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1997-148hanglO ord O~CE NO q,l~/¢? , AN ORDINANCE AUTHORIZINO THE CITY MANAGER OF THE CITY OF DENTON, TEXAs TO EX~CUTE A CO~RCIAL LEASE AO~E~NT ~ETW~EN THE city OF DENTON, TEXAS AND HANGAR 10 FLYING MUSEUM FOR APPROXIMATELY 32,400 SQUARE FEET OF PROPERTY LOCATED AT THE DENTON MUNICIPAL AIRPORT, WITH OPTIONS ON THE LEASE OF ADDITIONAL PROPERTY COMPRISING AN ADDITIONAL 64,800 SQUARE FEET, AND PROVIDING AN EFFECTIVE DATE THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS ~5~LII.029~ That the City Manager ~s authorized to execute a commerc~ lease agreement between the City of Denton, Texas and Hangar 10 Flying Museum for approximately 32,400 square feet of land located at the Denton Mumcqaal An-port, under the terms and conditions contamed walun the agreement, whtch ts attached hereto and made a part hereof ~ That tins ordinance shall become effective Lmmechately upon its passage and approval PASSED AND APPROVED this the ~0~"'day of ~ ,1997 ATTEST' JENNIFER WALTERS, CITY SECRETARY CITY OF DENTON, TEXAS CITY OF DENTON, TEXAS ORIGINAL AIRPORT LEASE AGREEMENT THE STATE OF TEXAS § § KNOW ALL MEN BY THESE PRESENTS COUNTY OF DENTON § TI~ lease is made and executed this ~__t~y of '[nT~:'~o ' ' 1997, at Demon, Texas, by and between the City of Demon, Texas, a mummpal cort~rat n, hereinafter referred to as "Lessor", and Hangar 10 Flying Museum~ hamg its principal offices at 5088 Sabre Lane, Denton, Texas, Denton Municipal Airport, Denton, Texas 76207, hereinafter referred to as "Lessee" WITNESSETH: WHEREAS, Lessor now owns, controls and operates the Mumc~pal An'port (An'port) tn the City of Denton, County of Denton, State of Texas, and WHEREAS, Lessee desk, es to lease certain prem~s on sad an'port and construct and m0mtam an office, warehouse, aircraft hangar and related avmtton facdtties thereon, and NOW, THEREFORE, for and m eons~deration of the promases and the mutual covenants contained in this agreement, the parties agree as follows I. CONDITIONS OF AGREEMENT NOTWITHSTANDING ANY LANGUAGE TO THE CONTRARY HEREINAFTER CON- TAINED, THE LANGUAGE IN PARAGRAPHS A THROUGH D OF THIS SECTION SHALL BE BINDING A pRINCIPLES OF OPERATIONS Does not grant Lessee the right to operate as a fixed base operation to serve the pubhc B NON.DISCRIMINATION Lessee, for himself, his personal representatives, successors and interests, and assigns, as a part of the consideration hereof, does hereby covenant and agree as a covenant tanning wtth the land that 1 No person on the grounds of race, rehgion, color, sex, or national origin shall be excluded bom participatton ah denied the benefits of, or be otherwise subjected to chsorrmmafion tn the use of said facihties, and 2 In the construction of any m~provements on, over, or under such land and the funushin~ ofserwces thereon, no person on the grounds of race, rehgion, color, sex, or national ongm shall be excluded from participation m, demed the benefits of, or otherwise be subjected to dlscnmmation, and 3 Lessee shall use the premises m comphance with all other requirements imposed by or pursuant to Title 49, Code of Federal Regulations, Departmem of Transportation, Subtitle A, Office oftbe Secretary, Part 21, Non&sermunatlon m Federally assisted pro,'ams of the Department of Transportation - Effectual of Title VI of the Clwl Raghts Act of 1964, as smd Regulations may be amended C I~IGHT OF INDIVIDUALS TO MAINTAIN AIRCRAFT It is clearly understood by Lessee that no right or privilege has been granted which would operate to prevent any person, firm or eorporatlon operat~ aa'craft on the airport from performing any services on its own mrerafi with its own regu~r employees (including, but not hrmted to, maintenance and repatr) that it may choose to perform. D NON-EXCLUSIVE RIGHT. It Is understood and agreed that nothing hereto contained shall be construed to grant or authorize the granting of an exclusive right within the meaning of Title 49 U S C Appendix §1349 1 Lessor reserves the fight to further develop or unprove the landing area of the anport as it sees fit, regardless of the desu'es or views of Lessee, and w~thout interference or hmdrance 2 Lessor shall be obhgated to maintain and keep m repatr the landing area of the an-port and all pubhcly owned facthties of the an'port, together with the right to dtrect and control all activities of Lessee in tins regard 3 Durmg time of war or national emergency, Lessor shall have the right to lease the landing area or any part thereof to the United States Government for mihtary or naval use, and, ti'such lease ~s executed, the provisions of tlus instrument insofar as they are inconsistent with the provisions of the lease to the Government, shall be suspended, 4 Lessor reserves the right to take any action it considers necessary to protect the aerud approaches of the airport against obstruction, together with the rtght to prevent Lessee from erecting, or permitting to be erected, any budding or other structure on or adjacent to the airport which, m the opimon of Lessor, would Imut the usefulness or safety of the an'port or constitute a hazard to mrera~ or to mrcrafi navigatlor~ 5 Tlus Lease shall be subordinate to the provisions of any eyastmg or future agreement between Lessor and the Umted States or agenoy thereof, relative to the operation or maintenance of the au'port Lessor, for and m eonsideraUon of the covenants and agreements hereto contained, to be kept by Lessee, does hereby dermse and lease unto Lessee, and Lessee does hereby lure and take from Lessor, the following described land situated m Denton County, Texas A LAND AtraetoflandmeasurmglS0feet×lS0feet, approxm~tely 32,400 square feet m area, as drawn and outlined on Exkibit "A", incorporated herein by reference, denoted thereto as Tract A and legally described below 1 All that certain tract or parcel of land situated m the W'flham Ned Survey, Abstract Number 970, and being a part of Lot One, Block One, of the Southeast Au'port Addmon, m the City of Demon, Denton County, Texas, and filed for record m CAB O,PG 295 Plat Records of Denton County, Texas Commencing at the most westerly southwest comer of smd Lot One, Block One, Southeast Airport Addmon, of winch the northwest corner bears north 08 degrees 36 minutes 21 seconds east a d~stance of 1610 27 feet THENCE north 08 degrees 36 nmmtes 21 seconds east with the west boundary line of smd Lot One, Block One, a chstanoe of 936 47 feet to a point m the west line of smd Southeast Aa'port Addition THENCE south 88 degrees 36 minutes 10 seconds east a chstance of 373 28 feet to an ~ron pin set for the northwest oftbe hereto described tract Smd point also being the northeast corner ora 60 feet access, drainage, and ut~y easement, and the point of beginning of the hereto described tract; THENCE south 88 degrees 36 minutes 10 seconds east w~th the south line ora 130 feet taxiway, drainage, and utility easement a d~staace of 180 00 feet to an iron pm set for the northeast comer of the hereto described tract, THENCE south 01 degrees 23 minutes 50 seconds west a d~stanee of 180 00 feet to an ~ron pin set for the southeast comer of the berem described tract, smd ~ron pm being m the north line of 60 feet access, drainage, and utility easement, THENCE north 88 degrees 36 minutes 10 seconds west w~th the north line of said access easen~nt a distance of 180 00 feet to an iron pm set for the southwest comer of the herein described tract, THENCE north 01 degrees 36 minutes 50 seconds east with said 60 feet access easement a distance of 180 00 feet to the point ofhegmmng and containing 32,400 00 square feet or 0 7438 acres of land Together with the nght of ingress and egress to said property, and the nght m common v~th others so authonzed of passage upon the Airport property generally, subject to reasonable regulations by the City of Denton and such rights shall extend to Lessee's employees, passengers, patrons and mvitees For purposes of this agreement, the term "Prermses" shah mean all property located vathm the metes and bounds descnl~l and identified above, including leasehold maprovements constructed by the Lessee, but not including certain easements or property owned or controlled by the Lessor PLUS, B RIGHT OF FIRST REFUSAL TO LEASE TRACT B Provided that, and for so long as Lessee stays in lawful possession of the land denoted above as Tract A, Lessee shall have a fight of fu-~t refusal on any lease na$otmted on the tract of land identified and drawn on Exbablt "A" as Tract B, measuring 180 feet x 180 feet, approxmaately 32,400 square feet m area, and legally described below, 1 All that certain Iract or parcel of land situated in the Wflham Ned Survey, Abstract Number 970, and hem8 a part of Lot One, Block One, of the Southeast Aa-pon Addition, m the City of Denton, Denton County, Texas, and filed for record in CAB G,PG 295 Plat Records of Denton County, Texas Commencing at the most westerly southwest comer of smd Lot One, Block One, Southeast Aa-pon Addition, of wbach the northwest comer hears north 08 degrees 36 minutes 21 seconds east a distance of 1610 27 feet THENCE north 08 degrees 36 minutes 21 seconds east with the west boundary line of smd Lot One, Block One, a distance of 936 47 feet to a point m the west hne of stud Southeast Airport Addition THENCE south 88 degrees 36 minutes 10 seconds east a d~stanee 0f553 28 feet to an iron pm set for the northwest of the herein described tract Stud point also lying m the south line ora 130 feet taxiway, drainage, and utthty easement, and the point of hegmnmg of the herein described tract, Hangar 10 Flying Museum Lease Agreement -Paqe 4 THENCE south 88 degrees 36 minutes 10 seconds east wtth the south hno of said taxtway easement a thstance of 180 00 feet to an ~ron pm set for the northeast comer of the hereto doscrihed tract, THENCE south 01 desrees 23 minutes 50 seconds west a dstance of 180 00 feet to an iron pin set for the southeast corner ofthe hereto descnhed tract, and lying m the north line ora 60 feet access, drainage, and u~ity easement, THENCE north 88 degr~ 36 minutes I0 seconds west w~th the north hne of said access easeawent a distance of 180 00 f~ to an iron pm set for the southwest corner of the herein descrlhed tract, THENCE north 01 degrees 23 minutes 50 seconds east a dtstance of 180 00 feet to an tron pin at the northwest comer of the herein described tract and the point of hegmmng and containing 32,400 00 square feet or 0 7438 acres of land The Lessor shall notify Lessee, al writing, of any bonafide offer on lease opttons wtth tinrd parttes on the identified Tract B Lessee shall have thirty (30) days to exercise as right of first refusal on Tract B Any future lease negotiated on Tract B shall he subject to whatever lease tern may be negotiated between Lessor and Lessee, and Lessee shall have no vested right to lease said tract under any particular terms of agreement, or speeflied rental, whether contained w~tlun tlus agreement or any other Le~ee's ex, re,se of sad right of ~a-st refusal is expressly conditioned upon Lessee's continuous and s~multaneoua remal of Tract A above In no event shall th~ right of first refusal extend more than two (2) years past the mitml execution of this Agreement Together with the right of ingress and egress to said property, and the right m common w~th others so authortzed of passage upon the Airport property generally, subject to reasonable regulauons by the City of Denton and such rights ~_all extend to Lessee's employees, passengers, patrons and mmtees For purposes of tins agreement, the term "Pretmses" shall mean all property located within the metes and bounds described and ~demdied above, m¢inding leasehold improve- ments constructed by the Lessee, but not including certain easements or property owned or controlled by the Lessor PLUS, C 1lIGHT OF FIRST REFUSAL TO LEASE TRACT C Provided that, and for so long as Lessee stays in lawful possesston of the land denoted above as Tract A and B, Lessee shall have a right of fa,st refusal on any lease negotiated on the tract &land identified and drawn on Exbabtt "A" as Tract C, measuring 180 feet x 180 feet, approxtmately 32,400 square feet m area, and legally descnhed below, 1 All that certain tract or parcel of land situated m the Wdl,sm Ned Survey, Abstract Number 970, and being a part of Lot One, Block One, oftbe Southeast A~port Addition, m the City of Denton, Denton County, Texas, and filed for record m CAB G,PG 295 Plat Records of Denton County, Texas Conm~encmg at the most westerly southwest comer of smd Lot One, Block One, Southeast Atrport Adchtlon, of wtuch the northwest comer bears north 08 degrees 36 minutes 21 seconds east a dlstance of 1610 27 feet THENCE north 08 degrees 36 mutes 21 seconds east with the west boundary hne of smd Lot One, Block One, a distance of 936 47 feet to a point m the west hne of smd Southeast Airport Addition THENCE south 88 degrees 36 mutes 10 seconds east a d~tance of 733 28 feet to an non pin set for the northwest of the hereto described tract Smd point being m the south line of a 130 feet tax,way, drainage, and ut~hty easement, and the point of begnming of the herein described tract, THENCE south 88 degrees 36 minutes 10 seconds east w~th the south line of smd mxlway easement a d~stance of !80 00 feet to an iron pm set for the northeast comer of the berem described tract, THENCE south 01 degrees 23 minutes 50 seconds west a distance to an ~ron pm set for the southeast corner of the hereto described tract and being ua the north hne of a 60 feet access, drainage, and ut~hty easement, THENCE north 88 degrees 36 minutes 10 seconds west with the north hne of said access easement a distance of 180 00 feet to an ~ron pm set for the southwest comer of the herein described tract, THENCE north 01 degrees 23 minutes 50 seconds east a d~stance of 180 00 feet to an ~ron pm in the south hne of said taxiway easement and the point ofbegmmng and containing 32,400 00 square feet or 0,7438 acres of land The Lessor shall notify Lessee, ua wntmg, of any bonafide offer on lease options with tturd parties on the identified Tract C Lessee shall have thirty (30) days to exercise its right of first refusal on Tract C Any future lease negotmtnd on Tract C shall be subject to whatever lease terms may be negot~ted between Lessor and Lessee, and Lessee shall have no vested right to lease smd tract under any parucular terms ofagreen,~t, or specified rental, whether contained vothm th~ a~eem~t or any other Lessee's exercise of said ri~t of first refusal is expressly conditioned upon Lessee's continuous and sanultaneous t~tal of Tracts A and B, above In no event shall th~ right of first refusal extend more than four (4) years past the initial execution of this Agreement Hangar 10 Flying Museum Lease Agreemont- Paqe 6 Together with the right of regress and egress to smd property, and the right m common wah others so authorized of passage upon the Parport property generally, subject to reasonable regulations by the City of Denton and such rights shall extend to Lessee's employees, passengers, patrons and mvatees For purposes of this agreemem, the term "Prennses" shall mean all property located within the metes and bounds described and ldentflied above, including leasehold unprove- ments constructed by the Lessee, but not including certain easements or property owned or controlled by the Lessor D IMPROVEMENTS PROVIDED BY LESSOR NONE There will be no tmprovements provided by Lessor, except as set forth m Article II E "Access to UtthUes" below For the purpose offlas agreement, the term "Lessor maprovements" shall mean those things on the leased premises belop, gmg to, consu'ucted by, or to be constructed by Lessor, which enhances or increases, or will enhance or increase, the value or quality of the leased land or property Unless othervose noted hereuh all Lessor unprovements are and will remain the property of Lessor All Lessor anprovements must be described in detail above, or above referenced and attached to flus agreement in an extfib~t approved by Lessor E IMPROVEMENTS PROVIDED BY LESSEE On Tract A, Lessee si.all construct a 12,000 square foot office and hangar feetllty, w~th taxiway access and approprmte culverts as reqmred by C~ty ordinances in the drainage channel north of the hanger and south of the taxtway, as well as other anprove~ as shown on the attached site plan Exhtb~t "B", and required by City ordinances Should Lessee exermse its right of first refusal to lease Tract B, Lessee shall construct a 12,000 square foot hangar facility, w~th taxiway access and appropriate culverts as reqmred by Cay ordinances m the drainage channel north of the northern ramp boundary for taraway access, as well as other improvements as shown on the attached site plan Exlab~t "B", and reqmred by City ordinances Should Lessee exercise ~ts right of first refusal to lease Tract C, maprovements w~ll be the same as those identified for Tract B F ~ Lessor and Lessee by mutual agreement may estabhsh, on the lease prerrases, easements for public access on roads and taxlways The mitml term ofthts agreement shall be for a period of tlm'ty (30) years, commenctng on the 15th day of May, 1997, and continuing through the 14th day of May, 2027, unless earlier terminated under the pmvtsions of the agreement Any attempt by Lessee to renegotmte flus Lease shall be m wntlng addressed to the Caty Manager at least one hundred eighty (180) days before the exp~rauon of the stated term of flus lease, and at least 180 days before the exptrat~on of any additional renegoUated period Lessee has the option to renew for two (2) add~uonal ten (10) year terms The rental and the prowslons of the agreement to be negotmed for either of the additional terms shall be reasonabl~ and eo~ wah the ~ value, rentals and prov~sxons of agreement of sinular property on the airport IV. pAYMENTS. RENTALS AND FEES Lessee covenants and agrees to pay Lessor, as consideration for tlus lease, the following payments, rentals and fees A ~ shall be due and payable in twelve (12) equal monthly installments m advance, on or before the first of ench and every month during the term of tl~s agreement in the amount ofoue-twelRh (1/12) of an annual rental payment based on the following formulae, ealcula~ed on the basis of minimum yearly rentals adjusted for mtlation as per paragraph IV C 1, 05/15/97 - 05/14/03 $0,05 per square foot mimmum yearly rental, adjusted annually per paragraph I y//,.aC~,D~ o~ e~ ~.~ , 0 r square foot minimum yearly rental, adjusted annually per paragraph IV C 3. 09/15/11 - ~ The em'rent lease rate will be increased by a sum of $0 03 per square foot minimum yearly rental, adJusted annually per paragraph IV C B LESSOR IMPROVEMENTS RENTALS NONE There are no Lessor m~provements on the leased premises. C PAYMENT. PENALTY. ADJUSTMENTS All payments w~ll be due on the 15th oftbe month. ~ payment will be for the prior month fees and the current month land rentals If payments are not received before or on the 15th, a five (5) percent penalty will be due as of the 16th If payments are not received by the first of the subsequent month, an additional penalty of one (1) percent of the unpmd rental/fee amount ~ be due A one (1) percent charge wdl be added on the fu~t of each subsequent month until the unpaid rental/fee payment is made Fadure to pay thc rent, fee, or either monetary penalty amounts on delinquent rent or fees shall constitute an event of default of this Lease. The yearly rental for land and unprovements hereto leased shall be readjusted at the end of each year period during the term of this lease on the bas~s of the proportion that the then current United States Consumer Price Index for all urban consumers (CPI-U) for the Dallas-Fort Worth geo~q, hical region, as compiled by the U S Depm t~uent of Labor, Bureau of Labor Staust~cs bears to the January, 1997 index, which was 150 (1982-84 -- 100) Each rental adjustment, ffany, shall occur on the 15th day of May, beginning 1998, and every year thereafter on such date The adjustments in the yearly rent shall be determined by multiplying the mmanum yearly rent as set forth in Section IV A by a fraction, the numerator of wluch ~s the index number for the last month prior to the adjustment, and the denominator of which ~s the index number for January, 1997, which was 150 (1982-84 = 100) If the product of this multlpheat~on ~s greater than the mimmum yearly rem as set forth aa Sec~on IV A, Lessee shall pay this greater amount as the yearly rent until the time of the next rental adjustment as called for m fins secuon If the product of tins multlplieatton is less than the mmtmum yearly rent of as set forth m Section IV A, there shall be no adjustment aa tho annual rent at that time, and Lessee shall pay the mmunum yearly rent as set forth aa Section IV A, until the time of the next rental adjustmem as called for tn th~s section In no event shall any rental adjustmem called for m thru section result in an annual rent less than the mmmaum yearly rent of as set foFda in Seet~on IV A The adjustment shall be lnmted so that the annual rental payment determined for any gtven year shall not exceed the annual rental payment calculated for the previous year by more than ten percent (10%) If the consumer price index for all urban consumers (CPI-U) for the Dallas-Fort Worth geograpbacal re$1on, as eompflad by the U S Department of Labor, Bureau of Labor Stamttcs, ~s d~scontmued during the ~erm of this leased the remaining rental adjustments called for m thts section shall be made using the formula set forth aa Subsection (A) above, but submtutmg the index numbers for the Consumer Price Index-Seasonally Adjusted U S Cay Average For All Items For All Urban Consumers (CPI-U) for the index numbers for the CPI-U apphcable to the Dallas-Fort Worth geographical region. If both the CPI-U for the Dallas-Fort Worth geograpbacal region and the U S C~ty Average are discommued during the term of tim lease, the remaining rental adjustments called for in tins~sect~on shall be made using the statlsucs of the Bureau of Labor Statmtxcs of the Umted States Depa~hiient of Labor that are most nearly comparable to the CPI-U apphcable to the Dallas- Fort Worth geograpbacal rag~on~ If the Bureau of Labor Statmues oftbe Umted States Department of Labor ceases to exist or ceases to pubhsh stattst~cs concermng the purchasing power of the consumer dollar during the term of th~s lease, the remaining rental adjustments called for m tbas seeuon shall be made using the most nearly comparable star,sUes pubhshed by a reeogn~ed financial authorrry selected by Lessor V. RIGHTS AND OBLIGATIONS OF LESSEE A USE OF LEA~qKD PREMISES Lessee is granted the non-exclusive pnmlege to use the leased prermses to engage in or provtde the following 1, Hangaraag and exinbaflon ofatrcraft, matnteaanee, repmr, and restoration of ~cret~ of Lessee and tts tenants ofatrcratt, 2 Hangar, with offices and maintenance shop Lessee may not use any port,on of the Premises for any other use unless otberw~se agreed to by Lessor and Lessee Lessee, or sublessees shall not be authortzed to conduct any servtces not specflically hsted tn thts agreement The use of the lease premtses of Lessee, or sublessees shall be hrmtad to only those private activities havLng to do with or related to airports and aviatxon No person, business or corporation may operate a commeroml, retad or industrial business upon the prermses of Lessee or upon the Airport without a lease or license from Lessor anthormng such commercml, retad or indus- trial actav:ty The Lessor shall not unreasonably withhold author~zataon to conduct aeronaut:cai or related services B INDEPENDENT CONTRACTOR. Dunng all tunes that this Lease is m effect, the part,es agree that Lessee ~s and shall be deemed to be an independent contractor and operator and not an agent or employee of City wath respect to their acts or onuss~ous hereunder For all purposes hereunder, Lessee is and shall be deemed an mdependant contractor and it as mutually agreed that nothing contained horem shall be deemed or construed to eonstatute a partnership or joint venture between or among the pames hereto C ~ Lessee shall meet or exceed the following standards 1 Address Lessee shall file w~th the Aa'port Manager and keep current his m,,hng addresses, telephone numbers and contacts where he can be reached m an emergency 2 List, Lessee shall file wtth the An'port Manager and keep current a hst of bas tenants and sublessees 3 Conduct Lessee shall contractually reqmre tus employers and sublessees (and sublessee's mvitees) to abide by the provis~oas of the agreement Lessee shall promptly enforce his contractual rights m the event of a default of such covenants 4 L~k~ff~l~LY..~. Lessee shall meet all expenses and payments m connection with the use of the Prenuses and the rights and privileges herein granted, including the timely payment of ut~hties, taxes, perrmt fees, hcense fees and assessments lawfully levaed or assessed 5 LII~.~, Lessee shall comply w~th all current and future federal, state and local laws, rules and regulations which may apply to the conduct of business contemplated, including rules, regulataous and ordinances promulgated by Lessor, and Lessee shall keep m effect and post m a prominent place ali necessary and/or required hceuses or permits Lessee% use ofthe prenuses shall at all tunes be m eomphanee vnth and subject to any covenants, restrictions, and condit~ous of record pertaining to the use and occupancy oftbe leased premises and shall at all tunes comply w~th the laws, codes, ordinances, rules, and regulations, either eyasting or those promulgated m the future, by the Caty of Danton, the County of Denton, the State of Texas, the Umted States of America, and the Federal Av~ion Admimstr~on, or their successors Lessee shall not operate Hangar lO Fl¥in9 Museum Lease Agreement - Page 10 or perrmt the operation of any transmitter devices, electrical signal producers, or machinery on the leased premises winch could interfere with the electromc atrcraft navigatton aids or devices located on or off Airport property Lessee shall not be permitted to engage m any business or operation on the leased premises winch would produce obstructions to visibility or violate height restrictions as set forth by the Federal Aviation Adrmmstratton or the City of Denton 6 ~ Lessee shall be responsible for the maintenance, repair and upkeep of all prope~, buildings, structures and nnprovements, including the mowing or elimination of grass and other vegetation on the Premises, and shall keep said Premises neat, clean and m respectable condition, free from any objectional matter or thing Lessee agrees not to utdize or permit others to utthze areas on the leased prerrases winch are located on the outside of any hangar or building for the storage of wrecked or permanently dtsabled mrerat~, aircraft parts, automobiles, vehicles of any type, or any other eqmpmem or items winch would detract from the appearance of the leased premkqes Lessee agrees that at no tune shall the leased premises be used for a flea market type sales operation 7 Unauthorized use of_m~aises Lessee may not use any of the leased land or premises for the operation ora motel, hotel, restaurant, private club or bar, apartment house, or for industrial, commereml or retail purposes, except as authorized hereto 8 ~ It is expressly understood and agreed that no permanent dwelhng or domictle may be budt, moved to or estabhshed on or within the leased premises nor may lessee, bas tenants, invitees, or guests be permitted to reside or remain as a resident on or within the leased premises or other auport premises 9. ~ Lessee shall quit possession of all premises leased hereto at the end of the primary term of tins lease or any renewal or extension thereof, and deliver up the premises to Lessor m as good condttlon as existed when possession was taken by Lessee, reasonable wear and tear excepted 10. ~)J.~~. LESSEE SHALL INDEMNIFY AND HOLD HARMLESS I.I~.~SOR FROM AND AGAINST ALL LOSS AND DAMAGES, INCLUDING DEATH, PERSONAL INJURY, LOSS OF PROPERTY OR OTHER DAM- AGES, ARISING OR RESULTING FROM THE OPERATION OF LESSEE'S BUSINESS IN AND UPON THE LEASED PREMISES 1 1 ~ Lessee agrees to properly store, collect and dtspose of all chemicals and chermcal residues, to properly store, confine, collect and d~spose of all paint, including paint spray m the atmosphere, and paint products, and to comply with all Local, State and Federal ragu~ons governing the storage, handling or disposal of such chenueals and paints 12 Ha~ar{tous Acttvmes Should Lessee violate any law, rule, restriction or regulation of the City of Denton or the Federal Aviation Adrmmstratioth or should the Lessee engage in or penmt other persons or agents to engage m activ~ties wi.ach could produce hazards or obstruction to mr navigation, obstructions to vmbility or interference with any aircraft navigational aid station or dewee, whether airborne or on the ground, then Lessor shall state such violation tn writing and deliver wmten notice to Lessee or Lessee's agent on the leased premases, or to the person(s) on the leased pretmses who are causing smd violation(s), and upon delivery of such written notice, Lessor shall have the right to demand that the person(s) responsible for the violation(s) cease and desist from all such activity creating the violation(s) In such event, Lessor shall have the right to demand that corrective action, as reqmred, be commenced immediately to restore the leased premases into conformance w~th the pameular law, rule or aeronautical regulation being vmlated Should Lessee, Lessee's agent, or the person(s) responsfole for the violation(s) fail to cease and desist from smd violatmn(s) and to nmnedmtely eo,i.iience correcting the wolation(s), and to complete smd corrections w~thm twenty-four (24) hours following written notification, then Lessor shall have the right to enter onto the leased prermses and correct the vmla- itOh(S), and Lessor shall not be responsible for any damages recurred to any improvements on the leased prermses as a result of the corrective ecuon process D SIGNS During the term of this agreement. Lessee shall have the right, at ItS own expense, to place m or on the lease Prermses s~ns klentffymg Lessee Smd s~gns shall be of a size, shape and design, and at a location or locations, approved by the Lessor and tn conformance wah any overall directional graphics or sign program estabhshad by Lessor for the An'port Lessors approval shall not be vathbeld unreasonably Said s~ns shall be matmalned tn good repair throughout the term of this agreement Notwathstandmg any other provision of tins agreement, smd signs shall remain the property of Lessee Lessee shall remove, at its expense, all lettering, signs and plecards so erected on the prermses at the expiration of the term of this agreement or extensions thereof VI. COVENANTS BY LESSOR Lessor hereby agrees as follows A PEACEFUL ENJOYMENT That on payment of rent, fees, and performance of the covenants and agreements on the part of Lessee to be performed hereunder, Lessee shall peaceably hold and enjoy the leased premises and all rights and privileges hereto granted, B ~ Lessor warrems mad represents that no the esmbhshment, constructton and operaUon of sad Denton Mumeipal Au-port, that Lessor has heretofore and at tlus mae ts complying web all existing roles, regulations, and cntarta chsmbuted by the Federal Avmtion Admmtstratton, or any other governmental authority relating to and including, but not hnnted to, notse abatement, air rights and easements over adjoining and contiguous areas, over-flight m landing or takeoff, to the end that Lessee will not be legally hable for any action of trespass or similar cause of actaon by vn'tue of any aerial operations of adjoining property m the course of normal take.offand landing procedures from sad Denton Municipal A~'port, Lessor further warrants and represems that at all tares during the term hereof, or any renewal or exteuston of same, that it will continue to comply with the foregoing. VII. SPECIAL CONDITIONS It is expressly understood and agreed by and between Lessor and Lessee that this lease agreement Is subject to the following special terms and conditions A RUNWAYS AND TAXIWAYS That because of the present s~xty thousand (60,000) pound continuous use weight bearing capeclty oftbc runway and tardways of the Au'port, Lessee hereto agrees to hnat all aeronautical actively incind~ landmg, take-off and taxnng, to aircrat~ having an actual weight, including the weight of lis fuel, ofsm'y thousand (60,000) pounds or less, until such tn~ that the runway and designated taxiways on the Au'port have been unproved to handle atreraft of such excessive weights It Is further agreed that, based on q,,ahfied engineering studies, the weight restr~etious and proxnsions of tins clause may be adjusted, up or down, and that Lessee agrees to abide by any such changes or revisions as such stu&es may dictate "Aeronantlcal Activity" referred to in th~ clause shall m~lude that actiwty of the Lessee or ~ts agents or subcontractors, and ~ts customers and mmtees, but shall not include those activities over winch it has no sohcitory part or control, such as an unsolicited or unscheduled or emergency landing A pattern of negligent dtsregard of the prov~sions of thts section shall be sufficient to cause the munedtate termination of tbas enttre agreement and subject Lessee to llabthty for any damages to the An-port that mtght result VIII. LEASEHOLD IMPROVEMENTS A ~]]~j~, Before commencing the construction of any anprovements upon the prermses, Lessee shall subnut 1 Documentation, spemficat~ons, or design work, to be approved by the Lessor, winch shall estabhsh that the improvements to be budt or constructed upon the lease prenuses are m conformance with the overall s~ze, shape, color, quahty and des~h m appearance and structure of the program estabhshed by Lessor on the Au~rt Hangar 10 Flying MUBOUm Lease Agreement ~ Page 13 2 All plans and spectficattons shovang the location upon the prennses of the proposed constructlon~ 3, The estunated cost of such construction No construcUon may co~ until Lessor, acting by as COY Council, has approved the plans and spec/w, attons and the location of the waprovements, the estimated costs of such constructxon and the agreed estnnated life of the budding or structure Approval by the City Council shall not be ~nably w~thheld, should the Council fml to deny Lessee's plans and specfficattons walun s~xty (60) days of subnussion thereof to the Council, such plans and specificattons shall he deemed approved Documentary evtdence of the actual cost ofconstmctton on pubhe areas only (such as tamways) shall he delivered by Lessee to Lessor's COY Manager from tune to time as such costs are prod by Lessee, and Lessor's COY Manager is hereby authormzed to endorse upon a copy of tlus lease filed with the COy Secretary of Lessor such actual amoums as he shall have found to have been prod by Lessee, and the findings of the Ctty Manager when endorsed by into upon smd contract shall be concinstve upon all pames for all purposes of this agreement B ADDITIONAL CONSTRUCTION OR IMPROVEMENTS Lessee ts hereby authorized to construct upon the land herein leased, at Ins own cost and expense, buddings, hangars, and struc- tures, that Lessor and Lessee mutually agree are necessary for use m connection with the operattons authorized by this lease, provided however, before commencing the construction of any nuprove- ments upon the premises, Lessee shall submit plans and spemficauons for approval by Lessor as specflied m Article VIII A, above C QWNERSHIP OF IMPROVEMENTS. Ail bmldn~s and nnprovements constructed upon the prerm~ by Lessee shall remain the property of Lessee unless smd property becomes the property of Lessor under the foilowin~ conditions, terms and prowstons I ~ No building or permanent fixture may he removed from the premises 2 ~ All braidings and nnprovements of whatever nature remaining upon the leased prerrases at the end of the primary term, or any extension thereof, of tins lease shall automattcally become the property of Lessor absolutely m fee w~thout any cost to Lessor 3 ~ It ts afil'eed that the hfe of the bmldm8 to be constructed by Lessee on the property hereto leased ~s tbarty (30) years 4 .C~lgp.,lllt~l~ Should th~ lease be canceled for any reason before the end of the thn'ty (30) year expected bulldn~ hfe, ttm especmlly understood and a~reed that Lessor reserves the fight to purchase all braidings, structures and improvements then ex~stmg upon the prermses by tendermg to Lessee one tinrtleth (1/30) of the undeprecmted value of such building for each year remaining on the agreed life of such building The undepreciated value of all improvements ts to be determined by having such maprovements apprmsed by three apprmsers, one appointed by Lessor, one appointed by Lessee and one appointed by the two apprmsers IX. SUBROGATION OF MORTGAGEE A Lessee shall have the nglat to place a first mortgage lien upon its leasehold m an amount not to exceed eighty-five percent (85%) of the cost of the capttai unprovements B Any person, corporation or instttution that lends money to Lessee for construction, purchase and or refinance of any hangar, structure, bufldmg or unprovement and retams a security mterest m smd hangar, structure, buddmg or unprovement shall, upon default of Lessee's obhgattons to said mortgagee, have the right to enter upon smd leased premases and operate or manage smd hangar, structure, bulldmg or lmprov~ according to the provisions of the agreement, for a period not to exceed the term of the mortgage wlth Lessee, or untd the loan ts paid m full, wluchever comes first, but m no event longer than the term of tins lease It ts expressly understood and agreed that the right of the mortgagee referred to herein is ltrmted and restricted to those h'nprovements constructed with funds borrowed from mortgagee, those improven~nts purchased with borrowed funds and those maprovements pledged to secure the refirumcmg of the tmprovements C Lender's duties and rights are as follows 1 The Lender shall have the right, va case of default, to assume the rights and obhgations of Lessee berem and become a substituted Lessee, with the further right to assign the Lessee's merest to a tinrd party, subject to approval of the Lessor, such approval to not be unreasonably withheld or delayed. Lender's obhgations under flus Lease as substituted Lessee shall cease upon assignment to a tturd party and approval by the Lessor 2 As a condiUon precedent to the exerctse of the right granted to Lender by fins paragraph, Lender shall notify the Lessor of all action taken by it m the event payments on such loans shall become dehaquent Lender shall also not~y the Lessor, m writLng, of any change in the ldantaty or address of the Lender 3 All not~ces of default, as well as all notices required by Arttcle XIV berem (Cancella- tion by Lessor) to be given by the Lessor to Lessee shall also be gtven by the Lessor to Lender at the same tree and in the same manner, provided the Lessor has been fumtsbed with written not,w~e of Lender's merest and its address Lessor's notice shall be given to the City Mmmger Upon recenpt of such not,ce, Lender shall have the same rights as Lessee to correct any default Hangar 10 Plying Museum Lease Agreement - Page 15 X ]~IGHT OF EASEMENT Lessor shall have the right to estabhsh easements, at no cost to Lessee, upon the leased ground space for the purpose ofprovtdmg underground utility serwces to, from or across the an'port property or for the construction ofpubhc faeflit~as on the Au'port However, any such easements shall not interfere w~th Lessee's use of the leased premises and Lessor shall restore the property to original condlUon upon the installation of any utility services on, m, over or under any such easement or the conclusion of such construction ConstrueUon m or at the easement shall he completed w~tlun a reasonable tune. XI. SUBLETTING AND ASSIGNMENT OF LEASE A The Lessee may rent or sublease the Preratses for the storage of individual atreraf~ w~thout prior written consent of the Lessor, but Lessee shali not rent or sublease all or any part of the Prermsas or the improvements located thereon for any other purpose w~thout the prior written consent of the Lessor, such consent to not he unreasonably w~thheld or delayed Any tenant or sublessee shall he subject to the same condmons, obligaUons and terms as set forth hereto Lessee shall he respenfible for the observance by its tenants and sublessecs o f the terms and covenants o f tins Lease It is the intenUon of the City that the subleases not he nnsused as a method to avoid eomphance w~th the mmanum standards herem~ In the event that the Lessor determines that a sublease ~s operating an avmUon-related business w~thout complying w~th the minimum standards apphcable thereto, the sublease may he terminated m the same manner as provtded by Amcle XIV hereto for leases B Lessee ewpressly covenants that ~t will not assign tbas Lease, convey more than forty.nme percent (49%) of the interest m ~ts business, deemed hereto to mean the controlling interest m ~ts business, through the sale of stock or otherwise, nor sublet, assign, transfer, nor hcense the whole or any part of the smd Prennses for any purpose, except for rental of hangar space or ue-down space, w~thout the written consent of the Lessor Lessor agrees that ~t wdl not unreasonably w~thhold ns approval of the sale or sublease of the fac~httes for airport related purposes The provlsmns ofttus Lease shall remain binding upon the assignees, ff any, or Lessee A REOUIRED INSURANCE. Lessee shall mammm continuously m effect at alt times during the term of this agreement, at Lessee's expense, the following insurance coverage 1 Commereml general liability cevermg the leased prenuses, the Lessee or ~ts company, tts personnel, and tts operaUons on the airport 2 A~rcra~ hab~hiy to cover all fl~ght operations of Lessee 3 Fire and extended coverage for replacement voJue for all facflmes used by the Lessee e~tber as a part of tins agreement or erected by the Lessee subsequent to fins agreement 4 Lmbthty insurance bruits shall be m the following mmunum amounts Bodily Injury and Property Damage One Mflhon Dollars ($1,000,000) combined single hnnts on a per occurrence basis 5 All policies shall name the C~ty of Denton as an addmonal named insured and provide for a minimum ofthn'ty (30) days written notice to the City prior to the effective date of any cancellation or lapse of such pohey 6 All policies must be approved by the Lessor 7 The Lessor shall be provided wtth a copy of all such pohc~es and renewal eertn'icates During the term of this lease, Lessor herein reserves the right to adjust or increase the hability insurance amounts reqmred of the Lessee, and to reqmre any additional rider, provisions, or eeruficates ofinma'an~ and Lessee hereby agrees to prowde any such insurance reqmrements as may be required by Lessor, provided however, that any reqmrements shall be commensurate with insurance requirements at other pubhc use airports mmilar to the Denton Mumeipal An~ort m size and m scope of avmtion activities, located in the southwastem region of the United States Lessee hereto agrees to comply vath all increased or adjusted insurance requtrements that may be reqtared by the Lessor throughout the original or extended term of this lease, including types of insurance and monetary amounts or hrmts ofnmumnee, and to comply w~h smd insurance reqturements w~thm smty (60) days following the receipt of a notice m writing bom Lessor stating the increased or adjusted msunmee requimnents, Lessee shall have the right to maintain m force both types of insurance and amounts of insurance which exceed Lessor's rmmmum insurance requirements In the event that State law should be amended to reqmre types of insurance and/or insurance amounts which exceed those ofhke or snnflar pubhe use an-ports m the southwestern region of the Umted States of Amenem, then in sneh event, Lessor shall have the right to requare that Lessee maintain m force types of insurance and/or amount of msuranee as specified by State law Failure of Lessee to comply wath the rmmmum specified amounts or types of insurance as requtred by Lessor shall consmute Lessee's default of tins Lease XIH. INDEMNITY LESSEE AGREES TO INDEMNIFY AND HOLD HARMLESS CITY AND ITS AGENTS, EMPLOYEES, AND REPRESENTATIVES PROM AND AGAINST ALL LIABILITY FOR ANY AND ALL CLAIMS, SUITS, DEMANDS, AND/OR ACTIONS ARISING FROM OR BASED UPON INTENTIONAL OR NEGLIGENT ACTS OR OMISSIONS ON THE PART OF LESSEE, ITS AGENTS, REPRESENTATIVES, EMPLOYEES, MEMBERS, PATRONS, VISITORS, CONTRACTORS AND SUBCON- TRACTORS, IF ANY, AND/OR SUBLESSEES, WHICH MAY ARISE OUT OF OR RESULT FROM LESSEEVS OCCUPANCY OR USE OF THE PREMISES AND/OR ACTIVITIES CONDUCTED IN CONNECTION WITH OR INCIDENTAL TO THIS LEASE. THIS INDEMNITY PROVISION EXTENDS TO ANY AND ALL SUCH CLAIMS, SUITS, DEMANDS, AND/OR ACTIONS REGARDLESS OF THE TYPE OF RELIEF SOUGHT THEREBY, AND WHETHER SUCH RELIEF IS IN THE FORM OF DAMAGES, JUDGMENTS, AND COSTS AND REASONABLE ATTORNEY'S FEES AND EXPENSES, OR ANY OTHER LEGAL OR EQUITABLE FORM OF REMEDY. THIS INDEMNITY PROVISION SHALL APPLY REGARDLESS OF THE NATURE OF THE INJURY OR HARM ALLEGED, WHETHER FOR INJURY OR DEATH TO PERSONS OR DAMAGE TO PROPERTY, AND WHETHER SUCH CLAIMS BE ALLEGED AT COMMON LAW, OR STATUTORY OR CONSTITUTIONAL CLAIMS, OR OTHERWISE. THIS INDEMNITY PROVISION SHALL APPLY WHETHER THE BASIS FOR THE CLAIM, SUIT, DEMAND, AND/OR ACTION MAY BE ATTRIBUTABLE IN WHOLE OR IN PART TO THE,LESSEE, OR TO ANY OF ITS AGENTS, REPRESENTATIVES, EMPLOYEES, MEMBERS, PATRONS, VISITORS, CONTRACTORS, AND SUBCONTRACTORS, IF ANY, AND/OR SUBLESSEES, OR TO ANYONE DIRECTLY OR INDIRECTLY EMPLOYED BY ANY OF THEM. FURTHER, CITY ASSUMES NO RESPONSIBILITY OR LIABILITY FOR HARM, INJURY, OR ANY DAMAGING EVENTS WHICH ARE DIRECTLY OR INDIRECTLY ATTRIBUTABLE TO PREMISE DEFECTS OR CONDITIONS WHICH MAY NOW EXIST OR WHICH MAY HEREAFTER ARISE UPON THE PREMISES, ANY AND ALL SUCH DEFECTS BEING EXPRESSLY WAIVED BY LESSEE. LESSEE UNDERSTANDS AND AGREES THAT THIS INDEMNITY PROVISION SHALL APPLY TO ANY AND ALL CLAIMS, SUITS, DEMANDS, AND/OR ACTIONS BASED UPON OR ARISING FROM ANY SUCH CLAIM ASSERTED BY OR ON BEHALF OF LESSEE OR ANY OF ITS MEMBERS, PATRONS, VISITORS, AGENTS, EMPLOYEES, CONTRAC- TORS AND SUBCONTRACTORS, IF ANY, AND/OR SUBLESSEES. IT IS EXPRESSLY UNDERSTOOD AND AGREED THAT THE LESSOR SHALL NOT BE LIABLE OR RESPONSIBLE FOR THE NEGLIGENCE OF LESSEE AND/OR SUBLESSEES, ITS AGENTS, SERVANTS, EMPLOYEES AND CUSTOMERS. LESSEE FURTHER AGREES THAT IT SHALL AT ALL TIMES EXERCISE REASONABLE PRECAUTIONS FOR THE SAFETY OF, AND SHALL BE SOLELY RESPONSIBLE FOR THE SAFETY OF ITS AGENTS, REPRESENTATIVES, EMPLOYEES, MEMBERS, PATRONS, VISITORS, CONTRACTORS AND SUBCONTRACTORS, IF ANY, AND/OR SUBLESSEES, AND OTHER PERSONS, AS WELL AS FOR THE PROTECTION OF SUPPLIES AND EQUIPMENT AND THE PROPERTY OF LESSEE OR OTI~R PERSONS. LESSEE AND LESSOR EACH AGREE TO GIVE THE OTHER PARTY PROMPT AND TIMELY NOTICE OF ANY SUCH CLAIM MADE OR SUIT INSTITUTED WHICH IN ANY WAY, DIRECTLY OR INDIRECTLY, CONTINGENTLY OR OTHERWISE, AFFECTS OR MIGHT AFFECT THE LESSEE OR THE LESSOR. LESSEE FURTHER AGREES THAT THIS INDEMNITY PROVISION SHALL BE CONSIDERED AS AN ADDITIONAL REMEDY TO LESSOR AND NOT AN EXCLUSIVE REMEDY. XIV. CANCELLATION BY LESSOR All the terms, restrictions, covenants and condmons of record pertamang to the use and occupancy of the Prermses are conchtmns oftlus Lease and fadure of the Lessee to comply w~th any of the terms, conditions, restnetions, covenants and condations of record shall be considered a default of this Lease, and upon default, the Lessor shah have the right to invoke any one or all of the follovang remedies A Should Lessee fad to pay the monthly rental amounts and/or fees prescribed in Article IV hereof, such failure shall constitute a default of this Lease, and Lessor may g~ve written notice to Lessee ofLessee's fiulure to pay and demand payment in accordance with the Lease terms Should Lessee fad to pay the monthly rental amount wittun twenty (20) days following receapt of written notice from Lessor, then Lessor may terrmnate thru Lease B In the event that Lessee f~uls to comply wtth any other terms, condmons, restrictions and covenants pertaining to tl~s Lease Agreement then in such event, Lessor shall give Lessee horace of said breach, and request Lessee to cure or correct the same Should Lessee frei to correct smd v~olation(s) or breach vattun tlurty (30) days follovang receipt of smd notice, except that this tlurty (30) day period shall be extended for a reasonable period of time if the alleged default is not reasonably capable of cure vathtn stud thirty (30) day period and Lessee proceeds to dihgently cure the default, then Lessor shall have the nght to tenmnate tins Lease C In addmon to terrmnatlon ofttus Lease for the breach of terms and con&tions herein, the Lessor shall have the right to terrmnate tbas Lease for the follovang reason(s) 1 The Lease has reached the termmatton date of the original tturty (30) year term or any extended term thereof Hangar l0 Flying Museum Lease Agroement - Page 19 2 In the event that Lessee shall file a voluntary petition m bankruptcy or proceedings in bankruptcy shall be mst~tuted agmnst Lessee and Lessee thereafter ~s adjudicated bankrupt pursuant to such proceedings, or any cou~ shall take jurisdiction of Lessee and its assets pursuant to the proceedings brought under the provlmons of any federal reorgamzat,on act, or ,f a receiver shall take junschct~on of Lessee and ~ts assets pursuant to proceedings brouF, ht under the pwwsxons of any federal reorgamzat~on act, or If a receiver for Lessee's assets ,s appointed 3 In the event that Lessee should make an asmgnment of tins Lease, for any reason, vathout the approval of and written consent from Lessor Upon tornunat~on or cancellation of tins Lease and provided all momes due Lessor have been pmd, Lessee shall have the nsht to remove its personal property, prowded such removal does not cause damage to any part of the hangar, structure or ~mprovements D The Lessor shall have a hen as security for the rent aforesmd upon all 8oods, wares, chattels, ~mplements, fixtures, furmture, tools and other personal property winch are or may be put or caused to be put on the dermsed prermses by Lessee E Upon termination of tbs Lease, Lessee shall remove all personal property from the demised premlses w~thm thn-ty (30) days at~er smd te~a~matlon If Lessee fails to remove ~ts personal property as agreed, Lessor may elect to retmn possesmon of such property or may sell the same and keep the proceeds, or may have such property removed at the expense of Lessee F If Lessor has exercised ,ts option to take t,tle to fixed ~mprovements as prowded, Lessee shall repmr, at its own expense, any damage resulting from smd removal of personal property and shall leave the leased premises m a neat and clean condmon w~th all other ~mprovements m place G Fadure of Lessor to declare tbs Lease terminated upon the default of Lessee for any of the reasons set out shall not operate to bar, destroy or wmve the nght of Lessor to cancel tins Lease by reason of any subsequent wolat~on oftbe terms hereof The acceptance of rentals and fees by Lessor for any period or periods aider a default of any of the terms, covenants, and conditions berem contmned to be performed, kept and observed by Lessee shall not be deemed a wmver of any rights on the part of the Lessor to cancel tins Agreement for failure by Lessee to so perform, keep or observe any of the terms, covenants or con/ht~ons hereof to be performed, kept and observed XV. CANCELLATION BY LESSEE Lessee may cancel tins agreement, m whole or part, and temunate all or any of ~ts obhgat~ons hereunder at any ~me, by tinrty (30) days written not~ce, upon or a/~er the happemng of any one of the followm8 events (1) ~ssoance by any court of competent junsdwtlon of a permanent mjunctwn m any way preventing or restram~ng the use of smd mrport or any part thereof for mrport purposes, Hangar 10 Flying Museum Lease Agreement - Page 20 (2) the breach by Lessor of any of the covenants or agreements contained hereto and the failure of Lessor to remedy such breach for a period of ninety (90) days after receipt of a written notice of the existence of such breach, (3) the lnablhty of Lessee to use smd prenuses and facdmes continuing for a longer period than mnety (90) days due to any law or any order, rule or regulation of any appropriate governmental authority having jurisdictton over the operations of Lessor or due to war, earthquake or other casualty, or (4) the assumption or recapture by the Umted States Government, or any authorized agency thereof, of the maintenance and operation of said mrport and facilities or any substantial part or parts thereof Upon the happemng of any of the four events listed in the preceding paragraph, such that the leased pren,ases cannot be used for aviation purposes, then the Lessee may cancel this lease as aforesaid, or may elect to continue this lense under its terms, except, however, that the use of the leased prermses shall not be himted to av~on purposes, their use being only hnuted by such laws and ordinances as may be apphcable at that t~me XVI. MISCELLANEOUS PROVISIONS A ENTIRE AGREEMENT This agreement constitutes the entire understanding between the partnes and as of its effecave date supersedes all prior or independent agreements between the parties covenng the subject matter hereof Any change or modification hereof shall be m writing signed by both parties B ~ All covenants, stipulations and agreements hereto shall extend to, brad and mute to the benefit of the legal representatives, successors and assigns of the respective par- ties hereto C F~FFECT OF CONDEMNATION If the whole or any part of the leased premises shall be condemned or taken by eminent dommn proceechngs by any city, county, state, federal or other authority for any purpose, then the term of this Lease shall cease on the part so taken from the day the posse~on of that part sb~ll be required for any purpose and the rent shall be paid up to that day, and fromlthat day, Lessee shall have the right to continue m the possession of the remainder oftbe premises under the terms hereto provided, except that the rent shall be adjusted to such amount as the part,es hereto shall negotmte, but, under no circumstances shall the rent be greater than the rental per square foot provided for hereto All damages awarded for such tak, ng of and for any pubhc purpose shall belong to and be the property of Lessor All damages awarded for such talang of structures, improvements or businesses that were constructed by Lessee shall be reflective of their value for the remainder of the lease term and be awarded to Lessee, the remainder to be awarded to Lessor D ~ If a provision hereof shall be finally declared void or illegal by any court or edmlmstratlve agency having .lunsdictlon. the entire agreement shall not be void, but the Hangar 10 Flying Museum Lease Agreement - Page 21 remaining provtsions shall continue m effect as nearly as possible m accordance w~th the original intent of the pemes E NOTICE Any not~ce g~ven by one party to the other m connection w~th tins agreement shall be m wrtttng and shall be sent by regtstered mad, return receipt requested, w~th postage and registration fees prepmd as follows 1 If to Lessor, addressed to City Manager Cxty of Denton Denton, Texas 76201 2 If to Lessee, addressed to Hangar 10 Flying Museum Matt Wright, Prestdent Phflhp R Edgmgton, Secretary-Treasurer Gary Orubb, Trustee 5088 Sabre Lane Denton Mumcipal Au'port Denton, Texas 76207 Notices shall be deemed to have been recetved on the date of recetpt as shown on the return rece:pt F HEADINGS The headings used m tlus agreement are intended for convemence of reference only and do not define or hnut the scope or meamug of any prowsion ofthts agreement O GOVERNING LAW AND VENUE Tlus agreement ts to be construed m accordance vath the laws of the State of Texas and venue for its enforcement shall he m Denton County, Texas H PARKING Lessor reserves the right to restrict and designate parking areas for ail surface velucles on all areas of the Denton Mumc~pal An-pon, except the leased pretmses 1 ~ In any acUon brought to Lessor m which a conwction or judgment ts awarded m favor of Lessor for the enfomement of the obligations of the Lessee, Lessor shall be entitled to recover all costs from Lessee, including attorney's fees, revolved m the enforcement of flus IN WITNESS WHEREOF, the partes have executed tbas agreement as of the day and ye~x first above written CITY OF DENTON, TEXAS, LESSOR TED BENAVIDES, CITY MANAGER ATTEST JENNIFER WALTERS, CITY SECRETARY CITY OF DENTON, TEXAS APPROVED AS TO LEGAL FORM HERBERT L PROUTY, CITY ATTORNEY CITY OF DENTON, TEXAS HANGAR 10 FLYING MUSEUM, LESSEE ~H~LIP I~ ED~I~OT~) - oARY Hangar 10 Flying Museum Lease Agreement - Page 23 THE STATE OF TEXAS § COUNTY OF DENTON § Thts instrument was acknowledged before me on the d~g:)~' y of May, 1997 by Ted Benavides, Oty Manager ANN FORSYTHE aOT. U Lzc, TE S THE STATE OF TEXAS § COUNTY OF DENTON § Tlu-~ instrument was acknowledged before me on the /~ , day of May, 1997 by Philllp R Edgmgton, Hanger 10 Flying Museum ~,%~P~J.~ State of Texas My Comrms$1on Explr,~ ,, , THE STATE OF TEXAS § COUNTY OF DENTON § Tlus n~ument was acknowledged before me on tbe ~ d~yofMay, 1997 by Gary Grubb, Hanger 10 Flying Museum ~[-'°/'"-A~""~ NOTARY PUBLIC f I ~"~ State of Texas ~ N~ PUBLIC, STATE OF TEXAS My Comr~sslon Exp~es ..... Hangar 10 Flyinq Museum Lease Agreement - Page 24 TRACT A ALL THAT CERTAIN TRACT OR PARCEL OF LAND SITUATED IN THE WILLIAM NElL SURVEY,ABS3'RACT NUMBER 970, AND BEING A PART OF LOT ONE, BLOCK ONE, OF THE SOUTHEAST AIRPORT ADDITION, IN THE CITY OF DENTON, DENTON COUNTY, TEXAS, AND FILED FOR RECORD IN CAB, G,PG 295 PLAT RECORDS OF DENTON COUNTY,TEXAS, COMMENCING AT THE MOST WESTERLY SOUTHWEST CORNER OF SAID LOT ONE, BLOCK ONE, SOUTHEAST AIRPORT ADDITION, OF WHICH THE NORTHWEST CORNER BEARS NORTH 08 DEGREES 36 MINUTES 21 SECONDS EAST A DISTANCE OF 1610 27 FEET THENCE NORTH 08 DEGREES 36 MINUTES 21 SECONDS EAST , WITH THE WEST BOUNDRY LINE OF SAID LOT ONE, BLOCK ONE, A DISTANCE OF 936 47 FEET TO A POINT IN THE WEST LINE OF SAID SOUTHF_AST AIRPORT ADDITION THENCE SOUTH 88 DEGREES 36 MINUTES 10 SECONDS EAST A DISTANCE OF 373 28 FEET TO AN IRON PIN SET FOR THE NORTHWEST OF THE HEREIN DESCRIBED TRACT, SAID POINT ALSO BEING THE NORTHEAST CORNER OF A 60 FEET ACCESS, DRAINAGE, AND UTILITY EASEMENT,AND THE POINT OF BEGINNING OF THE HEREIN DESCRIBED TRACT; THENCE SOUTH 88 DEOREES 36 MINUTES 10 SECONDS EAST WITH THE SOUTH LINE OF A 130 FEET TAXlWAY, DRAINAGE, AND UTILITY EASEMENT A DISTANCE OF 18000 FEET TO A IRON PIN SET FOR THE NORTHEAST CORNER OF THE HEREIN DISCRIBED TRACT; THENCE SOUTH 01 DEGREES 25 MINUTES 50 SECONDS WEST A DISTANCE OF 180 O0 FEET TO AN IRON PIN SET FOR THE SOUTHEAST CORNER OF THE HEREIN DESCRIBED TRACT, SAID IRON 'PIN BEING IN THE NORTH LINE OF' 60 FEET ACCESS, DRAINAGE, AND UTILITY EASEMENT, THENCE NORTH 88 DEGREES 36 MINUTES 10 SECONDS WEST WITH THE NORTH LINE OF SAID ACCESS EASEMENT A DISTANCE OF 180 O0 FEET TO AN IRON PIN SET FOR THE SOUTH WEST CORNER OF THE HEREIN DESCRIBED TRACT, THENCE NORTH 01 DEGREES 23 MINUTES 50 SECONDS EAST WITH SAID 60 FEET ACCESS EASEMENT A DISTANCE OF 180 O0 FEET TO THE POINT OF BEGINNING AND CONTAINING 32400 O0 SQUARE FEET,OR 0 7438 ACRES OF I.AND TRACT B ALL THAT CERTNN TRACT OR PARCEL OF LAND S)~UATED IN THE W)LUAM NElL SURVEY,ABSTRACT NUMBER gTo, AND BE)NG A PART OF LOT ONE, BLOCK ONE, OF THE SOUTHEAST A)RPORT ADD)T)ON, )N THE C)TY OF DENTON, DENTON COUNI~F, TEXAS, AND FILEO FOR RECORD IN CAB G.PG 295 PLAT RECORDS OF DENTON COUN~i',TEXAS COMMENCING AT THE MOST WESTERLY SOUTHWEST CORNER OF SAID LOT ONE. BLOCK ONE. SOUTHEAST AIRPORT ADDITION, OF" WHICH THE NORTHWEST CORNER BEARS NORTH 08 DEGREES 36 MINUTES 21 SECONDS EAST A DISTANCE OF 1610.27 FEET THENCE NORTH 08 DEGREES 36 MINUTES 21 SECONDS EAST WITH THE WEST BOUNDRY LINE OF SAID LOT ONE, BLOCK ONE, A DISTANCE OF 936 47 FEET TO A POINT IN THE WEST LINE OF SAID SOUTHEAST AIRPORT ADDITION THENCE SOUTH 88 DEGREES 36 MINUTES 10 SECONDS EAST A DISTANCE OF 553 28 FEET TO AN IRON PIN SET FOR THE NORTHWEST OF THE HEREIN DESCRIBED TRACT SAID POINT ALSO LYING IN THE SOUTH LINE OF A 130 FEET TAXIWAY, DRAINADE, AND UTILITY EASEMENT. AND THE POINT OF BEGINNING OF THE HEREIN DESCRIBED TRACT THENCE SOUTH 88 DEGREES 36 MINUTES 10 SECONDS FAST WITH THE SOUTH LINE OF SAID TAXlWAY EASEMENT A DISTANCE OF 180 O0 FEET TO AN IRON PIN SET FOR THE NORTHEAST CORNER OF THE HEREIN DESCRIBED TRACT. THENCE SOUTH 01 DEGREES 23 MINUTES 50 SECONDS WEST A DISTANCE OF 180 O0 FEET TO AN IRON PIN SET FOR THE SOUTH EAST CORNER OF THE HEREIN DESCRIBED TRACT, AND LYING IN THE NORTH LINE OF A 60 FEET ACCESS, DRAINAGE. AND UTILITY EASEMENT; THENCE NORTH 88 DEGREES 36 MINUTES 10 SECONDS WEST WITH THE NORTH LINE OF SAID ACCESS EASEMENT A DISTANCE OF 180 O0 FEET TO AN IRON PIN SET FOR THE SOUTHWEST CORNER OF THE HEREIN DESCRIBED TRACT. THENCE NORTH 01 DEGREES 23 MINUTES 50 SECONDS EAST A DISTANCE OF 180 O0 FEET TO AN IRON PIN AT THE NORTH WESTCORNER OF THE HEREIN DESCRIBED TRACT AND THE POINT OF BEGINNING AND CONTAINING 32400 O0 SQUARE FEET OR 0 7438 ACRES OF LAND TRACT C ALL THAT CERTAIN TRACT OR PARCEL OF LAND SITUATED IN THE WILLIAM NElL SURVEY,ABSTRACT NUMBER 970, AND BEING A PART OF LOT ONE, BLOCK ONE, OF THE SOUTHEAST AIRPORT ADDITION, IN THE CITY OF DENTON. DENTON COUNTY, TEXAS. AND FILED FOR RECORD IN CAB G,PG 295 PLAT RECORDS OF DENTON COUNTY,TEXAS COMMENCING AT THE MOST WESTERLY SOUTHWEST CORNER OF SAID LOT ONE, BLOCK ONE, SOUTHEAST AIRPORT ADDITION, OF WHICH THE NORTHWEST CORNER BEARS NORTH 08 DEGREES 36 MINUTES 21 SECONDS EAST A DISTANCE OF 161027 FEET THENCE NORTH 08 DEGREES 36 MINUTES 21 SECONDS EAST WITH THE WEST BOUNDRY LINE OF SAID LOT ONE, BLOCK ONE, A DISTANCE OF 936 47 FEET TO A POINT IN THE WEST LINE OF SAID SOUTHEAST AIRPORT ADDITION THENCE SOUTH 88 DEGREES 36 MINUTES 10 SECONDS EAST A DISTANCE OF 733 28 FEET TO AN IRON PIN SET FOR THE NORTHWEST OF THE HEREIN DESCRIBED TRACT SAID POINT BEING IN THE SOUTH LINE OF A 130 FEET TAXIWAY, DRAINAGE, AND UTILITY EASEMENT,AND THE POINT OF BEGINNING OF THE HEREIN DESCRIBED TRACT, THENCE SOUTH 88 DEGREES 36 MINUTFS 10 SECONDS EAST WITH THE SOUTH LINE OF SAID TAXIWAY EASEMENT A DISTANCE OF 180 O0 FEET TO AN IRON PIN SET FOR THE NORTHEAST CORNER OF THE HEREIN DESCRIBED TRACT, THENCE SOUTH 01 DEGREES 23 MINUTES 50 SECONBS WEST A DISTANCE TO AN IRON PIN SET FOR THE SOUTHEAST CORNER OF THE HEREIN DESCRIBED TRACT AND BEING IN THE NORTH LINE OF A 60 FEET ACCESS,DRAINAGE,AND UTILITY EASEMENT; THENCE NORTH 88 DEGREES 36 MINUTES 10 SECONDS WEST WITH THE NORTH LINE OF SAID ACCESS EASEMENT A DISTANCE OF 180 O0 FEET TO AN IRON PIN SET FOR THE SOUTHWEST CORNER OF THE HEREIN DESCRIBED TRACT THENCE NORTH 01 DEGREES 23 MINUTES 50 SECONDS EAST A DISTANCE OF 18000 FEET TO AN IRON PIN IN THE SOUTH LINE OF SAID TAXIWAY EASEMENT AND THE POINT OF BEGINNING AND CONTAINING 32400 O0 SQUARE FEET OR 0 7438 ACRES OF LAND M"OC~'~: ~'1' OS 9NIAVd /'JVHcISV ,~ M.og,~.LOS .0 0~' t ",,4. ~ /~.o~.~.~os 0 ~ ooo~ O00g l C)~ ~o~ O00g L ~ ~ ~.og,t~.~o. ~ m ,OS I,~,1 ~ ~ ~'o.~ o ~ ~, I 0 0 ~ ,oo~, Exhlblt "B" YZ% Ordinance