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HomeMy WebLinkAboutO-2007-3055 8 REQUEST FOR CITY COUNCIL AGENDA ITEM Agenda Date Reqnested: ~~. 17.. 2007 Requested By: S. Gillett ~ Department: Public Works Appropriation Source of Funds: Account Number: Report: Resolution: Ordinance: x Amount Budgeted: Exhibits: Ordinance Amount Requested: Exhibits: Agreement and Lease Budgeted Item: N/A Exhibits: SUMMARY & RECOMMENDATION Gulf Central Aviation currently leases 3.6065 acres at the La Porte Municipal Airport and operates a Fixed Base Operation (FBO) at the site. The current lease began on January 1, 1993 and is due to expire on December 3 1, 2013. Gulf Central owners have agreed to sell the assets of the corporation to La Porte Flight Line, L.L.C. La Porte Flight Line has requested a new, twenty (20) year lease, with two (2) five (5) year options to operate an FBO on the same site. The lease period will begin on January 1, 2008 and run through December 31,2027. Additionally, La Porte Flight Line has requested a five (5) year option, with right of first refusal, on an adjacent 2.057 acre tract for possible future development. The lease rate, beginning on January 1,2008 is $1,820.25 per acre per year, which would result in a first- year rental rate of $6,564.73 for the 3.6065 acres. This is the identical rate per acre charged to all FBO's at the Airport. Annual cost-of-living adjustments based on the CPI-U are included in the lease, as in all FBO leases. In accordance with the Standard Minimum Requirements for Airport Aeronautical Services at the La Porte Municipal Airport, La Porte Flight Line has submitted a letter requesting the lease, evidence of its ability to operate an FBO and the required $500 application fee. La Porte Flight Line meets all the requirements ofthe FBO Standards. Due to the volume of information, a copy of the submissions, as well as a signed copy of the Agreement for Purchase and Sale of Certain Assets of Gulf Central Aviation, Inc. is available for review in the City Secretary's Office. Date ORDINANCE NO. 2oo~-30 5S AN ORDINANCE APPROVING AND AUTHORIZING AN AGREEMENT AND LEASE FOR FIXED BASE OPERATIONS AT CITY OF LA PORTE MUNICIPAL AIRPORT BETWEEN THE CITY OF LA PORTE AND LA PORTE FLIGHT LINE, L . L . C ., HAlCING VARIOUS FINDINGS AND PROVISIONS RELATING TO THE SUBJECT, FINDING COMPLIANCE WITH THE OPEN MEETINGS LAW, AND PROVIDING AN EFFECTIVE DATE HEREOF. Section 1. The city council hereby approves and authorizes the contract, agreement, or other undertaking described in the title of this ordinance, a copy of which is on file in the office of the City Secretary. The city Manager is hereby authorized to execute such document and all related documents on behalf of the City of La Porte. The City Secretary is hereby authorized to attest to all such signatures and to affix the seal of the city to all such documents. Section 2. The City council officially finds, determines, recites, and declares that a sufficient written notice of the date, hour, place and subject of this meeting of the City Council was posted at a place convenient to the public at the City Hall of the City for the time required by law preceding this meeting, as required by the Open Meetings Law, Chapter 551, Texas Government Code; and that this meeting has been open to the public as required by law at all times during which this ordinance and the subject matter thereof has been discussed, considered and formally acted upon. The city Council further ratifies, approves and confirms such written notice and the contents and posting thereof. Section 3. This Ordinance shall be effective from and after its passage and approval, and it is so ordered. PASSED AND APPROVED, this J?ff- day of f) ta? /VtM2L , 200 By: Ca6:.:~1=>~ Alton E. Porter, Mayor -- ATTEST: ;1{I11~, ~~# Mar ha A. Gil ett City Secretary APPROVED: ,/],/ '~. \ ) {/~~ ;JCl u/~i~ Knox W. Askins City Attorney 2 AGREEMENT AND LEASE FOR FIXED BASE OPERATIONS AT CITY OF LA PORTE MUNICIPAL AIRPORT THIS AGREEMENT AND LEASE, made and entered into effective the 1st day of January, 2008, by and between the City of La Porte, a municipal corporation organized and existing under the laws of the State of Texas, hereinafter referred to as "Lessor", and La Porte Flight Line, L.L.C., a Texas limited company, organized and existing under the Laws of the State of Texas, acting herein by and through its duly authorized officers, hereinafter referred to as "Lessee." WIT N E SSE T H: WHEREAS, the Lessor controls and operates an airport known as La Porte Municipal Airport, located in the City of La Porte, State of Texas, which airport and any additions or improvements thereto or changes therein which the Lessor hereafter makes or authorizes are hereinafter collectively referred to as the "Airport", and, WHEREAS, the parties hereto desire to enter into an Agreement and Lease for the use of premises and facilities at the Airport all as more fully hereinafter set forth. NOW, THEREFORE, for and in consideration of the mutual covenants and agreements herein contained, the Lessor and the Lessee do hereby mutually undertake, promise and agree, each for itself and its successors and assigns, as follows: TRANSITION PROVISIONS Lessee has obtained by assignment from Gulf Central Aviation, Inc., all rights to an existing Agreement and Lease for Fixed Base Operations at the City of La Porte Municipal Airport, dated January 1, 1993, between the City of La Porte, as Lessor, and Gulf Central Aviation, Inc., as Lessee. Said prior Lease shall terminate as of December 31, 2007. ARTICLE I - TERM OF AGREEMENT The term of this Agreement and Lease shall be for a twenty (20) year period commencing January 1, 2008, and terminating December 31, 2027; provided, however, the term of this Lease shall extend for two additional five-year renewal options, at the option of Lessee, unless cancelled by written notice from Lessee to Lessor, on or before October 31, 2027, in the case of the first five year renewal option; and on or before October 31, 2032, in the case of the second five year renewal option. ARTICLE II - LEASED PREMISES AND FACILITIES 1. The Lessor, in consideration of the compensation and sundry covenants and agreements set forth herein to be kept and performed by the Lessee, does hereby, and by these presents, demise and lease unto the Lessee, upon the conditions hereinafter set forth, all of which the Lessee accepts, the exclusive use and occupancy of the Leased Premises, to-wit: Property at La Porte Municipal Airport, consisting of 3.6065 acres, more or less, identified as "Fixed Base Operator Area" on Exhibit "A" attached hereto and made a part of this Agreement. The location and boundaries of said Leased Premises, as indicated on Exhibit "A" attached hereto, are stipulated and agreed between the parties to be correct and by reference are made a part hereof. 2. Lessee takes all of such property in its present condition "as is", and except as otherwise specifically provided herein, agrees to provide all necessary and reasonable maintenance and repairs in order to maintain such property in a usable condition. 3 . Lessee shall make available to the public for rental purposes, the T-Hangars and tie-down facilities leased to Lessee herein. In its rental of such T-Hangars and tie-down facilities, the Lessee shall provide reasonable rental rates, consistent with industry standards for this region. Notwithstanding any other provision of this Agreement, the parties recognize and agree that Lessee is not herewith given and shall not exercise exclusive control over the ramp area not specifically leased under this Agreementj and that the public shall have the right, at all time, to ingress and egress, over and through said area, as reasonably necessary for the use by the public of airport facilities at La Porte Municipal Airport. 4. The Lessor expressly reserves from the lease of the Leased Premises the following: A. All gas, oil and mineral rights in and under the soil. B. The right to grant utility rights-of-ways to others over, under, through, across or on the Leased Premises, provided that such use will not unreasonably or materially interfere with the Lessee's use of the Leased Premises. ARTICLE III - RENTALS AND CHARGES 1. For the Leased Premises, as described in Article II, the basic ground rental calculated for an index value of 100.0 is Eight Hundred Seventy-one and 20/100 Dollars ($871.20) per acre per year. The actual rentals for the Leased Premises, to be paid to the Lessor by the Lessee, shall be determined by multiplying said basic rentals specified under paragraph 1 above by the index value determined for successive calendar years in the manner herein set forth. The index value for the calculation of actual rental rates shall be based on the Consumer Price Index for All Urban Consumers, using as base year 1982-84 = 100, published by the Bureau of Labor statistics of the united States Department of Labor, and shall be calculated as follows: 2 A. The index for any particular lease year shall be the index for the month of October of the calendar year next preceding the year for which the calculation is made. The index for October, 2007, is 208.936, resulting in an annual rental rate of One Thousand Eight Hundred Twenty and 25/100 Dollars ($1,820.25) per acre for the lease year beginning January I, 2008. This rate results in a total 2008 lease year ground rental for the Leased Premises of six Thousand Five Hundred Sixty-four and 73/100 Dollars ($6,564.73). B. The actual rental rate shall be determined prior to January 1st of each lease year and shall be effective for that lease year. C. In the event that the united states Department of Labor discontinues publication of the above index or data from which the index can be directly computed, or if the method for the determination of such index is substantially different than that existing at the time this Agreement and Lease is executed, the basis for the rental rate adjustment shall be the most closely comparable index published by the u.s. Government. 2. The parties recognize that Lessee shall lease to tenants, facilities for the storage and/or tie-down of aircraft within leased properties described as "Designated Use Area" on Exhibit "A" . The Lessee shall have the right to provide additional T- Hangar or tie-down facilities on the property leased herein, but any such additional facility shall only be provided after specific written authorization from the Lessor. Additional facilities shall be provided only in areas specifically authorized by the Lessor and shall be hardsurfaced rather than grass areas. The parties further agree that no aircraft will be tied-down on grass surface areas within Lessee's leased premises after the year 1994. 3 . The rental above provided for during the term of this Agreement and Lease shall be paid monthly, in sum equal to 1/12 of the annual rental due hereunder, in advance on the first day of each and every month. In the event that this Agreement and Lease commences or terminates other than on the first or last day of the month, pro-rata payments shall be made for the fractional part of a month involved. 4. The Lessor is entitled to collect and the Lessee agrees to pay, all rentals due under this Agreement and Lease to the City of La Porte, La Porte Municipal Airport, La Porte, Texas, without notice to the Lessee. Rentals more than thirty (30) days past due may be subject to a service charge of one percent (1%) per month, based on an annual rate of twelve percent (12%) 5. without prejudice to any other remedy which otherwise might be used for arrears of rent or other breach of this Agreement, if the Lessor is required or it elects to pay any sum or incurs any obligations or expense, by reason of a failure, neglect or refusal of the Lessee to perform anyone or more of the terms, conditions or covenants of this Agreement and Lease or as the result of any 3 act or omission of Lessee contrary to said terms, conditions and covenants, the sum or sums so paid or the expense so incurred, including all interest, costs, damages and penalties may be added to any installment of rent thereafter due hereunder and each and every part of the same shall be and become additional rent recoverable by the Lessor in the same manner and with like remedies as if it were originally a part of the rent as set forth hereinabove. ARTICLE IV - ACTIVITIES, USES, PRIVILEGES AND OBLIGATIONS OF THE LESSEE 1. A Fixed Base Operations is defined as a commercial aviation activity conducted by a person, partnership, firm or corporation engaged in the hangaring, maintenance, care and operation of aircraft for use by the public, and such other activities as may be pertinent to such use. This definition specifically includes all terms as set forth in Minimum Standards for Equipping & Operating A General Fixed Base Operation at the La Porte Municipal Airport, made a part hereof by reference and attached as Exhibit "B". 2. During the term of this Agreement and Lease, the Lessee agrees to use the Leased Premises for the purposes or activities stated above, subject to the conditions generally or particularly set forth herein, and not to use or permit the use of the Leased Premises or any part thereof for any purposes or activities other than those specifically stated above without first obtaining the express, written approval of the Lessor. 3. Lessee agrees that the rights and privileges granted herein are non-exclusive except as to the Leased Premises which shall be for the exclusive use of the Lessee. 4. The Lessee agrees that the Lessor has the right to adopt and enforce reasonable rules and regulations and that it and all its employees, agents and servants, and all sublessees, will faithfully observe and comply with all rules and regulations as may from time to time be promulgated by the Lessor, the united States of America or by any department or agency thereof, the State of Texas and the City of La Porte. 5. The Lessee agrees, at its own expense, to pay any and all taxes levied by the City, County or other appropriate governmental units and to pay any and all costs or charges for utility services furnished to or required by the Lessee. 6. The Lessee will not suffer or permit to be maintained upon the Leased Premises or upon the exterior of any improvements or appurtenances thereto any billboards, signs or other advertising media except those which have prior written approval of the Lessor. Flashing, rotating, animated or intermittent illuminated type signs are prohibited. 7. Lessee shall utilize on the Airport, only service contractors authorized to operate at the Airport, including, but not limited to vendors of aircraft, aircraft parts, service and fuel, car rental service, taxicab service, vending machine service and the like; it 4 being understood that fees may be imposed or collected by the Lessor from such contractors for the privilege of operating at the Airport. ARTICLE V - RIGHTS AND COVENANTS OF THE LESSOR 1. The Lessor covenants that it is well seized of the Leased Premises and has good title thereto free and clear of all liens and encumbrances and has full right and authority to lease the same as herein set forth. 2 . The Lessor covenants that the Lessee shall have peaceful possession and quiet enjoYment of the Leased Premises during the term hereof so long as the Lessee performs and observes all of the covenants, agreements, terms and conditions hereof. 3. The Lessor reserves the right to maintain and keep in repair the landing area of the Airport and all publicly owned facilities of the Airport, together with the right to direct and control all activities of the Lessee in this regard. 4. The Lessor reserves the right further to develop or improve the landing area and all publicly owned air navigation facilities of this Airport as it sees fit, regardless of the desire or views of the Lessee, and without interference or hindrance. 5. The Lessor reserves the right to take any action it considers necessary to protect the aerial approaches of the airport against obstruction, together with the right to prevent the Lessee from erecting, or permitting to be erected, any building or other structure on the airport which in the opinion of the Lessor would limit the usefulness of the Airport or constitute a hazard to aircraft. 6. During time of war or national emergency Lessor shall have the right to enter into an agreement with the unites States Government for military or naval use of part or all of the landing area, the publicly owned air navigation facilities of the Airport. If any such agreement is executed, the provisions of this instrument, insofar as they are inconsistent with the provisions of the agreement with the Government, shall be suspended. 7. This Agreement shall be subordinate to the provisions of any outstanding agreement between Lessor and the united States relative to the maintenance, operation or development of the Airport. 8. It is understood and agreed that the rights granted by this Agreement will not be exercised in such a way as to interfere with or adversely affect the use, operation, maintenance or development of the Airport. 9. There is hereby reserved to the Lessor, its successors and assigns, for the use and benefit of the public, a free and unrestricted right of flight for the passage of aircraft in the airspace above the surface of the premises herein conveyed, together with the right to cause in said airspace such noise as may be inherent in the operation of aircraft, now known or hereafter 5 used for navigation of our flight in the air, using said airspace for landing at, taking off from, or operating on or about the Airport. ARTICLE VI - IMPROVEMENTS AND MAINTENANCE 1. Lessee agrees that construction of all facilities, improvements or appurtenances on or in connection with the Leased Premises is prohibited without the express written consent of the Lessor before commencement of said construction. All facilities, improvements, or appurtenances proposed for construction shall comply with all existing applicable codes, ordinances, laws and regulations relating thereto. Lessee agrees to adhere to the Lessee's Construction Schedule attached hereto as Exhibit "B", and made a part of this Agreement for all purposes. 2. The Lessee agrees that no obstruction to air navigation as such are defined from time to time by application of the criteria of Part 77 of the Federal Aviation Regulations or subsequent and additional regulations of the Federal Aviation Administration will be constructed or permitted to remain on the Leased Premises. Any obstructions shall be removed by the Lessee at its expense. The Lessee agrees not to increase the height of any structure or objects or permit the growth of plantings of any kind or nature whatsoever that would interfere with the line of sight of aircraft operating on or above the Airport in airspace protected under rules prescribed by FAR Part 77. The Lessee further agrees not to install any structures, objects, machinery or equipment that would interfere with operation of navigation aids or that would interfere with the safe and efficient operations of the Airport, or interfere with the operations of other tenants and users of the Airport. 3. The Lessee agrees that all utility services required by it during the lease term for the Leased Premises must be paid for by the Lessee including the installation and maintenance cost of service lines. 4. The Lessee agrees, at its own expense, to cause the Leased Premises and any improvements and appurtenances thereto to be maintained in a tenantable and in a safe, neat, clean and presentable condition including, but not limited to, the necessary mowing and snow removal of the Leased Premises during the appropriate periods of the year. 5. The Lessee agrees, at its own expense to keep and maintain in good repair, all structures, pavements, utilities and all other improvements and appurtenances wi thin and upon the Leased Premises, as described on Exhibit "A" attached hereto. Lessee further agrees that Lessor shall have no maintenance responsibilities with respect to the Leased Premises, except Lessor shall be responsible for maintenance of ramp areas contiguous to the T-hangars, and taxiways providing ingress and egress to the respective T-hangars. 6. Lessee agrees, at his own expense, to remove all garbage, and rubbish from the Leased Premises, and agrees deposit the same on any part of the Leased Premises temporarily in connection with collection for removal. No waste, not to except waste, 6 garbage or rubbish will at any time be deposited on any other area of the Airport. 7. Lessee agrees to provide! at its own expense! such janitor! toilet! and cleaning services and supplies as may be necessary or required in the operation and maintenance of the Leased Premises and the improvements and appurtenances thereto. 8. The Lessor and its authorized officers! employees! agents! contractors! subcontractors! and other representatives shall have the right to enter upon or in the Leased Premises and any improvements thereon for the following purposes: A. To inspect the Leased Premises and any improvements thereon at reasonable intervals during regular business hours or at any time in case of emergency! to determine whether the Lessee has complied and is complying with the terms and conditions of this Agreement and Lease with respect to such Leased Premises. B. To perform any and all things which the Lessee is obligated to do and has failed! after reasonable notice to do! including maintenance! repairs and replacements of any portion of the Leased Premises! improvements or appurtenances thereto! in which event the Lessee agrees to reimburse the Lessor for reasonable costs thereof promptly upon demand! as set forth herein before. c. In the exercise of the Lessor!s police power. D. To inspect the Leased Premises and perform any and all things with reference thereto which the Lessor is obligated or authorized to do as set forth herein. No such entry by or on behalf of the Lessor within or upon the Leased Premises or any improvements thereon shall cause or constitute a termination of the letting thereof or be deemed to constitute an interference with the possession thereof by the Lessee. 9. Upon termination of this Agreement and Lease at the expiration of the term or for any other reason or cause! the Lessee shall have the right to remove any structures or other improvements and all machinery! fixtures! apparatus and equipment owned by the Lessee and located on the Leased Premises for a period of 120 days after said termination date and upon paYment of rentals as provided in Article III hereof to the date of removal of said improvements. The Lessor shall be entitled to have the Leased Premises herein demised returned to it clear of all improvements owned by the Lessee and may require the Lessee to make such restoration by written notification within 120 days following termination of this Agreement and Leasei and! in the event of the failure by the Lessee to restore the Leased Premises as herein required! within 120 days of said written notification! then the Lessor may make such restoration at the Lessee!s expense. In the event that Lessee does not remove all said improvements or equipment! and the Lessor elects not to require said restoration of the Leased Premises! then 7 upon the expiration of 120 days from the date of termination of this Agreement and Lease, all structures or other improvements and all machinery, fixtures, apparatus and equipment located on the Leased Premises shall become the property of the Lessor. Underground fuel storage tanks and appurtenances, if any, shall be removed and disposed of in accordance with Federal and state of Texas regulations. ARTICLE VII - INDEMNIFICATION AND INSURANCE 1. The Lessee covenants and agrees to indemnify and save harmless the city of La Porte, its officers, agents and employees, their successors and assigns , individually or collectively, from and against all liability for any fines, claims, suits, liens, demands, actions or cause of action of any kind or nature for personal injury or death, or property damage in any way arising out of or resulting from any activity or operation of the Lessee on the Leased Premises or in connection with its use of the Leased Premises, and the Lessee further agrees to pay all expenses in defending against any such claims made against the Lessor, including reasonable attorney's fees; provided, however, that the Lessee shall not be liable for any injury, damage or loss occasioned by the sole negligence or willful misconduct of the Lessor, its agents or employees. The Lessee and the Lessor shall give prompt and timely notice of any claim made or suit instituted which, in any way, directly or indirectly, contingently or otherwise, affects or might affect either party. If the Lessee fails, after written notice from Lessor, to so save harmless and indemnify Lessor, Lessor shall have the right, in addition to its other legal remedies, to declare a default in Lessee's obligation to fulfill and comply with the terms and conditions of this Lease, and Lessor may then proceed to termination of the Lease pursuant to Article IX hereof. 2. The Lessee shall procure and maintain in effect during the term of this Agreement and Lease insurance with companies licensed to do business in the State of Texas, and naming the Lessor as an additional insured and containing a cross liability agreement, providing the following coverages: . Worker's Compensation and Employer Liability statutory . Aircraft Liability . Non-owned Aircraft $500,000 each occurrence $100,000 each passenger $500,000 each occurrence $100,000 each passenger . Airport Premises Liability $500,000 . Products & Completed Ops. $500,000 . Contractual Liability $500,000 . Hangar Keepers Liability (Risk Analysis) 8 . Property Insurance for Leased Premises (Replacement value of lease hold premises) . Builders Risk $500,000 . Automobile Liability statutory minimum . Chemical Liability statutory 3. A certified copy of each policy evidencing the existence thereof shall be delivered to the Lessor within ten (10) days after the execution of this Agreement and Lease. Each such copy shall contain a valid provision or endorsement that the policy may not be cancelled, terminated, changed or modified without giving ten (10) days written advance notice thereof to the Lessor. Each such policy shall not, without obtaining express advance permission from the Lessor, raise any defense involving in any way the immunity of the City of La Porte, its members, officer, agents, or employees, the governmental nature of the Lessor, or the provisions of any statutes respecting suits against the City. 4. The Lessee shall furnish to the City satisfactory evidence that it carries Workmen's Compensation Insurance in accordance with the laws of the state of Texas. 5. In the event that any repairs, alterations, additions, or improvements are made, in, on or to the Leased Premises (excluding the Tie-Down areas) by reason of the use and occupancy of the Leased Premises by the Lessee, then the Lessee covenants and agrees to make such repairs, alterations, additions, or improvements in, on or to the Leased Premises at its own expense. The Lessee covenants and agrees to indemnify and save harmless Lessor from and against all expenses, liens, claims, or damages to either persons or property which mayor might arise by reason of any repairs, alterations, additions, or improvements made by the Lessee in, on or to the Leased Premises. ARTICLE VIII - TERMINATION BY LESSEE 1. In addition to all other remedies available to the Lessee, this Agreement and Lease shall be subject to cancellation by the Lessee should anyone or more of the following events occur: A. The permanent abandonment of the Airport. B. The issuance by any court of competent jurisdiction of any injunction preventing or restraining the use of the Airport in such manner as to substantially restrict the Lessee from conducting its fixed base operation, and the remaining in force of such injunction for at least thirty ( 3 0 ) days. C. The breach by the Lessor of any of the terms, covenantsr or conditions of this Agreement and Lease to be kept, performed, and observed by the Lessor, and the failure of the Lessor to remedy such breach for a period of thirty (30) days after written notice from the Lessee of the existence of such breach. 9 D. The assumption by the united states Government, or any authorized agency thereof, of the operation, control or use of the Airport and its facilities in such a manner as to substantially restrict the Lessee from conducting its operation, if such restrictions be continued for a period of three (3) months or more. ARTICLE IX - TERMINATION BY LESSOR 1. In addition to all other remedies available to the Lessor, this Agreement and Lease shall be subject to cancellation by the Lessor should anyone or more of the following events occur: A. If the Lessee shall file a petition of bankruptcYi or if proceedings in bankruptcy shall be instituted against it and it is thereafter adjudicated a bankrupt pursuant to proceedingsi or if a court shall take jurisdiction of the Lessee and its assets pursuant to proceedings brought under the provisions of any Federal Re-Organization Acti or if a Receiver for the Lessee's assets is appointedi or if the Lessee shall be divested of its rights, powers and privileges under this Agreement and Lease by other operation of law. B. If the Lessee shall default in or fail to make any paYments at the times and in the amount required of it under this Agreement and Lease. C. If the Lessee shall abandon and discontinue all aeronautical activities at the Leased Premises. D. If the Lessee shall fail to perform, keep and observe all the covenants and conditions contained in this Agreement and Lease to be performed, kept and observed by it. E. If the Lessee shall fail to abide by all applicable laws, ordinances, rules and regulations of the united States, State of Texas, or the City of La Porte. Provided that upon happening of any of the contingencies recited in subparagraphs B, C, D and E above the Lessor shall give written notice to the Lessee to correct or cure such default, failure to perform, or breach, and if, within thirty (30) days from the date of such notice, the default, failure to perform or breach complained of, shall not have been corrected in a manner satisfactory to the Lessor, then, and in such event, the Lessor shall have the right at once and without further notice to the Lessee to declare this Agreement and Lease terminated and to enter upon and take full possession of the Leased Premises and Leased Facilities and, provided further that upon the happening of anyone of the contingencies enumerated in subparagraph A hereof, this Agreement and Lease shall be deemed to be breached by the Lessee and thereupon ipso facto and without entry or any other action by the Lessor, the Agreement and Lease shall terminate, subject to be reinstated only if such involuntary bankruptcy or insolvency proceedings, petitions for reorganization, trusteeship, receiver ship, or other legal act divesting the Lessee of its rights under 10 this Agreement and Lease shall be denied, set aside, vacated or terminated in the Lessee's favor within forty-five (45) days from the happening of the cont ingency . Upon the happening of said latter event, this Agreement and Lease shall be reinstated as if there had been no breach occasioned by the happening of said contingencies provided that the Lessee shall within ten (10) days discharge any and all sums of money which may have become due under this Agreement and Lease in the interim and shall then remain unpaid and shall likewise fully perform and discharge all other obligations which may have accrued and become payable in the interim. The acceptance of rentals and fees by the Lessor for any period or periods after a default of any of the terms, covenants, and conditions herein contained to be performed, kept and observed by the Lessee shall not be deemed a waiver of any rights of the Lessor to cancel this Agreement and Lease for failure by the Lessee to so perform, keep, or observe any of the terms of this Agreement and Lease to be kept, performed, and observed by the Lessee. ARTICLE X - ASSIGNMENT AND SUBLETTING 1. The activities, uses, privileges and obligations authorized herein are personal and the Lessee agrees that it will not assign, subcontract, sublet, or underlet the same or any portion thereof, or assign, subcontract, sublet or underlet the Leased Premises or any portion thereof without the prior expressed consent of the Lessor in writing and any purported assignment or subcontract in violation hereof shall be void. In no case, however, may the activities, uses, privileges and obligations authorized herein or the Leased Premises or any portion thereof be assigned, subcontracted, sublet, or underlet by the Lessee for any use other than herein specified. All provisions of this Agreement and Lease applicable to the Lessee hereunder shall be equally binding upon any party to which the activities, uses, privileges and obligations authorized herein, Leased Premises are assigned, subcontracted, sublet or underlet. Any party operating a business on the Leased Premises, by sublease from Lessee, shall be considered a subtenant, for the purposes of this Article X, Assignment and Subletting. 2. The Lessor will not be unnecessarily arbitrary in granting said permission, but the Lessor shall be the sole judge as to the reliability, capability, character, and desirability of the parties involved. ARTICLE XI - HOLDING OVER 1. In the event the Lessee shall hold over and remain in possession of the Leased Premises herein leased after expiration of this Agreement and Lease without any written renewal thereof, such holding over shall not be deemed to operate as a renewal or extension of this Agreement and Lease but shall only create a tenancy from month to month which may be terminated at any time by the Lessor ARTICLE XII - SUCCESSOR AND ASSIGNS BOUND BY COVENANTS 1. All covenants, stipulations and agreements in this Agreement and Lease shall extend to and bind the legal representatives, successors, and assigns of the respective parties hereto. 11 ARTICLE XIII - GENERAL PROVISIONS 1. Notices to the Lessor provided for in this Agreement and Lease shall be sufficient if sent by certified or registered mail, postage prepaid, addressed to the City Manager, City of La Porte, 604 West Fairmont Parkway, La Porte, Texas 77571, and notices to the Lessee if sent by certified or registered mail, postage paid addressed to La Porte Flight Line, L. L. C., City of La Porte Municipal Airport, La Porte, Texas 77571, or to such other respective address as the parties may designate to each other from time to time. 2. The Lessee represents that it has carefully reviewed the terms and conditions of the Agreement and Lease and is familiar with such terms and conditions and agrees faithfully to comply with the same to the extent to which said terms and conditions apply to its activities, authorized and required by this instrument. 3. The term "Lessor" as used in this Agreement and Lease means the City of La Porte, and where this Agreement and Lease speaks of approval and consent by the Lessor, such approval is understood to be manifested by act of the City Manager, except as otherwise expressly stated in this Agreement and Lease. ARTICLE XIV - INVALID PROVISION 1. In the event that any covenant, condition or provlslon herein contained is held to be invalid by any Court of competent jurisdiction, the invalidity of any such covenant, condition, or provision shall in no way affect any other covenant, condition or provision herein contained; provided that the validity of any such covenant, condition, or provision does not materially prejudice either the Lessor or the Lessee in its respective rights and obligations contained in the valid covenants, conditions, or provisions of this Agreement and Lease. ARTICLE XV - FEDERAL REQUIREMENTS 1. The right to conduct aeronautical activities or furnishing services to the public is granted to the Lessee subject to Lessee agreeing to: A. Furnish said services on a fair, equal and not unjustly discriminatory basis to all users thereof, and B. Charge fair, reasonable, and not unjustly discriminatory prices for each unit or service; provided, that the Lessee may be allowed to make reasonable and nondiscriminatory discounts, rebates, or other similar types of price reductions to volume purchasers. 2. The Lessee in exercising any of the rights or privileges herein granted to it shall not on the grounds of race, color, or national origin discriminate or permit discrimination against any person or group of persons in any manner prohibited by Part 21 of the Regulations of the Secretary of Transportation. The Lessor is hereby granted the right to take such action, anything to the 12 contrary herein notwithstanding, as the united States may direct to enforce this nondiscrimination covenant. 3. The Lessee assures that it will undertake an affirmative action program as required by 14 CFR Part 152, Subpart E, to insure that no person shall on the grounds of race, creed, color, national origin, or sex be excluded from participating in any employment activities covered in 14 CFR Part 152, Subpart E. The Lessee assures that no person shall be excluded on these grounds from participating in or receiving the services or benefits of any program or activity covered by this subpart. The Lessee assures that it will require that its covered suborganizations provide assurances to the Lessee that they similarly will undertake affirmative action programs and that they will require assurances from their suborganizations, as required by 14 CFR Part 152, Subpart E, to the same effect. ARTICLE XVI - FAVORED NATIONS CLAUSE 1. Lessor covenants and agrees not to hereafter enter into any lease, contract, or agreement, nor any renewal of any existing leases, with any other party with respect to the Airport, containing more favorable terms than this lease or to grant to any other operator rights, privileges or concessions with respect to the Airport which are not accorded to Lessee hereunder, unless the same rights, privileges and concessions are concurrently and automatically made available to Lessee. It is understood and agreed that the intent of the parties in this paragraph is to provide that Lessee shall not be put at a competitive disadvantage with any other operator rights, privileges or concessions which have not been granted to Lessee or terms and conditions more favorable than those enjoyed by Lessee. ARTICLE XVII - LESSOR'S APPROVALS 1. Lessor covenants and agrees, in the case of every provision of this lease which requires Lessor approval for certain events or happenings, to not unreasonably withhold permission or approval of Lessee's request to use the leased premises for certain purposes or activities, provided that such request is consistent with the terms of the lease, and provided, further, that the request is consistent with the Minimum Standards for Airport Aeronautical Services at the La Porte Municipal Airport, and other applicable regulatory ordinances affecting the Airport. Lessee's request to Lessor shall be in writing, and Lessor agrees to reply to Lessee's request within thirty (30) days of such written application. ARTICLE XVIII - FORCE MAJEURE 1. Any prevention, delay or stoppage which is due to strikes, labor disputes, inability to obtain labor, materials, equipment or reasonable substitutes therefor, act of God, governmental restrictions or regulations or controls, judicial orders, enemy or hostile government actions, civil commotion, fire or other casualty, or other causes beyond the reasonable control of the party obligated to perform hereunder, shall excuse performance by such party for a period equal to the duration of such prevention, 13 delay or stoppage, except where such performance is the payment of rental or other charges to be paid by Lessee pursuant to the provisions of this Lease. ARTICLE XIX - ENVIRONMENTAL 1. "Environmental Laws" means all federal, state, and local environmental, land use, zoning, health, chemical use, safety and sanitation laws, statutes, ordinances and codes relating to the protection of the environment and/or governing the use, storage, treatment, generation, transportation, processing, handling, production or disposal of Hazardous Substances. "Hazardous Substances" means, without limitation, radon, radioactive materials, asbestos, urea formaldehyde form insulations, polychlorinated biphenyls, benzene, hazardous materials, flammable explosives, hazardous or toxic wastes, hazardous or toxic substances or related materials including all such wastes, materials and substances as such terms are defined in the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended [42 U.S.C. Sec. 9601 et. seg.], the Resource Conservation and Recovery Act, as amended [42 U.S.C. Sec. 6901 et. seg.] or any other applicable environmental laws and the regulations adopted pursuant thereto and other Environmental Laws governing waste substances, and the rules, regulations, policies, guidelines, interpretations, decisions, orders, and directives of any governmental authority with respect thereto. "Polluting Substances" means, without limitation, fuels, crude oil, chemicals, or any other liguid or solid material which if spilled or disposed of on real estate will pollute such real estate. The Leased Premises are not being used for the storage, treatment, generation, transportation, processing, handling or disposal of any Hazardous Substance in violation of any Environmental Laws. In addition, Lessor represents that (a) no release of a Hazardous Substance or Polluting Substance has occurred on the Leased Premises that would constitute a violation of any Environmental Laws; (b) no underground storage tanks have been placed on or exist on the Leased Premises; (c) there have not been nor are there any Hazardous Substances or Polluting Substances in or contaminating any of the land, buildings, structures, or other improvements constituting a part of the Leased Premises that would constitute a violation of any Environmental Laws; and (d) there have not been nor are there any Hazardous Substances in concentrations that exceed amounts permitted by Environmental Laws on or in any of the land, buildings, structures, or other improvements on the Leased Premises. 2. Lessee covenants and agrees, in its use of the leased premises, that it shall comply with all Environmental Laws. Lessee covenants and agrees, in its use and occupancy of the leased premises, that (a) no release of a hazardous substance or polluting substance shall occur on the leased premises that would constitute a violation of any Environmental Law; (b) any underground storage tanks placed on the leased premises shall be used in conformity with all Environmental Laws, and all necessary permits shall be obtained therefore; (c) there shall not be any Hazardous Substances or Polluting Substances in or contaminating any of the land, buildings, structures, or other improvements constituting a part of 14 the Leased Premises that would constitute a violation of any Environmental Laws; and (d) there have not been nor are there any Hazardous Substances in concentrations that exceed amounts permitted by Environmental Laws on or in any of the land, buildings, structures, or other improvements on the Leased Premises. ARTICLE XX - OPTION TRACT 1. Lessor grants to Lessee, an option, in the form of a right of first refusal upon thirty (30) days written notice from Lessor to Lessee, whereby Lessee may lease from City, the hereinafter described Option Tract. Lessee shall pay to Lessor, as additional rental, in the event Lessee exercises its option to lease said option Tract, an annual rental as calculated under the terms and provisions of this lease, for the balance of the term of the lease. Lessor shall give Lessee thirty (30) days written notice of any offer by a third party to lease such Option Tract, in which case Lessee hereunder may, within thirty-five (35) days of the date of said notice, either accept the option to lease all of said Option Tract by giving written notice to the City of its desire to do so, or, in the absence of such written notice, upon Lessee's refusal to lease said Option Tract, City shall be free to lease same to said other third party. In the event Lessee accepts and exercises its option hereunder, the term of the lease for said Option Tract shall extend for the full remaining term of the primary lease hereunder. This option shall continue in force to December 31, 2012. ARTICLE XXI - FURTHER OBLIGATIONS OF LESSEE 1. Lessee covenants and agrees with Lessor to keep and perform the following milestones, to-wit: A. Lessee shall abate all current violations by Gulf Central Aviation, Inc., including the sub-tenants of Gulf Central Aviation Inc., under the previous lease, now pending in the City of La Porte Municipal Court, or which have been the subject of notice letters from the City of La Porte to Gulf Central Aviation, Inc., on or before January 31, 2008. B. Submit to Lessor, for its prior written approval, all written subleases between Lessee, and existing sub- lessees on the Leased Premises, which meet the definition of "sublessee" under Article X hereof, on or before January 31, 2008. C. Remove from the Leased Premises, all non-aviation material and accumulations, on or before March 1, 2008. 15 IN WITNESS WHEREOF, the parties have caused these presents to be signed by their duly authorized representatives, effective January I, 2008. ATTEST: ~t14a/l ~aI Mar ha A. Gillett city Secretary APPROVED : ~ 1/..// ~. / .;;1~{/,//t/ . 1.1!, ~ Knox W. Askins city Attorney ATTEST: BY: Lessee: La Porte Flight Line, L.L.C. G By: 16 TRACT ONE: Being a tract of land out of the La Porte Municipal Airport, said Airport being 300 Acres, more or less, out of the W. J . Payne Subdivision of the W.M. Jones Survey, A-482, Harris County, Texas, more particularly described as follows: BEGINNING for reference at a 1/2" iron pipe found for the Southwest corner of the LaPorte Municipal Airport, said point being in the North right-of-way line at Spencer Highway; THENCE, S890331E, a distance of 100.01 feet along the North right- of-way line of Spencer Highway to a point for corner; THENCE, North, a distance of 452.47 feet to the POINT OF BEGINNING of this tract; THENCE, continuing North, a distance of 261.64 feet to a point for the Northwest corner of this tract; THENCE, N52054'48"E, a distance of 129.82 feet to a point for the Northeast corner of this tract; THENCE, S37005'1211E, a distance of 208.72 feet to a point for the Southeast corner of this tract, said point being 300 feet Northwesterly of the center line of the Southwest-Northeast Runway of the La Porte Municipal Airport; THENCE, S52054'48"W, parallel to and 300 feet Northwesterly of the center line of said Southwest-Northeast Runway, a distance of 287.58' to the POINT OF BEGINNING of this tract; Said tract containing 1.0000 Acres of land. TRACT TWO: Being a tract of land out of the La Porte Municipal Airport, said Airport being 300 Acres, more or less, out of the W. J . Payne Subdivision of the W.M. Jones Survey, A-482, Harris County, Texas, more particularly described as follows: BEGINNING at the most Northeasterly corner of the M.L. Miller One- acre lease area of the La Porte Municipal Airport; hereinafter referred to as Tract No.1; THENCE, N52054148"E, a distance of 208.72 feet to a point for corner; THENCE, S37005'12"E, a distance of 208.72 feet to a point for Exhibit "A" Page 1 of 4 corner; THENCE, corner; S52054'48"W, a distance of 208.72 feet to a point for said point being the Southeast corner of Tract No.1; THENCE, N37005'12"W, a distance of 208.72 feet, along the East line of Tract No.1, to the PLACE OF BEGINNING; Said tract containing One (1) acre of land. TRACT THREE: Being a 1.00 acre tract of land located in the City of La Porte Municipal Airport, Harris County, Texas, and being hereinafter referred to as Lease Area Tract No.3, as shown on Exhibit "B", attached hereto, said 1.00 acre Tract No.3 being more particularly described as follows: COMMENCING at the Southwest corner of the La Porte Municipal Airport, La Porte, Harris County, Texas; THENCE, S89033'E, along the South line of the La Porte Municipal Airport, said line being the North right-of-way line of Spencer Highway, a distance of 100.01 feet to a point for corner; THENCE, North, along the East side of a 100 foot wide drainage and roadway reserve, a distance of 714.11 feet to a point for corner, said point being the Northwest corner of Lease Tract No.1; THENCE, N52054'48"E, along the Northwest line of Lease Tracts No. 1 and 2, a distance of 338.54 feet to the POINT OF BEGINNING of this Lease Tract No.3; THENCE, S37005'12"E, along the Northeast line of Lease Tract No. 2, a distance of,208.72 feet to a point for corner, said point being 300 feet Northwesterly from the center-line of the N.E. - S.W. Runway of the La Porte Municipal Airport, and the Southeast corner of Lease Tract No.2; THENCE, N52 054' 48 "E, along a line parallel to and 3 00 feet Northwesterly from the center-line of the N.E. - S.W. Runway, said line also known as the Airport Building Line, a distance of 208.72 feet to a point for corner; THENCE, N37005'12"W, a distance of 208.72 feet to a point for corner; THENCE, S52054'48"W, a distance of 208.72 feet to the POINT OF BEGINNING. Exhibit "A" Page 2 of 4 TRACT FOUR: Being a 0.6065 acre (26,418 sq. ft~) tract (Tract 4) comprising part of that certain City of La Porte 300.14 acre municipal Airport tract (Vol. 1614, Pg. 190, Harris County Deed Records), W. M. Jones Survey, A-482, Harris County, Texas. All coordinates and bearings are referred to the Texas Coordinate System of 1983, South Central Zone, as defined in the Texas Natural Resource Code, Section 21.071, et seq., and are based on the position of "La Porte 1962", having published coordinates of N 4,209,400.770 and E 980,752.809 meters, and N 13,810,342.36 and E 3,217,686.51 U. S. Survey Foot; and having a scale factor of 0.9998798. The 0.6066 acre tract as surveyed by H. Carlos Smith, Engineers & Surveyors, Inc. on November 25th thru December 1st, 1992, is more particularly described by metes and bounds as follows; COMMENCING at the Southwest corner of said 300.14 acre La Porte airport tract, having coordinates of N 13,810,198.10 and E 3,216,126.75. Thence N 86 degrees 56 minutes 22 seconds E; coincident with the North right-of-way line of West Main Street (Spencer Highway) (100' ROW); a distance of 100.01 feet to a point for corner. Thenoe N 03 degrees 30 minutes 38 seconds W; passing at 452.47 feet the Southwest corner of Tract 1 of the existing Gulf Central Aviation, Inc. Lease Tract; fcr a total distance of 714.11 feet to a 5/8 inch iron rod set for the Northwest corner of said Tract 1, the POINT OF BEGINNING of this 0.6065 acre tract and having coordinates of N 13,810,916.12 and E 3,216,182.88. Thence N 03 degrees 30 minutes 38 seconds W a distance of 62.68 feet to a 5/8 inch iron rod set for the Northwest corner of this 0.6065 aore tract. Thence N 49 degrees 24 minutes 10 seconds E a distance of 509.46 feet to a 5/8 inch iron rod set for the Northeast corner of this 0.6065 acre tract. Thence S 40 degrees 35 minutes 50 seconds E a distance of 50.00 feet to a 5/8 inch iron rod set for the Southeast corner of this 0.6065 acre tract. Thence S 49 degrees 24 minutes 10 seconds W; coincident with the North line of the existing Gulf Central Aviation, Inc. Lease Tracts 1, 2, and 3; a distance of 547.26 feet to the POINT OF BEGINNING. Exhibit "A" Page 3 of 4 OPTION TRACT: Being a 2.057 acre (89,616 sq. ft.) tract (Option Tract 5) comprising pa~t of that certain City of La Porte 300.14 acre municipal Airport tract (Vol. 1614, Pg. 190, Harris County Deed Records), W. M. Jones Survey, A-482, Harris County, Texas. All coordinates and bearings are referred to the Texas Coordinate System of 1983, South Central Zone, as defined in the Texas Natural Resource Code, Section 21.071, et seq., and are based on the position of "La Porte 1952", having published coordinates of N 4,209,400.770 and E 980,752.809 meters, and N 13,810,342.36 and E 3,217,686.51 U. S. Survey Foot; and having a scale factor of 0.9998798. The 2.057 acre tract is more particularly described by metes and bounds as follows; COMMENCING at the Southwest corner of said 300.14 acre La Porte airport tract, having coordinates of N 13,810,198.10 and E 3,216,126.75. Thence N 86 degrees 56 minutes 22 seconds E; coincident with the North right-of-way line of West Main Street (Spencer Highway) (100' ROW); a distance of 100.01 feet to a point for corner. Thence N 03 degrees 30 minutes 38 seconds W; passing at 452.47 feet the Southwest corner of Tract 1 of the existing Gulf Central Aviation, Inc. Lease Tract; passing at 714.11 feet a 5/8 inch iron rod set for the Northwest corner of said Tract 1 and the Southwest corner of a 0.6065 acre tract (Tract 4); for a total distance of 776.79 feet to a 5/8 inch iron rod set for the Northwest corner of said Tract 4, and the POINT OF BEGINNING of this 2.057 acre tract and having coordinates of N 13,810,978.67 and E 3,216,179.04. Thence N 03 degrees 30 minutes 38 seconds W a distance of 260.74 feet to the Northwest corner of this 2.057 acre tract. Thence N 49 degrees 24 minutes 10 seconds E a distance of 352.23 feet to the Northeast corner of this 2.057 acre tract. Thence S 40 degrees 35 minutes 50 seconds E a distance of 208.00 feet to a 5/8 inch iron rod set for the Northeast corner of said 0.6065 acre tract and the Southeast corner of this 2.057 acre tract. Thence S 49 degrees 24 minutes 10 seconds W; parallel with and 50 feet North of the North line of the existing Gulf Central Aviation, Inc. Lease Tracts 1, 2, and 3; a distance of 509.46 feet to the POINT OF BEGINNING. Exhibit "A" Page 4 of 4 LU (,) Z LU u..;:;, . TRACTj1..... // ". ~ . I : 30138"W-62.68'... ( I \ GATE r i ~ PO. N3 I P.O .B. N 13,810,916.12 E 3,216,182.88 1 \ ~ <l' - ~ - CD V (IJ r:: ,/ Al.l. COORDINATES AND BEARINGS ARE REFERRED TO THE TEXAS COORDINATE SYSTEM OF 1983, SOUTH CENTRAL ZONE, AS DEFINED IN THE TEXAS NATURAL RESOURCESCODE,SEC: 21.071, et seq., AND ARE BASED ON THE POSITION OF "LAPORTE 1952", HAVING PUBLISHED COORDINATES OF N 4,209,400.770 AND E 980,752.809 METERS, AND N 13,810,342.36 AND E 3,217,686.51 U.S. SURVEY FOOTi AND HAVING A SCALE FACTOR OF 0.9998798. f ~'I-~ / -- ~\ / eo, \ / I ,:?-V' ~ ~1 o 'l,.' c" ,,~-y.: c" ,,~-y.: ~ ",0 0<( ;! ci "' (IJ " ~ , ,-0 'l-Po o Po~ '" v' i>' \ , c" 0--5 ,,~-y.: C;; ~,~\!J +,'? ~ ~ CD '" ~ o '" z I'- <l' N "' <l' NS6056122"E \ PO C ..- 100.01' -.\ . . . \ ....s.w. COR 300.14 Ac. LA PORTE MUNICIPAL AIRPORT N 13,810,198.10 E 3,216,126.75 S 4003SlS0llE - 50.00' :z: t- ll: o Z o a: (!) SCALE: I": 100 I o DENOTES 5/S"I.R. SE- WEST MAIN - STREET ( 100 l R. O. W. ) PROPOSED GULF CENTRAL AVIATION LEASE TRACT ( SPENCER' HWy. ) -...., PREPARED FOR: CITY OF LA PORTE PREPARED BY: H. CARLOS SMITH, E $ S, INC. DATE: DEC. I, 1992 JOB NO. 2759 - 92 Exhibi t "B" STANDARD MINIMUM REQUIREMENTS FOR AIRPORT AERONAUTICAL SERVICES LA PORTE MUNICIPAL AIRPORT Dated: Exhibit "e"