HomeMy WebLinkAbout11569 ORD - 07/11/1973JRR:MLVl:JKH- 4 -3 -73; I,ST
" AN ORDINANCE
AUTHORIZING THE CITY MANAGER TO ENTER INTO AN
AGREEMENT OF•LEASE WITH THE CORPUS CHRISTI AIRPORT
DEVELOPMENT CORPORATION FOR'THE LEASING BY THE
+ SAID CORPUS CHRISTI AIRPORT DEVELOPMENT CORPORATION
OF A 10 —ACRE TRACT OR PARCEL OF LAND AT THE CORPUS y
CHRISTI INTERNATIONAL AIRPORT, ALL AS MORE FULLY
SET'FORTH IN THE AGREEMENT OF LEASE, A COPY OF WHICH
IS ATTACHED HERETO AND MADE A PART HEREOF, MARKED
EXHIBIT "A ".
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CORPUS CHRISTI,
TEXAS:
SECTION 1. THAT THE CITY MANAGER BE AND HE IS HEREBY AUTHORIZED
Sa
l TO ENTER INTO AN AGREEMENT OF LEASE WITH THE CORPUS CHRISTI AIRPORT DEVELOPMENT
CORPORATION FOR THE LEASING BY THE SAID CORPUS CHRISTI AIRPORT DEVELOPMENT,
Vr CORPORATION OF A 10 -ACRE TRACT OR PARCEL OF LAND AT THE CORPUS CHRISTI
* INTERNATIONAL AIRPORT, ALL AS IS MORE FULLY SET FORTH IN THE AGREEMENT OF
LEASE, A COPY OF WHICH IS ATTACHED HERETO ANG MADE A PART HEREOF.
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11569
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ACRIiEMENT OF LEASE
THE STATE OF TEXAS X
COUNTY OF NUECES X
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This agreement of lease is made and entered into on the day
and year hereinbelow stated, by and between the City of Corpus Christi, a
home rule city of the State of Texas, situated in Nueces County, Texas,
hereinafter called "Lessor ", and Corpus Christi Airport Development
Corporation, a non - profit corporation. with its principal place of
business in Corpus Christi, Texas, hereinafter called "Lessee ",
WITNESSETH:
Lessor does by these presents lease and demise unto Lessee, and
Lessee hereby leases from Lessor, that certain tract of land situated in the
City of Corpus Christi, Nueces County, Texas, specifically described as
follows:
Being a 10 -acre tract of land out of Block 23,
J. C. Russell Farm Blocks as shown by map of
record in Volume 3, page 53, I•lap Records, Nueces
County, Texas, said 10.0 acre tract of land being
more particularly described by metes and bounds
as follows:
Beginning at a point, the intersection of the east
boundary line of said Block 23, and the new south
right -of -way line of State Highway No. 44, said
point being S. 1 °, 19' 56" E., 240.0 feet from
the original northeast corner of said Block 23;
thence S. 88° 35' 46" W., a distance of 50.0
feet to a point in the proposed west right -of -way
of the Airport Entrance Road and the east boundary
line of said Block 23, a distance of 660.0 feet to
a point, the southeast corner of the tract herein
described;
• Thence S. 88° 35' 46" W., with a line that is
660.0 feet south of and parallel to the south
right- of -a:ay line of said new State highway No. 44,
a distance of 660.0 feet to a point, the southwest
corner of the tract herein described;
Thence N. 1° 19' 56" W., with a line that is 710.0
feet west of and parallel to the centerline of the
K Airport Entrance Road, a distance of 660.0 feet to
a point in the south right -of -way line of the new
State highway No. 44, for the northwest corner of the
tract herein described;
Thence N. 88° 35' 46" ]i. with the south right -of -way
line of tho new State highway No. 44, a dJatance of
660.0 feet to the point of beginning.
Sub,�oct to the �ancru•nts iu favor of Lcnsor and /or
other:: ::h"wn un lixhlblt A, al'tached hereto and made n
part. hor,of.
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I.
For the purposes of this lease agreement each of the following
words or terms shall have the following meaning, unless a different meaning
clearly appears from the context and manner'in which each such word is used,
to -wit:
• 1. "Agreement of Sublease" - the Sublease Agreement covering
the Leased Premises entered into on the day of ,
1973, between the Corpus Christi Airport Development Corporation as Lessee
and Power Monolithics., Inc. as Sublessee;
2. "Bondholder ", "Bondholders" - a bearer or bearers of any of
the Bonds in coupon form or the registered owner or owners of any of the
Bonds in registered form.
3. "Bond ", "Bonds" - the first mortgage revenue bonds issued by
the Lessee pursuant to the terms of the Indenture; 0
4. "Building" - the building and other improvements to be
acquired and constructed by Lessee on the Leased Land with the proceeds of
the Bonds;
5. "FAA" - Federal Aviation Administration and its successor
agency, or agencies, if any.
6. "Indenture" - the Indenture of Mortgage and Deed of Trust dated
as of , by and between the Lessee and the Trustee,
securing the Bonds;
7. " Leased Land" - the ten (10) acre tract of land hereinabove
described;
8. "Leased Premises" - the Leased Land and Building;
9. 'Outstanding Bonds" - all Bonds theretofore and thereupon being
authenticated and delivered under the Indenture except (a) Bonds cancelled by
the Trustee at or before said date, or (b) Bonds for the payment or redemption
of which cash, equal to the principal amount or Redemption Price thereof, with
interest to the date of maturity or redemption date, shall be held by the
Trustee or any Paying Agent 1.11 truest for such purpose (whether at or prior to
the maturity or redemption date), providod that if such Bonds are to be redecricd,
notice of such redemption nhall have been given as in Article Four of the
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Indenture provided or provision satisfactory to the Trustee shall have been
made for the giving of such notice;
10. "Trustee" - Corpus Christi Bank and Trust.
II.
Lessee agrees to construct with reasonable promptness a building
containing no less than 25,000 square feet on the Leased Land together with
other improvements, which building and improvements (tile "Building ") shall
be erected and completed in substantial compliance with the blueprints,
plans and specifications approved by Lessor, which approval shall not be
unreasonably withheld by Lessor.
The Leased Premises shall be used for the purposes of manufacturing,
warehousing, offices, and any other lawful purpose and in accordance with the
Burke Master Plan for City Airport Development (on file in the officials
records of the City of Corpus Christi, Texas) and subject to the approval of
the FAA.
IV.
This lease shall be composed of an interim lease term and a primary
lease term. The interim lease term shall commence on the date of this
agreement and shall end on the last day of the month during which the
Building is completed and ready for occupancy by Lessee or Lessee's sub- .
lessee, or twelve (12) months from the date of Bonds initially issued,
whichever is earlier (herein called "interim rental term "). The primary
rental term shall commence on the first day of the month after the Building
is completed and is ready for occupancy by Lessee or Lessee's sub - lessee,
or twelve (12) months from the date of issuance of the Bonds, whichever
date is earlier, and shall be.for a term of•15 years thereafter (hereinafter
sometimes called "15 year primary term" or "primary term ") . The rental
payable for the interim lease term is $1.00, receipt of which is acknowledged
by Lessor.
During the 15 year primary term of this lease, the rental shall be
$2,625.00 per year payable in equal quarterly installments, the first quarter-
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ly, payment being due and payable to Lessor on the first day of the month of
the primary term and a like payment being and becoming due and payable on the
first Jay of every third month thereafter during the 15 year primary term of
said lease. All rentals for the Leased Premises are payable at City Hall in
Corpus Christi, nieces County, Texas.
Lessee shall furnish to Lessor a financial report relating to Lessee's
financial condition on a monthly basis during construction of the Building and
semiannually thereafter during the term of this lease.
If the Building is not completed and ready for occupancy by Lessee
or its sub- lessee on or before the commencement of the primary term, then Lessee
shall be entitled to a credit against the first rentals becoming due and payable
during the renec:al terns, as hereinafter defined, for any rentals paid to
Lessor for the period from the commencement of the primary term to the first
day of the month after the Building is completed and ready for occupancy, to-
gether with interest thereon at the rate of seven percent (7%) per annum until
such sums are recovered by Lessee.
V.
Lessee shall obtain proposals for the construction of the Building
prior to December 31, 1973, or within thirty (30) days after Lessor approves
the plans for the Building, whichever date is earlier. Lessee shall from time
to time issue its Bonds in such amounts as may be necessary to meet all costs of
constructing the Building (which shall include all costs incidental to the finan-
cing and construction of the Building, including but not limited to, architect's
fees and the fees and costs of the bond attorney) and shall, prior to the
award of the contract therefor, make all arrangements required for such pur-
pose so that such contractor or contractors may be paid for all work in
accordance with the terms of the contract or contracts. Lessee shall pay the
principal and interest on the Bonds only from revenues derived by Lessee from
its sub -lease of the Leased Premises. when the Building is completed, the
Building shall be owned by Lessor, subjcdt to the terms of this lease.
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VI.
Lessee is hereby granted seven separate five year options (except
that the last five year option shall be reduced by the period of the interim
rental term) for renewal of this lease (herein called "renewal terms "), so the
total possible period to be covered by this %lease and renewal shall be 50 years
including the interim rental term. Lessee can exercise its options to renew
this lease by giving Lessor written notice by certified mail, return receipt
requested, at least 60 days prior to the expiration of the primary term in
order to exercise the first renewal option, and at least 60 days notice by
certified mail, return receipt requested, prior to the expiration of any renewal
term in order to exercise the next renewal option. Each renewal shall be on the
sane terms and conditions herein specified except that the annual rental for
each year during any renewal term shall be at the rate equal to the fair market
rental value of the Leased Premises. It is hereby found and determined that,
taking into account the depreciated value of the Building after having been
constructed at the beginning of the primary term, the fair market rental value
of the Leased Premises shall be four percent (4%) of the'actual original con-
struction cost of the Building (excluding architect's fees and the fees and
costs of the bond attorney).
VII.
The Lessee shall keep the Leased Premises in good condition and
repair during the term of this lease and upon the termination thereof shall
deliver the same to Lessor in good condition, ordinary wear and tear, damage
by fire or other casualty, acts of God, riot and civil comqotion, excepted.
VIII.
• Lessee may make or permit, to be made, such alterations and modifi-
cations of, and additions to, the Leased Premises as Lessee, or its Sublessee,
may deem desirable for the use thereof and may, at Lessee's or its Sublessee's
option and without cost to Lessor, at any time and from time to time during the
Primary Term, or during any extension or renewal hereof, do any one or more of
the following, provided plans and specifications thero-for shall be subject to
approval of Lessor if such alterations or modifications involve the demolition
or removal of fifty percent (50,1) or more of the permanent, humanly occupiable
nquare footage of the L'uLldlnf;:
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a. alter or remodel any building or other improvements
on the Leased Premises, provided the rental value of any buil.ding
or improvements so altered or remodeled is not adversely affected
thereby, and /or
Is. construct an addition, or additions thereto, and in-
stall any fixtures, machinery and equipment, provided, that
any such construction and installation shall be in accordance
with applicable laws, ordinances, rules and regulations;
C. demolish and remove from the Leased Premises any building
or improverient which in the judgment of Lessee, or its Sublessee,
has become unfit for use, obsolete, surplus or is no longer
necessary for operations of the Lessee, or its Sublessee, pro-
vided, if t}ie property to be demolished and removed shall have
had an original construction cost, or an allocable purchase
cost to Lessee, in excess of $100,000 (or, in the event that
such cost, when taken together with the original construction
cost, or allocable purchase cost to Lessee, of property
previously demolished and removed by Lessee, or its Sublessee,
for which Lessee, or its Sublessee, shall not have provided
replacements, shall exceed $100,000) Lessor shall be entitled
to condition its consent to such denolition and removal on
the receipt from Lessee, or its Sublessee, of .any undertaking,
satisfactory to Lessor, that Lessee, or its Sublessee, will at
its own expense (or pursuant to arrangements satisfactory to
Lessor) construct on the Leased Land new improvements to the ex-
tent reasonably necessary to compensate for such loss of rental
value of the Leased Premises as may result from such demolition
and removal. In determining whether there has been a net di-
minution of such value, consideration shall be.given to any new
improvements Lessee, or its Sublessee, may have constructed from
time to time on the Leased Premises, in addition to those con-
structed as specific replacements for property demolished and
removed; but in no event shall any demolition or removal of the
Building, as hereinabove defined, whether in one removal or
demolition or a series thereof, amounting at any time to fifty
percent' (50%) or more of the permanent, humanly occupiable square
footage of the Building be effected without the approval of Lessor.
d. construct an additional new building or buildings on
the Leased Premises.
At the expiration or termination of,this Lease, or any extension -or
renewal thereof, Lessee, or its Sublessee, shall leave the Leased Premises in
good condition, allowance being made for ordinary wear and tear, damage by fire
or other casualty, acts of God, riot and civil cor..motion, and Lessee, or its
Sublessee, shall not be required to restore the Leased Premises to the condition
in which the Leased Premises were in as of the commencement of the term hereof-,
it being agreed that Lessor shall accept the Leased Premises wish such alterations,
remodeling, additions, or new constructi.oft, as may have been made pursuant to
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authorization contained in this paragraph. Lessee agrees that it will not permit
or allow any mechanic's, material.rien's, or other liens to stand against the Leascd
Premises for work or materials furnished Lessee, or its Sublessee, in connection
with any such alterations, remodeling, additions or new construction, it being
provided, however, that Lessee, or its Sublessee, shall have the right to contest
the validity of any such lien or claims, but upon a final determination of the
validity thereof, Lessee, or its Sublessee, shall immediately pay any judgment
or decree rendered against Lessee, or its Sublessee, with all proper costs and
charges, and shall cause any such lien to be released of, record without cost
to Lessor.
Lessee, or its Sublessee, shall have the right at its own expense to
install such fixtures, machinery and equipment in or about the Leased Premises,
and to post or attach such signs on the interior and exterior thereof, as it
may deem desirable and conformable to law and to FAA regulations. All signs,
fixtures (including lights), machinery, or other equipment which may be installed,
placed or attached in or about the Leased Premises by Lessee, or its Sublessee,
shall remain the property of Lessee, or its Sublessee, and upon the termination
of this lease, by expiration of the term, or upon the termination of any renecaal
.thereof,'Lessee, or its Sublessee, shall have the right to remove the same within
a reasonable time after such termination;.provided, however, that Lessee, or
its Sublessee, shall at its expense repair or•cause to be repaired any damage
caused to the Leased Premises by virtue of the removal thereof.
Title to all buildings and all pernfanent improvements annexed to the
realty under the terms of this paragraph VIII shall immediately vest in Lessor.
IX.
The Lessee agrees to pay or cause to be paid when clue all lawful charges
for electricity, power, gas, water and any other utilities used by it upon and in
the operation of the Leased Premises.
X.
Lessee shall pay or cause to be paid all taxes and assessments of every
nature, kind and description lawfully levied against all personally situated on
the Leae:ed Premises legally classified a:: personal property. Lessor shall pay
all taxes and ruai•s::mcnt:; of every nntura, hind and description lawfully levied
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against Lessor's interest in the Leased Premises, and Lessee shall pay or cause
to be paid all taxes and assessments of every nature, kind and description law-
fully levied against Lessee's interest in the Leased Premises.
XI.
Lessee shall maintain or cause to be maintained at least the following
insurance coverages insuring the Building:
(a) Fire and extended coverage insurance with vandalism and malicious
mischief endorsements in the amount of 80% of the replacement costs of the
Building.
(b) Flood insurance in an-amount equal to the maximum amount available
under the United States Government Federal Insurance Program or any successor
program (if such insurance is available); provided, however, the amount of such
flood insurance shall not be required to exceed the amount of the fire and ex-
tended coverage insurance set forth 'above in subparagraph -(a);
(c) Such other hazard insurance coverages as may be reasonably
required from time to time by Lessor.
The insurance coverages set forth in subparagraph (a), (b) and (c)
above, are hereinafter sometimes collectively called "hazard insurance ".
All such hazard insurance policies shall name Lessor, Lessee and
Lessee's sub - lessee as insureds, as their interests may appear, and shall
contain a loss payable clause in favor of Trustee for the benefit of the
Bondholders. Lessee shall cause such hazard insurance policies or copies
thereof, to be delivered to Lessor and Trustee.
XII.
If during the interim term and primary term, the Building is damaged
by any cause insured against under the hazard insurance policies, the follow-
ing shall occur:
(a) If the Building is totally-destroyed, as hereinafter defined,
Lessee shall have the option either to terminate and cancel this lease or
to restore the Building, as hereinafter provided, and to continue thin lease.
Such election shall be made_ by written notification to the Lessor within sixty
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(60) days after the date of ouch destruction. In the event of cancellation of
this lease agreement because of total destruction, then the proceeds from the
hazard insurance policy shall first be paid to Trustee, to'the extent of any
outstanding Bonds and the accrued interest thereon to date of payment, and
the remainder, if any, shall be payable as follows:
(i) to Lessee, to the extent that Lessee would be entitled
to recover any suns during the renewal terms of this
lease, as provided in this paragraph RII, and in para-
graph IV above; and
(ii) to Lessor, to the extent that there are any remaining
funds.
If-the Building is totally destroyed and the lease is cancelled, the
cancellation shall be effective as of the date of such damage and Lessee shall
be entitled to a refund of any prepaid rent. In the event this lease is not
cancelled as hereinabove provided after total destruction of the Building,
then Lessee shall promptly restore or cause to be restored the Building to
substantially the same condition as it existed at the time of the damage,
and the title to such restoration shall vest in Lessor upon completion of the
restoration work. All plans and specifications for such restoration shall be
submitted to Lessor for its approval. Such approval shall not be unreasonably
withheld. All plans and specifications for such restoration shall be submitted
to the FAA for approval.
(b) In the event of the partial destruction of the Building by a
cause insured against under the hazard insurance policies, Lessee shall promptly
restore or cause to be restored the Building to substantially the same condition
• as it existed at the time of such damage.
(c) In the event Lessee elects to restore the Building, or is
required to do so under the terms of subparagraphs (a) and (b. ) above, all
funds collected from the hazard insurance policies shall be delivered to and
used by Lessee (or the Sublessee) to restore the Building. In the event that
such insurance proceeds are insufficient to repair such damage, then Lessee
shall furnish or cause to be furnished the additional funds necessary to
complete ::uch repairs (herein called "additional constructibn funds ").
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(d) In the evOnL of the total (ICsLrUeLion of the Building and if
the lease is not cancelled or in the event of partial destruction of the
Building, Lessee shall continue to pay the rental provided for in this lease
agreement, provided, however, that Lessee shall earn a credit against the
first rentals becoming due and payable during the renewal terms of this lease,
if this lease is renewed, equal to the following: '
(i.) The amount of the additional construction funds furnished
• to restore the Building, plus interest thereon at the
rate of seven percent (77) per annum from the date such
funds were expended to the date such funds are recouped; and
(ii) An'amount by which the rental would- have been abated, as here-
inafter defined, during the period from the date of the damage
to the Building to the date of the completion of the repairs
to the Building together with interest on such amount at the
rate of seven percent (7%) per annum from the time of such
abatement.' Lessee for the purposes of this provision shall
be entitled to an equitable abatement of rent determined on
the nature and extent of the damage sustained to the Building
from the date of damage until the date of completion of re-
pairs to the Building.
(e) For'purposes of this paragraph XII the term "totally damaged ",
or "total destruction ", shall have occurred to the Building, if:
(i) 50% or more of the Building shall have been damaged or des-
troyed; and
(ii) The insurance proceeds payable from the hazard insurance
policies shall be sufficient to redeem all Outstanding Bonds.
For the purposes of this paragraph XII the term "partially damaged"
or "partially destroyed" shall mean any damage which does not constitute total
destruction.or totally destroyed as set forth above.
XIII.
=If-the Butldi.ng is totally destroyed or partially destroyed during
any of the seven renewal term; of this lease by any cause insured against under
the hazard insurance pollcies, the following shall occur:
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(a) If the Building is totally destroyed, as hereinafter defined, °
Lessee shall have the option either to terminate and cancel this lease or
to restore the Building, as hereinafter provided, and to continue this lease.
Such election shall be made by written notification to the Lessor within
sixty (60) days after the date of such destruction. In the event of can-
cellation of this lease, the insurance proceeds shall be payable as follows:
(i) to Lessee, to the extent that Lessee would be entitled
to recover (and has not previously recovered) any sums
during the renewal terms of this lease, as provided in
paragraph XII and-IV; and
(ii) to.Lessor, to the extent *that there are remaining funds.
If this lease is cancelled, then the termination shall be effective as of the
date of such damage, and Lessee shall be entitled to an abatement of rent from
the date of the damage and any prepaid rent shall be returned to Lessee.
(b) In the event this lease is not cancelled as hereinabove provided
after total destruction of the Building or in the event of partial destruction
of the Building, then Lessee shall promptly restore or cause to be restored the
Building to substantially the same condition as it existed at the time of such
damage, and the title to such restoration shall vest in Lessor upon completion
of such restoration work. All plans and specifications for such restoration
shall be submitted to Lessor for approval. Such approval shall not be unreason-
ably withheld. All plans and specifications shall be submitted to the FAA for
approval. All funds collected from the hazard insurance policies shall be
delivered to and used by Lessee (or the Sublessee) to restore the Building.
In the event that such insurance proceeds are insufficient to repair such
damage, then Lessee shall furnish or cause to be furnished the additional funds
necessary to complete such repairs (herein called "additional construction funds ").
(c) In the event of the total destruction of the Building and if
the lease is not cancelled or in the event of partial destruction of the Build-
ing, there shall be an equitable abatement of rent determined on the nature and
extent of damage sustained to the Bulldint; from the date of damage until the
date of coutplctlon of repairs to the Building. In addition, Lessee shall earn
a credLt .1gainst Lhe first rentals becoming due and payable after such repairs
equal to the amount of the additional con::tructi.on funds furnished to resture
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the Building, plus interest thereon at the rate of seven percent (7%) per annum
from the date such funds were expended to-the date such funds are, recouped.
(d) For purposes of this paragraph XIII, the term "totally
destroyed" or "total destruction" shall mean that either: (i) 10% or more of
the Building shall have been damaged or destroyed; or (ii) the Building shall
have been damaged or destroyed to the extent that the estimated additional
construction funds required to restore the Building exceed the balance of the
rental for the remainder of the lease.
For purposes of this paragraph XIII, the term "partially damaged"
or "partially destroyed" shall mean any damage which does not constitute "total
destruction" or totally destroyed as set forth above.
XIV.
If Lessee shall violate any of the terms and conditions it has
obligated itself to fulfill and comply with under this contract, Lessor may
notify Lessee in writing at P. 0. Box 640, Corpus Christi, Texas 78403,
that such violation has occurred; and unless Lessee shall within ninety (90)
days after such notification commence and prosecute with diligence the curing
of such violation, Lessor may, after such 90 -day period declare this lease
contract ended and may re -enter the Leased Premises, with or without process
of law and. expel, move and put out the Lessee and any other person or persons
occupying the same, using such force as it may deem necessary, and repossess the,
Leased Premises, without prejudice to its rights to collect the entire rental
due and to become due under the terms of this lease. The provisions of this
paragraph notwithstanding, the rights of the Lessor set forth in this paragraph
shall be subject to the rights of the Trustee and the Bondholders as set forth
in the Indenture.
In addition to the notices to be sent Lessee hereunder, Lessor at
the same time notices are sent to Lessee, shall send copies of such notices
to the Trustee, if there are any Outstanding Ponds, and to the Sublessee of
Lessee, if the Leased Premises have been'sub- leased. Such Sublessee and
Trustee, in addition to Lessee, may act to cure any default of Lessee here-
under. No notice of default shall be deemed to have been given to Lessee
unln:u; such noticu Is also }riven to Trustee and any Sublessce.
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XV.
Lessee may sub -lense or assign the Leased Premises and the lease-
hold estate created hereby for the remainder of the term of this lease (in-
cluding options to renew); but, notwithstanding any such assignment or sub-
lease, Lessee shall remain liable to Lessor for performance of all the terms,
conditions and provisions of this lease. Lessee shall promptly notify Lessor
of any sublease or assignment of this lease by giving written notice thereof
to Lessor, c/o City Manager, City Hall, Corpus Christi, Texas.
XVI.
Provisions-of this lease shall be binding upon and shall inure to
the benefit of the parties hereto and their respective successors and /or
assigns. Any sub -lease or assignment hereof shall conform to the terms of
this lease.
XVII.
In the event of the commencement, prosecution or consummation during
any term of this lease of any condemnation proceeding, or proceedings in eminent
domain (hereinafter called "condemnation "), covering, touching or affecting all
or any part of the Leased Premises, Lessor and Lessee at their option may pro-
secute their respective claims against the public or private body designated
as the taking authority on account of any such taking or appropriation of the
Leased Premises, or any part thereof, and receive their respective award as
provided by law. 11 .
However, in the event of any condemnation during the interim rental
period and 15 year primary rental period, the condemnation proceeds shall be
payable to Trustee to the extent sufficient in amount to redeem all Outstanding
• Bonds. All remaining proceeds shall be allocated and paid to Lessor and Lessee
in accordance with the award of the court having jurisdiction of such condemnation.
If there is a partial taking sufficient to impair the business
operations of Lessee, or its sub- lessee, then Lessee shall have the option to
terminate and cancel this lease; however, during the primary term, such can-
cellation shnll not be effective unless Lessee pays to Trustee an amount
suffi.cient:.to rcdcori any Outstanding ltunds, after reduction for any condemnation
funds paid Lo Trustee.
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XVIII.
The Lessee and any sub- lessee or assignee thereof shall forever save
and hold harmless the Lessor from any and all claims, demands, damages, injuries
and causes of action occasioned by them, their agents, servants or employees
to any person, persons, legal entities, or property, by virtue of the operation
of the business of said Lessee, sub- lessee or assignee on said Leased Premises,
or in connection with the operation of said business, whether on said Leased
Premises or otherwise.
XIX.
The Lessor does not make any warranty, either express or implied,
as to the actual or designed capacity of the Building; as to the suitability
or operation of the Building for the purposes specified herein; or as to the
condition of the Building or that it will be suitable for Lessee's or Sublessee's
purposes or needs. Lessee releases the Lessor from, and the Lessor shall not
be liable for, and Lessee will hold Lessor harmless against, any loss or damage
to property or any injury to or death of any person that may be occasioned by
any cause whatsoever pertaining to the Leased Premises, or the use thereof; pro-
vided, that the indeminity in this sentence shall be effective only to the extent
of any loss that may be sustained by Lessor in excess of the sums paid for the
benefit of Lessor from any insurance carried with respect to the loss sustained.
XX.
Lessor hereby waives the statutory Landlord's Lien on any property
of Lessee placed on the Leased Premises.
XXI.
Both parties hereto agree to exert every reasonable effort to have
the Building completed and possession thereof delivered to the Lessee on or
before the day of , 197. however,
shall have no pecuniary liability for the construction of said Building.
XXII.
Any rights retained by Cite Lessor in this agreement shall be and
remain Subordivato to the rights of the Bondholders so long as there are
kitty Outstanding Aonds.
IMM
XXIII.
The Agreement of Sublease provides, "Sublessee shall have the righL
to terminate Lhis Sublease at any time by paying to Lessee a sum equal to the
aggregate principal amount of the Outstanding Bonds, plus the interest which
will accrue to the date the Ponds mature or -are redeemed in accordance with
their terms, plus the Basic Lease Rental Payments due through the date of
said termination ".
In the event the Sublessee exercises the option to terminate the
Agreement of Sublease in accordance with the quoted provision, this Agreement
of Lease shall terminate upon the payment to Lessor of the sums thereby
received by Lessee in satisfaction of the Basic Lease Rental Payments represent-
ing the rental payments due under this Agreement of Lease.
IN TESTIMO:iY WHEREOF, the parties hereto have caused these presents
to be executed on this the day of , 1973.
(Seal) CITY OF CORPUS CHRISTI
ATTEST:
City Secretary
APPROVED:
day of 1973:
City Attorney
(Seal)
h
ATTEST:
r r
. ' ; -N
r
By
R. Marvin Townsend, City Manager
LESSOR
CORPUS CIIRISTI AIRPORT DEVELOP2IENT
CORPORATION
By
LESSEE
-15-
SIiCI'It1N 26. EXENTS OP DEFAilla'; IMIEDIL•'s. (a) Sublessee shall
be deemed Lo be in default under this Sublease only if one or more of the follow-
ing events shall occur:
(i) The Sublessee shall (1) fail to make any of the Basic
Sublease Rental payment:; before the close of the calendar month in
which it is due or within ten days after notice to the Sublesseu by the
Lessee or the Trustee that such is overdue, whichever occurs first,
or (2) fail to make any Basic Lease Rental. payments and such failure
shall continue for thirty days after notice to the Sublessee by the
Lessee or the 'trustee that it is overdue.
(ii) The Sublessee shall fail to maintain or procure insurance
and to file copies of policies or certificates with reference thereto
with the Lessor, Lessee, and Trustee in accordance with the require-
ments of this Sublease, and such failure shall not be remedied within
twenty (20) days after notice_ to the Sublessee by the Lessee or the
Trustee that such insurance has not been procured or is not being
maintained as required by this Sublease or is about to be,terminated,
cancelled, or modified in a manner not permitted by this Sublease.
(iii) The Sublessee shall fail to observe or perform any other
covenant, condition, agreement, or provision hereof and such failure
shall not be remedied within ninety days after notice thereof to the
Sublessee by the Lessee or the Trustee, or if such failure cannot
reasonably be remedied within ninety days after such notice, then if
the Sublessee does not commence to remedy the same within such ninety
day period and diligently continue to do so.
(iv) The Sublessee and Guarantor (if during the primary term) shall
file voluntary petitions in bankruptcy or shall admit in writing their
inability to pay their debts as they shall mature, or shall make assign-
ments for the benefit of creditors, or shall apply for, consent to or
acquiesce in the appointment of a trustee or receiver for the Sublessee
and the Guarantor.
(v) A trustee or receiver shall have been appointed for the Sublessee
and Guarantor (if during the primary term) or for substantially all of
their property without their consent or acquiescence and shall not be dis-
charged within sixty days after such appointment, excluding any period in
which such appointment shall be stayed upon appeal or otherwise.
(vi) Sixty days shall have expired after the entry by a court of
competent jurisdication of an order adjudicating the Sublessee and
Guarantor (if during the primary term) bankrupt or insolvent or approving
a petition seeking reorganization, readjustment, arrangement, composition,
or other similar relief as to the Sublessee and the Guarantor under the
Federal bankruptcy laws or any similar law for the relief of debtors, but,
such period of sixty days shall not include any period during which such
order shall be stayed upon appeal or otherwise.
(b) In case Sublessee shall be in default-, Lessee may declare said term
ended, and may re -enter upon the Premises either with or without process of law,
and remove all persons therefrom. Sublessee expressly agrees that the exercise
by Lessee of the right of re -entry shall not be a bar to or prejudice in any way
any other legal remedies available to Lessee.
(c) If Lessee shall so re- enter, Lessee may repair and alter the Premises
in such manner as to Lessee may seem necessary or advisable, and /or let or releL
the Premises or any part.-. Lhercof for the whole or any part- of tile. romninder of
tho torn heroin originally lea.cd or for a longer period, in Sublcs::oc's n:unu, or
at: the al;ont of SubJo::r.e•c, and ouL of any rent so collecLvd or roce•ivud lessee
shall; first, pay to it:;olf the ro:;L and cx1ivnse of roLaking, rupossc: ;gimp;, re-
pairing; and /or alto ring the• :111i,le:c:od proniat•::, and Lhe cu::L and c>:pcnae of rcrnov-
Lnl; all perr :oils and prot•orly thorn -room; second, pay to Ltsalf Lhe cost and vxJ' nnc
sust.aJncd L: svcurJng; any nc•w lc:n.uiLn,' and if Les!;c•e ::hall, maintain and operato
-I/,-
they ficmises Lho cost and rxpon:e of operating cnl.l mainLaininf; the Premises; and,
third, pay to itself any balance remaining un account of the liability of Sub -
Jcssve to Lessee for tice sum equal to all rent rc: ;erved herein and unpaid by Sub-
lessee for the remainder of the Primary Term hereof. Any entry or re -entry by
Lessee, wheLhcr had or Lal.cn under summary proceedings or oche noise, shall not
absolve or discharge Sublessee from liability hereunder.
(d) Should any rent so collected by Lessee after the aforementioned
payments be insufficient fully to pay to Lessee a sum equal to all such rent
reserved herein, the balance or deficiency shall be paid by Sublessee on the rent
days herein specified, that is >, upon each of such rent days Sublessee shall pay
to Lessee the amount of the deficiency then existing; and Sublessee shall be and
remain liable for any such deficiency, and the right of Lessee to recover from
Sublessee the amount thereof, or a sum equal to all such rent reserved herein,
if there shall be no reletting, shall survive the issuance of any dispossessory
warrant or other cancellation or termination hereof, and Sublessee hereby expressly
waives any defense that might be predicated upon the issuance of such disposses-
sory warrant or other cancellation or termination hereof.
(e) Suit or suits for the recovery of such deficiency or-damages, or
for a sum equal to any delinquent installment or installments of Basic Sublease
Rental Payments, or Basic Lease Rental Payments may be brought by Lessee, from
time to time at Lessee's election, and nothing herein contained shall be deemed
to require Lessee to await the date vilereon this Sublease or tlse term hereof
would have expired had there been no such-default by Sublessee or no such can-
cellation or termination.
SECTION 27. NO WARRANTY Or CONDITION OR SUITABILITY. The Lessee does not
make any warranty, either express or implied, as to the actual or designed capacity
of the Building; as to the suitability or operation of the Building for the pur-
poses specified herein; or as to the condition of the Building or that it will
be suitable for Sublessee's purposes or needs. Sublessee releases the Lessee
from, and the Lessee shall not be liable for, and Sublessee will hold Lessee
harmless against, any loss or damage to property or any injury to or death of
any person that may be occasioned by any cause whatsoever pertaining to the Premises,
or the use thereof: nrovided, that the indemniry in this sentence shall be effective
only to the extent of any loss that may be sustained by Lessee in excess of the
sums paid for the benefit of Lessee from any insurance carried with respect to
the loss sustained.
SECTIOid 28. LESSEE'S DUTY TO P.ELET Old TEMMINATION BY SUBLESSEE. If the
right of the Sublessee to the use, occupancy and possession of the Premises shall
be terminated in any way, the Lessee will use its best efforts to relet said
Premises or any part thereof for the account and benefit of the Sublessee for
such rental terms to such persons, firms or corporations and for such period or
periods as may be fixed and determined by the Lessee but the Lessee shall not
unreasonably refuse to accept or receive any suitable occupant or tenant offered
by the Sublessee. The Lessee shall not otherwise be required to do any act what-
soever or exercise any diligence whatsoever to mitigate the damages to the Lessee,
and if a suf:ficieclt sure shall not be received from* any reletting to satisfy the
rental Payments hereby agreed to be made by the Sublessee, after paying the ex-
penses of reletting and collection, then the Sublessee hereby agrees to pay and
satisfy any such deficiency, if, as and when the same exists; provided, however,
any excess rentals from any such reletting shall be credited to any rental due
or to become due by the Sublessee.
SECTION 29. OPTION TO TER1(71: : \TIi BY SUBLESSEE. During the primary term,
Sublessee shall. have the rLf;hL to Len71inaLe this Sublease at any time by paying
to Le :a ec a sum equal to the aggregate principal amount of the Outstanding bonds,
plus the iuterc•sL whLch will accrue to the date tile. Bonds mature or may be re-
deemed in accorclauce with their terns, plus the Ba :;ic Lease I.eutal PaymonLs clue
Uirough Lhc dale Of Said LC190L11atiell.
-15-
SUCTTON 30. OPTION TO RENEW. Sublessee is hereby granted seven separate
five year opt.i6us (except that thu last five year option shall be reduced by the
period of the interim rental term) for renewal of this Sublease (herein called
"renewal terms ") , so the total possible period to be covered by this Sublease
and renewals shall. be 50 years including Lhc,interim rental term. Sublessee can
exercise its options to renew this lease by giving Lessee written notice by cer-
tified mail, return receipt requested, at least ninety (90) days prior to the ex-
piration of the primary term in order to exercise the first renewal option, and
at least ninety (90) days notice by certified mail, return receipt requested,
prior to the expiration of any renewal term in order to exercise the next renewal
option. Each renewal shall be on the same terms and conditions herein specified
except that the annual rental for cacti year during any renewal term shall be at
the rate coual to the fair market rental value of the Premises. It is hereby found
and determined that, taking into account the depreciated value of the Building
after having been constructed at the beginning of the primary term, the fair mar -
kct rental value of the Premises shall be four percent (4%) of the actual original
construction cost of the Building (excluding architect's fees and the fees and
costs of the bond attorney). Should the Sublessee choose to exercise one or more
of its options herein granted, the Lessee shall timely exercise the corresponding
option to renew the Lease. _
SECTION 31. NOTICES. All. notices required hereunder shall be deemed to
have been served if sent by registered mail as follows:
To lessee: To Sublessee:
Corpus Christi Airport Development Power Monolithics, Inc.
Corporation 1224 The 600 Building
P. 0. Box 640 Corpus Christi, Texas 78401
Corpus Christi, Texas 78403
To Lessor: To Guarantor:
City of Corpus Christi, Texas Veeco Instruments, Inc.
c/o City Manager Terminal Drive
P. 0. Box 9277 Plainview, New York 11803
Corpus Christi, Texas 78404 _
To Trustee:.
Corpus Christi Bank, and Trust
P. 0. Box 4666
Corpus Christi, Texas 78408
Such addresses taay be'chnnged by the parties hereto by notice.
SECTION 32. CA111TAL EYPEUDITURE LIMITATIONS. (a) It is understood that
the Bonds are being issued by the Lessee under the capital expenditure limita-
tions prescribed in Section 103(c)- (6)(D) and (E) of the Internal Revenue Code
of 1954, as intended, and that in order for the interest paid'on the Bonds to be
excludable from gross income of the recipients thereof for Federal income tax
purposes, the Sublessee t::ust and shall comply with such capital expenditure
limitations. Further, in the event of a determination by a District Director
of Internal-14-venue (or by an officer succeeding to the duties of a District
Director) that interest on the Bonds is includable in the gross income of the
recipient thereof for Federal income tax purposes because the capital expendi-
ture linitnLLons were not complied with, the rental paynents required to be
uade during tho Lerm of this: Sublease pur::uant to the requirements herein estab-
Ushed ::I1;11,1 bo accelerated and shal.l be clue and lie paid by the Subles ee to Lhc
-16-
I
Lcssev within 30 days after such deterrifnarion; provided that the Sublcsscc ::hall
not be required to pay as accelerated rental n total amount vxcecdiul; the agl;re-
gate principal amount of tile. Bonds. outstanding, accrued interest thereon to date
of redemption of the Donds, the costs necessary and incidental to the, exercising
of any prepayment options, other than premiums, for prepayment and any other
expenses incurred by the Le :See due to such redemption less all sums at the time
in the Funds established by the Indenture. • The Lessee will receive or cause to
be received tile monies thus paid by the Sublessee and deposit same or cause same
to be deposited in said Funds. The Lessee further agrees to then call or cause
to be called all the Bonds Outstanding for redemption prior to scheduled maturities
at the earliest time permitted by, and in accordance with, the Indenture.
(b) At such time as all of the Bonds together with the interest thereon
to date of redemption and premium due thereon in accordance with the Indenture
are paid in full, in accordance with this Section and the corresponding provisions
of the Indenture, no further Basic Sublease Rental Payments shall be made by the
Sublessee pursuant to Section 12. all other terms of this Sublease shall remain
in full force and effect.
(c) In'the -event of any such determination by a District Director of
Internal Revenue or such successor officer, the Sublessee's obligation to pay
the accelerated rental may be postponed for a period of three months following
receipt of written notice of such determination, during which time the Sublessee
shall have the right, to the extent permitted by law, to contest such dcterri.na-
tion and in the event such determination is reversed or withdraom within such
three month period, the Sublessee shall be relieved of its obligation to pay the
accelerated rental.
SECTION 33. MISCELLANEOUS
(a) Sublessee throughout the primary term of this Sublease or any re-
newal thereof will comply with all laws, ordinances, orders, rules, regulations
and requirements of all governmental authorities having jurisdiction of the
Premises. Sublessee may contest the validity of any such laws, ordinances,
orders, rules, regulations and requirements but shall indemnify and hold Lessee
harmless against the consequences of any violation thereof by Sublessee.
(b) Sublessee will cooperate with Lessee in the performance of Lessee's
covenants under the Indenture, and shall perform the duties and obligations of
the Sublessee and of the Lessee thereunder to the extent requested by the Lessee
or required by the terms of the Indenture.
(c) Lessee hereby waives all liens, including the statutory landlord's
lien on any property of Sublessee placed on the Premises.
(d) With respect to any proceeds payable to Lessee under the Lease
because of condemnation or insurance recoveries' under the Lease, such sums shall
be payable to Sublessee, notwithstanding any contrary provisions of this Sublease.
(a) The rights of the parties hereto shall be subordinate to the rights
of the parties to the Indenture, and this Sublease shall in no way diminish or
reduce the rights of the Bondholders as provided in the Indenture or the security
thereby afforded.
(f) No remedy herein conferred upon or reserved to Lessee or to Sublessee
is intended to be exclusive of any other remedy herein or by law provided, but each
shall be cumulative and shall be in addition to every other remedy given hercundcr
or not,• or hereafter existing at law or in equity or by statute.
(T) If any :section, subsection, paragraph, sentence, clause or other pro-
vision of this Subloanv shall be held invalid, the invalidity thereof Shall not
affect Uie ot•hcr provisions of this Sublea e.
-17-
(h) the covenants: and agret,mcuts herein conLainrd shall hind, apply to
;uu1 inure to Lhe bcuef.i.t of Lhe parties hereto, and to Lhelr respective suc-
cessors, tassigns, and lei;al. represenLati -vcs.
(i) Except as otherwise provided in this Sublease or in the Indenture,
subsequent Lo the initial i::suanCC of ronds and prior to pa}mcnt of the fonds
in full (or provision for the payment thereof having been made in accordance
with the provisions of the Indenture), thi: Sub] case may not be effectively
amended, changed, modified, altered or terminated without the prior written
consent of the Trustee.
(j) This Sublease may be executed in several counterparts, each of
which shall be regarded as an original and all of which shall constitute but
one and the same Sublease.
(k) The captions or headings in this Sublease are for convenience only
and in no way define, ] -init or describe the scope or intent of any provisions
or sections of this Sublease.
IN WITNESS U"HE EOF, Corpus Christi Airport Development Corporation and
Power Monolithics,.Inc., have caused these presents to be executed by its proper
officers 'thereunto duly authorized on this the day of
A.D., 1973.
CORPUS CHRISTI AIRPORT DEVELOPMENT
CORPORATION, LESSEE
By
John W. Crutchfield, President
(SEAL) of Corpus Christi Airport Devel-
opment Corporation
ATTEST:
(SEAL)
ATTEST:
Secretary
Secretary
P014ER _MONOLITHICS, INC., SUBLESSEE
_38-
THE STATE OF TEXAS X
COUNTY OF NULCES X
BEFOIL II{, the undersigned authoripy, on this day personally appeared
JOAN 1,1. CI:U7'CIIFII '.I.D, knout to me to be the person those name is subscribed to
the foregoing instrument, and knount to me to be the President of Corpus Christi
Air Port Development Corporation, a corporation, acknowledged to me that lie
executed the same as the act and deed of said corporation, in his official
capacity as stated, under the seal thereof, and for the purposes and considera-
tion therein expressed.
GIVEN L?:DER MY HAND AND SEAL OF OFFICE, this day of
1973.
Notary Public iii and for Nueces County,
T e x a s
My Commission Expires: June 1, 1975
'THE STATE OF TEXAS X
COUNTY OF NUECES X
BEFORE ME, the undersigned authority, on this day personally appeared
, known to me to be the person whose name is sub-
scribed to the foregoing instrument, and known.to me to be the President
of Power Moctolitliics, Inc., a corporation, acknowledged to me that he executed
the same as the act and deed of said corporation, in his official capacity as
stated, and under the seal thereof, and for the purposes therein and considera-
tion therein expressed.
GIVEN UNDER•TJY NAND AND SEAL OF OFFICE, this day of ,
1973.
'Notary Public in and for Nueces County,
Texas
My Commission Expires: June 1, 1975
-19-
That the foregoing ordinance was read for the first time and passed
to its second reading on this the day of , 19 , by the
following vote:
Jason Luby
James T. Acuff
Rev. Harold T. Branch
Thomas V. Gonzales
Ricardo Gonzalez
Gabe Lozano, Sr.
J. Howard Stark
r} That the foregoing?ordin ce
' to its`thi =d reading on this the
as read for the second tune and— passed
ay of 19 j by the
following vote:
Jason Luby
T.
,James Acuff
1
Rev. Harold T. Branch
+i �W
1
Thomas V. Gonzales
c-
Ricardo
1
C�
Gonzales
„C
Gabe Lozano, Sr.
J. Howard Stark
� '�'—
That the foregoing ordinance was read for the third time and passed
finally on this the day of f1 W1—&n. , 19 7-3 , by the following vote:
U
Q
Jason Luby
James T. Acuff v _
Rev. Harold T. Branch U
Thomas V. Gonzales
U
Ricardo Gonzales
Gabe Lozano, Sr.
J. Howard Stark iL
PASSED AND APPROVED, this the l t4, day of Q"j 19_Z_.
ATTEST:
s <
City Secret %y
APPROVED: /J
DAY 0 V , 1-97 3
SQ, i�SS( City Attorney
HAYRP
THE CITY OF CORPUS CHRISTI•,,'TEXAS
6►
,rte �z
•x ,� .�t4v P�'�'� 8�1. �,` „s ' . • _ : KY .. � '� _ • - • *S .,_ a�k.E. r • ��� ,�. �,yif rrw'�
THAT THE FOREGOING ORDINANCE WAS READ FOR THE FIRST TIME AND PASSED
TO ITS SECOND READING ON THIS THE�DAY OF__ ... '1BY THE
FOLLOWING VOTE:
RONNIE SIZEMORE
CHARLES A. BONNIWELL
ROBERTO BOSQUEZ, M.D.
REV. HAROLD T. BRANCH
THOMAS V. GONZALES
GABE LOZANO, SR.
J. HOWARD STARK
PASSED AND APPROVED, THIS THE_
ATTEST:
DAY-OF , j9
CITY SECRETARY MAYOR
THE CITY OF CORPUS CHRISTI, TEXAS
APPROVED:
DAY OF , 19
CITY ATTORNEY
BONNIE SIZEMORE
CHARLES A. BONNIWELL
ROBERTO BOSQUEZ, M.D.
REV. HAROLD T. BRANCH
THOMAS V. GONZALES
GAGE LOZANO, SR.
^.�V--
--- --- '_' -- --
"J9:f' HOWARD_STARK — —. - - --
'— I- HAT —THE FOREGOING ORDINANCE WAS READ FOR
THE SECOND TIME AND PASSED
TO ITS THIRD,READING ON THIS THE%4,,DAY.OF ��y..��
., j9�, BY THE
FOLLOWING VOTE:
✓1`
T /R s a N /- 1) y
RoN+ -E--S4 zE-moR e
J/jT9cs r. f1Gu Fr-
C- FFA"R. E— „— A.— BDMiF I+FE -LL
T
f/1f (ZO A.P T(3QH NC.N
��
—
J2�CA2DO GaNZA� E Z
REV — HYCR'@L`D—T— BRYcNCH-
/�--
THOMAS V. GONZALES
GABE LOZANO, SR.
O
J. HOWARD STARK
r✓
THAT THE FOREGOING ORDINANCE WAS READ FOR
THE THIRD TIME AND PASSED
FINALLY ON THIS THE
DAY OF , 'IS_,
BY THE FOLLOWING VOTE:
RONNIE SIZEMORE
CHARLES A. BONNIWELL
ROBERTO BOSQUEZ, M.D.
REV. HAROLD T. BRANCH
THOMAS V. GONZALES
GABE LOZANO, SR.
J. HOWARD STARK
PASSED AND APPROVED, THIS THE_
ATTEST:
DAY-OF , j9
CITY SECRETARY MAYOR
THE CITY OF CORPUS CHRISTI, TEXAS
APPROVED:
DAY OF , 19
CITY ATTORNEY
PUBLISHER'S AFFIDAVIT
r-
'STATE OF TEXAS, tss:
County of Nueces. )
Before me, the undersigned, a Notary Public, this day personally came ..................................
------- Riphar ding to law, says that he is the
.A..p ... . ... H-ardin .................... who being first duly sworn, according
Q.jjaj3.*j ...... Ad.v..j,.jF.......... ........................ ...... of the Corpus Christi Caller and The Corpus Christi Times,
Daily Newspapers published at Corpus Christi, Texas, in said County and State, and that the publication of
—..auth-cirizIng ±die Ci.ty Maxwg.er ................ — -------- -- --
A',
of which the annexed is a true copy, was published in .............. TAMe-8 ...................................................... . .... .
on the .... 17-tkAay of ........ April .................. 19 7-3, a;3MJkO9=:=R1X -------------- - -------- M-AffolgiffAM ----------- - --------- - ---
con=Rtive .........................................................
...............I .............. Times.
$ 7 ?-..O.Q ............... ..... . LO.,-
Richard D. Hardin, ass. Adv. Mgr.
Subscribed and sworn to before me this 611a--day of ............. .....July.............._... 19 ... 7.3 ......
Louise Vick
L-
................... .... .................... - --- - ---------- 4--
N ary Public, Nueces County,
T. e/x_a.s
--�-p
PUBLISHEWS AFFIDAVIT ,
s STATE OF TEXAS, ss:
County of Nueces.
Before me, the undersigned, a Notary Public, this day personally came ... ...............................
Lau .% e_... V. 3c- k------ -------------- •-- •- ......•• -- who being first duly sworn, according to law, says that he is the
........ visor•• ..... ............• of the Corpus Christi Caller and The Corpus Christi Times,
Daily Newspapers published at Corpus Christi, Texas, in said County and State, and that the publication of
nA? 7� .a..11S�8....... .....1s.ase ... with ... C. C ...Airport- .De-va-l- opmentr -..,
of which the annexed is a true copy, was published in ...................... Times .......................................... .._.- ...�_.
on the...3rA day of... ........... IU3-Y ............... 19.7.3... and once each ...... waek_ .......... thereafter-for ...I.............__._---
consecutive ....W.� e.1�....name 7 y.. Jn1g ..13 .
2 .............Times.
�u-_lU ...._._..
R Louise Vick, Class. Adv. Supe"rvisor
Subscribed and sworn to before me this ...... 24.th.....day of. ...................... July.................... 19....7.3.....
Woodrow Glenn _-••.,, .G? /.`..` .._ ....
_
Notary Public, Nueces County, Texas
(4) Poe purposes of this Section 23(c), the term "totally
destroyed" or "total destruction" shall mean either:
(1) 107 or more of the Building shall have been dammed
or destroyed; or
(ii) the Building shall have been damaged or destroyed to
the extent that the estimated additional construction
funds required to restore the Building exceed the
balance of the rental for the remainder of the lease.
For purposes of this Section 23(c)' the term "partially
damaged" or "partially destroyed" shall mean any damage which does
not constitute "total destruction" or totally destroyed as set
forth above.
SECTION .24, E• IiiI.2 T DO:LtIN. In the event of the commencement,
prosecution or consummation during any term of this Sublease of any condemna-
tion proceeding, or - proceedings, in eminent domain (hereinafter called "con-
demnation"), covering, touching or affecting all or any part of the Premises,
Lessor, Lessee <-md Sublessee at their option may prosecute their respective
claims against the public or private body designated as the taking authority on
account of any such taking or appropriation of the Premises, or any part thereof,
and receive their respective award as provided by law.
However, in the event of any condemnation during the interim
rental period and 15 -year primary rental period, all condernation proceeds shall
be payable to Trustee to the extent sufficient to redeem all Outstanding Bonds.
All remaining proceeds shall be allocated and paid to Lessor, Lessee, and Sub-
lessee in accordance with the award of the court having jurisdiction of such
cotsder.nation.
If there is a partial talking sufficient to impair the business
operations of Sublessee, then Sublessee shall have the option to terminate and
cancel this Sublease; however, during the interim rental period or the primary
term, such cancellation shall not be effective unless Sublessee pays to Trustee
an amount sufficient to redeem all Outstanding Bonds, after reduction for any
condemnation funds paid to Trustee.
SECTION 25. FORCE MAJEURE. In case by reason of force majeure
either party hereto shall be rendered unable wholly or in part to carry out its
obligations under this sublease, then except as otherwise e::pressly provided in
this sublease, if such party shall give notice and full particulars of such
force majeure in writing to the other party within a reasonable time after
occurrence of the event or cause, the obligations of the party giving such notice,
other than the obligation of the Sublessee to make the rental payments required
herein, so far as they are affected by such force majeure, shall be suspended
during the continuance of the inability then claimed which shall include a
reasonable titae for the removal of the effect thereof, but for no longer period,
-and such party shall endeavor to remove or overcome such inability with all
reasonable dispatch. The term "force majeure,' as employed herein, shall mean
acts.of God, strikes, lockouts or other industrial disturbances, acts of the
public enemy, orders of any kind of the Government of the United States or the
State of 1•exas or any civil or military authority, insurrections, riots, restrain-
ing of governr:ctlt and people, epidemics, landslides, lightning, earthquakes,
fires, hurricanes,
es, stums, floods, washouts, droughts, arrests, civil dis-
turb.ulcej;, explosions, breakal;u or accidents to machinery, transmission pipes
or canals, partial or entire failure of uti.liticS, shurtageS of'l.1 bar, material,
supplies or Lean : :porLatiotl, or any other cau::e not reasonably t:ithin the con-
trol of Una party Cl-61-lint, l:ur.h inabLlity. IL is understood and agreed that
the :vettlor :rat of L -ti!:t in}; c,r ftapendial; : :Lrikc's, lockout:; or other industrial
di :authan cc ^: l ;h.11l be vaLitely wiLhitl Iho discrct.ion of the party having thu
dlCfitulty and th.0 the• ahnvc rt•,Iuiremonl!; Marl ally force majculc shall by
rc•tredled with all re.rtn11ablo dispatch !:hall be dremrd Lo be fulf.ill"d tavern thuu};h
l :uch tl :i : :Lini; ,n it.q+,•utliul; lurk,+utat, .111,1 ulhc•r Industrial dir.Un'b :11lrcv:
may nt,l ba rt.:I lod .old could h.: v,• Loon Sot.l lod by acvedlut; to Lhc demand.,; of
tilt. upp,v: I'll. I+rr::uu or pt•t alma. I
(5) l'or purposes of this Section 23(b) the term "totally
damaged" or "LoLal. destruction ", steal]. have occurred to the
Building, if:
(1) 50% or more of the Building shall have been damaged
or destroyed; and
(ii) The insurance proceeds payable from the hazard insur-
ance policies shall be sufficient to redeem all
Outstanding Bonds.
For the purposes of this Section 23(b) the term "partially
damaged" or "partially destroyed" shall mean any damage which does
not constitute total destruction or totally destroyed as set forth
above.
(c) If the Building is totally destroyed or partially destroyed
during any of, the seven renewal terms of this Sublease by any cause insured
against under the hazard insurance policies, then the follot:ing shall occur:
(1) If the Building is totally destroyed, as hereinafter de-
fined, Sublessee shall have the option either to terminate and cancel
this Sublease or to restore the Building, as hereinafter provided, and
to continue this Sublease. Such election shall be made by written
notification to the Lessee within sixty (60) days after the date of
such destruction. In the event of cancellation of this Sublease, the
insurance proceeds shall be payable as follows: '
(i) to Sublessee, to the extent that Sublessee would be
entitled to recover (and has not previously recovered)
any sums during the renewal terms of this lease, as pro-
vided in Sections 23 and 9; and
(ii) to Lessor, to the extent that there are remaining funds.
If this Sublease is cancelled, then the termination shall
be effective as of the date of such damage, and Sublessee shall be en-
titled to an abatement of rent from the date of the damage and any
prepaid rent shall be returned to Sublessee.
(2) In the event this Sublease is not cancelled after total
destruction of the Building or in the event of partial destruction of
the Building. to substantially the same condition as it existed at the
time of such damage. All plans and specifications for such restora-
tion shall be submitted to Lessor for approval. Such approval shall
not be unreasonably withheld. All funds collected fro-.a the hazard
insurance policies shall. be delivered to and used by Sublessee to
restore the Building. In the event that such insurance proceeds are
insufficient to repair such damage, then Sublessee shall furnish the
additional funds necessary to cor,plete such repairs (heroin called
"additional construction funds ").
(3) In the event of the total destruction of the Building and
if the Sublease is not cancelled or in the event of partial destruction
of the Building, there shall be an equitable abatement of rent deter-
mined on the nature and extent of damage sustained to the Building from
the date of daiaage until the dale of completion of repairs to the
Building. In addition, Suble::sce shall earn a credit against the
first rent..!]:; becoming due. and payable after such repairs equal to Lhe
amount of Lhe additional cons u-uct!ou funds furnished to restore the
Building;, plus; intere: ;L therrun :�t the rata of seven per cent (TL)
per annum Isom Lhe d;ite such feud:, were e::pouded to the date such
funds cu•c recoupad.
—12 --
�4��
Trur;tce, to Lhe extent of any Outstanding 1,onds, and Lhe accrued interest
Lhercon to date of payment, and the remainder, if any, shall be payable as
follows:
(i) to Sublessee, to the extent 'that Sublessee would be
entitled to recover any sums during the renewal terms
of this lease, as provided in this Section 23, and in
Section 9 above; and
(ii) to lessor, to the extent that there are any remaining
funds.
If the building is totally destroyed and the Sublease is
cancelled, the cancellation shall be effective as of the date of such
damage and Sublessee shall be entitled to a refund of any prepaid rent.
In the event this Sublease is not cancelled after total destruction of
the Building, the Sublessee shall promptly restore the Building to sub-
stantially the same condition as it existed at the tine of the damage.
All plans and specifications for such restoration shall be submitted
to Lessor for its approval. Such approval shall not be unreasonably
withheld. -Title to the restoration of such Building shall vest in
Lessor upon completion of the restoration work.
(2) In the event of the partial destruction of the Building by
a cause insured against under the hazard insurance policies, Subleasee
shall promptly restore the Building to substantially the same condition
as it existed at the time of such darage. Title to the restoration of
such Building shall vest in Lessor upon completion of the restoration
work.
(3) In the event Sublessee elects to restore-the Building, or
is required to do so under the terns of subparagraphs (1) and (2) above,
all funds collected from the hazard insurance policies shall be delivered
to and used by Sublessee to restore the Building. In the event that
such insurance proceeds are insufficient to repair sueh damage, then
Sublessee shall furnish the additional funds necessary to complete such
repairs (herein called "additional construction funds ").
(4) In the event of the total: destruction of the Building and
if the Sublease is not cancelled or in the event of partial destruction
of the Building, Sublessee shall continue-to pay the rental provided
for in this Sublease agreement, provided, however, that Sublessee shall
earn a credit against the first rentals becoming due and payable during
the renewal terns of this Sublease, if this Sublease is renewed, equal
to the following:
(i) The amount of the additional construction funds furnished
to restore the Building, plus interest thereon at the
rate of seven per cent (7 %) per annum from the date such
funds were. expended to the date such funds are recouped;
and
(ii) An amount by which the rental would have been abated,- as
hereinafter defined, during the period from the date of
the'damaf;c to the Building to the date of the completion
of the repairs to the Building together with interest
on such nr:ount at the rate of seven per cent (72) per
annum from Lhe tire of such abatcment. Sublessee for the
purposes of U+is provision shall be entitled to all equit-
al,Ia nbaLemenL of rent dctCrL^.1nPd on the nature and er.-
Lent of the damngL• sustained to t•hc Building from the
data of dmmnf;u until the date of completion of repair:: to
Lila Building.
O WC
SECTION 21. RIGHTS OF LESSEE CUMULAT M,". The Sublessee agrees that Lila
rights and remedies of the Lcsscc under this Sublease shall-Se cumulative and
shall not exclude any other rights and remedies of the Lessee allowed by law
with respect to any default under this Sublease. Failure by the Lessee to insist
upon the strict performance of any of' the covenants and agreements herein set
forth or to exercise any rights or remedies upon default by the Sublessee here-
under shall not be. considered or taken as a waiver or relinquishment for the
future of the right to insist upon and to enforce by. appropriate legal remedy
strict compliance by the Sublessee with all of the covenants and conditions here-
of, or of the right to exercise any such rights or remedies, if such default by
the Sublessee to be continued or repeated, or of the right to recover possession
of the Premises by reason thereof.
SECTION' 22. SUBLETTING 1UND ASSIG19'M -NT. Sublessee shall have the right
to assign or transfer this Sublease or to underlease or sublet the whole or any
part of the Premises without the prior written consent of Lessee. Should Sub-
lessee assign this Sublease it shall nevertheless remain liable to-Lessee for
full payment of rent and Sublessee's other obligations under this sublease. No
further sublease shall relieve Sublessee of its obligation to pay rentals as
provided in Section 12.
SECTION 23. INSUPMICE. (a) Sublessee shall maintain or cause to be
maintained no less than the following insurance coverages insuring the Building:
(1) Fire and extended coverage insurance with vandalism and malicious
mischief endorsements in the amount of 80% of the replacement
costs of the Building.
(2) Flood insurance in an amount equal to the maximum amount available
under the United States Government Federal Insurance Program or any successor
program (if such insurance is available); provided, however., the amount of
such flood insurance shall not be required to exceed the amount of the fire
and extended coverage insurance set forth above in subparagraph (1).
(3) Such other hazard insurance coverages as may be reasonably.required
from time to time by Lessor.
The insurance coverages set forth in subparagraphs (1), (2) and (3)
above, are hereinafter sometimes collectively called "hazard insurance ".
All such hazard insurance policies shall name Lessor, Lessee, and
Sublessee as insureds, as their interests may appear, and shall contain a
loss payable clause in favor of Trustee for the benefit of the Bondholders.
Sublessee shall cause such hazard insurance policies or copies thereof, to
be delivered to Lessor, Lessee, and Trustee.
(b) If during either the interim term or the primary term, the Building
is damaged by any cause insured against under the hazard insurance policies, the
following shall occur:
(1) If the building is* totally destroyed., as hereinafter defined, Sub-
lessee shall have the option either to terminate and cancel this Sublease
or to restore the Building, as .hereinafter provided, and to continue Lhis
Sublease. Such election shall lie made by written notification to the
Lessee within sixty (60) days after the date of such destruction. In the
event of e,neullati.on of this lease agreement because of total destruction,
than the proceeds from the hazard insur:mce policy Shall first be paid Lo
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:tk
TILE STATE OF TEXAS X
COUNTY OF NUECES I
AGREEM NT OF SUBLEASE
THIS AGRI'Mn, \T OF SUBLEASE, made as of the day of ,
1973, between Corpus Christi Airport Development Corporation, a corporation duly
organized and existing as a non- profit corporation under and by virtue of the
laws of the State of Texas, with its domicile in Corpus Christi, Texas, (herein-
after referred to as "Lessee "), and Power Plonolithics, Inc., a corporation
organized and existing under the laws of the State of Delaware (hereinafter
referred to as "Sublessee ").
W I T N E S S E T H:
WHEREAS, Power 11onolithics, Inc., is a subsidiary of Veeco Instruments,
Inc., and by collateral agreement of even date herewith Veeco Instruments, Inc.,,
has unconditionally guaranteed the performance by Sublessee of all obligations
assumed by or imposed on.the Sublessee by the terms of this Agreement of Sublease
during the primary term of this sublease, and not thereafter; and
WHEREAS, of even date herewith the City of Corpus Christi, Texas, and
Lessee entered into a lease agreement wherein the City leased the below described
premises herein defined as the "Premises "; and
WHEREAS, Lessee will issue its Corpus Christi Airport Development Corpor-
ation First Mortgage Revenue Bonds for the purpose of acquiring, by construction,
buildings and other improvements which shall be a part of and included in the
Premises which are suitable for use by the Sublessee, such Bonds to be secured by
an Indenture of Mortgage and Deed of Trust (hereinafter defined as the "Indenture ")
dated as of by and between the Lessee and Corpus Christi
Bank and Trust, Corpus Christi, Texas, as Trustee; and
WHEREAS the Lessee and the Sublessee desire that the Lessee construct
certain improvements according to Sublessee's specifications to be a part of and
included in the Premises, to -crit: the manufacturing, warehouse and office build-
ing and related facilities to be acquired and constructed thereon de §cribed in the
Architect's Plans and Specifications; and
WHEREAS, the Lessee has agreed to lease the Premises to the Sublessee in
accordance -ith the terms hereof,
Now therefore,' in consideration of the nutual agreements and undertakings
-herein contained, and subject to the conditions herein set forth, the parties
hereto do hereby covenant with each other as follows:
SECTION 1. DEFINITIO \S.
Additional Bonds - one or more series of bonds issued in addition to the
Series 1973 bonds to 'provide funds for the cost of construction of Additional
Facilities or to complete the construction of the Initial Facilities or any Add -.
itional facilities;
Additional Facilities; - all additions or betterments or both of every
nature whaLsoever to the Bu;I(Ihi; and all properties other than the BUIldiol; nc-
quLred by the Le::aee, by purc.h.irc or const.ruction for which a :;cries of Additional
]Sand:: is i -.sued ]nu_ ::uaoL to Chu fndrnLurc and which are lensed to the Subles:ccc
for u:r as uanui "auturinl; warrhousu or ofilce faclllLlec;
Architect's Plans and Specifications - the plans and specifications
prepared by the firm of
architects of Corpus Christi, Texas, dated 1973, covering
plans of the Initial Facilities and filed with the Lessor, Lessee, Sublessee
and the Trustee;
Basic Lease Rental Payments - the rental payments due under the Lease
during the primary term thereof, in the amount of $2,625.00 annually;
Basic Sublease Rental Payments - the rental payments in addition to
the Basic Lease Rental Payments due under this Agreement of Sublease for the
primary term hereof;
Bond, Ponds - the first mortgage revenue bonds issued by the Lessee
pursuant to the terms of the Indenture;
Bond Date - the date of the Series 1973 Bonds;
Bondholder or Holder or holders of Bonds, or any similar terms - any
person who shall be a bearer of any outstanding coupon Bond or Bonds or the
registered owner of any outstanding registered Bond or Bonds without coupons;
Building - the improvements, including the Initial Facilities, to be
acquired and constructed by Lessee on the leased land with the proceeds of the
Bonds;
Completion Bonds - Additional Bonds issued by the Lessee sufficient in
amount to provide funds to complete the construction of the Initial Facilities or
any Additional Facilities in the event the proceeds of the Series 1973 Bonds or
any Additional Bonds are insufficient for such purpose;
Consulting Architect - the independent architect or independent archi-
tectural firm at the time employed by the Sublessee, or employed by the Sublessee
as the consultant architect in accordance with the Indenture;
FAA - Federal Aviation Administration and its successor agency or
agencies, if any;
Gfiarantor - Veeco Instruments, Inc.,-a corporation organized and existing
under the laws of the State of
Indenture - the Indenture of mortgage and Deed of Trust dated as of
by and. between the Lessee and the Trustee,
securing the Bonds;
Initial. Facilities - the building and other improvements as described in
the Architect's Plans and Specifications to be acquired and constructed with the
proceeds of the Series 1973 Bonds;
Lease - the lease agreement entered into on the day of
, 1973, between the City of Corpus Christi, Texas, and
the Corpus Christi Airport Development Corporation;
Leased Land - the ten (10) acre tract of land described in Section 2 herein;
Lessee - Corpus Christi Airport Development Corporation;
Lessor - City of Corpus Christi; Texas;
-2-
o.
Outstanding; Muds - all Bonds theretofore and thereupon being authen-
ticated and delivered tinder the Indenture except (a) Bonds-cancelled by the
Trustee at or before said date, or (b) Bonds for the payment or retemption of
which cash, equal to the principal amount or redemption price thereof, with
interest to the date of maturity or redemption date, shall be held by the
Trustee or any Paying Agent in trust for such purpose (whether at or prior to
the maturity or redemption date) , provided that if such Bonds are to be re-
deemed, notice of such redemption shall have been given as in the Indenture
provided or provision satisfactory to the Trustee shall have been made for
the giving of such notice;
Premises, Leased Premises - hereinafter described in Section 2;
Primary Term, 15 Year Primary Term - the original term of this lease
set forth in Section 9 or as modified by an amendment thereto;
Series 1973 Ponds - the Series of Bonds to be issued initially pursuant
to the terms of the Indenture and entitled "Corpus Christi Airport Development
Corporation First Mortgage Revenue Bonds, Series 1973" to acquire and construct
the Initial Facilities;
Sublease - this Agreement of Sublease;
Sublessee - Power Monolithics, Inc.;
Trustee - Corpus Christi Bank and Trust, Corpus Christi, Texas.
SECTION 2. DEMISED PR121ISES. Lessee does hereby demise and lease to
Sublessee, and Sublessee does hereby hire and take from Lessee, subject only
to those easements outstanding in favor of the Lessor and /or others as more
particularly described in Exhibit "A" attached hereto, the following described
real property together with the buildings and other improvements to be con-
structed by the Lessee and all rights -of -way, appurtenances and easements
presently appertaining thereto, in the County of Ilueces, State of Texas, to -wit:
All that certain lot, tract or parcel of land situated in
Nueces County, Texas, within the Corporate Limits of the
City of Corpus Christi, Texas, being a 10 -acre tract of
land out of Block 23, J. C. Russell Farm Blocks as shown by
map of record in Volume 3, page 53, Map Records, Nueces
County, Texas, said 10.0 acre tract of land being more
particularly described by metes and bounds as follows:
BECIA'NINC at a point, the intersecXion of the east boundary
line of said Block 23, and the new south right -of -way line
of State llighway No. 44, said point being S. lo, 19' 56" E.,
240.0 feet from the original northeast corner of said Block
23; thence S. 8So 35' 46" N., a distance of 50.0 feet to a
point in the proposed west- right -of -way of the Airport Entrance
Road and the cast boundary line of said Block 23, a distance of
660.0 feet to a point, the southeast corner of the tract herein
described;
THENCE S. 880 35' 46" ld:, with a line that is 660.0 feet south
cif and parallel to the south right -of -way line of said new
State Highway No. 44, a distance of 660.0 feet to a point,
the. southwest corner of the tract: herein described;
THENCE N. 10 19' 56" R., with n line that is 710.0 feet west
of and parallel to the cent.erline of Lite. Airport Entrance Road,
a di::tcutre of 660.0 feet to a point in the south rig;llt -of -way
line of the nr:w State 111J :hway No. 44, for the northwest corner
of the tract heruln de:,cribcd;
k
-3-
I
THENCE N. £1£30 35' 46" E. wIth the SouUi right -of -wary line of the
new State highway No. 44, a distance of 660.0 feet to the POINT
OF BL••GINNING;
the said tract of land and improvements thereon being hereinafter collectively
referred to as the "Premises ",. or the—Leased Premises ".
SECTION 3. AGRL••rXENT TO CONSTRUCT.
(a) The Lessee shall construct with reasonable promptness the Initial
Facilities, a building containing no less than 25,000 square feet on the leased
land, together with other improvements, according to the Architect's Plans and
Specifications approved by the Sublessee, Lessor and the FAA.
(b) Should the proceeds from the sale of the Series 1973 Bonds, in the
aggregate principal amount of $1,500,000, be insufficient to complete the con-
struction of the Initial Facilities, then the Lessee shall from time to time with
the consent of the Sublessee sell Completion Bonds sufficient in amount to provide
funds to complete the construction of the Initial Facilities. The Co=mpletion Bonds
may be on a parity with or subordinate to the said Series 1973 Bonds. The Sub -
lessee's Basic Sublease Rental Payments under Section 12 shall be increased in
amounts sufficient to pay the interest on and principal of the Completion Bonds.
SECTION 4. USE OF THE PREMISES. The Premises shall be used for the
purposes of manufacturing, warehousing, offices, and any other lawful purpose and
in accordance with the Burke Piaster Plan for City Airport Development (on file in
the official records of the City of Corpus Christi, Texas) and subject to the
approval of the FAA.
SECTION 5. BUILDING ST&NDARDS. All constructicn on the Leased Land
shall conform with the requirements of the National Fire Code of the NFPA for
such occupancy and facilities. The Sublessee shall maintain and operate such
facilities and conduct its operations on the Premises in such manner as not to
conflict with the regulations of any Federal, State or Municipal authority having
jurisdiction thereof.
SECTION 6. CONSULTING ARCHITECT. At any time the Sublessee undertakes
construction relative to the Premises whether it be in connection with Additional
Facilities having-a cost in excess of $100,000 or restoration resulting from
physical loss in excess of $100,000, the Sublessee will employ a Consulting Archi-
tect who shall be qualified under the terms of -the Indenture and shall perform the
duties of a Consulting Architect prescribed in the Indenture.
SECTION 7.- ALTERATIONS AND ADDITIONS.
(a) Sublessee may make or permit to be made, such alterations and modifica-
tions of, and additions to, the Premises as Sublessee may deem desirable for the
use thereof and may, at Sublessee's option and without cost to Lessee, at any time
and from time to time during the Primary Term, or during any extension or renewal
hereof, do anv one or more of the following, provided plans and specifications
therefor shall be subject to approval of Lessee and Lessor if such alterations
or modifications involve the demolition or removal of fifty percent (50%) or
more of the permanent, humanly occupiable square footage of the Building:
(1) alter or remodel any building or other improvements on the
Premises, provided the rental. value of any building or improvements
so altered or remodeled Jr. not adversely affected thereby, and /or
(2) con: ;fruct an addition, or additions thereto, and install
any fixtures, machinery and equipment, provided, that any such con -
struction and lunlallation rha)l be in accordance wlth applicable
laws, ordinance. ;, rule:; and regulation.^.;
-4-
(3) demolish and remove from the Premises any building or
improvement which in the judgment of Sublessee has become unfit for
use, obsolete, surplus or is no longer necessary for operations of
the Sublessee, provided, if the property to be demolished and re-
moved shall have had an original construction cost, or an allocable
purchase cost to Lessee, in excess of $100,000 (or, in the event
that such cost, when taken together with the original construction
cost, or allocable purchase cost to Lessee, of property previously
demolished and removed by Sublessee for which Sublessee shall not
have provided replacements, shall exceed $100,000, Lessee shall be
entitled to condition its consent to such demolition and removal on
the receipt from Sublessee of any undertaking, satisfactory to Lessee,
that Sublessee will at its own expense (or pursuant to arrangements
satisfactorv'to Lessee) construct on the Premises new improvements
to the extent reasonably necessary to compensate for such loss of
rental value of the Premises as nay result from such demolition and
removal. In determining whether there has been a net diminution of
such value, consideration shall be given to any new improvements Sub-
lessee nay have constructed from time to time on the Premises, in
addition to those constructed as specific replacements for property
demolished and removed; but in no event shall any demolition or removal
of the Building, as hereinabove defined, whether in one removal or
demolition or a series thereof, amounting at any time to fifty percent
(50 %) or more of the permanent, humanly occupiable square footage of
the Building be effected without the approval of Lessor.
(4) construct an additional new building or buildings on the
Premises.
(b) At the expiration or termination of this Sublease, or any extension
or renewal thereof, Sublessee shall leave the Premises in good condition, allowance
being made for ordinary wear and tear, damage by fire or other casualty, acts of
Cod, riot and civil commotion, and Sublessee shall not be required to restore the
Leased Premises to the condition in which the Premises are in as of the cosmenc-
ment of the term hereof, it being agreed that Lessee shall accept the Premises with
:such alterations, remodeling, additions, or new construction, as may have been made
pttr: ;cant to authorization contained in this Section. Sublessee agrees that it will
not permit any mechanic's, materialmen's, or other liens to stand against the Pre -
r.i: ;es for work or materials furnished Sublessee in connection with any such altera-
tions, remodeling, additions or new construction, it being provided, however, that
;cuSlessee shall have-the right to contest the validity of any such lien or claims,
i,ut upon a final. determination of the validity. thereof-, Sublessee shall immediately
p•ty ally judgment or decree rendered against Sublessee, with all proper costs and
tries, and shall cause any such lien to be released of record without cost to
(c) Sublessee shall have the right at its own expense to install such
tiktures, machinery and equipment in or about the Leased Premises, and to post
" attach such signs oil the interior and exterior thereof, as it may deem de-
sirab m
]e and conformable to law and to r,A regulations. All signs, fixtures
(including lights), machinery, or other equipment, which may be insealled,
1'1.:ced or attached in or about the Leased Premises by Sublessee, shall remain
!I•'' Prope.rty'of Sublessee, and upon the termination of this lease, by expira-
tl „u of the torn, or upon the termination of any renewal thereof, Sublessee shall
I'��'t• the rll;ht to remove the same within a reasonable time after such termination;
1t "vid�'d, however, that Sublusscc shall at its expense repair or cauc ;c to he re-
I.11red any damage caused to the Leased 1'remtses by virtue of the removal thereof.
(d) '1'itlu to all buildings. and all. permmu•nt improvements annexed to the
Malty under thu term:; of Lht :; "CeLlon 7 ::hall iuunr.diately ve : ;L In Lc: ;sor.
-5-
SECTION 8. MAINTENANCE. The Sublessee will keep the Premises, including
all buLldingt: and improvements and the appurtc•uances thereto, in good repair at
its own cost, ordinary wear and tear, damage by fire or other casualty, acts or
God,. riot or civil commotion, excepted.
SECTION 9. PRMU1Y TERM. This Sublease shall be composed of an interim
Sublease term and a primary Sublease term. The interim Sublease terra shall com-
mence on t'he date of this agreement and :;hall end on the last day of the month
during which the Initial Facilities are com.pletcd and ready for occupancy by Sub-
lessee, or twelve (12) months from the Eond Date, whichever date is earlier, (herein
called "interim rental term "). The primary rental term shall cormnence on the first
day of the i:onth after the Initial Facilities are completed and are ready for occu-
pancy by Sublessee, or twelve (12) months from the Bond Date, whichever date is
earlier, and shall be for a term of fifteen (15) years thereafter (hereinafter some-
times called "15 year primary term" or "primary term "). The rental payable for ttte
interim Sublease term is $1.00, receipt of which is acknowledged by Lessee.
If the Initial Facilities are not completed and ready for occupancy by
Sublessee on or before the c=aa.caccment of the primary term, then Sublessee shall
be entitled to a credit against the first rentals beco:ring due and payable during
the renewal terns, as hereinafter defined, for any rentals paid to Lessee for the
period from the commencement of the primary term to the last day of the month after
the Initial Facilities are completed and ready for occupancy, together with interest
thereon at the rate of seven percent (7!) per annum until such sums are recovered by
Sublessee.
SECTION 10. BONDS. In order to provide funds for payment- of the cost of
acquisition, construction, and installation provided for in Section 3, hereof,
Lessee has, concurrently with the execution of this Sublease, issued and delivered
to the purchasers thereof, the first series of its Bonds and Lessee has deposited
the proceeds of said Bonds with the Trustee. All monies received from the sale of
the Bonds and all rentals paid by'the Sublessee hereunder shall be applied solely
and exclusively in the manner and for the purposes expressed and specified in the
Lease, the Sublease, the Indenture, and in the Bonds. The Sublessee and the Lessee
realize and understand that the Bonds which will be issued by the Lessee to provide
funds for the construction of the Building, will be payable as to principal and
interest out of the revenues and rentals and other amounts received by the Lessee
therefrom or in respect thereof, and the Sublessee realizes and understands that
purchasers of the Bonds will necessarily make their purchase in reliance upon the
credit and.financial condition and history of the Sublessee and Guarantor. Ac-
cordingly, the Sublessee agrees that, during the primary term, in the event a
receiver should be appointed by a Court of competent jurisdiction to take charge
of the business or assets of both the Sublessee and Guarantor, or in the event
both the Sublessee and Guarantor are adjudicated bankrupts, whether. or not through
voluntary proceedings, and such receivership or bankruptcy proceedings are not dis-
missed within a period of 120 days, or in the event both the Sublessee and Guarantor
should sell all or substantially all of their assets (exclusive of the stock or
assets of any of the Sublessee's subsidiaries-, if any), all rentals for the entire
remaining term of this lease shall forthwith and automatically become due and pay-
able in cash from the Sublessee and Guarantor and both the Sublessee and Guarantor
shall. immediately pay the aggregate amount so payable, provided, however, that
this provision shall be inapplicable with respect to any dissolution and ter.in-
ation of the corporate existence of the Sublessee, if the same be pursuant to the
terms of a sale or merger of all or substantially all of the assets of the Sub-
lessee to another corporation which other corporation shall expressly assume all
of the obligations of the Sublessee hereunder and which other corporation (or such
other corporation and its subsidiaries) is acceptable to Trustee under and in
accordance with Trustee's standard loan policies and procedures at such tine.
The sale or merger of the Sublessee to another corporation not meeting the
above mentioned criteria will not accelerate all rentals for the entire re-
maining Primary Term of this lease if Veeco Instruments, Inc., remains obligated
with respect to the Sublease as. guarantor.
If consolld,ttlon, merger or sale or other transfer is made as provided in
this Section, the provl::lon:; of till:: Section shall continue in full force and'
effect :md 110 furtlu•r eou::olid.ttlon, merger or ::ale or 001(.1- transfer shall be
made uxcepL• in c0mp.liance wLL1 tic pruvi;:luu:: of till:; SaCLJon.
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SEC'T'ION 11. 11NCONDITTONAL OBLIGATION. The obligation of the Sublessee
to pay the rent during the Primary 'Perm as provided in Section 12 shall be ab-
solute and unconditional, irrespective of any rights of set -off, rc4oupment or
counterclaim it might othen•,ise have against Lessee. The Sublessee will not
suspend or discontinue any such payment for. any cause or terminate this contract
of Sublease for any cause. Notwithstanding the foregoing, the Sublessee may,
at its own cost and expense, and in its own name or in the name of the Lessee,
prosecute or defend any action or proceedings or take any other action against
the Lessee, Lessor or any third persons which the Sublessee deems reasonably
necessary in order to secure or protect its right of use and occupancy and other
rights hereunder.
SECTION 12. SUBLEASE RENTALS. (a) For and in consideration of Lessee's
performance of its obligations and Sublessee's enjoyment of its rights hereunder,
Sublessee does hereby agree to pay to Lessee:
(i) On or before the day of 1973, and
quarterly thereafter, the Basic Lease Rental Payment of
$656.25; and
(ii) On or before the day of , 1973, and
quarterly thereafter, the Basic Sublease Rental Payment of
as rent for the use and occupancy of the Premises due during the Primary Term.
Said payments shall be made by checks or drafts payable to the Trustee for
Lessee's credit at Corpus Christi Bank and Trust, Corpus Christi, Texas, as
Trustee, to be applied in accordance with the Indenture.
(b) It is intended that the Basic Sublease Rental Payments shall equal
the interest on and principal of the Bonds issued under the Indenture at any time
Outstanding; therefore, it is agreed that the Basic Sublease Rental Payments shall
be amended from time to time to reflect increases in debt:. service and fund payments
with respect to such Bonds and to reflect decreases in debt service and fund pay-
ments with respect to such Bonds. The Basic Sublease Rental Payments shall be in-
creased to accommodate the principal of and interest on Additional Bonds hereafter
issued and increases in fund payments hereafter required pursuant to the terms of
the Indenture, and shall be decreased to the extent interest and principal payments
and fund payments are reduced under the Indenture to reflect payment of Bonds prior
to their stated maturities. On the occasion of each event- calling for an alteration
of the Basic Sublease Rental Payments, the Sublessee shall file an amended schedule
of Basic'Sublease Rental Payments, approved by the Lessee, uith the Trustee, and
shall mail such amended schedule of Basic Sublease Rental Payments to the Lessor
and to any Bondholder who should so request in writing. Should there be an error
in calculations upon which the Basic Sublease Rental Payments are based, the Sub-
lessee is not relieved from naking payments at least equal to the principal of and
interest on the Bonds and Lhe full amount of the Basic Lease Rental Payments due at
any given tune.
(c) It is acknowledged by Sublessee that the Bonds will be purchased
by investors in reliance upon the unconditional obligation of Sublessee to pay
such Basic Sublease Rental Payments and Basic Lease Rental Payments once the
Bonds are issued and outstanding;, and, regardless of any provision of this Sub-
lease, therefore Sublessee shall on the respective dates indicated make payments
to Lessee in the amounts indicated in (a) :above until Lhe Bonds have been paid
and retired, and no default under either the Tease or this Sublease by either
Lessor or Lessee shall excuse performance by Sublessee of this obliraLion.
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(d) Sublessee shall have the right to prepay to Lessee all or any part
of tile, Baste Sublease Rental Payments payable under this Section-12 which Sub-
lessee may in it:: sole discretion from time to time desire for the redemption
of the Bonds in accordance with the terms of the Bonds. Lessee, upon receipt
of such prepayr.;ent, shall proceed to call, or cause to be called, redeemed and
cancelled the Bonds in accordance with the terms thereof. At any time during
the primary term that Sublessee has paid to Lessee sums sufficient to redeem
all of the Outstanding Bonds together with such other sums as Sublessee may
have become obligated to pay to Trustee under the terms of this Sublease or the
Indenture then Sublessee shall have no further obligation to pay the Basic Sub-
lease Rental Payment during such primary term of this Sublease, but such Sub-
lessee shall continue to pay the Basic Lease Rental Payment during the remainder
of such primary term.
(e) Sublessee shall in no way be responsible for the application by
Lessee of Basic Sublease Rental Payments, or Basic Lease Rental Payments, nor
shall Sublessee have any responsibility to the holders of the Bonds, directly
or indirectly, except for the malting of such rental payments to Lessee in
accordance with the terms of this Sublease.
(f) The amount of any transfer by the Trustee of excess monies on
deposit in the Construction Fund for 'credit to the Revenue Fund in accordance
and pursuant to the Indenture and the amount of any income derived from and any
profit or any investment of monies on deposit in the Revenue Fund shall be de-
ducted from and reduce the next Basic Sublease Rental Payment due hereunder.
(g) Execution of this Sublease by Sublessee in accordance with a
resolution of Sublessee's Board of Directors shall constitute approval of the
terms hereof and acknowledgrent by.Sublessee of receipt of a certified copy of
the Indenture and shall constitute approval and acceptance of the terms and
conditions of the Indenture and the application provided for therein of rentals
to be received by Lessee and disposition of the proceeds of the Bonds. Lessee,
the purchasers of the Bonds and all other interested parties shall have the right
to rely upon a certified copy of the resolution of the Board of Directors of
Sublessee as conclusive evidence of the complete, final and only action of Sub-
lessee necessary in approving the terms and conditions of the Indenture and the
Bonds.
SECTION 13. QUALIFICATION IN TEXAS. -Sublessee warrants that it is and
throughout the term of this Agreement it will continue to be a corporation either
organized under the laws of the State of Texas or duly qualified to*do business
in the State of Texas as a foreign corporation, as the case may be.'
SECTION 14. CONPLIANCE I:ITH LAWS. Sublessee agrees that it will at all
times comply with all applicable requirements of the laws of the State of Texas
and with all applicable lawful requirements of any agency, board or commission,
created under the lac:s of the State of Texas or of any other duly constituted
public authority with respect to the Premises, subject to the right of Sublessee
to contest in good faith any such requirements by appropriate legal proceedings.
SECTION 15. PSR?fITS 02: LICENSES. In the event it may be. necessary for
the proper performance of this Sublease on the part of the Lessee or Sublessee
that any application or applications for any permit or license to do or perform
certain things be nade to any governmental or other agency by Sublessee or
Lessee, Sublessee and Lessee each agree to execute promptly upon the request of
the other such application or applications.
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_o
SECTION 3.6. LESSEE WILL HAINTA1N CORPORATE EXISTENCE AND T1113 LEASE.
Lessee will at all.times maintain its corporate existence and its right to
operate the Premises and will July procure any necessary renewals and extensions
thereof; will use its best efforts to maintain, preserve and renew all the right!;,
powers, privileges and franchises owned by. it; and will comply with all valid acts,
rules, regulations, orders and directions of any legislative, executive, admini-
istrative or judicial body applicable to the Premises. The Lessee further coven-
ants that it will not take any action that would result in the loss of any ex-
emption from taxes which it presently enjoys or to which it may subsequently
become entitled, nor will the Lessee fail to take any action which would preserve
the exemption from taxes.
SECTION 17. ANNTUAI, STAM -TENT. During the primary term of this Sublease,
Guarantor agrees to furnish the Trustee a copy of Guarantor's annual report to its
Shareholders. Guarantor also agrees to furnish the Trustee a copy of each of the
financial statements and reports that Guarantor furnishes to its-shareholders.
Such financial statements and reports shall be furnished to the Trustee at the
same time as they are'furnished to the shareholders.
SECTIO`: 18. UTILITIES; TAXES. Sublessee agrees that it will pay when
due all charges for electricity, water, gas, telephone and other utility services
used by it upon and in the operation of the Premises. Sublessee further agrees
to pay all tares and assessments of every nature, kind and description lawfully
levied against all the personalty situated on the Premises legally classified as
personal property and Sublessee shall pay or cause to be paid all taxes and assess-
ments of every nature, kind and description lawfully levied upon the leasehold
a estate in the Premises'or upon any interest of Sublessee assigned under this
Sublease which are payable during the Primary Term or any renewal thereof, pro-
vided Sublessee shall not be required to pay any such tax or assessment if the
validity of the same shall be contested in good faith, unless by such action
the title of either the Lessor or Lessee to any part of the Premises shall be
materially endangered or the Premises or any part thereof shall become subject
' to loss or forfeiture, in which event such taxes or assessments shall be paid
prior to becoming delinquent. Either Lessor or the Lessee at any time may pay
tinder protest any such tax or assessment in order to protect the Premises from
loss or forfeiture. In such evert, the Sublessee shall promptly refund to the
Lessor or Lessee the amount so paid by it when it shall be finally determined
that Sublessee was liable for such tax or assessment. Such taxes and assess-
ments assessed during the term but payable in whole or in installments after
the termination of this Sublease shall be adjusted and prorated and Lessee
shall pay the prorated share thereof for the period subsequent to the term,
and Sublessee shall pay the prorated share thereof for the term of this Sub-
lease.
SECTION 19. LEASE DEFAULTS BY LESSEE. Should the Lessee be in default
of any obligation imposed on Lessee by the Lease, Sublessee shall have the right
• to cure said Lease defaults of Lessee to the extent necessary to protect and
preserve the rights of Sublessee. Sublessee shall be entitled to a credit
against the first rentals becoming due and payable during the renewal terms
for any costs and expenses incurred by Sublessee in curing any such default
of Lessee, together with interest thereon at the rate of seven percent (7`/>)
per annum until such sums are recovered by Sublessee.
SECTIO :d 20. NON- LIABILITY; INDE,Z4IFICATION. Neither Lessor nor Lessee
shall be liable to Sublcsscc or any other person whomsoever, for death or personal
injury, or for loss, damage or destruction of property in, or about the Premises
or any part thereof by or from any cause whatoocver, and Sublessee shall indemnify
and save harmless Lossor and Lessee and Clair officials, officers, agents and
employeen fror,, and defend the .uno ar,aia! ;t., auy and all claims, suita:, lions,
liability expenr.e!; (including reasonable att'ornoy :: fcus), l.os.,.cs and judi;mrnts
arising; from death or personal Injury, or from the lo:a, damage or destruction
of, property of any person ,:howsoever resultinl; from any acts or oulssions of
Suble:.Sve, Its ofClrct' : :, agent:: or epq,7oy -vs arlsiug nut of ar by rca:;on of Suh-
lessee's use or occup.mcy of, or it:: opo ra ti un :: on, Clio PYCOIj BC-S.
June 28, 1973
Mr. Richard D. Hardin
Corpus Christi Caller -Times
P. O. Box 9136
Corpus Christi, Texas 78408
Dear Mr. Hardin.
Enclosed is a copy of an ordinance authorizing a'lec" with the
Corpus Christi Airport Development Corporation. Plem publish
this on July 2 and hold for the third reading by the City Council,
which will take place within the next two days, and then publish
it again.
The result'of the voting will be called in to you subsequent to that
deft.
Yours very truly,
T. Ray Kring `
City Secretary
:kRK/dz
!s
April 13, 1973
Mr. Leland Barnes
Classified Deportment
Corpus Christi Caller -Times
P. O. Box 9136
Corpus Christi, Texas 78408
Dear Leland:
Herewith is an ordinance pertaining to the lease of a 10 -acre tract of
land at the Airport to the Corpus Christi Airport Development
Corporation.
Please publish this lease at the earliest date possible and hold for
subsequent publications. The date and vote will be called in to
your office.
Your very truly,
T. Ray Kring
City Secretary
TRK/dz
Enclosure
9