PURCHASE AGREEMENT

This Agreement is made on this _____ day of __________________, 200_, by and between Funny River Emergency Services, an Alaska nonprofit corporation, whose address is P.O. Box 3557, Soldotna AK 99669, (hereinafter referred to as "SELLER") and the KENAI PENINSULA BOROUGH, an Alaska municipal corporation, whose address is 144 North Binkley Street, Soldotna, Alaska 99669 (hereinafter referred to as "KPB").

Lot 5 Salmon Bend Subdivision, FRVFD Addition, According to Plat No. 2002-24, Kenai Recording District, within Section 17, Township 5 North, Range 8 West, Seward Meridian, Alaska (Assessor Parcel No. 066-170-31) (Hereinafter referred to as the Property)

WHEREAS, the Property includes facilities commonly known as the Funny River Fire Department and Disaster Relief Building located at 32530 Funny River Road; and

WHEREAS, KPB has offered to buy, and SELLER is willing to sell the Property as evidenced by this Purchase Agreement;

NOW THEREFORE, in consideration of the promises herein contained, SELLER hereby agrees to sell to KPB, and KPB hereby agrees to buy from SELLER, the Property on the terms and conditions as set forth below:

1. PURCHASE PRICE

The purchase price of the Property is one dollar and NO cents ($1.00). The Purchase Price shall be paid by KPB at time of closing. The purchase of the Property and appropriation for the purchase are subject to borough assembly approval.

2. TITLE

Title shall be delivered at time of closing by Warranty Deed, which shall be issued to KPB. SELLER warrants and covenants that at the time of closing there shall be no liens or judgments recorded against SELLER in the same recording district in which the Property subject to this purchase agreement is situated. Title shall be clear of liens and encumbrances except title is subject to reservations, easements, rights-of-way, covenants, conditions and restrictions of record.

SELLER shall furnish to buyer within 15 days of signature on this agreement a preliminary commitment for title insurance.

4. ESCROW AND CLOSING COSTS

KPB agrees to be responsible for closing costs in connection with this Agreement, including without limitation all escrow fees, title insurance charges, recording fees and inspections .

5. CLOSING

Unless otherwise agreed in writing, closing will occur within 90 days of execution of the Purchase Agreement. At closing, KPB will pay the balance of the purchase price. Both parties will execute all documents required to complete the Purchase Agreement and, if applicable, establish an escrow account.

6. POSSESSION

Possession of the Property shall be delivered to KPB at time of recording.

7. KENAI PENINSULA BOROUGH ASSEMBLY APPROVAL

Purchase of Property by the Kenai Peninsula Borough is subject to authorization by the Kenai Peninsula Borough Assembly and appropriate of funds. If the Kenai Peninsula Borough fails to adopt a resolution or ordinance authorizing the purchase of the Property and appropriation of funds, this agreement shall be terminated without penalty.

8. HAZARDOUS MATERIAL

SELLER covenants to the best of SELLER'S knowledge, that as the date of this agreement, except as specifically identified herein, the Property is free of all contamination from petroleum products or any hazardous substance or hazardous waste, as defined by applicable state or federal law, and there are no underground storage tanks or associated piping on the Property. SELLER agrees that no hazardous substances or wastes shall be located on or stored on the Property, or any adjacent property by seller, owner or contractors, nor shall any such substance be owned, stored, used, or disposed of on the Property or any adjacent property by SELLER, its agents, employees, contractors, or invitee's, prior to KPB'S ownership, possession, or control of the Property.

9. ENTIRE AGREEMENT

This Agreement and the documents referred to herein contain the entire agreement of the parties with respect to the subject matter hereof. Any changes, additions or deletions hereto must be made in writing and signed by both KPB and SELLER or their respective successors in interest. Provisions of this Agreement, unless inapplicable on their face, shall be covenants constituting terms and conditions of the sale and of the agreement to finance the sale, and shall continue in full force and effect until the purchase price is paid in full or this agreement is earlier terminated.

10. BREACH REMEDY

Prior to closing of the sale, in the event that KPB or SELLER fails to make any payment required, or fails to submit or execute any and all documents and papers necessary for closing and transfer of title within the time period specified in this agreement, the SELLER or KPB may terminate this Agreement.

11. MISCELLANEOUS

A. Time. Time is of the essence in performance of this Agreement.

B. Cancellation. This Agreement, while in good standing may be canceled in whole or in part, at any time, upon mutual written agreement by SELLER and the mayor. This Purchase Agreement is subject to cancellation in whole or in part if improperly issued through error in procedure or with respect to material facts.

C. Notice. Any notice or demand, which under the terms of this Agreement or under any statute must be given or made by the parties thereto, shall be in writing, and be given or made by registered or certified mail, addressed to the other party at the address shown on the contract. However, either party may designate in writing such other address to which such notice of demand shall thereafter be so given, made or mailed. A notice given hereunder shall be deemed received when deposited in a U.S. general or branch post office by the addressor.

D. Interpretation. This Agreement shall be deemed to have been jointly drafted by both parties. It shall be constructed according to the fair intent of the language as a whole, not for or against any party. The interpretation and enforcement of this Agreement shall be governed by the laws of the State of Alaska. The titles of sections in this Agreement are not to be construed as limitations of definitions but are for identification purposes only.

This Agreement has been executed by the parties on the day and year first above written.

KENAI PENINSULA BOROUGH: FUNNY RIVER EMERGENCY SERVICES INC:

_________________________________ ______________________________

___________, Mayor ______________, President

Dated: _____________ Dated: _______________

______________________________

______________, Secretary

Dated: _______________

ATTEST: APPROVED AS TO LEGAL FORM

AND SUFFICIENCY:

_______________________ ______________________________

Sherry Biggs, Holly B Montague,

Borough Clerk Assistant Borough Attorney

NOTARY ACKNOWLEDGMENT

STATE OF ALASKA )

)ss

THIRD JUDICIAL DISTRICT )

The foregoing instrument was acknowledged before me this ________day of

________________, 200_, by _________________, Mayor of the Kenai Peninsula Borough, an Alaska municipal corporation, for and on behalf of the corporation.

_______________________________

Notary Public in and for Alaska

My commission expires: ___________

NOTARY ACKNOWLEDGMENT

STATE OF ALASKA )

) ss

THIRD JUDICIAL DISTRICT )

The foregoing instrument was acknowledged before me this ________day of

________________, 200_, by ___________________, President of Funny River Emergency Services for and on behalf of the corporation.

_____________________________

Notary Public in and for Alaska

My commission expires: __________

NOTARY ACKNOWLEDGMENT

) ss

THIRD JUDICIAL DISTRICT )

The foregoing instrument was acknowledged before me this ________day of

__________________, 200_, by ___________________, Secretary of Funny River Emergency Services for and on behalf of the corporation

______________________________

Notary Public in and for Alaska

My commission expires: __________