2017-224s:\legal\our documents\ordinances\17\airport - huffs lease approval.doc
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AN ORDINANCE APPROVING A COMMERCIAL OPERATOR AIRPORT LEASE
AGREEMENT BETWEEN THE CITY OF DENTON, TEXAS AND JAMES W. AND
NANCY C. HUFF; AND PROVIDING AN EFFECTIVE DATE.
WHEREAS, James W. and Nancy C. Huff (66Lessee") has requested an Airport Lease
Agreement-Commercial Operator (66Lease") from the City of Denton (66Lessor") for a certain
0.317 acre building site at the Denton Enterprise Airport (66Airport99); and
WHEREAS, the Council Airport Committee considered Lessee's request and on July 25, 2017
voted to recommend Council approval of same by a vote of 3 to 0; and
WHEREAS, the City Council finds the Lease should be approved; NOW THEREFORE,
•' • • � • � ' : �' � •
SECTION l. The City Manager or his designee is hereby authorized to execute the Lease
between the City of Denton and James W. and Nancy C. Huff. in substantially the form of the
Airpart Lease Agreement which is attached to and made a part of this ordinance for all purposes.
SECTION 2. This ordinance shall become effective imrnediately upon its passage and
approval. �
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ATTEST:
JENNIFER WALTERS, CITY SECRETARY
/� �_� day of ,�� �'� � m�'�t ���� � 2017.
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CHRIS WATTS, MAYOR
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AARON LEAL, INTERIM CITY ATTORNEY
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This t,���� ��;�•eement (thc� "'I,u�se �t�r�e�1����t" car '",r'1.����c.���i��"} �� �nzi��: ar���
executed to 1��: �1'��:ciive as of the _j�;._��c�ay �i"�:. � - � °��, ?C�l � (t��� "`�1'f�.�:�i�r� I��tc�"� �:�
Denton, Texas, by and between the City c�f` i���� ���, '��xa�� �a ���a���i�i��� ����3��r�ii���,
hereinafter referred to as "Lessor", and James W. Huff and Nancy C. Huff, hereinafter
collectively referred to as "Lessee".
WI ESSETH:
WHEREAS, Lessor now ovms, controls and operates the Denton Enterprise Airport
(the 66Airport99} in the City of Denton, County of Denton, State of Texas; and
WHEREAS, Lessee desires ta lease certain premises at the Airport known as 4906
Lockheed Lane and to construct and maintain an aircraft hangar and related aviation
facilities thereon;
NOW, THEREFORE, for and in consideration of the promises and the mutual
covenants contained in this Agreement, the parties agree as follows:
I. (�I��iC�I. �"�?i`�1UI'I'IC)3�� ��I� LEASE ����1:1�jI�E1'�T
A. PRINCIPLES OF OPERATIONS. The right to conduct aeronautical and related
activities for furnishing services to the public is granted to Lessee subject to the terms hereof
and to Lessee agreeing:
1. To furnish said services on a fair, equal, and not unjustly discriminatory basis
to all users thereof; and
2. 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.
B. NON-DISCRIMINATION. Lessee, for itself, its personal representatives,
successors, and assigns, as a part of the consideration hereof, does hereby covenant and
agree as a covenant ruruling with the land that:
1. No person on the grounds of race, religion, color, sex, or national origin shall
be excluded from participation in, denied the benefits of, or be otherwise
subjected to discrimination in the use of said facilities;
2. In the construction af any improvements on, over, or under such land and the
furnishing of services thereon, na persan on the grounds of race, religion,
color, sex, or national origin shall be excluded from participation in, denied
the benefits of, or otherwise be subjected to discrimination;
3. Lessee shall use the premises in campliance with all other requirements
imposed by or pursuant to Title 49, Code of Federal Regulations,
Department af Transportation, Subtitle A, Office of the Secretary, Part 21,
Nondiscrimination in Federally Assisted Programs of the Department of
Transportation - Effectuatian of Title VI of the Civil Rights Act of 1964, as
said Regulations may be amended.
C. RIGHT OF INDIVIDUALS TO MATNT°�hIl"� t�TI�� it�.T�`�`. It is clearly understood
by Lessee that no right or privilege has been granted in this Agreement 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 ovm employees (including, but not lirnited to,
maintenance and repair) that it may choose to perform.
D. NON-EXCLUSIVE RIGHT. It is understaod and agreed that nothing herein
contained sha11 be construed to grant or authorize the granting of an exclusive right within
the meaning of Title 49 U.S.C. §40103.
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"Public Areas" or "Public Area" is that portion of the Airport, which is now or
hereafter considered by the FAA, TxDOT, the City of Denton, or any other regulatory
agency with oversight of the Airport ta be the obligation and responsibility of the Lessor to
operate and maintain for the common use and benefit of the general aviation public. The
Airport Public Area includes, without limitation, any air navigation facility or structure
designed and intended to serve the general public not specifically subject to an exclusive use
agreement such as a lease agreement, license, or perrnit. The Airport Public Areas include
all runways, taxiways and other common-use paved, graveled or turfed areas, and their
respective protection zones, safety areas, and/or object free areas; any other facility or
facilities at the Airport that are eligible for federal or state grants or subsidies awarded on the
basis of their serving the benefit of the public (including runways, taxiways, vehicle streets
and alleys, public aircraft aprans/tarrnac, vehicle parking areas, and drainage structures);
field lighting and associated beacon and lighted wind and landing direction indicators;
security, fire, and emergency medical facilities; directional signs; and perimeter or restricted
access fences. Generally, the Public Area is the total area and facilities of the Airport
exclusive of all non-public airport facilities, and may vary from time to time depending on
the total land camprising the Airport and the change of 1and use at the Airport.
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Lessor reserves the right to further develop or improve the Public Area of the
Airport and any other property at the Airport not part of the Leased Premises
as it sees fit, regardless of the desires or views of Lessee, and without
interference or hindrance.
2. Lessor shall be obligated ta maintain and keep in good repair the Public
Area, together with the right to direct and control all activities of Lessee in
this regard.
3. During time of war or national emergency, Lessor shall have the right to
lease the Public Area or any part thereof to the United States Government for
military or naval use, and, if such lease is executed, the provisions of this
instrument insofar as they are inconsistent with the provisions of the Lease
Agreement to the Government, shall be suspended.
4. Lessor reserves the right to take any actian it considers necessary to protect
the aerial approaches of the Airport against obstruction, together with the
right ta prevent Lessee from erecting, or permitting to be erected, any
building or other structure on or adjacent to the Airport which, in the opinion
of Lessor, would limit the usefulness or safety of the Airport or constitute a
hazard ta aircraft or to aircraft navigation. The Lessee Improvements as
currently contemplated in Section II.D do not violate this provision.
5. This Lease Agreement shall be subordinate to the provisions of any existing
or future agreement between Lessor and the United States or agency thereof,
relative to the operation or maintenance of the Airport.
6. This Lease is given and entered into and subject to all laws, ordinances,
statutes, rules, regulations, directives, permits, or standards of any
governmental authority, entity, ar agency (including, W1t110Ut I11TlliatlOri, the
City of Denton, Texas, the State of Texas, the Federal Aviation
Adrninistration, and the Texas Department of Transportation), whether now
in existence or hereafter enacted, adopted or imposed, and including, without
limitation, any and all grant agreements or grant assurances now existing or
as hereafter agreed to, adopted or imposed.
I�,,,. �. .� ♦ ��. � R
Lessor, for and in consideration of, and subject to, the terms, covenants and conditions
set forth in this Lease Agreement to be kept by Lessee, does hereby demise and lease unto
Lessee, and Lessee does hereby lease from Lessor, for the lease terrn described in Article
III, the following described land situated in Denton County, Texas:
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A. LAND. A tract of land, being approximately 13,800 square feet or 0.317 acres, as
described on Attachrnent 66 A 999 such attachment being incorporated herein by reference (the
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66LeaSeiU PTeII1ISeiS99\.
1
Together with the right of ingress and egress to the Leased Premises and the right in
common with others so authorized of passage, upon the Public Area, subject to reasonable
regulations by the City of Denton and such rights shall extend to Lessee's employees,
passengers, patrons and invitees. For purposes of this Lease Agreement, the term "Leased
Premises" shall mean all property located within the parcel described in Attachment "A",
including all Lease Improvements (as defined below) constructed or assumed by the Lessee,
but not including easements or property owned and/or controlled by the Lessor, if any.
;, . ; . , R . .
EXCEPT AS EXPRESSLY �']��C)VII��� IN THIS LEA.SE AGREEMENT, THE
EXECUTION AND DELIVERY OF THIS LEASE AGREEMENT IS ON A 66WHERE
I17999 66L'$1J 14Jy99 [ilrL 66VV1117 L1LL PL11.1L11J99 UL'117A1Jy L"11VL L�4JL7o1\ 1V11"1111i1J 1Vo
REPRESENTATIONS OR WA NTIES WHATSOEVER, EXPRESSED,
STATUTORY, OR IMPLIED, INCLUDING, WITHOUT LIMITATION, AS TO THE
DESCRIPTION, TITLE, VALUE, QUALITY, QUANTITY, PHYSICAL AND
ENVIRONMENTAL CONDITION OF THE LEASED PREMISES AND/OR
MATERIALS CONTAINED OR LOCATED IN, ON, OR UNDER THE LEASED
PREMISES, THE NATURE OF THE PAST OR HISTORIC USE OF THE LEASED
PREMISES, AND/OR MERCHANTABILITY, SUITABILITY, OR FITNESS FOR
PURPOSE OF ANY OF THE LEASED PREMISES, ABSENCE OF LATENT
DEFECTS AND COMPLIANCE WITH LAWS AND REGULATIONS RELATED TO
THE LEASED PREMISES. Lessee further acknowledges that, in executing and
accepting this Lease Agreement, it has relied solely upon its independent evaluation and
examination of the Leased Premises, public records relating to the Leased Premises, and
the independent evaluations and studies based thereon. Lessor makes no warranty or
representation as to the accuracy, completeness, or usefulness of any inforrnation
furnished to Lessee, if any, whether furnished by Lessor or any third party. Lessor, its
officers, employees, elected officials and agents assume no liability for the accuracy,
completeness or usefulness of any material furnished by Lessor, if any, or any of its
officers, employees, elected officials and/or agents, and/or any other person or party, if
any, and Lessee hereby releases such parties frorn and against any claims related to such
matters. Reliance on any material so furnished shall not give rise to any cause, claim, or
action against Lessor, its afficers, employees, elected officials and/or agents, and any
such reliance shall be at Lessee's sole risk.
Lessee has satisfied itself as to the title, type, condition, quality, and extent of the
property and property interests which comprise the Leased Premises and the interests and
rights provided by this Lease Agreement.
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1. Extension of existing taxilane to west side of premises.
2. The term "Lessor Improvements" shall mean those things on or adjacent to the
Leased Premises belonging to, constructed by, or to be constructed by the Lessor.
Unless otherwise noted herein, all Lessor Improvements are and will remain the
property of Lessor.
D, �l�fl���(.�`�+'���v1I1�1�!"1�� I'I�[:��[l��U �`�' �E����,
Lessee shall construct or cause to be constructed buildings and other improvements on
the Leased Premises and the applicable portion of the Public Area, if any (the "Lessee
Improvements"), as described in Attachment 66B79y at Lessee's sole cost, expense, and risk
(except as may be otherwise agreed to between Lessor and Lessee) in accordance with the
plans and specifications which are subject to the review and approval in writing by the
Lessor, as set forth herein and Article VIII, below. The term "Lessee Improvements"
shall also include those real property and structural improvements having been made
prior to the Effective Date and now existing on the Leased Premises, other than Lessor
Improvements, if any. Lessee shall own such Lessee Improvements during the Lease
Term, as provided in Article VIII. Except as provided otherwise in this Agreement,
Lessee may not construct, locate, install, place, or erect any other improvements upon the
Leased Premises or the Public Area. Lessee shall also construct appropriate culverts or
drainage as required by City ordinances, as well as other improvements as determined
necessary by Lessor or as required by City ordinances
Construction of Lessee Improvements shall be commenced no later than 180 days
and completed no later than 270 days, after the Effective Date (the "Construction Period").
For the purposes hereof, construction of the Lessee Improvements shall be deemed to have
commenced when all of the following events have occurred: (i) Lessor's written approval
and acceptance of the final construction design plans and specifications; (ii) Lessee has been
issued the required building permit(s) or licenses necessary to construct the Lessee
Irnprovements; (iii) Lessee shall have received (and shall have provided or caused to be
provided to Lessor) a true and correct copy of the FAA�S C�eieI7rilrililOri t0 L05S0e�S �lllrig
Forrn 7460 �J�a�i�� c��° k'r� �c���,c� �.�����tir��c.ti�a�� c��• �li�����tic�r�� or other such filings required by
the FAA and/or TxDOT; (iv) execution of a contract with a qualified general contractor; (v)
proof of required Builder's Risk Insurance Policy and Payment and Performance Band, as
required in Article VIII, below; and (vi) the initiation af actual mobilization of construction
equipment on the Leased Premises and/or the area af the Public Area wherein Lessee
Irnprovements are to be constructed, if any.
Construction of the Lessee Improvements shall be considered complete upon (i) the
issuance of a Certificate of Occupancy for the Lessee Improvements (other than the Lessee
Improvements located on the Public Areas); and (ii) acceptance by the Lessar af the Lessee
Improvements constructed upon the Public Areas, if applicable.
In addition, as a condition precedent to the effectiveness of this Lease Agreement, within 60
days after the Effective Date of this Lease Agreement, Lessee shall provide to Lessor (i) a
Page 5
written estimate to construct Lessee Improvements certified by the design architect or
engineer and prepared by a contractor who has demonstrated experience in the successful
construction of improvements similar to the Lessee Improvements (the 66Construction Cost
Estimate"); (ii) a written schedule of construction to complete Lessee Irnprovements; and,
(iii) a written loan commitment from a lending institution providing for funding to cover the
Construction Cost Estimate (collectively, "Conditions Precedent99). Should the Conditions
Precedent not be met, either party may terminate this Lease Agreement by giving the other
party written notice, in which case this Lease Agreement sha11 be null and void and of na
further force and effect. Such termination shall not prevent the Lessee from submitting a
new proposed lease request at a later date. The parties may extend the 60 day time period if
agreed to by Lessor and Lessee, as evidenced in writing duly authorized and executed by
both parties. Lessee is not entitled to take possession of the Leased Premises under this
Lease Agreement until the Conditians Precedent have been fttlfilled.
E. EASEMENTS. Lessor and Lessee by mutual agreement may establish, on the Leased
Premises, easements for public access on roads and taxiways. Nothing contained herein
shall be deemed to affect Lessor's rights provided in Article X, below.
F. UTILITIES.
1. Lessor represents that there are water, sewer and 3-phase electric lines
accessible within two hundred feet (200') of the Leased Premises available to
"tap-in" by Lessee, and that the same are sufficient for usual and customary
service on the Leased Premises.
2. Lessee shall be responsible, at Lessee's sole cost and expense, for obtaining all
utility connections at or for the Leased Premises and Lessee shall pay all
charges for water, electricity, gas, sewer, telecommunications, or any other
utility connections, tap-in fees, impact fees, other fees or expenses of any kind,
and for services fixrnished to the Leased Premises during the Term hereof.
Lessee agrees to contact all utility service providers and all other parties that
may ovm or claim to own underground pipelines, telecommunications, cable or
any other structure or facility, priar to any excavation or boring on or under the
Leased Premises. Lessor shall in no event be liable or responsible for any
cessation or interruption in any such utility services.
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A. The term of this Lease Agreement shall be for a period of thirty (30) years, com-
mencing on the 15st day of August, 2017 and continuing through the 14th day of August of
2047, unless earlier terminated under the provisions of the Lease Agreernent (the 66Lease
TE�ilII199). Lessee has the option to renew for two (2) additional five (5) year terms. In order
to exercise the first option Lessee must pravide written notice to Lessor of its intent to
exercise the first five (5) year option no later than 180 days before the expiration of the 30
year primary term. To exercise the second option, such written notice must be provided no
later than 180 days before the expiration of the first five (5) year optian term. The rental and
Page 6
terrns to be negotiated for the option terms shall be reasonable and consistent with the then
value, rentals and terms of similar property on the Airport.
B. HOLDING OVER. If Lessee holds over and continues in possession of the Leased
Prernises after the Term of this Lease Agreement expires, the holding over may be
considered by the Lessor, at the Lessor's option, a month to month tenancy binding Lessee
to all terms and conditions as set forth herein with the following exception: The rental
payment due Lessor herein shall be the amount per month at the last full month of the Term
prior to expiration of this Lease Agreement, payable on the first day of each month
thereafter, until the tenancy is terminated as provided herein. The holding over tenancy may
be terrninated at any time by Lessor or Lessee upon thirly (30) days written notice to the
other party, or may be terminated by Lessor as a remedy in accordance with the terrns of tYus
Lease, as elected by Lessor.
I •• " •' • �
Lessee covenants and agrees to pay Lessor, as consideration for this Lease Agreement,
the following payments, rentals and fees:
A. LAND AND RENTAL. Rental shall be due and payable to Lessor in the sum of
$0.27 per net square foot, as determined and provided in Attachment "A", said sum being
stipulated herein as $3,726.00 per year (the "Original Rent"), payable in twelve (12) equal
monthly installments in the sum of $310.50 in advance, on or before the lst day of each and
every month during the terrn of this Lease Agreement, beginning with the first day of the
month following receipt of a building permit for the parcel identified in Attachment "A" and
then the first day of the month following receipt af a building perrnit for the parcel identified
in Attachment "A99 to this Agreement. Lessee has the option to pay annuai rentals and fees
in whole on or before the 1 st day of August each and every year of this Lease Agreement.
Notwithstanding the foregoing, the annual rental will be reduced by the current lease rate
per square foot, as adjusted by the CPI-U referenced in Section IV.C, times the number of
square feet comprising all easements established in accordance with Section II.E.
The rent provided herein shall be net return to Lessor, free of any loss, expense or charge,
including without limitation, maintenance, construction, reconstruction, repairs,
replacement, insurance, taxes and assessments.
B. LESSOR IMPROVEMENTS RENTALS. None. There are no Lessor
Improvements on the Leased Premises as of the Effective Date.
C. �'��'1�T ]�7'm �'1�;1`��-��x"T�' �.i3,IC�'4 �"�^��;I�"�'�. All payments due Lessor from Lessee
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shall be made to Lessor at the offices of the Finance Department of the City of Denton,
Comptroller's Office, 215 E. McKinney, Denton, Texas, unless otherwise designated in
writing by the Lessor. If payments are not received on or before the 1 St day of the month,
the lesser of the maximum amount allowed by law and a five percent (5%) penalty, will be
due as of the 16th. If payments are not received by the first of the subsequent month, an
Page 7
additional penalty of the lesser of the maximum amount allowed by law and one percent
(1%) of the unpaid rental/fee amount will be due. The lesser of the maximum amount
allowed by law and one percent (1%) will be added on the first of each subsequent month
until the unpaid rental/fee payment is made. Notwithstanding anything herein to the
contrary, any such penalty shall be limited to but not exceed the maximum amount provided
by law, if any
The Original Rent for the Leased Premises sha11 be readjusted at the end of each
two (2) year period during the Lease Term, starting on the 1 st day of July 2019 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 bears to the May 2017 index, which was 225.264 (1982-84 = 100). Each
rental adjustment, if any, shall occur on the 1 st day of July, beginning 2019, and every
second year thereafter on such date.
The adjustments in the yearly rent shall be determined by multiplying the Original
Rent by a fraction, the numerator of which is the index number for the last month prior to
the adjustment, and the denominator of which is the index number applicable at the
execution of this Lease Agreement. If the product of this multiplication is greater than
the Original Rent, Lessee shall pay this greater amount as the yearly rent until the time of
the next rental adjustment as called for in this section. If the product of this multiplication
is less than the Original Rent there shall be no adjustment in the annual rent at that time,
and Lessee shall pay the previaus year's annual rent until the time of the next rental
adjustment as called for in this section. In no event shall any rental adjustment called for
in this section result in an annual rent less than the previous year's annual rent. The
adjustment shall be limited so that the annual rental payment determined for any given
two-year period shall not exceed the annual rental payment calculated for the previous
CPI adjustment by more than twenty percent (20%) percent.
If the consumer price index for all urban consumers (CPI-U) for the Dallas-Fort
Worth geographical region, as cornpiled by the U.S. Department of Labor, Bureau of Labor
Statistics, is discontinued during the Lease Term, the remaining rental adjustments called for
in this section shall be made using the formula set forth above, but by substituting the index
numbers for the Consumer Price Index-Seasonally Adjusted U.S. City Average For All
Items For All Urban Consumers (CPI-U) for the index numbers for the CPI-U applicable to
the Dallas-Fort Worth geographical region. If both the CPI-U for the Dallas-Fort Worth
geographical region and the U.S. City Average are discontinued during the Lease Term, the
remaining rental adjustments called for in this section shall be made using the statistics of
the Bureau of Labor Statistics of the United States Department of Labor that are most nearly
comparable to the CPI-U applicable to the Dallas-Fort Worth geographical region. If the
Bureau of Labor Statistics of the United States Department of Labor ceases to exist or
ceases to publish statistics concerning the purchasing pawer of the consumer dollar during
the Lease Term, the remaining rental adjustments called for in this section shall be made
using the most nearly comparable statistics published by a recognized financial authority
selected by Lessor.
Page 8
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A. USE OF LEASED PREMISES. Lessee is granted the non-exclusive privilege to
engage in owner/operator activities providing only the following aviation services:
���x���c���cf t31��i�� ���e� _x ����ir��. Lessee is granted the non-exclusive right
to rent hangar and office space.
Lessee, its tenants, employees, invitees, and guests shall not be authorized to conduct
any services not specifically listed in this Lease Agreement. The use of the Leased Premises
by Lessee, its tenants, employees, invitees, ar guests shall be limited to only those private,
commercial, retail, or industrial activities having to do with or related to airports and avia-
tion, as provided herein. Except as specifically authorized in this Lease Agreement, no
person, business or corporation may operate a commercial, retail, or industrial business upon
the Leased Premises or upon the Airport without a lease or license from Lessor authorizing
such commercial, retail or industrial activity.
B. STANDARDS. Lessee shall meet or exceed the following standards and perform
the following activities or actions:
Address. Lessee shall file with the Airport Manager and keep current its
mailing addxesses, telephone numbers and contacts where it can be reached in
an emergency.
2. List. Lessee shall file with the Airport Manager and keep current a list of its
sub-lessees and shall keep current and provide to the Airport Manager, as
requested, a list of all aircraft hangaxed or tied down on the Leased Premises
within the previous twelve (12) month period.
3. Conduct. Lessee shall contractually require its employees and sub-lessees (and
sub-lessee's invitees) to abide by the terms af this Lease Agreement. Lessee
shall promptly enforce its contractual rights in the event of a default of such
covenants by such employees and sub-lessees (and sub-lessee's invitees).
4. Utilities, Taxes and Feesq Lessee shall meet and pay all expenses and
payments in connection with the use of the Leased Premises and the rights and
privileges herein granted, including the timely payment of utilities, taxes,
permit fees, license fees, and assessrnents lawfully levied or assessed.
Laws. Lessee, at Lessee's sole cast and expense, shall comply with all current
and future federal, state, and local laws, rules and regulations which may apply
to the conduct of business contemplated and/or occupation of the Leased
Prernises, including rules, regulatians, and ordinances promulgated by Lessor,
and Lessee shall keep in effect and post in a prominent place all necessary
and/or required licenses or perrnits.
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6. 11��ii�1t�������� caF �'r�a��t��. Lessee shall be responsible for the maintenance,
repair, and upkeep of all property, buildings, paving, structures and
improvements, including the mowing or elimination of grass and other
vegetation on the Leased Premises and the Lessee Improvements constructed
on the Public Area, if any, and shall keep the Leased Premises neat, clean, and
in respectable condition, free from any objectionable matter or thing, including
trash or debris. Lessee agrees not to utilize or permit others to utilize areas on
the Leased Premises which are located on the outside of any hangar or
building for the storage of wrecked or permanently disabled aircraft, aircraft
parts, automobiles, vehicles of any type, or any other equipment or items
which would distract from the appearance of the Leased Premises.
7. L�i�:�•i��• f�l����-�te��ttz�c� �i'��ult{ir���. During the Lease Term, Lessor shall have
the right to require, not more than once every five years, that the metal exterior
of hangar(s) and building(s) located on the Leased Premises be inspected to
identify any deterioration beyond normal wear. The Lessor may require
Lessee to repair said exteriors according to Lessor's reasonable specifications,
including paint and metal restoration, if needed. Lessee shall complete any
repair in accordance with such specifications within one (1) year of receipt of
notice from Lessor. Lessee shall pay all costs and expenses involved in the
hangar or building restoration process.
8. Unauthorized Use of Leased Premises. Lessee may not use any of the Leased
Premises for any use not authorized herein unless Lessor gives Lessee prior
written approval of such additional use. Without limiting the foregoing, the
Leased Premises shall not be used for the operation of a motel, hotel,
restaurant, private club or bar, apartment house, flea market type sales,
industrial, commercial, retail sales, storage of recreational vehicles,
automobiles, or marine vehicles not incidental to uses permitted by this Lease,
or any other use or purpose not expressly authorized by this Lease.
9. L7���lli����. No dwelling or domicile may be built, moved to, or established on
or within the Leased Premises, nor may Lessee, its tenants, employees,
invitees, or guests be permitted to reside or rernain as a resident on or within
the Leased Premises or other Airport premises. Lessee may have a pilot
lounge, including restroom and shower facilities, far use by flight crew and
passengers.
10. �!�rit _I�o���s�i���. Lessee shall quit possession of the Leased Premises at the
end of the Lease Term, or upon cancellation or terrnination of the Lease
Agreement, and deliver up the Lease Premises to Lessor in as good condition
as existed when possession was taken by Lessee and as Lessee has
constructed, or accepted at the beginning of the Term, including the Lessee
Improvements and Lease Improvements provided in Sectfon II.D and Artfcle
VIII, hereof, reasonable wear and tear excepted.
��
11. ltrrlc����ai�_�;.�tcl �����a��. Lessee shall indemnify, hold harmless, and defend
the Lessor, its officers, agents, elected officials and employees, and hereby
releases Lessor, its officers, agents, elected officials and employees, frorn
and against any and all claims, liens, suits, liabilities, causes of action,
demands, losses, damages and/or actions for damages, injuries to persons
(including death}, property damage (including loss of use), and expenses,
including court costs, attorneys' fees and other reasonable costs
(collectivelyy 66Claims"), occasioned by, arising from or incidental or related
to the Lessee's occupancy or use of the Leased Premises or the Airport, the
activities of Lessee and/or any party acting under the authority of, or rights
granted by, Lessee conducted in connection with or incidental to this Lease
Agreement, and/or Lessees' breach or default under this Lease Agreement,
including without limitation all such Claims based on common,
constitutional, or statutory law or regulation, whether existing as of the date
hereof or as may be created or recognized hereafter. Lessee must at all
times exercise reasonable precautions on behalf of, and be solely responsible
for, the safety of its officers, employees, agents, customers, visitors,
invitees, licensees, and other persons, as well as the Leased Premises and
Lease Improvements, while in, on, or involved in any way with the use or
occupation of the Leased Premises.
Without limiting the indemnity and release provided herein, the Lessor shall
assume no responsibility or liability for harrn, injury, or any damaging events
which are directly or indirectly attributable to premise defects, whether real
or alleged, which may now exist or which may hereafter arise upon the
Leased Premises, responsibility for all such defects being expressly assumed
by the Lessee. The Lessee agrees that, without iimiting the indemnity and
release provided herein, this indemnity and release provision applies to all
Claims arising frorn all premise defects or related to the condition of the
Leased Premises and/or the Lease Improvements, of any kind or type.
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Page 11
The provisions of this Section V.B.11, shall survive the expiration and
termination of this Lease Agreement.
12. Chemicals and Other Substances. Lessee shall properly store, use, collect,
and dispose of all chemicals, chemical residues, paints, and/or any other
pallutant, contaminant, intermediate, hazardous substance, waste, asbestos
containing material, petroleum product, and any substance containing any of
the above ("Chemica199);, including withaut limitation, paint spray in the
atmosphere; and to comply with all local, state, and federal statutes, rules,
regulations, and ordinances governing the storage, handling, use, or disposal
of such Chemicals. Further, the Lessee shall be solely responsible for, and
without limiting the provisions of Article V.B.11, shall indemnify Lessor
against any and all claims, losses, liens, suits, fines, penalties, liabilities,
damages, causes of action, and demands, including without limitation, costs,
liabilities, and damages assaciated with the cleanup, remediation, and
disposal of said Chemicals, damage ta the environment or natural resources,
property damage and/or injury, disease, or death of any person, related to
discharges or releases, whether accidental or intentional, of any Chemical or
any other matter, claim, loss, lien, suit, liability, damage, demand, or cause of
action associated with or related to the Chemicals.
13. Hazardous Activities. Should Lessee violate any statute, rule, restriction,
order, ordinance, or regulation of the City of Denton or the Federal Aviation
Administration, or any other regulatory authority, or should the Lessee
engage in ar perrnit other persons or agents to engage in activities which
could produce hazards or obstruction to air navigation, obstructions to
visibility or interference with any aircraft navigational aid statian or device,
whether airborne or on the ground, then Lessor shall state such violation in
writing and deliver written notice to Lessee or, if so elected by Lessor,
Lessee's agent on the Leased Premises, or to the person(s) on the Leased
Premises who are causing said 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 fram all such activity creating the
violation(s). In such event, Lessor shall have the right to demand that
corrective actian, as required, be commenced immediately to restore the
Leased Premises into conformance with the particular statute, rule, restriction,
order, ordinance, or regulation being violated or to remove or remediate any
hazard described herein. Should Lessee, Lessee's agent, or the person(s)
responsible far the violation(s) fail to cease and desist from said violatian(s)
and to immediately commence correcting the violation(s), and to complete
said corrections within twenty-four (24} hours following written notification,
then Lessor shall have the right to enter onto the Leased Premises and correct
the violation(s) at the sole cost and expense of Lessee, and Lessor shall not be
responsible for any damages incurred to any improvements on the Leased
Prernises as a result of the corrective action process. In addition, such
violation shall be considered a material default by Lessee authorizing Lessor,
Page 12
at its sole option and discretion, to immediately terminate and cancel this
Lease Agreement and to exercise any and all other rights and remedies
available to it under this Lease Agreement.
C. 5IGNS. No signs, posters, or other similax devices (66Signage") shall be placed on
the exterior of the Lease Improvements, Lessor Improvements, if applicable, or on any
portion af the Leased Premises or Airport property without the prior written approval af
Lessor. Lessee, at its sole expense, shall be responsible for the creation, installation and
maintenance of all such Signage. Lessee, without limiting the general nature of Section
V.B.11, shall pay to Lessor any and all damages, injuries, or repairs resulting from the
installation, maintenance, or repair of any such Signage. Any Signage placed on the Leased
Premises shall be maintained at all times in a safe, neat, sightly, and good physical
condition. All signage shall be removed from the Leased Premises by Lessee immediately
upon receipt of instructions for rernoval of same from Lessor, including without limitation,
upon expiration or termination of this Lease Agreement. If Lessee fails ta remove the
Signage, then Lessor may do so at the sole cost and expense of Lessee. Subject to approval
by Lessor as provided herein, Lessee may place two wall signs, no greater than thirty-two
square feet each, identifying the commercial hangar operatian. Notwithstanding anything
contained herein to the contrary, all signage shall comply with all applicable City of Denton
ordinances, including the City of Denton sign ordinance.
D. ENTRY. Lessor and its designees shall have the right to enter the Leased
Premises upon reasonable advance notice (written or oral) and at any reasonable times for
the purposes of inspecting the Leased Premises, performing any work which Lessor
elects to perform under this Lease Agreement, and exhibiting the Leased Premises for
sale, lease, or mortgage. Nothing in this sectian shall imply any duty upon Lessor to do
any work or perform any activity, which under any other provision of this Lease
Agreement Lessee is required to perform, and any performance by Lessor shall not
constitute a waiver of any default by Lessee hereunder.
1 • • : ;• '
Lessor hereby agrees as follows:
A. l'�AC`ilf�"l��t �l�)C7Y1�L;�1°�. Upon payment of all rent, fees, and performance of
the covenants and agreements on the part of Lessee to be perforrned hereunder, Lessee
(subject to the terms and conditions of this Lease Agreement) shall peaceably hold and
enjoy the Leased Premises and all rights and privileges herein granted; however, Lessee
accepts this Lease Agreement subject and subardinate to any recorded mortgage, deed of
trust, or other lien presently existing upon, ar to any other matter of record in the Real
Property Records of Denton County, Texas and/or that Lessee is otherwise charged with
notice or inquiry notice, affecting the Leased Premises.
B. COMPLIANCE. Lessee will not be legally liable for any action of trespass ar
similar cause of action by virtue of any aerial operations of adjoining property in the course
of norrnal take-off and landing procedures from the Airport.
Page 13
VII. WEIGHT LIMIT OF AIRCRAFT
A. RLJNWAYS AND TAXIWAYS. Lessee shall limit all aeronautical activity,
including without limitation, landing, take-off and taxiing, to aircraft having an actual
weight, including the weight of its fuel, of thirty thousand (30,000) pounds or less, unless
and until such time that the runway and designated taxiways on the Airport have been
improved to handle aircraft of such excessive weights. It is further agreed that, based on
qualified engineering studies, the weight restrictions and provisions of this clause may be
adjusted, up or down, and that Lessee agrees to abide by any such changes or revisions as
such studies may dictate. "Aeronautical activity" referred to in this clause shall include any
activity of the Lessee or its agents or subcontractors, and its customers and invitees, but shall
nat include those activities over which it has no solicitory part or control, such as an
unsalicited, unscheduled, or emergency landing. Violation of the provisions of this section
on two or more occasions during the Term shall be sufficient to cause (i) the immediate
termination of this Lease Agreement, without opportunity to cure by Lessee; (ii) shall
otherwise constitute a default hereunder wherein Lessor may resort ta all other remedies
provided in this Lease Agreement; and (iii) without limiting the provisions of Section
V.B.11, subject Lessee to liability for any damages to the Airport that might result. Nothing
contained herein shall be construed as creating any obligation on the part of Lessor to
improve or modify any part of the Airport.
' • ' • 1 ..�
A. ADDITIONAL CONSTRUCTION OR IMPROVEMENTS. In addition to the
Lessee Improvements, subject to the terrns of this Article VIII, Lessee may construct upon
the Leased Premises, at its own cost and expense, buildings, hangars, and structures, that
Lessor and Lessee mutually agree in their discretion, are necessary for use in connection
with the operations authorized by this Lease Agreement (66Additional Improvements"); pro-
vided however, Lessee shall comply with all of the requirements of this Article VIII.
B. I�GQ[�I�I1�E1�IT� FfJTt I,��`�L I�fi'�Cl'vEN��T�T�.. Before commencing
construction activities related to the Lessee Improvements and/or the Additional
Improvements upon the Leased Premises (the Additional Improvements and the Lessee
Improvements are collectively referred to in this Lease Agreement as the 66Lease
Improvements"), Lessee shall submit to Lessor:
1. Docurnentation, specifications, or design work, prepared by an architect
and/or engineer selected by Lessee which shall be reviewed and approved by
the Lessor, which shall establish that the improvements to be built or
constructed upon the Leased Premises and Public Area, if applicable, are in
conforrnance with the overall size, shape, color, quality, and design, in
appearance and structure of the program established by Lessor on the
Airport.
Page 14
2. All plans and specifications showing the location upon the Leased Premises
and Public Area, if applicable, of the proposed construction and
improvements.
3. The estimated cast of such construction.
No construction may commence until Lessor has approved the plans and specifications and
the location of the Lease Improvements and the Public Area, if applicable, and the estimated
costs of such construction. Approval by the Lessor of construction in canformity with the
terrns af this Lease Agreement shall not be unreasonably withheld.
B.1. CONSTRUCTION OF LEASE IMPROVEMENTS.
1. Construction and modification of the Lease Improvements shall be
performed in a good and workmanlike manner and in compliance with all
applicable building codes, rules, standards, zoning, and other ordinances and
all state and federal standards (including, without limitation, Title III of the
Americans With Disability Act of 1990, any state statutes, governing
handicapped access or architectural barriers, and all rules, regulations, and
guidelines promulgated under such laws, as amended fram time to time).
2. Without limiting the provisions af Section V.B.11, Lessee shall promptly
pay and discharge all costs, expenses, claims for damages or injury
(including without limitation claims for personal injury or death, or property
damage or destruction, or economic loss), liens, and any and all other
liabilities and obligations which arise in connection with such construction.
3, Lessee shall cause each contractor performing any work or otherwise
occupying the Leased Premises or Public Area and/or Airport related to the
Lease Improvements or pursuant to the authority pravided to Lessee
hereunder, to indemnify the Lessor and its officers, agents, elected officials,
and employees to the same extent pravided by Lessee to Lessor in Section
V.B.11.
4, Lessee shall properly and timely submit to the FAA, TxDOT, and any other
governmental entity or agency having jurisdiction regarding the Airport, a
Notice of Proposed Construction and any and all other documents or
materials as may be required, when and as required.
5. Without limiting the rights to Lessor pravided in Section V.D, Lessor has
the right and is authorized by Lessee at all times during any construction
project to enter upon the Leased Premises to observe the performance of
such construction. Nothing contained herein shall be construed as an
obligation, of any kind or type, on the part of Lessor related to the
construction activities and/or to assure Lessee's compliance with the
provisions of this Lease Agreement.
��
6. No later than thirty (30) days after completion of the Lease Improvements,
Lessee shall submit to Lessor detailed as-built plans of the Lease
Improvements and documentary evidence acceptable to Lessor evidencing
the total cost to construct the Lease Improvements (66Cost to Construct Lease
Improvements").
7. No improvements to the Leased Premises, 111CIUC�IIlg W1t110Ut IlffiltatlOri, the
Lease Improvements, may be removed from the Leased Premises during the
Terrn hereof, unless otherwise specifically authorized herein.
Lessee shall cause the general cantractor to obtain (i) payment bonds for
construction contracts greater than Fifty Thousand and no/100 Dollars
($50,000); and (ii) payment and performance bands for construction
contracts greater than One Hundred Thousand and no/100 Dollars
($100,000), for each construction activity on the Leased Premises and Public
Area, if applicable, each naming the Lessor as an Additional Obligee.
Lessee shall furnish such bonds to Lessor prior to any work on the Leased
Premises or Public Area, if applicable. Additionally, any and all insurance
provided by the general contractor to Lessee shall name the Lessor as an
Additional Insured andlor Loss Payee, as applicable, and provide the
following coverages, at a minimum:
• Commercial General Liability -$1,000,000 per occurrence and $2,000,000 aggregate
• Business Automobile Liability -$500,000 per occurrence and $1,000,000 aggregate
� Workers' Compensation — Statutory Limits
• Builder's Risk (if applicable) —100% of the completed value
C. OWNERSHIP OF IMPROVEMENTS. Except as otherwise provided in this Lease
Agreement, the improvements now located, or constructed, or to be constructed upon the
Leased Premises by Lessee (including without limitation, the Lease Improvements), but
excluding the Lessor Improvements, if any, shall remain the properly of Lessee during the
Lease Term subject to the following conditions, terms and provisions:
1. Upon the termination of this Agreement, whether by expiration of the Term
hereof, by reason of default on the part af Lessee, or for any other reason
whatsoever, the improvements (including W1�10Ut I11711tailOri, the Lease
Improvements), and all parts thereof, shall merge with the title of, or be
otherwise considered and deemed a part of the real property, free and clear
of any claim of Lessee and all persons or entities claiming under or through
Lessee (including, without limitation, any holder of a leasehold mortgage),
and shall become the property of Lessor; provided, however:
(i) if Lessee is not then in default hereunder, Lessee shall have the right to
remove all personal property and trade fixtures owned by Lessee from the
Leased Premises, but Lessee shall be required to repair any damage to the
��
Leased Premises caused by such removal in a good and workmanlike
manner and at Lessee's sole cost and expense; and
(ii) Lessor may elect to require Lessee to remove all or part of the
improvements (other than the Lessor Improvements) from the Leased
Premises prior to the expiration or earlier termination of this Lease
Agreement and restore the Leased Premises to the condition in which the
same existed as of the Effective Date of this Lease, as concerns the
improvements required to be removed by Lessor, which said removal shall
be completed no later than the last day of this Lease Agreement, whether
expired or earlier terminated, in which event Lessee shall promptly
perform such removal and restoration in a good and workmanlike manner
and at Lessee's sole cost and expense; and
(iii) Upon such expiration or earlier termination, Lessee shall deliver the
Leased Premises to Lessor in good conditian, reasonable wear and tear
expected, and shall, at Lessor's request, execute a recordable instrument
evidencing the termination of this Agreement, expressly stating the
termination or expiration date thereof.
2. The Lessor Improvements, if any, shall remain the property of Lessor at all
times during and after the expiration or earlier termination of this Lease
Agreement.
3 k Nothing contained herein shall be construed to limit ar prohibit Lessor and
Lessee from mutually agreeing to either (i) amend or modify this Lease
Agreement or, (ii) enter into a new agreement to supersede and replace this
Lease Agreement, which may, among other things, effectively extend or
otherwise defer the transfer of title and ownership of the Lease
Improvernents to Lessor as provided for in this Section VIII.C, prior to the
expiration of this Lease Agreement. However, nothing contained herein
shall be deemed or construed to require any amendment or modification of
this Lease or the entering into of a new lease agreement. Any such action
shall be at the sole and absolute discretion of Lessor and Lessee.
IX. COLLATERAL A5SIGNMENT
A. CONSENT TO ENCUMBER. Lessee shall not collaterally assign this Lease or
otherwise encumber the estate created by this Lease Agreement without the written
consent of Lessor, which such consent shall be at Lessor's sole discretion. As conditions
to such consent, Lessor may require from Lessee and/ar the Secured Party (herein so
called) any commitment, condition, or requirement deemed necessary or advisable by
LeSSOP, 1riCIUC�Irig W1i110Ut IlrilltlilOri, pTOV1S1011 fOT:
�
1, Express agreement that the Lessee shall in no way be released from any of
its obligations under this Lease Agreement, including without limitation,
the obligation to pay rent;
2. The Secured Party to promptly provide Lessor notice of any default by
Lessee in any obligation to Secured Party; and
3, The Secured Party to provide notice to Lessor at least fifteen (15) days
prior to (i) accelerating any indebtedness owed by Lessee to Secured
Party; (ii) initiation of any foreclosure proceedings; and/or (iii) any other
actions to enforce any financial obligation of Lessee to Secured Party.
I: ' ! !� '''• , �
1. Any funds borrowed by Lessee in which this Lease Agreement or the
estate created by this Lease Agreement are utilized as security or
collateral, in whole or in part, may be used only for (i) obtaining funds for
the construction of the Lease Improvements, as described in Section II.D
and Article VIII hereof; (ii) for acquisition of the leasehold estate created
by this Lease; or (iii) any other purpose which may be approved from time
to time by Lessor, in writing, in its sole discretion.
C. LIEN. No lien contemplated by this Article IX shall constitute a lien on
Lessor's fee title. Any indebtedness secured by a lien against or on the estate created by
this Lease Agreement or this Lease shall at all times be and rernain inferior and
subordinate to conditions, covenants, and obligations of this Lease Agreement and to all
of Lessor's rights under this Lease Agreement.
. � .
Lessor shall have the right to establish easements, at no cost to Lessor, upon the
Leased Premises far the purpose of (i) providing underground utility services to, from, or
across the Airport property; or (ii) for the construction of public facilities and/or
infrastructure on the Airport. However, any such easements shall not interfere with
Lessee's use of the Leased Premises and Lessor shall restore the Leased Premises to as
close to its original condition as is reasonably practicable upon the installation of any utility
services on, in, over, or under any such easement at the conclusion of such construction.
Construction within the easement upon the Leased Premises sha11 be completed within a
commercially reasonable time.
XI. ASSIGNMENT OF LEASE
Lessee expressly covenants that it (i) will not assign this Lease Agreement; (ii) convey
more than fifiy percent (50%) of the voting interest in its business or entity as of the
Effective Date of this Lease Agreement, through the sale of stock or otherwise; or (iii)
transfer, license, or sublet the whole or any part of the Leased Premises for any purpose,
Page 18
except for rental of hangar space ar tie-down space far storage of aircraft only, without the
prior written consent of Lessor. Lessor agrees that it will not unreasonably withhold its
approval of such sale, sublease, transfer, license, or assignment of the facilities for Airport
related purposes. T'he provisions of this Lease Agreement shall remain binding upon the
Lessee and the sublessees and assignees, if any, of Lessee.
XII. CASUALTY L�3��IC"��I'IU���Ir'��I`I(��
A. CASUALTY/TOTAL OR P�ft"1�I�!+�L, I?E'�`��iiL��."I�1C��, In the event the Leased
Premises, or any improvements located thereon, are damaged by casualty, regardless of the
extent of the damage or destruction or whether insurance proceeds, if any, are sufficient,
Lessee shall, at its sole cost, risk and expense, promptly, but in no event to be later than six
(6) months after such casualty, cornmence and complete with diligence, the restoratian,
repair and/or replacement of any such improvements to substantially the same candition as
they existed prior to the casualty loss, conditioned upon the following provisions:
Any and all activities related to the restoration, repair, and replacement of the
damaged improvements, shall be subject to (i) Lessor's prior approval, as
provided in Section II.D and Article VIII, as applicable to the improvement
affected by casualty; and (ii) the provisions set forth in this Section I.A.
2. Lessor, as loss payee under the a11 risk property insurance coverage required
by this Lease Agreement, shall be entitled to approve disbursements of the
insurance proceeds as restoration, repair, and replacement activities are
completed by Lessee.
3. Lessee shall take and complete whatever actions are necessary, if applicable,
to obtain disbursement authority of insurance proceeds from any secured
party possessing a lien on the leasehold estate created by this Lease
Agreement.
4. In the event Lessee fails to promptly commence restoration, repair, and/or
replacement of the damaged improvements in conformance with the
provisions hereof, Lessee shall be in default under this Lease Agreement, in
which event Lessor may seek any remedies available hereunder, and Lessee
shall provide such endorsements or talce any other actions necessary,
including without limitation, any action required of any secured party, to
cause all of the insurance proceeds payable due to such damage or casualty
loss to be paid to Lessor.
' • � •' '�'' � ! R � •
.
1� If the Leased Premises or any part of them are taken by condemnation as a
result of any action or proceeding in erninent domain, or are transferred in
lieu of condemnation to any authority entitled to exercise the power of
eminent domain, this Article governs Lessor's and Lessee's interest in the
Page �9
award or consideration for the transfer and the affect of the taking or transfer
of this Lease Agreement.
2. In the event the entire Leased Premises are taken or transferred as described
in Section I.B.1, above, this Lease Agreement and all the rights, titles and
interest under it will cease an the date that title to the Lease Prernises vests in
the condemning authority, and the praceeds of the condemnation shall be the
property of Lessor.
3. If only part of the Leased Premises is taken or transferred, as described in
Section XII.B.1, above, this Lease Agreement shall terrninate if, in Lessee's
reasonable judgment, the remainder of the Leased Premises is in such a
location, or is in such form, shape, or reduced size, that Lessee's operations
cannot be effectively and practicably operated upon the remaining portion of
the Leased Premises. In such event, this Lease Agreement and all rights,
title and interest under it will cease on the date that the title to the portion of
the Leased Premises taken or transferred vests in the condemning authority.
The proceeds of the condemnation shall be the property of Lessor.
4. In the event part af the Leased Premises is taken or transferred as described
in Section XII.B.1, above, and, in Lessee's reasonable judgment, the
remainder of the Leased Premises is in such a location and in such form,
shape, or size, that Lessee's operations may be effectively and practicably
operated on the remaining portion of the Leased Premises, this Lease shall
terminate with the respect to the portion of the Leased Premises taken or
transferred as of the date title to such portion vests in the condernning
authority, but shall continue in full force with respect to the portion of the
Leased Premises not taken or transferred. Notwithstanding the partial
termination of this Lease Agreement, Lessee shall pay to Lessor One
Hundred Percent (100%) of the rent due and payable under this Lease
Agreement as if such partial taking had nat accurred. The proceeds of the
condemnation shall be the property of Lessor.
5. Nothing contained in this Article I shall be construed to prohibit Lessor
from voluntarily conveying all or part of the Leased Premises to any party
with condemning authority under state or federal laws, however, any such
voluntary conveyance shall be treated as a taking within the meaning of this
Article I.
6.. Notwithstanding the above, in the event the condemning authority, as
described in Section I.B.1, above, is the Lessor, the proceeds of the
condemnation atlributable to the Leased Premises shall be the property of
Lessee.
Page 20
XIII. INSURANCE
A. REQUIRED INSURANCE. Regardless of the activities contemplated under this
Lease Agreement, Lessee shall maintain continuously in effect at all times during the term
of this Lease Agreement, at Lessee's sole expense, the following minimum insurance
coverage:
1. Commercial General Liability covering the Lessee, its employees, agents,
tenants and independent contractors, and its operations on the Airport.
Coverage shall be 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 Lessor, coverage for:
products/completed operations; explasion, callapse and underground
property damage; and environmental impairment.
2. All risk property insurance on a one-hundred percent (100%) replacement
cost basis covering loss or damage to all facilities and improvements lacated
on the Leased Premises, either as a part of this Lease Agreement or erected
by the Lessee subsequent to this Lease Agreement. Under no circumstances
shall the Lessor be liable for any damages to fixtures, merchandise or other
personal property of the Lessee or its sub-lessees.
3. Business Automobile Liability to include coverage for Owned/Leased Autos,
Non-Owned Autos and Hired Cars:
For operation in aircraft movement areas the limit of liability shall be
$100,000 per occurrence.
For other operations the limit of liability shall be consistent with the amount
set by State Law.
B. ADDITIONAL COVERAGES. In addition to the above referenced coverage, the
following insurance is required if, in the opinion of Lessor, the activity or exposure exists or
is contemplated:
1. Aircraft Fuel/Oil Storage and Dispensing — Comprehensive Commercial
General Liability shall include coverage or separate coverage for
Environmental Impairment Liability.
2. Aircraft Sales or Aircraft Charter and Air Taxi — Aircraft Liability in the
amount of $1,000,000 per occurrence to include Hull Coverage and
Liability. In addition, Passenger Liability in an amount of $100,000 per
person (per passenger seat) shall be pravided.
3. Aircraft Rental or Flight Training - Aircraft Liability in the amount of
$1,000,000 per occurrence to include Hull Coverage and Liability, Passenger
Liability in the amount of $100,000 per person (per passenger seat) and
Page 21
Student/Renter Liability covering all users in the amount of $500,000 per
occurrence.
4, Specialized Commercial Flying (including crop dusting, seeding, and
spraying, banner towing and aerial advertising, aerial photography and
surveying, fire fighting, power line or pipe line patrol) - Aircraft Liability in
the amount of $1,000,000 per occurrence to include Hull Coverage and
Liability. In addition, Passenger Liability in an amount of $100,000 per
person (per passenger seat) shall be provided.
5. Aircraft Storage, Maintenance and/or Repair - Aircraft Liability in the
amount of $1,000,000 per occurrence to include Hull Coverage and
Liability. In addition, Hanger Keepers Liability in the amount of
$500,000 per occurrence shall be provided.
The requirement for Hangar Keepers Liability shall not apply to individual
owner/operators whose primary use of the hangar space is the storage of their own
aircraft. The requirement does not apply to such individuals notwithstanding the fact that
they may, from time to time, permit the storage of non-owned aircraft in the hangar space
and charge a fee for the storage of such aircraft so long as such use is in the nature of a
rent-sharing agreement rather than a commercial aircraft storage business.
C. �.fJ��LI�f`�,�F �Ct,�tl`I�EM�:1"�T�, All insurance coverage shall comply with the
following requirements:
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.
2, All insurance required by this 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.
3. 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 of the Lessee hereunder.
4. The Lessor shall be provided with a copy of all such policies and renewal
certificates. Failure of Lessee to comply with the minimum specified
amounts or types of insurance as required by Lessor shall constitute Lessee's
default of this Lease Agreement.
�
5. During the Lease Term, or any extension thereof, Lessor 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 Lessor.
XIV. DEFAULT BY LESSEE AND LESSOR
A. EVENTS OF DEFAULT OF LESSEE. The term "Event of Default by Lessee", as
used herein, shall mean the occurrence of any one or more of the following events:
1. Failure of Lessee (i) to pay any installment of rent or any other sum
payable to Lessor hereunder; or (ii) to pay or cause to be paid ad valorem
taxes, utilities or insurance premiums, or any ather payment which Lessee
is to make under this Lease Agreement, on the date that same is due and
such failure shall continue for a period of thirty (30) days after the date on
which such payment is due;
2. Lessee shall become insolvent, apply for or consent to the appointment of a
receiver, trustee, custodian, intervenor, liquidator, or other similar official
of itself, the Leased Premises, or all or substantial part of Lessee's assets,
make a general assignment for the benefit of creditors, or commence a
voluntary case or action under any applicable bankruptcy, rehabilitation,
insolvency, or ather similar law now or hereafter in effect;
3. A court having jurisdiction of or over the Leased Premises or Lessee shall
enter a decree or order for relief in respect of Lessee in any case or
proceeding under any applicable bankruptcy, rehabilitation, insolvency, or
other similar law now or hereafter in effect, or appointing a receiver,
trustee, custodian, intervenor, liquidator, or other similar official for
Lessee, the Leased Premises, or all or a substantial part of Lessee's assets,
or ordering the winding up or liquidation of Lessee's affairs and such
decree or order shall remain unstayed and in effect for a period of sixty
(60) cansecutive days;
4. Lessee shall make a transfer in fraud of creditors;
5. Abandonment or cessation of use of the Leased Premises for the purposes
leased by Lessee, as provided herein, for a period of thirty (30) consecutive
days; or
6. Lessee fails to punctually and properly perform, keep or observe any of the
terms, covenants, agreements, or conditions herein contained and such
failure shall not be cured within ninety (90) days after written notice
Page 23
thereof to Lessee, unless a shorter notice period, or no requirement of
notice, is otherwise specifically prescribed herein.
: ' � , • � 1� ' R • R � ; ;
In the event of an Event of Default by Lessee, if such Event of Default by
Lessee shall be continuing after the applicable notice of default period
provided in this Lease Agreement, if applicable, Lessor may declare this
Lease Agreement, and all rights and interests created by it, terminated. If
Lessee elects to terminate, this Lease Agreement will cease as if the day of
Lessee's election were the day originally fixed in the Lease Agreement for
its expiration. Lessor, at its option, may resume possession of the Leased
Premises and re-let them for the remainder of the Term at the rent
obtainable for the account of Lessee, who shall make good any deficiency
therein.
2. Any termination of this Lease Agreement shall not relieve Lessee from the
obligation of paying any sum or sums due and payable to Lessor under the
Lease Agreement at the time of termination and/or any claim for damages
then or previously accruing against Lessee under this Lease Agreement.
Any such termination shall not prevent Lessor from enforcing the payrnent
of any such sum or surns or claim for damages by any remedy provided by
law, contract, equity, or otherwise, including without limitation, recovering
damages from Lessee arising from or related to any default under this
Lease Agreement. All Lessor's rights, options, and remedies under this
Lease Agreement shall be construed to be cumulative, and no one of them
is exclusive of the other. Lessor may pursue any or all such remedies or
any other remedy or relief provided by law, contract, equity, or otherwise,
whether or not expressly stated in this Lease Agreement.
In the event of an Event of Default by Lessee, Lessor may, but shall not be
required, remedy the Event of Default by Lessee by any necessary action
and, in connection with such remedy, may pay expenses and costs related
to such curative efforts. In such event, Lessee shall pay Lessor for all sums
expended or obligations incurred by Lessor in connection with curing
Lessee's default.
4, Lessor and Lessee agree that, for the purposes of posting notice prescribed
by Section 93.002 (f} of the Texas Property Code, the front door of the
Leased Prernises is 4910 Lockheed Lane, Denton, Texas 76207.
C. EVENTS OF DEFAULT OF LESSOR. The term 66Event of Default by Lessor",
as used herein, shall mean that Lessor defaults in performing any term, agreement or
covenant that Lessor is required to perform under the Lease Agreement, and such default
shall not be cured within ninety (90) days after written notice thereof to Lessor describing
with specificity the claim of default, along with all required actions of Lessor to cure such
��
default. It is expressly agreed and stipulated that until such notice of default is provided,
and such cure period has expired, no such act or event shall be deemed an Event of
Default by Lessor hereunder.
D. REMEDIES ON DEFAULT BY LESSOR. If Lessor defaults in performing any
term, agreement or covenant that Lessor is required to perform under this Lease
Agreement, Lessee may, after notice to Lessor, as provided in Section XIV.C, remedy
the Event of Default by Lessor by any necessary action and, in connectian with such
remedy, may pay expenses. Lessor shall pay Lessee all sums reasonably expended or
reasonable obligations incurred by Lessee in connection with remedying Lessee's default,
so long as such claimed default is an Event of Default by Lessor hereunder. Lessee may,
if not so reimbursed, deduct the costs and expenses from rent subsequently due under this
Lease Agreement.
XV. ASSUMPTION BY T.,��l�`�"�1� STATF,S C'�nVERNMENT
Lessee, subject to the terms hereof, may terminate this Lease Agreement and its
abligations hereunder, by providing thirty (30) days written notice, upon or within thirty
(30} days after the assumption or recapture by the United States Government, or any
authorized agency thereof, of the operation of the Airport and the Leased Premises, to the
resulting extent that the uses of the Leased Premises, as prescribed in this Lease Agreement,
cannot effectively and practicably be operated by Lessee, in the reasonable judgment of
Lessor.
• U ' ' • . . �; �,
A. ENTIRE AGREEMENT. This Lease Agreement constitutes the entire
understanding between the parties and as of its Effective Date supersedes all prior or
independent agreements between the parties covering the subject matter hereo£ Any change
or modification hereof shall be in writing duly authorized and signed by both parties.
B. BINDING EFFECT. All cavenants, stipulations, and agreements herein shall run
with the land and extend to, bind and inure to, the benefit of the legal representatives,
successors and assigns of the respective parties hereto.
C. SEVE ILITY. If a provision hereof shall be finally declared void or illegal by
any court or administrative agency having jurisdiction, the entire Lease Agreement shall not
be void; but the remaining provisions shall continue in effect as nearly as possible in
accardance with the original intent af the parties.
D. NOTICE. Notices or other communications required or perrnitted to be given under
this Lease Agreement must be (i) given in writing and personally delivered or mailed by
prepaid certified or registered mail, return receipt requested; or (ii) transmitted by telephonic
facsimile, as follows:
Page 25
1. If to Lessor, addressed to:
City Manager
City of Denton
215 E. McKinney Street
Denton, Texas 76201
Fax No.940.349.8596
With copies to:
. ��, , ,�_
111 � �• ' �.�
�- � • #
I . • •.;� . • ;a
City Attorney
215 E. McKinney
Denton, Texas 76201
Fax No. 940.382.7923
2. If to Lessee, addressed to:
James W. Huff and Nancy C. Huff
2801 Santa Monica Drive
Denton, Texas 76205
Any notice provided herein shall be deerned to have been given (whether actually
received or not) on the day it is personally delivered as aforesaidy OTy if mailed, on the third
day after it is mailed as aforesaid, or, if transmitted by telephonic facsimile, on the day such
notice is transmitted, whichever is earliest to occur. Any party may change its address for
the purposes of this Lease Agreement by giving notice of such change to the other parties
pursuant to this Section XVI. .
E. HEADINGS. The headings used in this Lease Agreement are intended for
convenience of reference only and do not define or limit the scope or meaning of any
provision of this Agreement.
• ' , � ' � � �, ' � ;,
• ' � � •'�� � • • • �
. � ' ' •' � : � • •' .
• ' � � • " • ' R ;• ., � ' � ' :, '
• � • '' • '• 1'' '' R • � • •
,. .
Page 26
G. NO WAIVER. No waiver by Lessor or Lessee of any default or breach of covenant
or term of this Lease Agreement may be treated as a waiver of any subsequent default or
breach of the same or any other covenant or term af this Lease Agreement.
H. NO AGENCY. During all times that this Lease Agreement is in effect, the parties
agree that Lessee shall not in any event be deemed an agent or employee of the Lessor, nor
shall this Lease Agreement be construed to create or constitute a joint enterprise.
I. FORCE MAJEURE. None of the Parties shall be in default or otherwise liable for
any delay in or failure of performance under this Lease Agreement if such delay or failure
arises by any reason beyond their reasonable control, including any act of God, any acts of
the common enemy or terrorism, the elernents, earthquakes, floads, fires, epidemics, riots,
failures or delay in transportation or cammunications. However, lack of funds shall not be
deemed to be a reason beyond a party's reasonable control. In the event either party hereto
is not able to perforrn under this Lease Agreement due to an alleged event of force majeure,
as set farth herein, such party shall provide notice to the other party, on or before five (5)
calendar days after the occurrence of such event (i) specifically describing such force
majeure event; (ii) describing with specificity the acts to be talcen by the party claiming
force majeure to remedy the force majeure event; and (iii) the estimated time to remedy the
force majeure event. In the event the notice as set forth herein is not provided it sha11 be
deemed for all purposes that no such force majeure event has occurred.
J. RELEASE OF LESSOR. If Lessor sells or transfers all or part of the Leased
Premises and, as a part of the transaction, assigns its interests as Lessor in this Lease
Agreement, then as of the effective date of the sale, assignment or transfer, Lessor sha11 have
no further liability under this Lease to Lessee, except with respect to liability matters that
have accrued and are unsatisfied as of such date. Underlying this release is the parties'
intent that Lessor's covenants and obligations, express and implied, under this Lease
Agreement will bind Lessor and its successors and assigns only during and in respect of
their successive periods of ownership of the underlying fee estate of the Leased Premises.
K. LESSEE REFERENCE5. In the event requested by Lessor, Lessee shall deliver,
from time to time as requested, credit and banking references as Lessor may reasonably
request, during the term of this Lease Agreement.
L. MEMORANDUM OF LEASE. Upon request of either party hereto, the parties
shall execute a Memorandum of Lease for the purpose of imparting to the public notice of
the existence of this Lease Agreement, andlor its subsequent amendment, modification or
early termination, to be filed in the Real Properry Records of Denton County, Texas.
M. AIRPORT SPONSOR. Notwithstanding any provision contained herein to the
contrary, Lessor may limit or temporarily obstruct access to the Leased Premises and/or
Public Areas of the Airport in connection with or related to events occurring at the Airport.
Lessee stipulates that Lessor shall have such right to limit ar temporarily abstruct such
access and hereby releases Lessor, its officers, elected officials, agents, and employees from
any losses, damages or claims of any kind or type that Lessee may have related to such
Page 27
limited or obstructed access. Unless this Lease Agreernent otherwise allows such
obstruction or Lessor and Lessee otherwise agree, Lessor shall not completely obstruct
access to the Leased Premises for a period in excess of twenty-four (24) consecutive hours
related to such special events.
N. SUBLESSEES AND ASSIGNEES. In the event this Lease Agreement provides
applicability of any of its provisions to sub-lessees or assigns, such provision shall be
deemed to mean solely the sub-lessees or assignees of Lessee, as may be permitted by
Lessor.
O. TIME OF ESSENCE. It is expressly agreed by Lessor and Lessee that time is of the
essence with respect to this Lease Agreement.
page ae
IN WITNESS WHEREOF, the parties have executed this Lease Agreement as of the
Effective Date first above written.
• 1 • � •'
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��`i��' `l� HILEMAN
CITY MANAGER
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BY: `' � q W���.e._�
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APPROVED AS TO LEGAL FO .
AARON LEAL, INTERIM CITY ATTORNEY
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This mstrument was �c�lc��c�,�al����cl before ���e c�tt t��€: ���°
Todd Hileman, City IVI��������y c�f �hee City o� 1��..��i����, ��xas, c��� la�l�� of s c� t���nic�i���lii�.
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Page 29
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JAMES W. .l"X�,1��� AND NANCY C. HUFF
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BY �. �`.� a ,... �y �. ; � �y� � ��.:.
al /L�kI I:� W, � � [ � H .(�" ' � �rY . �,
LESSEE NOTARY
This instrument was acknowledged before me on the '� _ day of �+- ���.�-�'� , 2017 by
James W. Huff. ���
_�,�.����� .,. - _ _
��,�"� �,� JULIE N MULLINS
�' *£ Nh' NotarYlD � 8532322
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?�11�' 'r�tF�� PUBLIC, STATE i�F TEXAS
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This instrument was acknowledged before me on the day of �� , 2017 by
Nancy C. Huff.
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,,��'�a• '"� JULIE � N MULLINS
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