HomeMy WebLinkAbout26-0854Airport Lease Agreement (08/25)
AIRPORT LEASE AGREEMENT
between
CITY OF DENTON
and
SHELTAIR AVIATION DENTON, LLC
dated as of
_______________, 2026
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TABLE OF CONTENTS
Page No.
ARTICLE I LEASE OF LEASED PREMISES; TERM...........................................................2
Section 1.1 Lease of Leased Premises..................................................................................2
Section 1.2 Lease Term.........................................................................................................2
Section 1.3 Holding Over; Rights at Expiration ...................................................................2
Section 1.4 Inspection of Leased Premises; Access to Books and Records.........................2
Section 1.5 Ownership of Leased Premises..........................................................................3
Section 1.6 Existing Leases Terminated ...............................................................................3
ARTICLE II RENT.......................................................................................................................3
Section 2.1 Rent ....................................................................................................................3
Section 2.2 Insufficient Funds Charge..................................................................................4
Section 2.3 Time and Place of Payments..............................................................................4
Section 2.4 Delinquent Rent .................................................................................................4
ARTICLE III OCCUPANCY, USE AND CONDITIONS OF LEASED PREMISES............4
Section 3.1 Condition of Leased Premises ...........................................................................4
Section 3.2 Construction and Ownership of Improvements.................................................4
Section 3.3 Access ................................................................................................................5
Section 3.4 Use of Leased Premises and Compliance with all Laws and Regulations ........6
Section 3.5 No Unauthorized Use.........................................................................................7
Section 3.6 Permits and Licenses..........................................................................................7
Section 3.7 Payment of Taxes...............................................................................................7
Section 3.8 No Liens .............................................................................................................7
Section 3.9 Compliance with 2252.909 of Texas Government Code. ..................................8
ARTICLE IV REPRESENTATIONS AND WARRANTIES...................................................8
Section 4.1 Representations by City .....................................................................................8
Section 4.2 Representations by Lessee.................................................................................8
ARTICLE V OBLIGATIONS OF LESSEE...............................................................................9
Section 5.1 Plans and Specifications ....................................................................................9
Section 5.2 Appraisal at Conclusion of Construction ...........................................................9
Section 5.3 Operations and Maintenance..............................................................................9
Section 5.4 Utilities .............................................................................................................10
Section 5.5 Signs .................................................................................................................10
Section 5.6 Security ............................................................................................................10
Section 5.7 Obstruction Lights ...........................................................................................10
Section 5.8 Hazardous Materials........................................................................................10
Section 5.9 Trash, Garbage, and Other Refuse ...................................................................11
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ARTICLE VI INDEMNIFICATION AND INSURANCE......................................................12
Section 6.1 Insurance..........................................................................................................12
Section 6.2 Lessee’s Indemnification and Duty to Pay Damages. .....................................13
ARTICLE VII DEFAULT AND REMEDIES..........................................................................13
Section 7.1 Lessee’s Default ...............................................................................................13
Section 7.2 Default by City .................................................................................................14
Section 7.3 Remedies for Failure to Pay Rent....................................................................14
Section 7.4 Remedies for Breach of Agreement.................................................................14
Section 7.5 Survival ............................................................................................................14
ARTICLE VIII ASSIGNMENT AND SUBLEASING ............................................................14
Section 8.1 Assignment by Lessee......................................................................................14
Section 8.2 Assignment by City..........................................................................................15
Section 8.3 Encumbrances ..................................................................................................15
Section 8.4 Leasehold Mortgage.........................................................................................15
Section 8.5 Sublease ...........................................................................................................18
ARTICLE IX MISCELLANEOUS PROVISIONS..................................................................19
Section 9.1 Waiver of Exemption .......................................................................................19
Section 9.2 Addresses.........................................................................................................19
Section 9.3 No Waiver ........................................................................................................19
Section 9.4 Lessee’s Subordination....................................................................................19
Section 9.5 Additional Charges as Rent .............................................................................19
Section 9.6 Subordination to Grant Assurances .................................................................19
Section 9.7 Non-Interference With Operation of the Airport .............................................20
Section 9.8 Emergency Closures ........................................................................................20
Section 9.9 Interpretation ....................................................................................................20
Section 9.10 Force Majeure..................................................................................................21
Section 9.11 Governing Law and Venue..............................................................................21
Section 9.12 Amendments and Waivers...............................................................................21
Section 9.13 Severability ......................................................................................................21
Section 9.14 Merger ..............................................................................................................21
Section 9.15 Relationship of Parties.....................................................................................21
Section 9.16 Further Assurances...........................................................................................22
Section 9.17 Required Federal Clauses ................................................................................22
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_____________CITY ____________LESSEE
AIRPORT LEASE AGREEMENT
THIS AIRPORT LEASE AGREEMENT (this “Agreement”) effective as of this
_________ day of _____________________________, 2026, (by and between the CITY OF
DENTON, TEXAS, a Texas home-rule municipal corporation (“City”), and Sheltair Aviation
Denton, LLC, a Texas, foreign limited liability company (the “Lessee” and, together with City,
the “Parties” and each a “Party”).
RECITALS
WHEREAS, City is the owner and operator of the Denton Enterprise Airport in the City of
Denton, Texas (the “Airport”);
WHEREAS, Lessee is the current lessee pursuant to that certain Consent to Lease
Assignment dated November 15, 2022, and March 7, 2023, for fixed base operations and hangar
leasing, as approved by Ordinance 23-496, and Ordinance 22-2353 (the “Existing Leases”); and
WHEREAS, the Existing Leases, prior to being assumed by Lessee, were approved by the
City pursuant to Ordinance No. 2005-020, Ordinance No. 2005-311, Ordinance No. 98-133,
Ordinance No. 2007-186, Ordinance No. 2009-018, Ordinance No. 2004-362, and Ordinance No.
2015-259 respectively, as each has been amended or assigned from time to time; and
WHEREAS, the Lessee also has a License Agreement with the City for use of certain apron
space which the Parties intend to add to the Leased Premises (as defined below); and
WHEREAS, the Lessee has requested to consolidate the Existing Leases and the License
Agreement covering property described in Exhibit A attached hereto; and
WHEREAS, Lessee desires, and City agrees, to enter into a new consolidated lease
agreement that will supersede the Existing Leases subject to the terms and conditions contained in
this Agreement; and
WHEREAS, City has the right, title and interest in and to the real property on the Airport,
together with the facilities, easements, rights, licenses, and privileges hereinafter granted, and has
full power and authority to enter into this Agreement in respect thereof;
WHEREAS, City owns that certain real property located within the Airport legally
described on Exhibit A and made part hereof which consists of One Million, Five Hundred
Seventy-Six Thousand, One Hundred Nine square feet or 36.19 acres (such real property, together
with all rights, privileges, easements and appurtenances benefiting such real property, are
collectively referred to herein as the “Leased Premises”);
WHEREAS, the Parties hereto wish to memorialize their agreement herein and they agree
as follows:
AGREEMENT
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NOW, THEREFORE, in consideration of the foregoing Recitals, which by this reference
are hereby incorporated into this Agreement, and the mutual covenants contained in this
Agreement, the Parties hereto hereby agree as follows:
ARTICLE I
LEASE OF LEASED PREMISES; TERM
Section 1.1 Lease of Leased Premises. City hereby leases to Lessee, and Lessee hereby
rents from City for its exclusive use the Leased Premises, all herein described rights incident
thereto, for and during the Lease Term and upon and subject to the terms, provisions and conditions
herein set forth. All improvements existing in, on or under the Leased Premises as of the
Commencement Date, as hereafter defined, shall be referred to herein as “Improvements”. All
improvements constructed by or on behalf of City from and after the Commencement Date, as
hereafter defined, shall be referred to herein as “City Improvements”.
Section 1.2 Lease Term. The term of this Agreement (the “Lease Term”) shall be for a
period of thirty (30) years commencing on __________________, 2026 (the “Commencement
Date”), and unless sooner terminated pursuant to the provisions of this Agreement, shall terminate
on _______________________, 2056.
Section 1.3 Holding Over; Rights at Expiration.
A. If Lessee retains all or any portion of the Leased Premises after the expiration or
termination of the Lease Term by lapse of time or otherwise, such holding over shall constitute the
creation of a tenancy at will with respect to such retained portion, terminable by City at any time
upon thirty (30) days prior written notice to Lessee. Under such tenancy at will, Lessee agrees to
pay to City as liquidated damages, and not as a penalty, 150 % of the last monthly rental rate under
this agreement for each month of holdover. All provisions of this Agreement shall remain in full
force and effect during such holdover period.
B. Lessee further agrees that, upon the expiration or termination of the Lease Term,
the Leased Premises will be delivered to Cityin as good a condition as when this Agreement began,
reasonable wear and tear and matters covered by insurance excepted and the Improvements, as
defined above, will be delivered to City in as good a condition as when such Improvements were
constructed, located, installed, placed or erected in, upon or under the Leased Premises, reasonable
wear and tear and matters covered by insurance excepted.
C. Except as otherwise expressly set forth elsewhere herein, Lessee shall have no
rights with respect to any improvements made to the Leased Premises during the Lease Term that
are not otherwise required to be removed by City.
Section 1.4 Inspection of Leased Premises; Access to Books and Records. City, through
its duly authorized agents, shall have at any reasonable time the full and unrestricted right to enter
the Leased Premises and the Improvements, as hereafter defined, for the purpose of periodic
inspection for fire protection, maintenance and to investigate compliance with the terms of this
Agreement; provided, however, that except in the case of emergency, such right shall be exercised
upon reasonable prior notice to Lessee and with an opportunity for Lessee to have an employee or
agent present, and will not interfere with Lessee’s construction or operations. City or its duly
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authorized representatives shall have the right at all reasonable times during business hours to
inspect the books, records and receipts of Lessee, for the purpose of verification. Such records
must be made available for City inspection within the Denton City limits within thirty (30) days
of such request. Lessee must maintain an acceptable cost accounting system. Lessee agrees to
provide City, the Federal Aviation Administration, and the Comptroller General of the United
States or any of their duly authorized representatives access to any books, documents, papers, and
records of the Lessee which are directly pertinent to this Agreement for the purpose of making
audit, examination, excerpts, and transcriptions, provided that the confidentiality of business
records is preserved subject to City’s obligations under state law or other similar federal laws. The
Lessee agrees to maintain all books, records, and reports required under this Agreement for a
period of not less than three years after final payment is made and all pending matters are closed
Section 1.5 Ownership of Leased Premises. City and Lessee intend and hereby agree
that the Leased Premises shall be and remain the property of City during the entire term of this
Agreement and thereafter.
Section 1.6 Existing Leases Terminated. City and Lessee hereby agree that the
Existing Leases and License Agreement are terminated and of no further force and effect.
ARTICLE II
RENT
Section 2.1 Rent
A. In consideration for the use of the Leased Premises herein granted, Lessee shall
pay to City the following rental amounts (the “Rent”). The monthly rent shall be in the sum of
$0.38 per net square foot per year, as determined and provided in Exhibit A, said sum being
stipulated herein as Five Hundred Ninety-Eight Thousand, Nine Hundred Twenty-One
Dollars and forty-two cents ($598,921.42), payable in twelve equal monthly installments of
Forty-Nine Thousand, Nine Hundred Ten Dollars and Twelve Cents ($49,910.12). All rental
payment will be due in advance on the first of each calendar month thereafter. City will mail a
courtesy statement on or about the first of each month. Failure to receive the statement in a
timely manner does not absolve Lessee from making rental payment on the first of each month.
B. The monthly rent shall be increased to $0.40 per net square foot, one year after
the commencement date.
C. The Rent for the Leased Premises shall be readjusted at the end of each two (2)
year period during the Lease Term, starting two (2) years after the Commencement Date and
every two (2) years thereafter, on the basis of the proportion that the then current United States
Consumer Price Index for all urban consumers (“CPI-U”) for the Dallas-Fort Worth Bureau of
Labor Statistics (1982-84 = 100) bears to that of the Commencement Date.
D. Lessee shall pay City a percentage of (i) all hangar and tie -down rentals collected
and (ii) fees collected by Lessee from persons renting facilities on the Leased Premises. Such
fees shall be equal to 12% on gross receipts or such other percentage as established by the City
Council from time to time. All such fees shall be paid monthly to City on or before the 15th day
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of each month during the Lease Term. The fees shall be accompanied by the ledger verifying
rental and fuel fees with at least as much information as provided on the sample ledger attached
as Exhibit C.
Section 2.2 Insufficient Funds Charge. There shall be an extra charge of THIRTY
DOLLARS ($30.00) on any check returned by the bank for insufficient funds or account not
existing.
Section 2.3 Time and Place of Payments. The Rent, as well as all other charges
hereunder, shall be payable in equal monthly installments in advance on or before the first
business day of each calendar month of the Lease Term at City’s offices of the Finance
Department of the City of Denton, 215 E. McKinney, Denton, Texas, unless otherwise
designated in writing by the City.
Section 2.4 Delinquent Rent. In the event Rent due pursuant to Section 2.1 or any other
amounts payable by Lessee hereunder shall not be paid by Lessee on the due date thereof, Lessee
shall pay to City as additional Rent, an interest charge of five percent (5%), or the maximum
percentage allowed by law, whichever is greater, of the amount due for each full calendar month
of delinquency, computed as simple interest. No interest shall be charged until payment is thirty
(30) days overdue, but any such interest assessed thereafter shall be computed from the due date.
ARTICLE III
OCCUPANCY, USE AND CONDITIONS OF LEASED PREMISES
Section 3.1 Condition of Leased Premises. Lessee accepts the Leased Premises in their
present “as is” condition. Lessee releases Cityand holds Cityand City’s officers, directors, elected
and appointed officials, employees, and agents harmless for any claims arising out of or related to
any condition of the Leased Premises.
Section 3.2 Construction and Ownership of Improvements.
A. Lessee shall make a minimum capital investment of Three Million Three Hundred
Thousand Dollars ($3,330,000.00) in life extension improvements (“Life Extension
Improvements”) to the Leased Property within the first ten (10) years of the Lease Term. Such Life
Extension Improvements shall be applied exclusively to the designated surveyed properties set
forth in Section 3.2.A(a)-(o) and shall be consistent with Generally Accepted Accounting
Principles standards for capital expenditures, with the intent of enhancing the useful life of the
building and ramp infrastructure:
(a) Surveyed Tract 7.
(b) Surveyed Tract 8.
(c) Surveyed Tract 3.
(d) Surveyed Tract 4, Parcel 1
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(e) Surveyed Tract 4, Parcel 2
(f) Surveyed Tract 4, Parcel 3
(g) Surveyed Tract 5.
(h) Surveyed Tract 9.
(i) Surveyed Tract 10.
(j) Surveyed Tract 11.
(k) Surveyed Tract 12.
(l) Surveyed Tract 13.
(m) Surveyed Tract 14.
(n) Surveyed Tract 15.
(o) All surveyed fuel farms.
B. The Lessee shall use the Leased Premises for the following aeronautical uses: Fixed
Based Operator and hangar rental services. Any changes in aeronautical use must be approved in
writing by the Director of Airport or designee. With respect to the hangar leasing services use, all
subtenants of Lessee will be required to follow all Laws and Regulations, including the Airport
Minimum Operating Standards and Airport Rules and Regulations. The Lessee shall ensure that
its subtenants comply with such obligations and provide an annual report to City as to the uses of
the hangars by its subtenants.
C. Lessee will own the Improvements during the Lease Term only. Effective upon the
expiration or termination of this Agreement, the Improvements shall become the property of City,
without the payment by City of any compensation or other consideration for any Improvements,
and title to the Improvements shall merge with the title of, or be otherwise considered and deemed
a part of, the real property of City, free and clear of any claim of Lessee and any persons or entities
claiming under or through Lessee including, without limitation, the trustee, beneficiary or holder
of any mortgage or deed of trust. Any other personal property of Lessee that can be removed by
Lessee without material damage to the Leased Premises or to the Improvements may remain the
personal property of Lessee and may be removed by Lessee at any time on or before the end of the
Lease Term. Lessee shall, in removing any such personal property, repair all damage to the Leased
Premises and Improvements caused by such removal.
Section 3.3 Access. City agrees that if Lessee is not in breach of this Agreement, Lessee
and Lessee’s employees, officers, directors, sublessees (that are approved by City pursuant to this
Agreement), contractors, subcontractors, suppliers, agents, invitees, and other representatives
(“Lessee’s Associates”) are authorized to ingress and egress across the common areas of the
Airport (in the areas designated by City, for the purposes for which they were designed, and as
permitted by applicable Laws and Regulations as defined in Section 3.4) on a non-exclusive basis
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and to the extent reasonably necessary for Lessee’s use, occupancy, and operations at the Leased
Premises. Lessee agrees to comply with any driver training program or guidelines established by
the City. Lessee further agrees to ensure that Lessee’s Associates shall comply with such program
or guidelines. During special events at the Airport, Lessee acknowledges that the standard
operation procedure at the Airport may be altered such that egress and ingress to the Leased
Premises may be altered by City. City will notify Lessee in writing of any special events or
closures that will impede Lessee’s use of the Leased Premises. Lessee’s failure to comply with
the altered procedure is a default of this Agreement, and City may proceed to terminate this
Agreement. In accordance with Executive Order 13513, “Federal Leadership on Reducing Text
Messaging While Driving”, (10/1/2009) and DOT Order 3902.10, “Text Messaging While
Driving”, (12/30/2009), the Federal Aviation Administration encourages recipients of Federal
grant funds to adopt and enforce safety policies that decrease crashes by distracted drivers,
including policies to ban text messaging while driving when performing work related to a grant or
subgrant. In support of this initiative, City encourages the Lessee to promote policies and
initiatives for its employees and other work personnel that decrease crashes by distracted drivers,
including policies that ban text messaging while driving motor vehicles while performing work
activities associated with the project.
Section 3.4 Use of Leased Premises and Compliance with all Laws and Regulations.
Lessee agrees that it shall use the Leased Premises and the Improvements only for aeronautical
purposes and Lessee and Lessee’s Associates shall comply at all times, at Lessee’s sole cost, with
any and all laws and regulations (as amended or otherwise modified from time to time) that are
applicable to Lessee’s use, occupancy, or operations at the Leased Premises, the Improvements
or the Airport (the “Laws and Regulations”), which include, but are not limited to, all laws,
statutes, ordinances, regulations, rules, orders, writs, judgments, decrees, injunctions, directives,
rulings, guidelines, standards, codes, policies, common law, and other pronouncements of any
kind having the effect of law that may be applicable at any time during the term of this
Agreement including, but not limited to, the Airport Rules and Regulations, Minimum Operating
Standards, master plans and zoning codes, and all Laws and Regulations pertaining to the
environment (the “Environmental Laws”); any and all plans and programs developed in
compliance with such requirements (including, but not limited to, any Airport Security Plan); and
all lawful, reasonable, and nondiscriminatory Airport policies and other requirements. Lessee
shall provide all required notices under the Laws and Regulations. Upon a written request by
City, Lessee will verify, within a reasonable time frame, compliance with any Laws and
Regulations. Further, in its use of the Leased Premises and the Improvements, Lessee shall
comply with the following:
A. Address. Lessee shall file with the Airport Director and keep current its mailing
addresses, telephone numbers, and contacts where it can be reached in an emergency.
B. List of Sublessee and Aircraft. At least quarterly, Lessee shall file with the Airport
Director and keep current a list of its sublessees and a list of all aircraft hangared or tied down on
the Leased Premises within the previous four (4) month period.
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Section 3.5 No Unauthorized Use. Lessee and Lessee’s Associates shall use the
Leased Premises, the Improvements and the Airport only for purposes that are expressly
authorized by this Agreement and shall not engage in any unauthorized use of the same.
Unauthorized uses include, but are not limited to, restricting access on any road or other area that
Lessee does not lease; placing waste materials on the Airport or disposing of such materials in
violation of any Laws and Regulations; any use that would constitute a public or private nuisance
or a disturbance or annoyance to other Airport users; driving a motor vehicle in a prohibited
Airport location; the use of automobile parking areas in a manner not authorized by City; any use
that would interfere with any operation at the Airport or decrease the Airport’s effectiveness (as
determined by City in its sole discretion); and any use that would be prohibited by or would
impair coverage under either Party’s insurance policies or would cause an increase in the existing
rate of insurance upon the Leased Premise.
Section 3.6 Permits and Licenses. Lessee shall obtain and maintain in current status all
permits and licenses that are required under any Laws and Regulations in connection with Lessee’s
construction of Improvements and the use, occupancy, or operations at the Leased Premises, the
Improvements or the Airport. Those permits and licenses include, but are not limited to, (i) all
contractors doing work on the Leased Premises, including work on or for the Improvements, must
be licensed by the State of Texas, (ii) prior to commencing construction of any Improvements, a
permit must be obtained from the City of Denton and a copy of the permit must be furnished to
the Airport Manager, and (iii) if applicable, clearance must be obtained from the responsible health
department or other agency. In the event that Lessee receives notice from any governmental entity
that Lessee lacks, or is in violation of, any such permit or license, Lessee shall provide City with
timely written notice of the same.
Section 3.7 Payment of Taxes. Lessee shall pay (before their respective due dates) all
taxes, fees, assessments, and levies that relate to Lessee’s use, occupancy, or operations at the
Leased Premises, the Improvements or the Airport and all other obligations for which a lien may
be created relating thereto (including, but not limited to, utility charges and work for any
Improvements). Lessee shall be responsible for any and all taxes generated by the Denton County
Tax Assessor / Collector.
Section 3.8 No Liens. No liens may be placed upon the Leased Premises. Within thirty
(30) days, Lessee shall pay all lawful claims made against City and discharge all liens filed or
which exist against the Leased Premises or any other portion of the Airport (other than Lessee’s
trade fixtures or trade equipment) to the extent such claims arise out of or in connection with,
whether directly or indirectly, the failure to make payment for work done or materials provided by
Lessee, its contractors, subcontractors, or materialmen. However, Lessee shall have the right to
contest the amount or validity of any such claim or lien without being in default under this
Agreement upon furnishing security in form acceptable to City, in an amount equal to one hundred
percent (100%) of such claim or lien, which insures that such claim or lien will be properly and
fully discharged forthwith in the event that such contest is finally determined against Lessee or
City. City shall give timely notice to Lessee of all such claims and liens of which it becomes
aware. When contracting for any work in connection with the Leased Premises or the
Improvements, Lessee shall include in such contract a provision prohibiting the contractor or any
subcontractor or supplier from filing a lien or asserting a claim against City’s real property or any
interest therein. Lessee is solely responsible for ensuring that all requirements are met such that
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such lien waivers are effective and enforceable (such as filing such contracts, if necessary).
Furthermore, when completed, the Improvements on the Leased Premises shall be free from all
construction liens.
Section 3.9 Compliance with 2252.909 of Texas Government Code.
A. In connection with Lessee’s construction, alteration or repair of the Improvements
or any other construction on the Leased Property, Lessee shall require their contractor to:
(a) execute a payment bond that conforms to Subchapter I, Chapter 53,
Property Code; and
(b) execute a performance bond in an amount equal to the amount of the
contract for the protection of the City and conditioned on the faithful performance of the
contractor’s work in accordance with the plans, specifications, and contract documents.
B. Lessee shall provide City with a notice of commencement of construction no later
than ninety (90) days prior to the commencement of construction, alteration, or repair of any
improvement to the Leased Property (“Notice of Commencement”), which will materially conform
with the requirements under Texas Local Government Code 2252.909.
C. Notice of Commencement must:
(a) identify the public property where the work will be performed;
(b) described the work to be performed;
(c) state the total cost of the work to be performed;
(d) include copies of the performance and payment bonds required; and
(e) include a written acknowledgment signed by the contractor stating that
copies of the required performance payment bonds will be provided to all subcontractors not
later than the fifth day after the date a subcontract is executed.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.1 Representations by City. City represents and warrants that it has the right,
power, and legal capacity to enter into and perform its obligations under this Agreement, has duly
executed and delivered this Agreement, and that this Agreement constitutes a legal, valid, and
binding obligation of City.
Section 4.2 Representations by Lessee. Lessee represents and warrants that it has the
right, power, and legal capacity to enter into and perform its obligations under this Agreement, has
duly executed and delivered this Agreement, and that this Agreement constitutes a legal, valid, and
binding obligation of Lessee.
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ARTICLE V
OBLIGATIONS OF LESSEE
Section 5.1 Plans and Specifications. With respect to any Improvements, Lessee shall
select qualified architects and engineers to prepare, prior to construction or on a phased basis
during construction, the architectural, site, structural, mechanical, and/or electrical drawings and
specifications for the Improvements in the form and content required by the appropriate local
planning and zoning authorities and pursuant to all applicable Laws and Regulations and this
Agreement, which shall be approved in writing by the Director of Airport or designee (collectively,
the “Plans and Specifications”).
Section 5.2 Capital Expenditure Report. Lessee shall, at its own expense, provide City
(not more than once each Lease year) a report of the total capital expenditures relating to the Life
Extension Improvements that have been incurred as of the date of the report including detailed
invoices and confirmation of the cost of the Life Extension Improvements.
Section 5.3 Operations and Maintenance.
A. Lessee shall maintain the Leased Premises and all Improvements in a condition that
is clean, free of debris, safe, sanitary, and in good repair and shall not accumulate or permit the
accumulation of any trash, refuse, debris, or of anything that is unsightly, which creates a fire
hazard,nuisance,or causes inconvenience to adjoining properties. Lessee shall at its own expense
create, execute, and maintain a comprehensive landscaping and irrigation plan for the Leased
Premises in accordance with relevant local landscaping codes. Lessee shall perform all work in
accordance with Laws and Regulations and in a good and workmanlike manner. Lessee shall
promptly remedy any condition that fails to meet this standard. Without limiting the foregoing
obligations, Lessee shall not store on the Leased Premises any inoperable equipment, discarded
or unsightly materials, or materials likely to create a hazard; shall not use areas outside of enclosed
buildings for storage; and shall store trash in covered metal receptacles or any other receptacles
approved in writing by the Director of Airport, or designee. Any substance or material that is
regulated by any Environmental Law (“Hazardous Materials”) shall be governed by Section 5.8.
In addition, Lessee agrees to comply with all applicable provisions of City’s Texas Pollutant
Discharge Elimination Multi-Sector General Permit.
B. Lessee shall conduct a condition assessment on all Improvements no later than the
tenth (10th) anniversary of the Commencement Date, and every five (5) year anniversary thereafter
(the “Condition Assessment). The Condition Assessment shall be conducted by a licensed
commercial building inspector, whom shall be approved in writing by the City. The Condition
Assessment, which shall be at the Lessee’s sole expense, shall, at minimum,examine the building’s
structural components, electrical, plumbing, heating and cooling systems, roof, and asphalt and/or
concrete paving. The Condition Assessment shall be provided to the City within 30 days of the
Condition Assessment being due. Any extensions must be requested by the Lessee and approved
by the City in writing. Any deficiencies due to Lessee’s failure to meet its obligations under this
Agreement shall be corrected at the Lessee’s sole expense within one (1) year of the completion
of the Condition Assessment, with Lessee providing the City documentation of such correction.
Failure to correct such deficiencies will constitute a breach of this Agreement.
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Section 5.4 Utilities. City represents that there are water, sewer, and 3-phase electrical
lines accessible within the general vicinity of the Leased Premises. Lessee shall be responsible, at
Lessee’s sole cost and expense, for obtaining all utility connections at or for the Leased Premises
and the Improvements. Further, Lessee shall pay for telecommunications, television, internet, gas,
light bulbs, electricity, water, sewer, and garbage and trash removal services provided to or used
by Lessee and shall make such deposits as are required to secure service. Lessee shall be
responsible for any water or sewer impact fees incurred by their use of the Leased Premises. Any
repairs of the utility lines, other than those which are the responsibility of the utility service, are
the responsibility of Lessee. If utilities are billed to a common meter, Lessee shall pay to City the
pro-rated amount based on square footage leased.
Section 5.5 Signs. With the exception of signage denoting an on-site, permitted
business and in compliance with any applicable Laws and Regulations, Lessee shall not place, or
cause to be placed, any sign or signs on the Leased Premises or the Improvements unless otherwise
agreed to in writing by the Director of Airport, or designee. Any signage must meet all applicable
Laws and Regulations.
Section 5.6 Security. Lessee is responsible to comply (at Lessee’s sole cost) with all
security measures that City, the United States Transportation Security Administration, the United
States Department of Homeland Security (“Homeland Security”), the United States Federal
Aviation Administration (“FAA”), or any other governmental entity having jurisdiction may
require in connection with the Airport, including, but not limited to, any access credential
requirements, any decision to remove Lessee’s access credentials, and any civil penalty obligations
and other costs arising from a breach of security requirements caused or permitted by Lessee or
Lessee’s Associates. Lessee agrees that Airport access credentials are the property of City and
may be suspended or revoked by City for security-related reasons in its sole discretion at any time.
Lessee shall pay all fees associated with such credentials, and Lessee shall immediately report to
the Airport Manager any lost credentials or credentials that Lessee removes from any employee or
any of Lessee’s Associates. Lessee shall protect and preserve security at the Airport. Lessee
acknowledges that FAA, Homeland Security, or a subdivision of either may enact laws or
regulations regarding security at general aviation airports such that City may not be able to comply
fully with its obligations under this Agreement, and Lessee agrees that City will not be liable for
any damages to Lessee or Lessee’s personal property that may result from said noncompliance.
Section 5.7 Obstruction Lights. Lessee shall, at its expense, provide and maintain
obstruction lights on any structure on the Leased Premises, including the Improvements, if required
by City or FAA regulations. Any obstruction lights so required shall comply with the
specifications and standards established for such installations by City or FAA.
Section 5.8 Hazardous Materials.
A. No Violation of Environmental Laws. Lessee shall not cause or permit any
Hazardous Materials to be used, produced, stored, transported, brought upon, or released on, under,
or about the Leased Premises or the Airport by Lessee or Lessee’s Associates in violation of
applicable Environmental Laws. Lessee is responsible for any such violation as provided by
Section 7.1. In addition to the above, Lessee specifically agrees to comply with all applicable
standards, orders, and regulations issued pursuant to the Clean Air Act (42 U.S.C. §§ 7401-7671q)
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and the Federal Water Pollution Control Act as amended (33 U.S.C. §§ 1251-1387). Lessee shall
not be responsible for any violations occurring prior to Lessee’s entering into the Existing Leases.
B. Response to Violations. Lessee agrees that in the event of a release or threat of
release of any Hazardous Material by Lessee or Lessee’s Associates at the Airport, Lessee shall
provide City with prompt notice of the same. Lessee shall respond to any such release or threat of
release in accordance with applicable Laws and Regulations. If City has reasonable cause to
believe that any such release or threat of release has occurred, City may request, in writing, that
Lessee conduct reasonable testing and analysis (using qualified independent experts acceptable to
City) to show that Lessee is complying with applicable Environmental Laws. City may conduct
the same at Lessee’s expense if Lessee fails to respond in a reasonable manner. Lessee shall cease
any or all of Lessee’s activities as City determines necessary, in its sole and absolute discretion, in
connection with any investigation, cure, or remediation. If Lessee or Lessee’s Associates violate
any Environmental Laws at the Airport (whether due to the release of a Hazardous Material or
otherwise), Lessee, at Lessee’s sole expense, shall have the following obligations, which shall
survive any expiration or termination of this Agreement: (i) promptly remediate such violation in
compliance with applicable Environmental Laws; (ii) submit to City a written remediation plan,
and City reserves the right to approve such plan (which approval shall not be unreasonably
withheld) and to review and inspect all work; (iii) work with City and other governmental
authorities having jurisdiction in connection with any violation; and (iv) promptly provide City
copies of all documents pertaining to any environmental concern that are not subject to Lessee’s
attorney-client privilege.
C. Obligations upon Termination and Authorized Transfers. Upon any expiration or
termination of this Agreement or any change in possession of the Leased Premises authorized by
City, Lessee shall demonstrate to City’s reasonable satisfaction that Lessee has removed any
Hazardous Materials and is in compliance with applicable Environmental Laws. Such
demonstration may include, but is not limited to, independent analysis and testing to the extent
that facts and circumstances warrant analysis and testing, such as evidence of past violations or
specific uses of the Leased Premises. If the site is contaminated during Lessee’s possession, Lessee
shall bear all costs and responsibility for the required clean up, and shall hold City, its officers,
elected and appointed officials, employees, and agents harmless therefrom. Notwithstanding
anything to the contrary, the obligations of this Section 5.8 shall survive any termination of this
Agreement.
Section 5.9 Trash, Garbage, and Other Refuse. Lessee shall pick up and provide for a
complete and proper arrangement for the adequate sanitary handling and disposal, away from the
Airport through the City or any other licensed refuse hauler. Lessee is responsible for contacting
the Master Refuse Hauler and arranging for disposal and payment of such services. Lessee shall
provide and use suitable covered metal receptacles, or any other receptacles approved by the
Director of Airport, or designee, for all such garbage, trash, and other refuse on the Leased
Premises. Lessee shall not pile boxes, cartons, barrels, pallets, debris, or similar items in an
unattractive or unsafe manner, on or about the Leased Premises.
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ARTICLE VI
INDEMNIFICATION AND INSURANCE
Section 6.1 Insurance. Lessee agrees to purchase general liability covering the Lessee
and Lessee’s Associates, and its operations on the Airport as described in Section 3 in an amount
not less than $1,000,000 per occurrence and provide coverage for premises/operations and
contractual liability AND where exposure exists in the opinion of the City, coverage for:
products/completed operations; explosions, collapse, and underground property damage; and
environmental impairment.
A. All risk property insurance on a one hundred percent (100%) replacement cost basis
covering loss or damage to all facilities and improvements located on the Lease premises, either
as a part of this Lease Agreement or erected by the Lessee subsequent to this Lease Agreement.
Covered perils shall include, but not be limited to, Fire, Extended Coverage, and Vandalism &
Malicious Mischief. Under no circumstances shall the City be liable for any damages to fixtures,
merchandise, or personal property of the Lessee or its sub-lessees. The City of Denton will be
shown as a loss payee, as their interest may appear.
B. Additional Insurance requirements may be necessary as identified in the Airport
Minimum Operating Standards for specific aeronautical uses.
C. Coverage Requirements
i. All liability policies shall be endorsed to include the city of Denton, and
its officers and employees as an Additional Insured. All all-risk property
policies shall be endorsed to name the City of Denton as a loss payee. All
required insurance policies shall provide for a minimum of 30 days written
notice to the City of any cancellation or material change to the policy.
ii. All insurance required by the Lease Agreement must be issued by a
company or companies of sound and adequate financial responsibility and
authorized to do business in the State of Texas. All policies are subject to
the examination and approval of the City’s office of Risk Management for
their adequacy as to content, form of protection and providing company.
iii. Required insurance naming the City as an additional insured must be
primary insurance and not contributing with any other insurance available
to the City whether from a third-party liability policy or other. Said limits
of insurance shall in no way limit the liability the Lessee hereunder. Such
policies shall contain a waiver of subrogation in favor of the City of
Denton.
iv. The City shall be provided with a copy of all such policies and renewal
certificates within ten (10) days of expiration of any policy required
herein. Failure to Lessee to comply with the minimum specified amounts
or types of insurance as required by City shall constitute Lessee’s default
of this Lease Agreement.
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v. During the Lease Term, or any extension thereof, City herein reserves the
right to, with one hundred twenty (120) days’ notice, adjust or increase the
liability insurance amounts required of the Lessee, and to require any
additional rider, endorsement, provisions, or certificates of insurance, and
Lessee hereby agrees to provide any such insurance requirements as may
be required by City.
Section 6.2 Lessee’s Indemnification and Duty to Pay Damages.
A. LESSEE SHALL HOLD CITY AND CITY’S OFFICERS, ELECTED AND
APPOINTED OFFICIALS, EMPLOYEES, AND AGENTS EXEMPT AND HARMLESS,
TO THE EXTENT ALLOWED BY LAW, FROM AND AGAINST ANY AND ALL CLAIMS,
DEMANDS, SUITS, JUDGMENTS, COSTS, AND EXPENSES ASSERTED BY ANY
PERSON OR PERSONS (INCLUDING AGENTS OR EMPLOYEES OF CITY, LESSEE,
OR SUBLESSEE) BY REASON OF DEATH OR INJURY TO PERSONS OR LOSS OF OR
DAMAGE TO PROPERTY RESULTING FROM LESSEE’S OPERATIONS, OR
ANYTHING DONE OR OMITTED BY LESSEE UNDER THIS AGREEMENT EXCEPT
TO THE EXTENT THAT SUCH CLAIMS, DEMANDS, SUITS, JUDGMENTS, COSTS,
AND EXPENSES MAY BE ATTRIBUTED TO THE INTENTIONAL ACTS OR
OMISSIONS OF CITY, ITS AGENTS, OR EMPLOYEES.
B.CITY SHALL NOT BE LIABLE TO LESSEE FOR ANY DAMAGE BY OR
FROM ANY ACT OR NEGLIGENCE OF ANY CO-TENANT OR OTHER OCCUPANT
OF THE SAME BUILDING, OR BY ANY OWNER OR OCCUPANT OF ADJOINING OR
CONTIGUOUS PROPERTY.
C. LESSEE AGREES TO PAY FOR ALL DAMAGES TO THE LEASED
PREMISES, THE IMPROVEMENTS, ITS APPARATUS, OR APPURTENANCES
CAUSED BY LESSEE’S MISUSE OR NEGLECT THEREOF.
D. LESSEE SHALL BE RESPONSIBLE AND LIABLE FOR THE CONDUCT
OF LESSEE’S ASSOCIATES IN, ON AND AROUND THE LEASED PREMISES.
ARTICLE VII
DEFAULT AND REMEDIES
Section 7.1 Lessee’s Default. The occurrence of any of the following events shall
constitute a default by Lessee under this Agreement unless cured within thirty (30) days following
written notice of such violation from City: (i) Lessee fails to timely pay any Rent; (ii) Lessee or
Lessee’s Associates violate any requirement under this Agreement (including, but not limited to,
abandonment of the Leased Premises); (iii) Lessee assigns or encumbers any right in this
Agreement, delegates any performance hereunder, or subleases any part of the Leased Premises
(except as expressly permitted in this Agreement); (iv) Lessee files a petition in bankruptcy or has
a petition filed against Lessee in bankruptcy, insolvency, or for reorganization or appointment of
a receiver or trustee which is not dismissed within sixty (60) days; (v) Lessee petitions for or enters
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into an arrangement for the benefit of creditors, or suffers this Agreement to become subject to a
writ of execution and such writ is not released within thirty (30) days; (vi) Lessee defaults in
constructing any Improvements that are required to be constructed under this Agreement; or (vii)
Lessee dissolves or dies.
Section 7.2 Default by City. City shall not be in default under this Agreement unless
City fails to perform an obligation required of City under this Agreement within thirty (30) days
after written notice by Lessee to City. If the nature of City’s obligation is such that more than
thirty (30) days are reasonably required for performance or cure, City shall not be in default if City
commences performance within such thirty (30) day period and thereafter diligently prosecutes
the same to completion.
Section 7.3 Remedies for Failure to Pay Rent. If any Rent required by this Agreement
shall not be paid when due, City shall have the option to:
A. Terminate this Agreement, take possession of the Improvements, resume
possession of the Leased Premises for its own account, and recover immediately from Lessee the
differences between the Rent and the fair rental value of the property for the term, reduced to
present worth, or
B. Terminate this Agreement, take possession of the Improvements, resume
possession of the Leased Premises, re-lease the Leased Premises for the remainder of the term for
the account of Lessee, and recover from Lessee, at the end of the term or at the time each payment
of Rent comes due under this Agreement as City may choose, the difference between the Rent and
the rent received on the re-leasing or renting.
In either event, City shall also recover all expenses incurred by reason of breach, including
reasonable attorney’s fees.
Section 7.4 Remedies for Breach of Agreement. If Lessee shall fail to perform or breach
any provision of this Agreement other than the agreement of Lessee to pay Rent, City shall provide
written notice to Lessee specifying the performance required. Thirty (30) days after such notice is
provided under this Section 7.4, City may terminate this Agreement or take any such action it is
legally entitled to take, including instituting litigation to compel performance of this Agreement.
Should litigation be filed by City and it is the prevailing party in that litigation, Lessee shall be
liable for all expenses related to such litigation, including City’s attorney’s fees. The duties and
obligations imposed by the Agreement and the rights and remedies available thereunder are in
addition to, and not a limitation of, any duties, obligations, rights and remedies otherwise imposed
or available by law.
Section 7.5 Survival. The provisions of this Article VII and the remedies and rights
provided in this Article VII shall survive any expiration or termination of this Agreement.
ARTICLE VIII
ASSIGNMENT AND SUBLEASING
Section 8.1 Assignment by Lessee.
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A. Except as expressly set forth herein. Lessee shall not assign any of its rights under
this Agreement, including, but not limited to, rights in any Improvements, (whether such
assignment is voluntarily or involuntarily, by merger, consolidation, dissolution, change in control,
or any other manner), and shall not delegate any performance under this Agreement, except with
the prior written consent of City to any of the same, in City’s sole discretion. As a condition of
obtaining such consent, the City reserves the right to require the transferee receiving any such
rights from Lessee to execute a new lease agreement provided by City. Regardless of City’s
consent, Lessee shall not be released from any obligations for matters arising during the time when
this Agreement was in effect. Any purported assignment or delegation of rights or delegation of
performance in violation of this section is void.
B. Upon the expiration or termination of this Agreement, Lessee hereby assigns,
transfers, and conveys to City, without warranty, the following:
(a) The right to the use of the Plans and Specifications on the Premises to the
extent owned by Lessee;
(b) Any copyright interests in the Plans and Specifications held by Lessee; and
(c) The right to enforce, in Lessee’s own name as a proper party, (i) any
subcontracts related to the Improvements or other maintenance or services contracts in force with
respect to the Leased Premises or Improvements and any warranties arising under any of them or
in connection with the performance thereof, as the case may be.
Section 8.2 Assignment by City. City shall have the right, in City’s sole discretion, to
assign any of its rights under this Agreement (and in connection therewith, shall be deemed to have
delegated its duties), and upon any such assignment, Lessee agrees that Lessee shall perform its
obligations under this Agreement in favor of such assignee.
Section 8.3 Encumbrances. Lessee shall not encumber or permit the encumbrance of
any real property at the Airport. Except for a Leasehold Mortgage as defined in Section 8.5, Lessee
shall not encumber or permit the encumbrance of any of Lessee’s rights under this Agreement
without City’s prior written consent, in City’s sole discretion. Lessee shall not record this
Agreement or any document or interest relating thereto. Any purported encumbrance of rights in
violation of this Section 8.3 is void.
Section 8.4 Leasehold Mortgage –
A. Right to Mortgage. Lessee may encumber its leasehold estate by granting a mortgage
or other similar instrument creating a mortgage lien against the Lessee’s leasehold interest. Any
such instrument which creates a first mortgage lien is hereinafter referred to as “Leasehold
Mortgage”, and the holder thereof is referred to as “Leasehold Mortgagee”) during the Lease Term
and any extension thereof; provided that, City shall not be obligated to, nor deemed to have
subjected or subordinated City’s fee simple interest in the Leased Premises to any Leasehold
Mortgage, nor subordinated the City’s interest in this Lease to such Leasehold Mortgage. City’s
interests in the fee and in this Lease are and shall always remain superior and prior in right to any
LeaseholdMortgage.
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B. Notice of Default, Default. A Leasehold Mortgagee may provide written notice of its
Leasehold Mortgage in the same manner and at the same address as required by this Lease for
notices delivered to City, together with the name and address of the Leasehold Mortgagee. In the
event such notice is delivered to City, City upon serving Lessee with any notice of default under
this Lease, shall also serve a copy of that notice of default upon the Leasehold Mortgagee in the
same manner as required by this Lease for notices delivered to Lessee. The delivery shall be made
at the address the Leasehold Mortgagee shall have designated in writing to City.
C. Right to Cure. In case Lessee shall default under any of the provisions of this Lease,
the Leasehold Mortgagee shall have the right to cure such default, within the time periods set forth
for Lessee in this Lease Agreement, whether same consists of the failure to pay rent and other
payments as further set forth in Article II, or the failure to perform any other matter or thing which
Lessee is required to do or perform and City shall accept such performance on the part of the
Leasehold Mortgagee as though the same had been done or performed by Lessee subject to City’s
rights to damages, restitution, or other legal or equitable monetary remedies related directly to the
default(s) at issue. The Leasehold Mortgagee, upon receiving such notice, shall have, in addition
to any time to cure a default (a “Cure Period”) extended to Lessee under the terms of this Lease, a
period of an additional thirty (30) days within which to cure the default or cause same to be cured
or, if such default cannot reasonably be cured within such 30 days, to commence to cure such
default with diligence and continuity, notwithstanding the foregoing:
i. Where a provision of this Lease provides less than a thirty (30) day Cure
Period, the Leasehold Mortgagee shall also have an additional fifteen (15)
days Cure Period following the Lessee’s Cure Period; or
ii. Where a provision of this Lease expressly provides that Lessee has no
opportunity to cure, the Leasehold Mortgagee shall have no CurePeriod.
In case Lessee shall default under any of the provisions of this Lease, the Leasehold
Mortgagee shall have the right to cure such default, within the time periods set forth above,
whether same consists of the failure to pay rent and other payments as further set forth in Article
II, or the failure to perform any other matter or thing which Lessee is required to do or perform
and City shall accept such performance on the part of the Leasehold Mortgagee as though the
same had been done or performed by Lessee.
D. Cure of Default or Termination. City will take no action to affect a termination of
the Lease until such time as the Cure Period provided herein has expired and the defaults remain
uncured. During the Cure Period, the Leasehold Mortgagee shall be entitled to: 1) obtain possession
of the Premises (including possession by a receiver) and cure such default in the case of a default
which is susceptible of being cured when the Leasehold Mortgagee has obtained possession; or 2)
institute foreclosure proceedings or otherwise acquire Lessee’s interest under this Lease with
diligence and continuity and thereafter proceed to cure such default; provided, however, that the
Leasehold Mortgagee shall not be required to continue such possession or continue such
foreclosure proceedings if the default which would have been the reason for City serving such
notice of default shall be cured, and provided further, that nothing in this paragraph shall preclude
City from exercising any other rights or remedies under this Lease with respect to the default.
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E. Foreclosure. The Leasehold Mortgagee may become the legal owner and holder of this
Lease by foreclosure of its Leasehold Mortgage or as a result of the assignment of this Lease in
lieu of foreclosure, subject to City’s written consent, which shall not be unreasonably withheld,
and effective upon such assignment whereupon such Leasehold Mortgagee or assignee shall
become and remain liable under this Lease as provided in this paragraph, except that such
Leasehold Mortgagee may assign this Lease with City’s consent, which shall not be unreasonably
withheld, and subject to the assignee’s meeting the requirements of sub-paragraph I of this Section
8.4 to the City’s reasonable satisfaction, and effective upon such assignment, the new lessee shall
become and remain liable to CitL under this Lease, and the Leasehold Mortgagee shall no longer
be liable to City. If a Leasehold Mortgagee shall become the owner or holder of Lessee’s interest
in this Lease by foreclosure of its Leasehold Mortgage or by assignment of this Lease in lieu of
foreclosure, the term “Lessee” as used in this Lease, shall include the owner or holder of Lessee’s
interest in the event of a sale, assignment or other disposition of Lessee’s interest in this Lease by
the Leasehold Mortgage.
Reference in this Lease to acquisition of Lessee’s interest in this Lease by the Leasehold
Mortgagee shall be deemed to include, where circumstances require, to acquisition of Lessee’s
interest in this Lease by any purchaser at a sale on foreclosure of the Leasehold Mortgage and
provisions applicable to the Leasehold Mortgagee in such instance or instances shall also be
applicable to any such purchaser. Leasehold Mortgagee’s acquisition of Lessee’s interest in this
Lease and any assignment of the acquired interest by the Leasehold Mortgagee shall not be deemed
a novation of Lessee’s obligations under this Lease. City does not authorize any novation of
Lessee’s obligations under this Lease.
F. Prohibition on Fee Simple Transfer. So long as Lessee’s interest in this Lease shall
be mortgaged to a Leasehold Mortgagee, the parties agree, for the benefit of such Leasehold
Mortgagee, that City shall not sell, grant or convey to Lessee all or any portion of City’s fee simple
title to thePremises without thepriorwrittenconsent of such Leasehold Mortgagee (which consent
shall not be unreasonably withheld, conditioned, or delayed, provided the parties agree in writing
that such sale, grant, or conveyance shall not result in a merger of this Lease into fee simple title to
the Premises). In the event of any such sale, grant, or conveyance by City to Lessee, City and
Lessee agree that no such sale, grant or conveyance shall create a merger of this Lease into a fee
simple title to the Premises. This paragraph shall not be construed to prevent any, or to require any
consent of any Leasehold Mortgagee or Lessee to any, sale, grant, or conveyance of City’s fee
simple title by City to any person, firm, or corporation other than Lessee, its successors, legal
representatives, and assigns.
G. Leasehold Mortgagee. Reference in this Lease to a Leasehold Mortgagee shall be
deemed to refer where circumstances require, to any assignee of a Leasehold Mortgagee; provided
that such assignee shall forward to City, pursuant to Section 8.4.B a duplicate original of the
assignment of the Leasehold Mortgage in a form proper for recording or a copy of such assignment,
as recorded in the Public Records, together with a written notice setting forth the name and address
of the assignee and, to the extent available, the name, telephone number, facsimile number and
email address of a representative of the assignee to whom notices may be sent.
H. Subordination. Any leasehold mortgage shall be specifically subject and subordinate
to City’s rights under this Lease and City’s fee simple interest in the Leased Premises. Despite any
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provision which is or may appear to the contrary in this Lease, under no circumstances whatsoever
shall the fee simple title interest of City in the Leased Premises, or any portion of same, be
subordinated to the leasehold mortgage or encumbered by the leasehold mortgage.
I. Assignees. Notwithstanding anything herein to the contrary, after a default by Lessee
whereby any Leasehold Mortgagee shall acquire any rights and/or obligations under this Lease,
including as a result of bidding or lack thereof at auction after foreclosure (this also includes any
rights/obligations a Leasehold Mortgagee shall acquire under any other lease of Lessee at the
Airport, as a result of cross- default provisions), and thereafter the Leasehold Mortgagee or referee
at sale proposes to assign, sell, rent, or otherwise transfer any interests, rights, and obligations to a
special purpose entity and/or third party, or allow use of the property under this Lease (or any other
property under any other lease at the Airport that Lessee is a party to as a result of cross-default
provisions) by a special purpose entity and/or third party, any such assignment, sale, transfer, or
use of the property under this Lease (or any other property under any other lease at the Airport that
Lessee is a party to as a result of cross-default provisions) by a special purpose entity and/or third
party is contingent upon City confirming to its reasonable satisfaction that the special purpose
entity and/or third party has the financial and operational capabilities sufficient for the proper
conduct of a fixed base operator as those capabilities are defined in this Lease and the Minimum
Standards for Aeronautical Activities and Rules and Regulations, as may be amended from time-
to-time by City applicable to the Airport. In such case, the Leasehold Mortgagee agrees to make
commercially reasonable efforts to promptly find such a special purpose entity and/or third party
meeting the requirements of this Section 8.4.I to enter into a new agreement with the City for the
remainder of the Lease Term and/or to temporarily perform fixed based operator services at the
property while the Leasehold Mortgagee secures a replacement lessee. City may also submit
nominees to the Leasehold Mortgagee, and the Leasehold Mortgagee shall negotiate in good faith
and act with such nominees in order to determine whether any such nominee meets the Leasehold
Mortgagee’s qualifications.
J. Estoppel Certificates. Each party agrees, at any time and from time to time upon not less than
twenty (20) days priorwritten notice by theother party, to execute, acknowledge and deliver to the
other party a statement in writing, in substantially the same form as Exhibit B certifying: (a)
whether this Lease is in full force and effect, and if it is alleged that this Lease is not in full force
and effect, setting forth the nature thereof in reasonable detail; (b)whether this Lease has been
supplemented or amended, specifying the manner in which it has been supplemented or amended;
(c) the date to which all rental payments have been made; (d) the commencement and expiration
date of this Lease; and (e) whether or not, to the best of the knowledge of the signer of such
statement, the other party is in default or may be with notice or the passage of time, or both, in
keeping, observing or performing any term, covenant, agreement, provision, condition or
limitation contained in this Lease and if in default, specifying each such default, it being intended
that any such statement delivered pursuant to this Section may be relied upon by the other party,
any prospective assignee of the other party’s interest in this Lease or any Leasehold Mortgagee,
but reliance on such certificate may not extend to any default as to which the signer shall not have
had actualknowledge.
Section 8.5 Sublease. Any sublease of Improvements shall be for aviation-related
purposes only. Any sublease agreement for the purpose of conducting commercial aeronautical
activities as identified in the Airport Minimum Operating Standards will require an approved
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Airport Business Permit prior to commencing operation. All sublease agreements shall be
provided to the City at the time of execution.
ARTICLE IX
MISCELLANEOUS PROVISIONS
Section 9.1 Waiver of Exemption. Any constitutional or statutory exemption of Lessee
of any property usually kept on the Leased Premises, from distress or forced sale, is waived.
Section 9.2 Addresses. All notices given under this Agreement to City shall be sent to
the Airport Manager at 5000 Airport Road, Denton, Texas 76207, with a copy to the City Attorney
at 215 E. McKinney, Denton, Texas 76201, or such other place as City shall specify in writing.
All notices given under this Agreement to Lessee shall be sent to:
Sheltair Aviation Denton, LLC
Attn: Lisa Holland, President
4860 NE 12th Avenue, Fort Lauderdale, FL 33334
lholland@sheltairaviation.com
All notices given under this Agreement to the Mortgagee shall be sent to the address provided by
Mortgagee to City. Any notice properly mailed by registered mail, postage and fee prepaid, shall
be deemed delivered when mailed, whether it is received or not.
Section 9.3 No Waiver. The waiver by City of any breach of any term, covenant, or
condition herein contained shall not be deemed to be a waiver of such term, covenant, or condition
or any subsequent breach of the same or any other term, covenant, or condition herein contained.
The subsequent acceptance of rent hereunder by City shall not be deemed to be a waiver of any
preceding breach by Lessee of any term, covenant, or condition of this Agreement, other than the
failure of Lessee to pay the particular rental so accepted, regardless of City’s knowledge of such
preceding breach at the time of acceptance of such rent.
Section 9.4 Lessee’s Subordination. Lessee hereby subordinates and makes this
Agreement inferior to all existing and future mortgages, trust indentures or other security interest
of City or City’s successor in interest. Lessee shall execute and deliver any documents required
to evidence and perfect such subordination.
Section 9.5 Additional Charges as Rent. Any charges against Lessee by City for
services or for work done on the Leased Premises or the Improvements by order of Lessee or
otherwise accruing under this Agreement shall be considered as Rent due.
Section 9.6 Subordination to Grant Assurances. This Agreement shall be subordinate
to the Grant Assurances, as amended. In the event that this Agreement, either on its own terms or
by any other reason, conflicts with or violates any such Grant Assurances, City has the right to
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amend, alter or otherwise modify the terms of this Agreement in order to resolve such conflict or
violation.
Section 9.7 Non-Interference With Operation of the Airport. Lessee expressly agrees
for itself, its successors, and assigns that Lessee will not conduct operations in or on the Leased
Premises or the Improvements in a manner that in the reasonable judgment of City, (i) interferes
or might interfere with the reasonable use by others of common facilities at the Airport, (ii) hinders
or might hinder police, fire fighting, or other emergency personnel in the discharge of their duties,
(iii) would or would be likely to constitute a hazardous condition at the Airport, (iv) would or
would be likely to increase the premiums for insurance policies maintained by City unless such
operations are not otherwise prohibited hereunder and Lessee pays the increase in insurance
premiums occasioned by such operations, (v) is contrary to any applicable Grant Assurance; (vi)
is in contradiction to any rule, regulation, directive, or similar restriction issued by agencies having
jurisdiction over the Airport including FAA, Homeland Security, Transportation Security
Administration and Customs and Border Patrol, or (vii) would involve any illegal purposes. In the
event this covenant is breached, City reserves the right, after prior written notice to Lessee, to enter
upon the Leased Premises and the Improvements and cause the abatement of such interference at
the expense of Lessee. In the event of a breach in Airport security caused by Lessee, resulting in
fine or penalty to City of which Lessee has received prior written notice, such fine or penalty will
be charged to Lessee.
Section 9.8 Emergency Closures. During time of war or national emergency, City shall
have the right to enter into an agreement with the United States Government for military or naval
use of part or all of the landing area, the publicly-owned air navigation facilities and/or other areas
or facilities of the Airport. If any such agreement is executed, the provisions of this Agreement,
insofar as they are inconsistent with provisions of the agreement with the Government, will be
suspended.
Section 9.9 Interpretation.
A. References in the text of this Agreement to articles, sections, or exhibits pertain to
articles, sections, or exhibits of this Agreement, unless otherwise specified.
B. The terms “hereby,” “herein,” “hereof,” “hereto,” “hereunder,” and any similar
terms used in this Agreement refer to this Agreement. The term “including” shall not be construed
in a limiting nature, but shall be construed to mean “including, without limitation.”
C. Words importing persons shall include firms, associations, partnerships, trusts,
corporations, and other legal entities, including public bodies, as well as natural persons.
D. Any headings preceding the text of the articles and sections of this Agreement, and
any table of contents or marginal notes appended to copies hereof, shall be solely for convenience
of reference and shall not constitute a part of this Agreement, nor shall they affect the meaning,
construction or effect of this Agreement.
E. Words importing the singular shall include the plural and vice versa. Words of the
masculine gender shall be deemed to include correlative words of the feminine and neuter genders.
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Section 9.10 Force Majeure. No act or event, whether foreseen or unforeseen, shall
operate to excuse Lessee from the prompt payment of rent or any other amounts required to be
paid under this Agreement. If City (or Lessee in connection with obligations other than payment
obligations) is delayed or hindered in any performance under this Agreement by a force majeure
event, such performance shall be excused to the extent so delayed or hindered during the time
when such force majeure event is in effect, and such performance shall promptly occur or resume
thereafter at the expense of the Party so delayed or hindered. A “force majeure event” is an act or
event, whether foreseen or unforeseen, that prevents a Party in whole or in part from performing
as provided in this Agreement, that is beyond the reasonable control of and not the fault of such
Party, and that such Party has been unable to avoid or overcome by exercising due diligence, and
may include, but is not limited to, acts of nature, war, riots, strikes, accidents, fire, and changes in
law. Lessee hereby releases City and City’s officers, elected and appointed officials, employees,
and agents from any and all liability, whether in contract or tort (including strict liability and
negligence) for any loss, damage, or injury of any nature whatsoever sustained by Lessee, its
employees, agents, or invitees during the Lease Term, including, but not limited to, loss, damage,
or injury to the aircraft or other personal property of Lessee that may be located or stored in, on or
under the Leased Premises or the Improvements due to a force majeure event.
Section 9.11 Governing Law and Venue. This Agreement has been made in and will be
construed in accordance with the laws of the State of Texas. In any action initiated by one Party
against the other, exclusive venue and jurisdiction will be in the appropriate state courts in and for
Denton County, Texas.
Section 9.12 Amendments and Waivers. No amendment to this Agreement shall be
binding on City or Lessee unless reduced to writing and signed by both Parties. No provision of
this Agreement may be waived, except pursuant to a writing executed by the Party against whom
the waiver is sought to be enforced.
Section 9.13 Severability. If any provision of this Agreement is determined to be invalid,
illegal, or unenforceable, the remaining provisions of this Agreement shall remain in full force and
effect if both the economic and legal substance of the transactions that this Agreement
contemplates are not affected in any manner materially adverse to any Party. If any provision of
this Agreement is held invalid, illegal, or unenforceable, the Parties shall negotiate in good faith
to modify this Agreement to fulfill as closely as possible the original intents and purposes of this
Agreement.
Section 9.14 Merger. This Agreement constitutes the final, complete, and exclusive
agreement between the Parties on the matters contained in this Agreement. All prior and
contemporaneous negotiations and agreements between the Parties on the matters contained in this
Agreement are expressly merged into and superseded by this Agreement. In entering into this
Agreement, neither Party has relied on any statement, representation, warranty, nor agreement of
the other Party except for those expressly contained in this Agreement.
Section 9.15 Relationship of Parties. This Agreement does not create any partnership,
joint venture, employment, or agency relationship between the Parties. Nothing in this Agreement
shall confer upon any other person or entity any right, benefit, or remedy of any nature.
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Section 9.16 Further Assurances. Each Party shall execute any document or take any
action that may be necessary or desirable to consummate and make effective a performance that is
required under this Agreement.
Section 9.17 Required Federal Clauses. Lessee and Lessee’s Associates shall comply
with all Laws and Regulations, including all of the required federal clauses in this Section 9.17
and any amendments or successor requirements during the Term of this Agreement.
A. During the performance of this contract, Lessee, for itself, Lessee’s Associates, its
assignees, and successors in interest (hereinafter collectively referred to as the “Lessee”) agrees as
follows:
1.Compliance with Regulations:Lessee will comply with the Title VI List of
Pertinent Nondiscrimination Acts And Authorities, as they may be amended from
time to time, which are herein incorporated by reference and made a part of this
Agreement.
2.Non-discrimination: Lessee, with regard to the work performed by it or use of
the Leased Premises and the Improvements during the Lease Term, will not
discriminate on the grounds of race, color, national origin, creed, sex, age, or
disability in the selection and retention of contractors, including procurements of
materials and leases of equipment. Lessee will not participate directly or indirectly
in the discrimination prohibited by the Nondiscrimination Acts and Authorities,
including employment practices when the contract covers any activity, project, or
program set forth in Appendix B of 49 CFR Part 21, including amendments
thereto.
3. Solicitations for Contracts, including Procurements of Materials and
Equipment: In all solicitations, either by competitive bidding, or negotiation
made by Lessee for work to be performed under a contract, including
procurements of materials, or leases of equipment, each potential contractor or
supplier will be notified by Lessee of Lessee’s obligations under this Agreement
and the Nondiscrimination Acts and Authorities on the grounds of race, color, or
national origin.
4. Information and Reports: Lessee will provide all information and reports
required by the Acts, the Regulations, and directives issued pursuant thereto and
will permit access to its books, records, accounts, other sources of information,
and its facilities as may be determined by the sponsor or the Federal Aviation
Administration to be pertinent to ascertain compliance with such
Nondiscrimination Acts and Authorities and instructions. Where any information
required of Lessee is in the exclusive possession of another who fails or refuses to
furnish the information, Lessee will so certify to City or the Federal Aviation
Administration, as appropriate, and will set forth what efforts it has made to obtain
the information.
5.Sanctions for Noncompliance: In the event of Lessee’s noncompliance with the
non-discrimination provisions of this contract, City will impose such sanctions as
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it or the Federal Aviation Administration may determine to be appropriate,
including, but not limited to cancelling, terminating, or suspending the Lease, in
whole or in part.
6. Incorporation of Provisions: Lessee will include the provisions of paragraphs
one through six of this Section 9.17(A) in every contract, including procurements
of materials and leases of equipment, unless exempt by the Acts, the Regulations,
and directives issued pursuant thereto. Lessee will take action with respect to any
contract or procurement as City or the Federal Aviation Administration may direct
as a means of enforcing such provisions including sanctions for noncompliance.
Provided, that if Lessee becomes involved in, or is threatened with litigation by a
contractor, or supplier because of such direction, Lessee may request City to enter
into any litigation to protect the interests of City. In addition, Lessee may request
the United States to enter into the litigation to protect the interests of the United
States.
B. Lessee for itself, its heirs, personal representatives, successors in interest, and
assigns, as a part of the consideration hereof, does hereby covenant and agree as a covenant running
with the land that in the event facilities are constructed, maintained, or otherwise operated on the
property described in this Agreement for a purpose for which a Federal Aviation Administration
activity, facility, or program is extended or for another purpose involving the provision of similar
services or benefits, Lessee will maintain and operate such facilities and services in compliance
with all requirements imposed by the Nondiscrimination Acts and Regulations listed in the
Pertinent List of Nondiscrimination Authorities (as may be amended) such that no person on the
grounds of race, color, or national origin, will be excluded from participation in, denied the benefits
of, or be otherwise subjected to discrimination in the use of said facilities.
C. Lessee for itself, its heirs, personal representatives, successors in interest, and
assigns, as a part of the consideration hereof, does hereby covenant and agree as a covenant running
with the land that (1) no person on the ground of race, color, or national origin, will be excluded
from participation in, denied the benefits of, or be otherwise subjected to discrimination in the use
of said facilities, (2) that in the construction of any improvements on, over, or under such land,
and the furnishing of services thereon, no person on the ground of race, color, or national origin,
will be excluded from participation in, denied the benefits of, or otherwise be subjected to
discrimination, and (3) that Lessee will use the Leased Premises and the Improvements in
compliance with all other requirements imposed by or pursuant to the List of discrimination Acts
and Authorities.
D. During the performance of this contract, the contractor, for itself, its assignees, and
successors in interest (hereinafter referred to as the “contractor”) agrees to comply with the
following non-discrimination statutes and authorities; including but not limited to:
i. Title VI of the Civil Rights Act of 1964 (42 U.S.C. § 2000d et seq., 78 stat. 252)
(prohibits discrimination on the basis of race, color, national origin);
ii. 49 CFR Part 21 (Non-discrimination in Federally-Assisted programs of the
Department of Transportation—Effectuation of Title VI of the Civil Rights Act of
1964) including amendments thereto;
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iii. The Uniform Relocation Assistance and Real Property Acquisition Policies Act of
1970, (42 U.S.C. § 4601) (prohibits unfair treatment of persons displaced or whose
property has been acquired because of Federal or Federal-aid programs and projects);
iv. Section 504 of the Rehabilitation Act of 1973 (29 U.S.C. § 794 et seq.), as amended
(prohibits discrimination on the basis of disability); and 49 CFR part 27
(Nondiscrimination on the Basis of Disability in Programs or Activities Receiving
Federal Financial Assistance);
v. The Age Discrimination Act of 1975, as amended (42 .U.S.C. § 6101 et seq.)
(prohibits discrimination on the basis of age);
vi. Airport and Airway Improvement Act of 1982 (49 U.S.C. § 47123), as amended
(prohibits discrimination based on race, creed, color, national origin, or sex);
vii. The Civil Rights Restoration Act of 1987 (P.L. 100-259) (broadened the scope,
coverage and applicability of Title VI of the Civil Rights Act of 1964, the Age
Discrimination Act of 1975 and Section 504 of the Rehabilitation Act of 1973, by
expanding the definition of the terms “programs or activities” to include all of the
programs or activities of the Federal-aid recipients, sub-recipients and contractors,
whether such programs or activities are Federally funded or not);
viii. Titles II and III of the Americans with Disabilities Act of 1990 (42 U.S.C. § 12101,
et seq.) (prohibit discrimination on the basis of disability in the operation of public
entities, public and private transportation systems, places of public accommodation,
and certain testing entities) as implemented by U.S. Department of Transportation
regulations at 49 CFR Parts 37 and 38;
ix. Title IX of the Education Amendments of 1972, as amended, which prohibits you
from discriminating because of sex in education programs or activities (20 U.S.C. §
1681, et seq.).
E. In all its activities within the scope of this Agreement, Lessee and its transferee
agree to comply with pertinent statutes, Executive Orders, and such rules as identified in Title VI
List of Pertinent Nondiscrimination Acts and Authorities to ensure that no person shall, on the
grounds of race, color, national origin, creed, sex, age, or disability be excluded from participating
in any activity conducted with or benefiting from Federal assistance. This provision obligates
Lessee or its sublessee for the period during which Federal assistance is extended to the Airport
through the Airport Improvement Program. In cases where Federal assistance provides, or is in
the form of personal property; real property or interest therein; structures or improvements thereon,
this provision obligates the party or any transferee for the longer of the following periods: (i) the
period during which the property is used by the City or any transferee for a purpose for which
Federal assistance is extended, or for another purpose involving the provision of similar services
or benefits; or (ii) the period during which the airport sponsor or any transferee retains ownership
or possession of the property.
F. In the event of breach of any of the above nondiscrimination covenants, City will
have the right to terminate this Agreement and to enter, re-enter, and repossess said lands and
facilities thereon, and hold the same as if the Agreement had never been made or issued.
G. This Agreement incorporates by reference the provisions of 29 CFR Part 201, the
Federal Fair Labor Standards Act (“FLSA”), with the same force and effect as if given in full text.
The FLSA sets minimum wage, overtime pay, recordkeeping, and child labor standards for full
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and part time workers. Lessee has full responsibility to monitor compliance to the referenced
statute or regulation. Lessee must address any claims or disputes that arise from this requirement
directly with the U.S. Department of Labor – Wage and Hour Division.
H. This Agreement incorporates by reference the requirements of 29 CFR Part 1910
with the same force and effect as if given in full text. Lessee must provide a work environment
that is free from recognized hazards that may cause death or serious physical harm to the employee.
Lessee retains full responsibility to monitor its compliance and any sublessee’s compliance with
the applicable requirements of the Occupational Safety and Health Act of 1970 (20 CFR Part
1910). Lessee must address any claims or disputes that pertain to a referenced requirement directly
with the U.S. Department of Labor – Occupational Safety and Health Administration.
I. Lessee agrees that it shall insert the above eight provisions (Section 9.17(A)
through Section 9.17(H)) in any agreement by which said Lessee grants a right or privilege to any
person, firm, or corporation to render accommodations and/or services to the public on the Leased
Premises or at the Improvements, herein leased or owned, as applicable.
J. Lessee agrees to furnish service on a fair, equal, and not unjustly discriminatory
basis to all users thereof, and to charge fair, reasonable, and not unjustly discriminatory prices for
each unit or service; provided that Lessee may be allowed to make reasonable and
nondiscriminatory discounts, rebates, or other similar types of price reductions to volume
purchasers. (Grant Assurance 22)
K. It is hereby specifically understood and agreed that nothing herein contained shall
be construed to grant or authorize the granting of an exclusive right to provide aeronautical services
to the public as prohibited by the Grant Assurances, and City reserves the right to grant to others
the privilege and right of conducting any one or all activities of an aeronautical nature. (Grant
Assurance 23)
L. City reserves the right to further develop or improve the landing area of the Airport
as it sees fit, regardless of the desires or view of Lessee, and without interference or hindrance.
(FAA Order 5190.6B)
M. City reserves the right, but shall not be obligated to Lessee, to maintain and keep in
repair the landing area of the Airport and all publicly-owned facilities of the Airport, together with
the right to direct and control all activities of Lessee in this regard. (FAA Order 5190.6B)
N. This Agreement shall be subordinate to the provisions of and requirements of any
existing or future agreement between City and the United States, relative to the development,
operation, or maintenance of the Airport. (FAA Order 5190.6B)
O. If the Lessee assigns this Agreement or transfers an obligation in accordance with
its terms, the transferee is obligated in the same manner as Lessee. These obligations apply to the
Lessee for the term of the Lease as long as the Airport remains obligated to the Federal Aviation
Administration.
P. Lessee agrees to comply with the notification and review requirements covered in
Part 77 of the Federal Aviation Regulations in the event any future structure or building is planned
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for the Leased Premises, or in the event of any planned modification or alteration of any present
or future building or structure situated on the Leased Premises. (FAA Order 5190.6B)
Q. It is clearly understood by Lessee that no right or privilege has been granted which
would operate to prevent any person, firm, or corporation operating aircraft on the Airport from
performing any services on its own aircraft with its own regular employees (including but not
limited to, maintenance and repair) that it may choose to perform. (Grant Assurance 22(f))
R. Lessee agrees to comply with mandatory standards and policies relating to use and
procurement of certain telecommunications and video surveillance services or equipment in
compliance with the National Defense Authorization Act P.L. 115-232, § 889(f)(1)).
[SIGNATURE PAGES FOLLOW]
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Signature Page to Airport Lease Agreement between
City of Denton and Sheltair Aviation Denton, LLC
IN WITNESS WHEREOF, the Parties have set their hands and seals this day of
_______________________________________, 2026.
ATTEST:
Kristi Fogle, Interim City Secretary
By: _________________________________
APPROVED AS TO LEGAL FORM:
Mack Reinwand, City Attorney
By: _________________________________
CITY OF DENTON, TEXAS, CITY
By:
Cassey Ogden, Interim City Manager
Sheltair Aviation Denton, LLC, LESSEE
By________________________________
Lisa Holland, President
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14th
July
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Exhibit B
GROUND LESSOR ESTOPPEL AND CONSENT AGREEMENT
WHEREAS, __________________________ a ____________ [corporation]
[limited liability company] (hereinafter “Landlord”), or its predecessor in interest, has heretofore
leased certain lands described on Exhibit A attached hereto (hereinafter the “Premises”) to
_________________________ a ____________ [corporation] [limited liability company]
(hereinafter “Tenant”), or its predecessor in interest, pursuant to an agreement of lease, as more
particularly described on Exhibit B (as same may have been amended, modified, substituted or
extended, hereinafter the “Lease”);
WHEREAS, Tenant and certain other affiliates of Borrower, as co-borrowers or
guarantors (collectively, “Loan Parties”) intend to enter into a Credit Agreement among Borrower,
the Loan Parties, SunTrust Bank, as Administrative Agent and Collateral Agent (together with it
successors and assigns, the “Administrative Agent”), Swingline Lender and Issuing Bank, and the
Lenders from time to time party thereto (as the same may be amended, restated, supplemented or
otherwise modified from time to time, the “Credit Agreement”; capitalized terms used herein and
not otherwise defined shall have the meanings assigned to such terms in the Credit Agreement).
As security for the Obligations under the Credit Agreement and the other Loan Documents, Tenant
intends to execute a first leasehold [mortgage] [deed of trust] [deed to secure debt]for the
benefit of Administrative Agent upon Tenant’s interest as tenant under the Lease in the Premises
(the “Leasehold Mortgage”); and
WHEREAS, the Administrative Agent and the Lenders are unwilling to enter into
the Credit Agreement unless Landlord reaffirms to Administrative Agent that the provisions of the
Lease respecting leasehold mortgages are restated and confirmed for Administrative Agent’s
benefit [and certain additional agreements are made with Administrative Agent with respect
to Administrative Agent’s rights as the holder of the Leasehold Mortgage];
NOW THEREFORE, in consideration of ten dollars ($10.00) and other good and
valuable consideration the receipt and sufficiency of which are hereby acknowledged, Landlord
hereby certifies to and agrees with Administrative Agent as follows:
1. [Upon the recording of the Leasehold Mortgage, Landlord hereby
recognizes Administrative Agent as a “Leasehold Mortgagee” as defined in Section ___ of
the Lease, for all purposes under the Lease] [Landlord hereby consents to the granting by
Tenant of a mortgage on Tenant’s interest pursuant to the Lease to Administrative Agent.]
2. [All of the leasehold mortgagee protection provisions contained in the
Lease, including but not limited to Sections(s) ______, and all other provisions inuring to the
benefit of leasehold mortgagees or their successors and assigns contained in the Lease, are
hereby incorporated into this agreement by reference and restated and confirmed by
Landlord for the benefit of Administrative Agent, its successors and assigns.] Landlord
[confirms that pursuant to the provisions contained in Section(s) ___ of the Lease] [covenants
and agrees]that Landlord is not permitted, in the absence of an uncured default of Tenant under
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the Lease or a default of Tenant where a provision of the Lease expressly provides that Tenant has
no opportunity to cure, to disturb the possession, interest or quiet enjoyment of Tenant or any
subtenant of the Tenant, or in any manner, which would adversely affect the security provided in
the Leasehold Mortgage.
3. Landlord hereby [confirms that pursuant to Section ___ of the Lease,]
[agrees that] the Lease shall not be modified, terminated, amended, altered or cancelled, nor shall
a surrender of the Premises be accepted by Landlord, without prior written notice to Administrative
Agent and after the expiration of all applicable opportunities to cure provided for in the Lease, and
that any such action taken without such notice and expiration shall not be binding on Tenant or
Administrative Agent.
4. Landlord hereby [confirms that, pursuant to Section ____ of the Lease]
[covenants and agrees that], in the event that the Lease is terminated for any reason including,
without limitation, as a result of a rejection of the Lease in a bankruptcy proceeding, upon
Administrative Agent’s request, and subject to the requirements in Section IX.I of the Lease
Landlord shall enter into a new ground lease with Administrative Agent and such new ground
lease shall be upon the same terms and conditions of the unexpired term of the Lease immediately
prior to such termination.
5. Landlord hereby confirms with respect to the new ground lease referred to
in [Section ___ of the Lease] [paragraph 4 above] that, should Administrative Agent become
the tenant under a new lease [pursuant to Section ___ of the Lease]:
(a) title to all improvements now owned by Tenant [including the Building,
as defined in the Lease], situate on the Premises shall automatically vest in Administrative Agent
[pursuant to Section ___ of the Lease]; and
(b) Landlord shall promptly assign to Administrative Agent all space leases and
subleases under which the tenants have attorned, with the consent of Administrative Agent
[pursuant to Section ___ of the Lease], to Landlord.
6. Landlord hereby [confirms] [covenants and agrees] that the Leasehold
Mortgage shall not be subject or subordinate to any mortgage encumbering the fee estate of the
Premises.
7. Landlord hereby [confirms the provisions of Section ____ of the Lease to
the effect] [covenants and agrees] that Landlord shall deliver to Administrative Agent written
notice of any default by Tenant under the Lease simultaneously with sending such notice to Tenant
and that no notice of default given to Tenant, and no exercise of any remedy by Landlord as a
result of any such default, shall be effective unless such notice shall have been delivered to
Administrative Agent. Landlord hereby further [confirms the provisions of Section ____ of the
Lease to the effect] [covenants and agrees] that Administrative Agent shall have the right, but
not the obligation, to cure any default by Tenant under the Lease and Administrative Agent shall
be afforded (a) 30 additional days to cure any such default where Tenant has 30 days to cure
pursuant to the Lease; or (b) 15 additional days where the Tenant has less than 30 days to cure
such default pursuant to the Lease; or (c) in the event that any such default cannot, with reasonable
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diligence, be cured within such cure period, such longer period as may be required to complete
such cure including, without limitation, such time as may be required for Administrative Agent to
gain possession of Tenant’s interest under the Lease, provided that Administrative Agent notifies
Landlord of its intention to cure such default and Administrative Agent promptly commences and
diligently pursues such cure to completion.
8. Subject to any assignee or sublessee meeting the requirements of Section
IX.I of the Lease, Landlord hereby [confirms] [agrees] that Tenant shall have the right to assign
or sublet Tenant’s interest under the Lease to Administrative Agent, its successor or assign without
the consent of Landlord, and in the event Tenant’s interest under the Lease is so assigned or sublet
to Administrative Agent, its successor or assign (as applicable, the “Assignee”), such Assignee
shall have the right to further assign or sublet the Tenant’s interest in the Lease without the need
to obtain the consent of Landlord.
9. Landlord hereby [confirms] [covenants and agrees] that Administrative
Agent shall be entitled to participate in any settlement regarding insurance or condemnation
proceeds or awards, to collect and hold any such proceeds or awards and to determine and direct
whether any such proceeds or awards are made available for the restoration of the Premises or are
applied to the repayment of the Obligations under the Credit Agreement and the other Loan
Documents.
10. Landlord hereby [confirms the provisions of Section ___ to the effect]
[agrees] that Administrative Agent shall have the right, pursuant to the terms of the Lease, to
exercise any option to renew the term of the Lease or any option to purchase the Premises, if the
Tenant shall fail to exercise any option to so extend or purchase.
11. Landlord hereby certifies as follows:
(a) Landlord is the owner of the fee simple estate in the Premises and is the
landlord under the Lease.
(b) Tenant is the owner of the leasehold estate in the Premises and is the tenant
under the Lease.
(c) The Lease is in full force and effect in accordance with its terms and has not
been further assigned, supplemented, modified or otherwise amended except as set forth in Exhibit
B attached hereto and each of the obligations on Landlord’s part to be performed to date under the
Lease have been performed.
(d) To the best of Landlord’s knowledge, each of the obligations on Tenant’s
part to be performed to date under the Lease have been performed.
(e) To the best of Landlord’s knowledge, Borrower has no offsets,
counterclaims, defenses, deductions or credits whatsoever with respect to the Lease.
Docusign Envelope ID: 33A99BCA-1056-8E4D-800A-16FEC7B7AFCE
(f) Except as set forth in Exhibit B attached hereto, there do not exist any other
agreements (including Subordination, Non-Disturbance and Attornment Agreements) concerning
the Premises, whether oral or written between Landlord and Tenant (or their respective
predecessors or successors) under the Lease.
(g) As of the date hereof, no basic rent or additional rent is due from Tenant
under the Lease. The basic rent currently payable by Tenant under the Lease is $__________ per
annum. Basic rent due under the Lease has been paid through _________.
(h) The term commencement date of the Lease was __________, and the initial
term/current extension term of the lease shall expire on ___________________.
(i) Neither Landlord nor Tenant has assigned the Lease or sublet the Premises.
(j) Landlord has not assigned, conveyed, transferred, sold, encumbered or
mortgaged its interest in the Lease or the Premises and there are currently no mortgages, deeds of
trust or other security interests encumbering Landlord’s fee interest in the Premises and no third
party has an option or preferential right to purchase all or any part of the Premises.
(k) Landlord has not received written notice of any pending eminent domain
proceedings or other governmental actions or any judicial actions of any kind against the
Landlord’s interest in the Premises.
(l) Landlord has not received written notice that it is in violation of any
governmental law or regulation applicable to its interest in the Premises and its operation thereon,
including, without limitation, any environmental laws or the Americans with Disabilities Act, and
has no reason to believe that there are grounds for any claim or such violation.
(m) The Lease attached hereto is a true, correct and complete copy thereof.
12. Notices. All notices, demands, requests or other communications to be sent
by one party to the other hereunder or required by law shall be in writing and shall be deemed to
have been validly given or served by delivery of the same in person to the intended addressee, or
by depositing the same with Federal Express or another reputable private courier service for next
business day delivery, or by depositing the same in the United States mail, postage prepaid,
registered or certified mail, return receipt requested, in any event addressed to the intended
addressee at its address set forth on the first page hereof and, if addressed to Administrative Agent,
to _____________, ________, _____________ _______, Attention: ____________, and if
addressed to Landlord, to _____________, ________, _____________ _______, Attention:
____________, or at such other address as may be designated by such party as herein provided.
All notices, demands and requests shall be effective upon such personal delivery, or one (1)
business day after being deposited with the private courier service, or two (2) business days after
being deposited in the United States mail as required above. By giving to the other party hereto at
least fifteen (15) days’ prior written notice thereof in accordance with the provisions hereof, the
parties hereto shall have the right from time to time to change their respective addresses and each
shall have the right to specify as its address any other address within the United States of America.
Docusign Envelope ID: 33A99BCA-1056-8E4D-800A-16FEC7B7AFCE
This Estoppel and Agreement and the representations and agreements made herein
are given with the understanding that this Estoppel and Agreement constitutes a material
inducement for Administrative Agent and the Lenders to enter into the Credit Agreement and that
Administrative Agent and the Lenders shall rely hereon in entering into the Credit Agreement.
This Estoppel and Agreement and the representations and agreements made herein shall inure to
the benefit of Administrative Agent, its successors and assigns and shall be binding on Landlord,
its heirs, legal representatives, successors and assigns.
This Estoppel and Agreement may be executed in any number of counterparts, each
of which shall be effective only upon delivery and thereafter shall be deemed an original, and all
of which shall be taken to be one and the same instrument, for the same effect as if all parties
hereto had signed the same signature page. Any signature page of this Estoppel and Agreement
may be detached from any counterpart of this Estoppel and Agreement without impairing the legal
effect of any signatures thereon and may be attached to another counterpart of this Estoppel and
Agreement identical in form hereto but having attached to it one or more additional signature
pages.
Executed this ____ day of ________________, 202___.
LANDLORD:
[INSERT SIGNATURE BLOCK]
[INSERT EXHIBIT A AND B]
Docusign Envelope ID: 33A99BCA-1056-8E4D-800A-16FEC7B7AFCE
Sheltair Denton Jet Center, LLC
Fuel and Hanger / Tie-Down and Rent Commission
MONTH:
Flowage Fee:
0.22$
Deliveries
Date Invoice # Jet-A Gallons Avgas Gallons Commission
-
-
Total Fuel
Commission -
Hanger/Tie-Down 12%
Date Amount Commission
GL Nightly Hangar Fees
GL Nightly Ramp Fees
Properties Rentals
Total Commission -
TOTAL PAYMENT -
FOR ACCOUNTING:
5004 Jet-A Flowage -$
5102 Avgas Flowage -$
4710 Hangar Fees -
4708 RON Fees -
1201 Exchange -
-$
-
Docusign Envelope ID: 33A99BCA-1056-8E4D-800A-16FEC7B7AFCE
Docusign Envelope ID: 33A99BCA-1056-8E4D-800A-16FEC7B7AFCE