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2004-023O INANCE NO. d F¢- AN ORDINANCE OF THE CITY OF DENTON, TEXAS TERMINATING THAT CERTAIN AIP, PORT LEASE DATED MARCH 1, 1999, BY AND BETWEEN THE CITY OF DENTON, TEXAS AND WAYNE ALLEN CONSTRUCTION, INC.; AUTHORIZING THE CITY ATTORNEY OR HIS DESIGNEE TO TAKE APPROPRIATE LEGAL ACTION, IF NECESSARY, TO EFFECTUATE THE TERMINATION; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City of Denton, Texas (the "City") and Wayne Allen Construction, Inc. ("Allen") have entered into that certain Airport Lease Agreement dated March 1, 1999 (the "Lease Agreement") whereby the City leased to Allen for aviation purposes an approximate 11,000 square feet of land described as Lot lA (called "Lot IA") and an approximate 8,800 square feet of land described as Lot lB (called "Lot lB"), which are more particularly described in the Lease Agreement which is incorporated herein by reference (the "Leased Property"); and WHEREAS, pursuant to the Lease Agreement Allen has the duty and obligation to construct on Lot A a hangar/office facility of not less than 3,500 square feet, including related improvements, and on Lot B the duty and obligation to construct a hangar/office facility of not less than 2,500 square feet, including related improvements (the "Improvements"); and WHEREAS, Allen's obligation to construct the Improvements is a material obligation of Allen under the Lease Agreement; and WHEREAS, on or about February 26, 2001 the City gave Allen notice that an unreasonable period of time had elapsed without construction of the Improvements on the Leased Property, a copy of which is attached hereto as Exhibit "A" and incorporated herein by reference (the "February 26, 2001 Notice"); and WHEREAS, in the February 26, 2001 Notice the City requested that Allen obtain a building permit within 45 days of the February 26, 2001 Notice and complete the Improvements no later than eight months after March 1, 2001, which was the two-year anniversary of the Lease Agreement; and WHEREAS, on or about September 10, 2001 the City gave Allen a notice of default under the Lease Agreement stating that the Lease Agreement would be terminated if construction was not completed within 30 days of the notice, a copy of said notice being attached hereto as Exhibit "B" and incorporated herein by reference (the "September 10, 2001 Notice); and WHEREAS, despite the February 26, 2001 Notice and the September 10, 2001 Notice Allen failed or refused to obtain a building permit or construct the Improvements; and WHEREAS, on or about November 20, 2003 the City gave Allen another notice of default for failing to construct the Improvements on the Leased Property, a copy which is attached hereto as Exhibit "C" and incorporated herein by reference (the "November 20, 2003 Notice); and S:\Our Documents\Ordinances\03\Termination of Airport Lease-Wayne Allen.doc WHEREAS, the address for Allen on the November 20, 2003 Notice was the address for Allen contained in the Lease Agreement, but it was returned because Allen's address had changed; therefore the City re-sent the November 20, 2003 Notice to Allen's current address on December 4, 2003 which was received by Allen on December 5, 2003; and WHEREAS, the November 20, 2003 Notice informs Allen that if the Improvements are not constructed with 30 days of the notice the City will terminate the Lease Agreement; and WHEREAS, to date, which is over 30 days since the November 20, 2003 Notice was received by Allen, Allen has failed to construct any of the Improvements on the Leased Property; and WHEREAS, the City Council of the City of Denton hereby finds that the more than 4 ½ year delay to construct the Improvements is an unreasonable period time for construction of the Improvements and is a material breach of the Lease Agreement; NOW, THEREFORE; THE COUNCIL OF THE CITY OF DENTON, TEXAS HERBY ORDAINS: SECTION 1. The findings and recitations contained in the preamble of this ordinance are incorporated herein by reference. SECTION 2. The City Council hereby terminates the Lease Agreement due to nonperformance of a material obligation of Allen under the Lease Agreement. Should legal action be required to effectuate the termination of the Lease Agreement and/or if it should become necessary to file legal action to remove Allen from the Leased Property or to determine the rights and obligations of the parties under the Lease Agreement, the City Attorney, or his designee is hereby authorized to file such legal actions or lawsuits on behalf of the City. SECTION 3. This ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this the~__..c[ay of ~tT~, 2004. F~O~, MAY~// ATTEST: JENNIFER WALTERS, CITY SECRETARY AP~;;EDf'A,~T O- LE G~F ORM: BY: ( / Page 2 DENTON Exhibit A DENTON MUNICIPAL AIRPORT, TERMINAL BUILDING, DENTON, TX 76207-4504 (940) 349-7736 - (940) 349-7702 - Fax (940) 349-7289 February26,2001 Mr. Wayne Allen, President Wayne Allen Construction, Inc. 100 North Locust, Suite 1 Denton, TX 76201 FEB 2 a ' LEGAL ~)~' Airport Lease Agreement dated March 1, 2001 between the City of Denton, Texas and Wayne Allen Construction, Inc., for Commercial Operations (the "Lease Agreement"). Dear Mr. Allen: Under the terms of the Lease Agreement you are required to construct at a minimum a 3,500 square foot hangar/office facility on Lot lA and a 2,500 square foot hangar/office facility on Lot lB of the leased premises. We are approaching the second anniversary of the commencement of the Lease Agreement and no substantial construction activity has been initiated as of the date of this letter. The construction of these facilities is an integral part of the lease agreement. The Airport Advisory Board believes that a two-year delay in construction is an unreasonable amount of time to delay the proposed development of said lots. This letter shall serve as written notification the Denton Municipal Airport is requestinglthat a building permit be obtained for the construction of said facilities on Lot lA and lB within 45-days of the receipt of this letter. Furthermore, it is requested that said development be completed or near completion within eight months of the two-year anniversary, March 1,2001, of the lease agreement. Should you have any questions concerning this request, please do not hesitate to contact me at 349- 7702. Sincerely, Mark Nelson Airport Manager PC: Denton Airport Advisory Board Jon Fortune, ACM, Public Safety and Transportation Operations Ed Snyder, First Assistant City Attorney "Dedz?ated to Qualil? Servt~e" DENTON Exhibit B City Attorney's Office City of Denton, Texas 215 East McKinney Denton, Texas 76201 (940) 349-8333 Fax (940) 382-7923 September I 0, 2001 CERTII~IED MAIL RRR#7000 1530 0005 1310 4594 Wayne Allen President Wayne Allen Construction, Inc. 100 North Locust, Suite 1 Denton, Texas 76201 Airport Lease Agreement dated March 1, I999 between the City of Denton, Texas and Wayne Allen Construction, Inc. (the "Lease Agreement") Dear Mr. Allen: On February 26, 2001 the City notified you in writing that you have failed to even commence construction of the hanger/office facilities required by the Lease Agreement. You were asked to provide the City in writing dates upon which you would begin and complete construction of the required improvements. You have failed to respond. To date no construction has begun. I have tried on several occasions to set up a meeting through your attorney, Ike Shupe, to discuss this issue. Each time he has indicated that he would try and fred out when you would be available to meet. To date I have not received any confirmations on whom you are willing to meet. You are hereby given notice that you are in default of the Lease Agreement by failing to construct the required improvements as provided in Article II D of the Lease Agreement. Should this default continue for thirty days after your receipt of this notice then the City shall terminate the Lease Agreement. Your prompt attention to this letter is r~quested. '~ , Very truly yours, Deputy City Attorney Jon Fortune, Assistant City Manager/Public Safety & Transportation Operations Mark Nelson, Director of Airport & Transit Operations Ike Shupe S;\Our Documents\Correspondence\Ed Snyder\01\Wayne Allen-9-11-01.doc "Dedt~ated to Quality Servt~e' wwmcityq/denton, com Exhibit C City Attorney's Office City of Denton, Texas 215 East McKinney Denton, Texas 76201 (940) 349-8333 Fax (940) 382-7923 November 20, 2003 VIA CERTIFIED MAIL RET[IRN RECEIPT REQUESTED #7003 1010 0004 2399 6522 AND FIRST CLASS MAIL Wayne Allen, President Wayne Allen Construction, Inc. 100 North Locust, Suite 1 Denton, Texas 76201 RE: Airport Lease Agreement dated March 1, 1999 between the City of Denton, Texas and Wayne Allen Construction, In¢: (the "Lease Agreement") Dear Mr. Allen: On February 26, 2001 and September 10, 2001 the City gave you written notices that you are in default under the Lease Agreement for failing to commence construction of the hangar/office facilities required by the Lease Agreement. To date you have not performed any construction activities for these required improvements even though you have had over 4 ½ years to do so. You are hereby given notice that you are in default of the Lease Agreement by failing to construct the required improvements as provided in Article II D of the Lease Agreement. If this default continues for thirty days after the receipt of this notice the City will terminate the Lease Agreement. Deputy City Attorney C: Jon Fortune, Assistant City Manager Mark Nelson, Director of Airport & Transit Operations S:\Our Documents\Correspondence\Letters\03\Allen Lease Default.doc "Dedicated to Qualihj Seroice "