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2010-237\\codad\departments\legal\our documents\ordinances\10\airport global maritime and comerica consent.doc ORDINANCE NO. 2010-237 AN ORDINANCE OF THE CITY OF DENTON, TEXAS APPROVING A CONSENT TO LIEN BETWEEN THE CITY OF DENTON, GLOBAL MARITIME MANAGEMENT, L.L.C. AND COMERICA BANK; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, on December 19,1995 the City of Denton, Texas (hereinafter the "City") entered into that certain Airport Lease Agreement with Avionics International Supply, Inc (hereinafter "AIS") at the Denton Municipal Airport (hereinafter the "Airport"); and WHEREAS, the interest of AIS in the aforementioned Airport Lease Agreement was subsequently assigned to Global Maritime Supply Management, L.L.C. (hereinafter the "Leasee") by City Ordinance 2010-150; and WHEREAS. Leasee has requested the City to enter into a Consent To Deed Of Trust Lien Upon Leasehold (hereinafter the "Consent") with Comerica Bank, a Texas financial institution (hereinafter `Bank"); and WHEREAS, at the meeting of September 15, 2010 the Airport Advisory Board recommended that the City approve the Consent; and WHEREAS, the City Council deems it in the public interest to enter into a Consent with Global Maritime Supply Management, L.L.C., which will facilitate the financing of improvements by Leasee through Comerica Bank; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1. The City Manager or his designee is hereby authorized to execute a Consent To Deed Of Trust Lien Upon Leasehold between the City of Denton, Global Maritime Supply, L.L.C. and Comerica Bank that will facilitate the financing of improvements by Leasee through Comerica Bank, said Consent being attached hereto as Exhibit A and made a part of this Ordinance for all purposes. SECTION 2. This Ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this the day of 2010. 3V - 611~ "'--I---.- r--I MARK URR U , MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY BY: APPROVED AS TO LEGAL FORM: ANITA BURGESS, CITY ATTORNEY BY: Exhibit A CONSENT TO DEED OF TRUST LIEN UPON LEASEHOLD DENTON MUNICIPAL AIRPORT AIRPORT LEASE AGREEMENT BETWEEN THE CITY OF DENTON AND GLOBAL MARITIME SUPPLY MANAGEMENT, L.L.C. This CONSENT TO DEED OF TRUST LIEN UPON LEASEHOLD (this "Agreement") is made and entered into by and among the CITY OF DENTON, a Texas municipal corporation ("Lessor"), GLOBAL MARITIME SUPPLY MANAGEMENT, L.L.C., a Texas limited liability company ("Lessee"), and COMERICA BANK, a Texas financial institution ("Bank"). Recitals A. On or about December 19, 1995, Lessor and Avionics International Supply, Inc. ("AIS") entered into a certain Airport Lease Agreement (the "Lease"), covering certain property at the Denton Municipal Airport ("Airport") and being approximately 24,650 square feet of improved land more particularly described in Exhibit A attached hereto and incorporated herein by reference for all purposes, and having a street address of 1750 Westcourt Drive, in Denton, Texas (the "Leased Premises"). The interest of AIS in the Lease and the leasehold improvements has been subsequently assigned to Lessee. B. In order for Lessee to obtain a loan to finance certain operations at the Leased Premises, Lessee and Bank desire Lessor to consent to the execution by Lessee of a Leasehold Deed of Trust, Security Agreement and Assignment of Rents (the "Deed of Trust") in favor of Bank, which will create a lien on the Leased Premises and secure the loan. Agreements NOW, THEREFORE, Lessor, Lessee and Bank hereby agree as follows: The statements set forth in the recitals above are true and correct and form the basis upon which Lessor, Lessee and Bank have entered into this Agreement. The Lease is a public document on file in Lessor's City Secretary's Office and is incorporated herein by reference for all purposes. 2. Lessor hereby consents to the execution and delivery by Lessee to Bank of the Deed of Trust, and the grant to Bank of a lien on all of the right, title and interest of Lessee in and to the Leased Premises and the leasehold improvements upon, and subject to, the terms set forth in the Lease. Notwithstanding anything to the contrary in the Deed of Trust, Lessee and Bank, acknowledge, understand and agree that Lessee and Bank do not have any right to convey any interests in the Leased Premises greater than those granted specifically by the Lease. Lessee and Bank further acknowledge, understand and agree that Lessor retains the mineral interest. In the event of any conflict between the Deed of Trust and the Lease, the Lease shall control in all respects as to Lessor and as to Lessee's and Bank's obligations to Lessor established by the Lease and/or this Agreement. In the event of any conflict between the Deed of Trust and this Agreement, this Agreement shall control. Except for the provisions set forth in Sections 3, 4 and 6 of this Agreement, in the event of any conflict between this Agreement and the Lease, the Lease shall control. 3. In the event that Lessor is required by the Lease to provide any kind of written notice to Lessee with regard to the Leased Premises, including notice of breach or default by Lessee, Lessor shall also provide a copy of such written notice to Bank. Lessor agrees that (i) Bank may perform any of the obligations or requirements imposed on Lessee by the Lease in order to avoid a breach or default under the Lease by Lessee, and (ii) Lessor will accept Bank's performance the same as if Lessee had performed such obligations or requirements. 4. Lessor agrees and covenants that it will not exercise any rights it may have under the Lease to cancel or terminate the Lease or to force surrender of all or part of the Leased Premises unless it first has provided Bank with written notice of its intent to exercise any such right. Bank shall have thirty (30) calendar days from the date it receives such notice to cure any monetary default under the Lease, and thirty (30) calendar days from the date it receives such notice to cure any other default under the Lease to Lessor's reasonable satisfaction in order to avoid such cancellation, termination or surrender, provided however, that if Bank, in good faith and after diligent and continuous efforts to remedy any non-monetary default under the Lease, cannot cure such default within thirty (30) calendar days, it shall notify Lessor in writing and Lessor and Bank shall negotiate in good faith a reasonable amount of additional time to cure such default. 5. Lessor hereby certifies to Bank, as of the date hereof, that: (a) Lessee has accepted and is in possession of the Leased Premises; (b) neither Lessor nor Lessee is in default in the performance of the Lease; (c) no rent under the Lease has been paid more than thirty (30) days in advance of its due date; (d) Lessee, as of this date, has no claim or offset against the rent; (e) except as otherwise provided herein, the Lease has not been modified and is valid and enforceable; (f) Lessor is the present owner and holder of the Leased Premises; (g) all amounts required to be paid under the Lease as of the date hereof have been paid and all terms required under the Lease as of the date hereof have been performed; and (h) Lessor agrees to comply in a timely manner with all terms of the Lease required to be performed by Lessor. 6. Notwithstanding the provisions of the Lease to the contrary, in the event Lessee shall be entitled to any insurance or condemnation proceeds with regard to the Leased Premises, the Deed of Trust provisions giving Bank the option to either apply such proceeds to the sums secured by the Deed of Trust or to permit Lessee to use such proceeds to repair the Leased Premises, shall be controlling. 7. Lessee agrees that it will not request or consent to any future modifications, amendments or assignments of the Lease without first receiving Bank's written consent thereto and providing a copy of such written consent to Lessor. Lessee understands and agrees that any such consent granted by Lessor without Bank's advance written consent shall be void and specifically releases, holds harmless and agrees to indemnify Lessor for any damages that may arise as a result of any such consent. 8. Lessor agrees that all of Lessee's machinery, equipment, inventory, fixtures or other property ("Lessee's Property") which may be located on the Leased Premises shall remain the personal property of the Lessee and shall not become a fixture or part of the realty notwithstanding anything that may be implied by law from the mode of attachment, installation or otherwise. Lessor further agrees that any lien or security interest Lessor may claim against any of Lessee's Property is subordinated to any lien or security interest now or subsequently held by Bank in any of such property. In the event that Bank undertakes to enforce its rights to any collateral granted by the Deed of Trust on account of a default by Lessee under the Deed of Trust, Lessor will cooperate with Bank in its efforts 2 to assemble and/or remove any of Lessee's Property on the Leased Premises. Bank hereby agrees to repair any damages at or to the Airport, including the Leased Premises, caused by or incident to such removal. 9. In addition to the insurance requirements set forth in the Deed of Trust and as a condition precedent to the effectiveness of this Agreement, Lessee agrees and covenants that it will endorse all insurance policies required by the Lease to name both Lessor and Bank as additional insureds. 10. Subject to Sections 4 and 7 of this Agreement, Lessor may take all action available to it under the Lease, at law or in equity in order to protect its interests, including, but not limited to, cancellation of Lessee's interest as provided by the Lease and in accordance with this Agreement. 11. Bank agrees that it will notify Lessor in writing when Bank has released its rights under the Deed of Trust. This Agreement will automatically terminate on the earlier of (i) the date as of which Bank releases such rights as evidenced by the filing in the real property records of a release of lien, or (ii) the date upon which the Lease expires or is terminated. 12. Except for a foreclosure sale of the Deed of Trust whereby Bank or an affiliated entity acquires Lessee's interest in the Lease, Bank may not sell or otherwise transfer in any way any of Bank's or Lessee's rights or interest in the Leased Premises unless Lessor consents to such sale or transfer in the form of a written agreement approved in advance by Lessor's City Council, which approval will not be unreasonably withheld. 13. Notices to Bank required pursuant to the provisions of this Agreement shall be conclusively determined to have been delivered when (i) hand delivered to Bank, its agents, employees, servants or representatives, or (ii) deposited in the United States Mail, certified, return receipt requested, addressed as follows: COMERICA BANK Mail Code 6566 P.O. Box 650282 Dallas, Texas 75265-0282 Attention: Bradley Cole 14. The parties hereto understand and agree that upon expiration or termination of the Lease, all structures, improvements and fixtures on the Leased Premises, and any items permanently attached to any such structure, fixture or improvement, will become the sole property of Lessor upon the terms set forth in the Lease, free and clear of all liens, including the Deed of Trust, except for improvements of a non-permanent nature, all trade fixtures, machinery, furnishings and other items may specifically be removed from the Leased Premises in accordance with the Lease. In the event that the Lease expires or is terminated, Lessee and Bank covenant and agree that nothing herein shall obligate Lessor to assume in any way Lessee's indebtedness to Bank. 15. This Agreement may not be withdrawn, amended or modified except by a written agreement executed by the parties hereto and approved by Lessor's City Council. Lessee and Bank covenant and agree that they will assign any rights and/or obligations under the Deed of Trust, without the prior written consent of Lessor. 3 16. This Agreement shall be construed in accordance with the laws of the State of Texas. Venue for any action arising under the provisions of this Agreement shall lie in state or federal courts located in Denton, Denton County, Texas. 17. This written instrument, including any documents attached hereto and/or incorporated herein by reference, contains the entire understanding and agreement between Lessor, Lessee and Bank as to the matters contained herein. Any prior or contemporaneous oral or written agreement concerning such matters is hereby declared null and void to the extent in conflict with this Agreement. 18. This Agreement may be executed in one or more counterparts, each of which when taken together shall constitute but one and same Agreement. IN WITNESS WHEREOF, the parties have executed this Agreement to be effective as of the day of September, 2010. [Signature Pages Follow] 4 Signature Page to Consent to Deed of Trust Lien Upon Leasehold Denton Municipal Airport Airport Lease Agreement between the City of Denton and Global Maritime Supply Management, L.L.C. LESSOR: CITY OF DENTON By: L - Printed Name: P City Manager APPROVED AS TO LEGAL FORM: r r AntedNam'e: ^ rr1 , ~r~, ~t Title: STATE OF TEXAS COUNTY OF DENTON BEFORE ME, th indersigned authority, a Notary Public in and for the State of Texas, on this day personally appeared known to me to be the person whose name is subscribed to the forego Vg instrument, and acknowledged to me that the same was the act of the City of Denton and that he executed the same as the act of the City of Denton for the purposes and consideration therein expressed and in the capacity therein stated. GIVEN UNDER MY HAND AND SEAL OF OFFICE thi66-O-day of September, 2010. A C~ Not r Public ' and for the State of Texas =ooPY JENNIFER K. WALTERS ` PGgG~ Notary Public, State of Texas My Commission Expires December 19, Z01tl Signature Page to Consent to Deed of Trust Lien Upon Leasehold Denton Municipal Airport Airport Lease Agreement between the City of Denton and Global Maritime Supply Management, L.L.C. LESSEE: GLOBAL MARITIME SUPPLY MANAGEMENT, L.L.C., a Texas limited liability company By: Printed Nam . ti ~1 ul' Title: t STATE OF TEXAS § COUNTY OF BEFORE ME, the undersigned authority, a Notary Public in and for the State of Texas, on this day personally appeared !n ,9PYSro~ , known to me to be the person whose name is subscribed to the foregoininstrument, and acknowledged to me that the same was the act of Global Maritime Supply Management, L.L.C., a Texas limited liability company, and that he executed the same as the act of Global Maritime Supply Management, L.L.C., a Texas limited liability company, for the purposes and consideration therein expressed and in the capacity therein stated. GIVEN UNDER MY HAND AND SEAL OF OFFICE this day of September, 2010. 1 y~ DAVID TU Notary Public in and for the State of Texas Notary Public, State of Texas !on 20F14 fires MY Commission vie 21, I'll Signature Page to Consent to Deed of Trust Lien Upon Leasehold Denton Municipal Airport Airport Lease Agreement between the City of Denton and Global Maritime Supply Management, L.L.C. BANK: COMERICA By:_ Printed Title: STATE OF TEXAS § COUNTY OF 2 114S § BEFORE ME, the dersi ed thoj'ty a Notary Public in and for the State of Texas, on this day personally appeared g-o-d Lau • C O l~ , known to me to be the person whose name is subscribed to the foregoing instram t, and acknowledged to me that the same was the act of Comerica Bank, a Texas financial institution, and that he executed the same as the act of Comerica Bank, a Texas financial institution, for the purposes and consideration therein expressed and in the capacity therein stated. I-,-) GIVEN UNDER MY HAND AND SEAL OF OFFIthis day of September, 2010. is in an&Tor the State of Texas ORENDII E t~101E ply Camndalon ftetmur 1, 2012 hp EXHIBIT A DESCRIPTION OF PROPERTY Leasehold Estate created by that certain Lease Agreement by and between City of Denton, as Lessor and Avionics International Supply, Inc., as lessee, dated December 19, 1995, filed December 29, 1995, recorded in/under County Cleric's File No. 95-R0080485 of the Real Property Records of Denton County, Texas; with the interest of Avionics International Supply, Inc. having been assigned to Andy Johnson pursuant to that certain Assignment of Lease and Conveyance of Ownership of Leasehold Improvements dated June 3, 2010, and recorded in/under County Clerk's File No. of the Real Property Records of Denton County, Texas; with the interest of Andy Johnson having been assigned to Global Maritime Supply Management, L.L.C., a Texas limited liability company, pursuant to that certain Assignment of Lease and Conveyance of Ownership of Leasehold Improvements dated June 3, 2010, and recorded in/under County Clerk's File No. of the Real Property Records of Denton County, Texas; and encumbering the following described tract of land: ALL that certain tract or parcel of land situated in the W. NEIL SURVEY, ABSTRACT NUMBER 970, Denton County, Texas and being part of a tract shown by deed to City of Denton, recorded in Volume 305, Page 216, Deed Records, and being more particularly described as follows: COMMENCING at an iron rod in the centerline of Underwood Road being 563.48 feet South of the south right-of- way of FM 1515; THENCE South 89 54 29 West a distance of 30.00 feet to a point for corner and a point of beginning; THENCE South 00 22 23 West a distance of 145.00 feet to a point for corner; THENCE South 89 54 20 West a distance of 170.00 feet to a point for corner; THENCE North 00 22 23 East a distance of 145.00 feet to a point for corner; THENCE North 89 54 20 East a distance of 170.00 feet to the point of beginning for a lot containing 24,650.0 square feet and being 0.565 acres of land, more or less.