prevailing therein shall be entitled to recover all reasonable costs and attorneys' fees. In the event of any such litigation between the parties, the parties agree to waive the right to request a jury trial. 23. LANDLORD NOT LIABLE. The Landlord shall not be liable for any damage or injury which may be sustained by the Tenant or any other person as a consequence of the failure, leakage or obstruction of the water, plumbing, steam, sewer, waste or soil pipes, roof, drains, leaders, gutters, valleys, downspouts or the like, or of the `./ electrical, gas, power, conveyor, refrigerator, sprinkler, air conditioning or heating systems, elevators or hoisting equipment; or by reason of the elements; or resulting from the carelessness, negligence or improper conduct on the part of any other Tenant or this or any other Tenant's agents, employees, guests, licensees, invitees, subtenants, assignees or successors; or attributable to any interference with, interruption of, or failure, beyond the control of the Landlord, of any service to be furnished or supplied by the Landlord, except as a consequence of Landlord's actual negligence. 24. QUIET ENJOYMENT. Subject to the terms of this Lease, Landlord covenants and represents that the Landlord is the owner of the Premises herein leased and has the right and authority to enter into, execute and deliver this Lease; and does further covenant that the Tenant, on paying the rent and performing the conditions and covenants herein contained, may peaceably and quietly have, hold and enjoy the leased Premises for the term aforementioned. 25. CUMULATIVE REMEDIES. The various rights, remedies, options and elections of the Landlord, expressed herein, are cumulative, and the failure of the Landlord to enforce strict performance by the Tenant of the conditions and covenants of this Lease or to exercise any election or option or to resort or have recourse to any remedy herein conferred or the acceptance by the Landlord of any installment or Revised and Amended Krabloonik Lease and Option Page 11 of 12 rent after any breach by the Tenant, in any one or more instances, shall not be construed or deemed to be a waiver or a relinquishment. 26. SEVERABILITY. The terms, conditions, covenants and provisions of this Lease shall be deemed to be severable. If any clause or provision herein contained shall be adjudged to be invalid or unenforceable by a court of competent jurisdiction of by operation of any applicable law, it shall not affect the validity of any other clause or provision herein, but such other clauses or provisions shall remain in full force and effect. 27. NOTICES. All notices required under the terms of this Lease shall be given in person or by mailing such notices by certified or registered mail, return receipt requested, to the address of the parties shown at the beginning of this Lease, or to such other address as may be designated in writing, which notice of change of address shall be given in the same manner. If not sooner received, any notice given by mail shall conclusively be deemed received three (3) days after the date of certification or registration. 28. ENTIRE LEASE. This Lease contains the entire contract between the parties. No representative, agent or employee of the Landlord has been authorized to make any representations or promises with reference to the within letting or to vary, alter or modify the terms hereof. No additions, changes or modifications, renewals or extensions hereof shall be binding unless reduced to writing and signed by the Landlord and the Tenant. 29. REFERENCES. In all references herein to any parties, persons, entities or corporations, the use of any particular gender or the plural or singular number is intended to include the appropriate gender or number as the text of the within instrument may require. 30. BINDING EFFECT. All tenns, covenants and conditions herein contained shall be for and shall inure to the benefit of and shall bind the respective parties hereto, and their heirs, executors, administrators, personal or legal representatives, successors and assigns respectively; provided, however, the term "Landlord" as used in this Lease so far as covenants or obligations on the part of Landlord are concerned, shall be limited to mean and include only the owner of the building in which the Premises is located and, in the event of any transfer of such interest, Landlord herein named shall be automatically freed and relieved from and after the date of such transfer or conveyance of all liability with respect to performance of any covenants or obligations thereafter to be performed under this Lease, it being intended hereby that the covenants and obligations of Landlord contained in this Lease or provided by law shall be binding on Landlord, its successors and assigns, only during and with respect to their respective successive periods of ownership. [This Space Intentionally Left Blank. Signatures on the Following Page.] Revised and Amended Krabloonik Lease and Option Page 12 of 12 IN WITNESS WHEREOF, the parties hereto have executed this Lease the day and year set forth below. LANDLORD: TOWN OF AS VILLAGE ��10017� By: Title: Date: S TENANT: Krabloonik, Inc. By: c ;Z/t�� Title: '6 ' 1 Date: (.Q EXHIBIT "A" - REVISED and AMENDED KRABLOONIK LEASE AND OPTION Krabloonjk Best Practices Plan Section 1. — General Policies At Krabloonik we are employing the idea of best practices, meaning we are not only meeting, but exceeding state and local regulatory requirements for operating a dogsled kennel and providing exceptional care for our sleddogs. At Krabloonik we aim for the highest standards in all aspects of our company and care of our dogs. The following are current best practices that we have implemented • "Working Pet Policy" —This means that our sleddogs receive the same care and attention as a normal pet would. Often the medical care and attention of our sleddogs at Krabloonik far exceeds that of a normal house pet. As opposed to treating our sleddogs as only 'working dogs', we treat them as a "working pet" • Spay and Neuter program- This was a program that began in 2014 with the help of the Friends of the Aspen Animal Shelter. 100 of our sleddogs to date have been spayed and neutered through this program. We plan on continuing to spay and neuter our dogs as needed to maintain a healthy and manageable kennel. • We maintain extensive records on all of our dogs which include their name, tag number, health records, physical and personality descriptions as well as any incident reports that range from minor injuries/illness to ones requiring veterinary care. • We provide our dogs with natural supplements, scientifically designed sleddog specific food, massage work, electrolytes, and baited water/hot soup (for hydration). We also supplement with all natural, homemade, high calorie 'snacks' several times per day The snacks are made from beef fat, the highest caloric kibble, recycled restaurant scraps, electrolytes and water. • Retirement Program- All of our sleddogs are treated with the upmost respect and love during their lifetime with us. Many of the dogs have transitioned well into the 'free run' area in order L, to get ready for adoption. If we feel that adoption would be a good fit for our retired sled dog, we will work with the local Aspen Animal Shelter and CARE as well as any other organization that would like to help adopt out our retired friends. If we feel that adoption is not a good fit for one of our dogs, then we will care for them on site as long as they are happy and healthy. • Public Education- We feel that educating the public is part of our responsibility as kennel owners. We have implemented an 'open door' policy and kennel tours in order to give the public an opportunity to seethe dogs, the kennel and ask questions We train our guides and 11page restaurant staff to be knowledgeable about the dogs and their care in order to answer questions Within the next year we plan on developing educational school programs, and summer youth/adult education programs. • On-site Care- We employ year round, on-site, 24 hours per day trained sleddog care takers • TOSV Animal Control- Yearly we provide the TOSV Animal Control an updated list of each dog including name, tag number, physical/personality description and rabies vaccination dates. • Bedding- We provide fresh, dry, clean straw for bedding that is evaluated on a daily basis and replaced as needed • Euthanasia- We feel that our dogs deserve the upmost respect for the duration of their lifetime. In the event that one of our dogs is no longer happy, healthy and pain free we will consult with our local veterinarian. In the event that the decision is made to end their lives, we will have them peacefully euthamzed by the veterinarian • Breeding- To maintain the longetiviy of the kennel we will do yearly breedings based on the needs to replace retired, adopted (short haired) sleddogs while still maintaining a manageable number of dogs between 175-225 which number will slowly ratchet down over the next fivew years to the target number of dogs of 175 in 2021 Our goal is to breed larger, longer haired, traditional sleddogs that will allow us to have a lower number of dogs needed to operate the business. The future business model will accommodate fewer dogs needed per guest, therefore lowering the number of dogs needed to operate the business. Housing- At this time we feel that the current houses with the straw bedding for insulation is adequate, yet we are looking into alternative housing options that would last longer and be more comfortable for our dogs. We currently have indoor housing available for any of our dogs that would need to come indoors for various reasons. Tethering- Tethering allows each individual dog to safely interact with one another by touching, playing and resolving conflict while still maintaining their own individual space. Mushers and guests are able to interact with each sleddog individually in the dogs own space. It is important for the sleddogs to be in a wide open area, highly visible for each sleddog caretaker to notice any changes in behavior, appetite or inactiveness. Tethering allows sleddog kennels to individualize each dog in order to monitor eating habits, drinking, behavior, illness and stool health. A humane tethering practice along with an excellent off tether program ensures each individual sleddog is treated as an individual and all of their needs are met • Transparency- We invite an open communication with the public While we have attempted to IN—i cover all questions in this packet, we do realize that there will always be questions, concerns 2 1 P a g e and suggestions Our responsibility to the public is to answer these questions knowledgably, honestly and with empathy. Section 2. - Krabloonik Adoption and Reduction Plan • Krabloonik has a long term plan of reducing the numbers of sled dogs at the kennel. • Krabloonik will be adopting out to GOOD HOMES all sled dogs over the age of 10. • Krabloonik will be adopting out younger dogs without thick heavy coats. • A training plan is in effect to help transition sled dogs up for adoption to be successful in forever homes. • Krabloonik is working on a business plan to offer multiple experiences that will require fewer dogs to operate. • The future of Krabloonik sled dogs will be larger more traditional sled dogs that will require fewer dogs per team. • Krabloonik Kennels will continue to spay and Neuter operating with a high number of altered dogs to avoid accidental breeding's • Krabloonik will develop a self-funded successful adoption plan. • Krabloonik will keep the numbers of births each year low and manageable while still creating a sustainable future kennel. • In the event of a large litter of sled dogs born at Krabloonik, some pups may be adopted out with the help of the Aspen Animal Shelter • The new Krabloonik will stand out as a forerunner of a modern, elite professional training kennel setting the bar for all racing, touring and professional kennels to learn from • Krabloonik will race professionally showing a modern holistic approach to dog sled training. • Krabloonik sled dogs that exceed the athletic abilities or social skills will be transferred into the racing world where they would be fit for that environment. Keeping touring dogs traditional and slower, for the safest experiences for our guests. • Krabloonik will strive to help each retiring sled dog be successful in their next phase of life. Our sled dogs are our passion and our love and devotion to them will continue into their retirement years We will go the extra mile to provide the training and education it takes for our working sled dogs to retire peacefully into a caring, loving and educated home Our sled dogs are not rescues they are cared for and loved by an amazing compassionate team. Krabloonik will be owned by new experienced Mushers and the needs for such a large kennel are no longer necessary. Section 3. -Feeding. Housing and Modern Care Pian A. Feeding/Hydration MA 31Page • The New Krabloomk will continue to feed the proven scientifically developed sled dog food Dr. `f Tims. • In addition continued feedings of frozen kibble mixed with fats, meats and recycled bi products of the restaurant will be fed throughout the day. • Additional night snacking if needed, for shorter times in between meals • Hydration is a strong key in sled dog nutrition In addition to clean freshwater available at all times a hot broth filled with supplements and pure fat to warm the sled dogs from the inside out will be distributed twice daily along with offerings after every run B. Housina/Weather • Krabloomk's first goal is to modernize the housing; we are currently looking for an ideal design. • Dry bedding will be offered year round. • Sled dogs will be sheltered inside if struggling with low temperatures or adopted into homes immediately • New housing will accommodate the current "porch" system for proper shade in the summer season • A system of misting the dogs in the summer months will be incorporated. C. Medical Care • Krabloonik will be supported locally by the Aspen Animal Hospital and their staff. • Krabloonik will continue to research and educate ourselves on the most proven techniques of sled dog care. • All minor to mayor injuries or illness will be documented and on record for future inquiries • All sled dogs will have a tag with a number and a corresponding file. • In the event that a sled dog is no longer able to live a happy and healthy life we will have the sled dogs euthanized peacefully by our kind and compassionate team of Veterinarians on site in their own environment. D. Off Season exercise • The new Krabloonik will continue with the offseason exercise program We will strive to increase time off tether as the program develops. We are currently exceeding state requirements. We have learned that the sled dogs love to free run and it develops into an amazing training experience We will continue in moving forward increasing less tether time. • Krabloonik will staff year round trained sled dog care takers living on site. • Krabloonik's Mission is to develop and institute new and modernized standards of sled dog care. Our devotion to our sled dogs and the life that comes with it will show as we evolve Krabloonik into the modern dog sledding kennel that stands out and pioneers the training and care of K9 athletes 4 1 P a g e U EXHIBIT `B" - REVISED and AMENDED KRABLOONIK LEASE AND OPTION AGREEMENT FOR APPOINTMENT OF A RECEIVER THI AGREEMENTXOR APPOINTMENT OF A RECEIVER ("Agreement") is made as of <0 610 , , 2015 by and between Dan MacEachen ("MacEachen"), and the Town of Snowmass Village, Colorado, a Colorado home rule municipality ("TOSV") RECITALS A. MacEachen has conveyed all of his interest in Krabloonik, Inc, a Colorado corporation, which owns and operates the Krabloonik Kennel and Restaurant in Snowmass Village, CO (the "Business") to Daniel and Regina Phillips (the "Buyers") pursuant to a Stock Purchase Agreement dated November 24, 2014 B. MacEachen agreed to finance the above-described conveyance pursuant to a Promissory Note payable by Buyers to MacEachen, which Promissory Note is secured by a pledge of the Buyer's shares of stock in Krabloonik, Inc ("Stock Pledge") C. In the event Buyer defaults in the payment of the Promissory Note or the terms of the Stock Pledge, following which MacEachen exercises his right to reacquire the stock in Krabloonik, Inc, MacEachen and TOSV desire that operational control and management of the Business be transferred to and vested in a Receiver until such time as the Business is either sold to a third -party or liquidated and terminated NOW THEREFORE, for in consideration of the mutual covenants, terms and conditions contained herein, the Parties agree as follows. 1 Appointment of Receiver In the event that MacEachen elects to exercise his right under the Stock Pledge to re -acquire the stock of Krabloonik, Inc., MacEachen shall provide written notice to TOSV prior to exercise of such rights and prior to taking possession of the pledged Stock Certificates At such time as the stock in Krabloonik, Inc. is transferred to MacEachen pursuant to the Stock Pledge, MacEachen and TOSV shall jointly appoint a qualified Receiver to assume control of Krabloonik, Inc as provided herein If the parties cannot agree on the Receiver to be appointed within twenty (20) business days of the aforementioned notice, TOSV shall be entitled to appoint the Receiver of its choice The Receiver shall be entitled to charge its normal and customary fees and to be reimbursed for out-of-pocket expenses in connection with its services under this Agreement The fees of the Receiver shall have priority over the payment of other expenses of the Business. 2 Receiver Authority and Receiver Property Receiver shall take charge, manage, operate or discontinue all or part of the operation of the Business, including the care and feeding of sled dogs, and, in his sole discretion shall appoint such managers, employees, accountants, attorneys, and Agreement for Appointment of A Receiver Page 2 of 5 � other professionals, as he deems appropriate and necessary to assist him in the management, operation or discontinuance of the Business, the protection of its assets, and the sale of the Business. The Receiver shall have all the powers and authority usually held by receivers and reasonably necessary to accomplish the purposes herein stated, including but not limited to, the following: (a) To take charge and possession of the Business, all improvements involved in the operation of the Business, all personal property used or associated with the operation of the Business, regardless of where such property is located, including but not limited to, accounts receivable, security deposits, bank accounts, checks, drafts, notes, contracts, claims, leases, all files, including but not limited to, personnel files and operations manuals, all records, including but not limited to, financial records and payroll records, all certificates and licenses, fixtures, equipment, inventory, keys, supplies, and furniture, in whomsoever' s possession they may be (all collectively herein referred to as the "Receivership Property"); (b) To arrange and pay for appropriate insurance coverage, including but not limited to, casualty, property, and liability insurance for the Receivership Property through `-' assumption of the owners' insurance or by arranging for new insurance; (c) To deposit all sums received by it in a financial institution insured by the federal government in its name as Receiver; (d) To repair, replace, maintain and protect the Receivership Property, and to pay for ordinary and necessary maintenance thereto, including deferred maintenance, and to take such other steps as the Receiver deems appropriate to prevent waste; (e) To enter into, abrogate, modify, terminate, ratify, confirm and/or renegotiate (to the extent legally entitled to do so) contracts or other agreements related to the operation of the Receivership Property, including but not limited to, hiring and firing of employees, present or future managers or management companies, leasing agents, or other professionals dealing with the Receivership Property; (f) To enter into contracts with third parties to accomplish any of the powers of the Receivership and for purposes of administration of the Receivership, including but not Agreement for Appointment of A Receiver Page 3 of 5 �./ limited to, the hiring of managers and/or management companies, leasing agents, listing agents, accountants, attorneys, and other professionals, which contracts may extend past the term of the Receivership, and to pay the fees of such as expenses of the Receivership, (g) To take all actions necessary to comply with applicable state and federal law and any applicable rules, regulations, or orders thereunder, (h) To hire an attorney to represent the Receivership Property and to file and maintain legal proceedings to protect the Receivership Property, pursue claims relating to the operation of the Receivership Property and to enforce the provisions of this Agreement, and if the Receiver so elects in his sole discretion, to be added or substituted as plaintiff in any legal proceedings already commenced which affect the Receivership Property, (i) To utilize the services of the Sheriffs Department or Police Department, or to retain security personnel, as necessary to secure the Receivership Property or assist the Receiver in performance of his duties under this Order, U 0) To incur indebtedness to the extent required to perform its duties as Receiver, (k) To use income and receipts from the Receivership Property for the payment of all costs associated with the operation and maintenance of the Business, for the payment of administrative expenses of the Receivership, for the payment of Receiver's fees and costs, his attorney's and consultant's fees and costs, for payment of the expenses of the Receivership including but not limited to taxes and utilities, for payment toward any debt which is secured by a lien on the Receivership Property All remaining income from the Receivership Estate shall be held by the Receivership Estate pending sale or termination of the Business; and (1) To do any and all acts necessary and convenient or incidental to the foregoing. 3 TOSV Lease The Business is currently conducted upon land that is subject to the Krabloomk Lease and Option dated September 25, 2006 between TOSV and Krabloomk, Inc, and the First Amendment thereto dated , 2015 (the "TOSV Lease") The Receiver shall use his best efforts to operate the Business in a manner that complies with the terms and conditions of the TOSV Lease and to prevent a default thereunder The Receiver shall not have the authority to modify or terminate the TOSV Lease without the written consent of MacEachen, which v consent maybe withheld for any reason Likewise, the Receiver shall not exercise the Option to Agreement for Appointment of A Receiver Page 4 of 5 u purchase the land that is subject to the TOSV Lease without the written consent of MacEachen, which consent may be withheld for any reason 4 Delivery of Receiver Property. Upon notice of the Receiver's appointment hereunder, all persons in active participation with the Business, including but not limited to the Buyers, banks, accountants, employees, and other agents, shall be directed by MacEachen and TOSV to deliver immediately over to the Receiver all Receiver Property, endorsed to the Receiver where necessary, and continue to deliver immediately to the Receiver any such property received at any time in the future and, where necessary or requested, to explain to the Receiver all books, files, and other records relating to the operation, maintenance and management of the Business, and to permit the Receiver to carry out his duties hereunder without interference MacEachen Inunction Except as maybe expressly authorized by this Agreement or any amendment thereto, MacEachen is enjoined from: (a) collecting any revenues from the operation of the Business or withdrawing funds from any bank or other depository account containing revenues of the Receivership Property, v other than with the consent of the Receiver and TOSV; (b) terminating or causing to be terminated any license, permit, lease contract or agreement relating to the Business, and (c) Exercising any authority or control over the operation of the Business. 6 Sale or Liquidation of Business. In addition to the management and operation of the Business, the Receiver shall undertake a reasonable effort to sell the stock in Krabloonik, Inc. or its assets To that end, the Receiver may advertise the Business for sale and may enter into listing contracts with qualified real estate or business brokers The purchase price and terms of sale shall be subject to approval by MacEachen, in his sole discretion The qualifications of the buyer, particularly with respect to the care and feeding of sled dogs, shall be subject to approval by both MacEachen and TOSV, in their discretion MacEachen hereby reserves the right to terminate the sale effort at any time and to instruct the Receiver to terminate operation of the Business. to terminate the TOSV Lease, and to liquidate the assets of the Business and otherwise wind up its affairs In the event that the Business is sold or terminated and liquidated by the Receiver, all funds shall remain in the hands of the Receiver after first defraying expenses of the Receivership including the Recenrer's attorneys' and other professionals' fees and costs and the payment of any costs u incurred in the operation and maintenance of the Business, the payment of taxes, insurance, utility Agreement for Appointment of A Receiver Page 5 of 5 bills and such other bills as set forth in this Agreement and said funds shall then be distributed to MacEachen 7 Breach of TOSV Lease If MacEachen exercises his right to re -acquire the stock in Krabloonk, Inc pursuant to the Stock Pledge and subsequently fails to comply with Paragraph 5 above such failure shall constitute a breach of the TOSV Lease IN WITNESS WHEREOF, each party to this agreement has caused It to be executed on the date indicated above Dan MacEachen \J TOWN OF 5 MASS VIL E BY. 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