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HomeMy WebLinkAbout17253 ORD - 09/15/1982AN ORDINANCE CANCELING THE LEASE AGREEMENT WITH PUMPKIN AIR AUTHORIZED BY ORDINANCE NO. 16925 AND AUTHORIZING A NEW LEASE" AGREEMENT WITH PUMPKIN AIR FOR A COMMERCIAL HANGAR PLOT. BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CORPUS CHRISTI, TEXAS: SECTION 1. That the lease agreement with Pumpkin Air, Inc., authorized by the City Council on March 10, 1982, by Ordinance No. 16925, is hereby canceled. SECTION 2. That the City Manager be and he is hereby authorized to execute a new lease agreementLwith Pumpkin Air, Inc., for a commercial hangar plot at the Corpus Christi International Airport effective October 1, 1982, all as more fully set forth in the lease agreement, a substantial copy of which is attached hereto and made a part hereof marked Exhibit "A." t7253 'SEP 2 8 1984 MICROFILMED, HANGAR LEASE THIS LEASE is entered into on the day and year below stated between the CITY OF CORPUS CHRISTI, TEXAS, a home rule city situated in Nueces County, Texas (the "City"), and PUMPKIN AIR, INC., a Texas corporation ("Pumpkin"), upon these terms, performable in Nueces County, Texas. ARTICLE I DEMISE OF LEASED PREMISES The City does hereby lease to Pumpkin, subject to all of the terms, conditions'and covenants in this lease, the parcel or tract of real property (the "Leased Premises") located generally on the northeast side of the Terminal Building in the Corpus Christi International Airport (the "Airport"), within the area shown and described on the attached drawing marked Exhibit "A," which'is made a part hereof forallintents and purposes as if copied verbatim herein, the Leased Premises leased being a tract of land extending 760 feet east and west and 250 feet north and south and comprising 190,000 square feet. The effective date of this lease shall be the date on which this lease shall have been fully executed and delivered by the City and Pumpkin, with all necessary approvals, authorizations' and ratifications of the execution and delivery hereof by the City having been given. At the request of either the City or Pumpkin, each of the City and Pumpkin shall execute and deliver a written acknowledgment in recordable form setting forth the effective date of this lease. ARTICLE II RIGHTS, PRIVILEGES, uSES AND INTERESTS A. USE OF LEASED PREMISES. Pumpkin shall have the right to use the Leased Premises for .the following purposes (subject to the express limitations in respect of fixed wing aircraft set forth in paragraph B. of this Article II and to applicable limitations set forth in paragraph E. of this Article II) and for no other use without the specific writ- ten permission of the the City: (1) The storage, parking, maintenance and serv- icing of aircraft of every class and description in covered and open areas; (2) The leasing, acquiring, selling, exchanging insuring or dealing in or with description and parts thereof, purchasing or otherwise , dispensing, financing, aircraft of every class and including without limitation engines, motors, aircraft instruments, supplies and acces- sories; (3) The storage, maintenance, servicing, over- hauling (major and minor), conversion and modification aircraft of every class and description, and aircraft engines, assemblies, accessories and component parts; (4) The rental, leasing and chartering of craft; of air - (5) The handling and accommodation of opera- tors, crews, ground personnel, employees and travelers arriving at or departing from the Leased Premises, including but not limited to office space, shops, pilot/operations facility, customer lounge, food and/or drink service facili- ties (from area, sale vations at dispensing machines), courtesy car facility or of flight insurance, facilities for making reser- hotels, motels and other lodging and other services reasonably necessary or desirable for the operation of the Leased Premises for the other uses and purposes herein set forth; (6) The operation of aviation related stores, concessions and other consumer service activities reasonably - 2 - required for the accommodation of operators, crews, trav- elers arriving at or departing from the Leased Premises by aircraft, and other persons doing business with or who are the guests, licensees or, invitees of Pumpkin or others using the Leased Premises; (7) The storage, parking, maintenance, servic- ing and fueling of automotive vehicles, automotive equipment and other equipment owned or operated by Pumpkin and uti- lized in connection with Pumpkin's aeronautical operations; (8) The fabrication, manufacture, testing and development of aeronautical materials, equipment, facilities or other items which will be used or installed in aircraft at the Leased Premises (including without limitation, avi- onics) and the installation thereof; (9) The operation of schools for the training of areonautical pilots, mechanics, repairmen, navigators, dispatchers and other aeronautical personnel; (10) The operation of underground fuel storage facilities for aircraft fuels, lubricants and propellents and the dispensing of aircraft fuels, lubricants and pro- pellents into aircraft (both on the Leased Premises and elsewhere in the Airport), including without limitation the maintenance and operation of the equipment and facilities (including but not limited to mobile equipment) necessary to fill and dispense such aircraft fuels, lubricants and pro- pellents into such aircraft; (11) The provision of ground transportation for employees, aviation customers and other persons who may be lawfully on the Leased Premises; (12) The operation of a heliport and all inci- dental uses which are necessary or desirable to the opera- tion of a heliport; - 3 - (13) The placing and erection of signs and advertising materials (i) within the hangar, offices and shops on the Leased Premises or (ii) on the outside of the building, shops and offices located on the Leased Premises (provided that the size and shape of any signs on the exterior of any such buildings, shops or offices shall con- ! form to uniform requirements pertaining thereto promulgated by the Airport Manager): B. LIMITATIONS CONCERNING FIXED WING AIRCRAFT. Until such time as Pumpkin qualifies as a Fixed Base Opera- tor under the standard set forth below in this paragraph, the term "aircraft" as used in paragraph A of this Article II shall mean helicopters of every class and description, owned or operated by Pumpkin, and fixed wing aircraft of every class and description which are owned or operated by Pumpkin. Pumpkin shall be deemed to have qualified as a Fixed Base_Operator at such time as Pumpkin shall have con- structed or caused to be constructed a hangar (the "FBO Hangar") having at least' 12,000 gross square feet of floor area (including all floors within any shop or office areas). Pumpkin may qualify as a'Fixed Base Operator by construction of the FBO Hangar on either the tract originally demised hereunder or the Option Tract (hereafter defined). The operations from the Leased Premises after construction of the FBO Hangar are referred to as fixed base operations. Pumpkin acknowledges that, until completion by the City of the taxiways described in paragraph C of Article VII, the Leased Premises will not have any paved taxiway connecting it to the Airport runways and that fixed wing aircraft may not be able to reach and utilize the Leased Premises. C. RIGHT TO USE.AIRFIELD. Pumpkin shall have the right to use the public areas and public airport facilities end services in the Airport, including but not limited to the runways, taxiways, aprons, ramps, take -off facilities, navigational aids and facilities and public parking areas in common with others so authorized to use the same, subject to and in accordance with the laws of the United States of America and the State of Texas, and the rules and regula- tions promulgated by their authority with reference to avia- tion and air navigation, and in accordance with all reason- able and applicable nondiscriminatory rules, regulations and ordinances applicable to the Airport and the Charter of the City. D. PARKING ON LEASED PREMISES. The City recognizes the necessity for Pumpkin to control the use of parking facilities on the Leased Premises. Accordingly, without in any way limiting the manner or means by which Pumpkin may control the parking facilities on the Leased Premises, it is specifically agreed that Pumpkin shall have the right to charge for parking automobiles and/or other vehicles at the Leased Premises and may .install and operate such equipment or facilities as Pumpkin may reasonably determine as neces- sary to accomplish such purposes and effect such charges. Pumpkin may implement and modify such procedures as Pumpkin may deem necessary or appropriate from time to time to vali- date, rebate or otherwise reduce or eliminate all or part of the parking charges for ,employees, customers, invitees, licensees, contractors and/or concessionaires. It is under- stood that any parking area or facilities on the Leased Premises shall not be used as a remote parking site for passengers for scheduled,air carriers. E. ACITIVITIES AND USES EXPRESSLY PROHIBITED. The following activities and uses are expressly excluded from this lease and Pumpkin is prohibited from any such use or activity except as noted: (1) Western Union Services. Pumpkin may use the wires, lines and services of Western Union for its own - 5 - purposes in connection with the establishment and operation of a communication system and weather system or for any other purpose so long as Pumpkin does not engage in commer- cially taking or sending of telegrams, money orders and the like. (2) Barber; valet and similar personal serv- ices. (3) Sale of flight and/or trip insurance for passengers on scheduleecommercial airlines. (4) The sale of food and/or drink except from dispensing machines located within the hangars, offices and/or shops. However, no cafe or cafeteria type of service shall be operated. (5) Pumpkin shall not sell newspapers, maga- zines or sundry items. (6) Any facilities for making reservations at hotels, motels or other lodging shall be utilized only in the course of or incident to the commercial aviation busi- ness operated in or from the Leased Premises. (7) Ground transportation which may be made available to customers or other persons who may be lawfully on the Leased Premises shall be limited to courtesy cars owned or operated by Pumpkin in the course of conducting its other business operations in the Leased Premises. Any charges made for such courtesy cars shall not exceed charges necessary to cover costs of providing, operating and main- taining such cars. ARTICLE III CONSTRUCTION OF HANGARS AND IMPROVEMENTS A. INITIAL IMPROVEMENTS. Attached hereto as Exhibit "B" is a list of the plans and specifcations (the "Approved Plans") describing and depicting the initial improvements (the "Initial Improvements") contemplated to be - 6 - constructed on the Leased Premises. The Approved Plans have been approved by the City and Pumpkin and have been ini- tialled by the City and Pumpkin for identification purposes. The Initial Improvements constructed by Pumpkin shall be constructed substantially in accordance with the Approved Plans. Any material changes in the Approved Plans must be approved by the City (such approval not to be unreasonably withheld). The estimated construction cost of the Initial Improvements is $175,000. A fifty (50) foot setback is to be maintained on the areas of the Leased Premises indicated on Exhibit "A" (such areas being herein called the "Setback Areas"). In the event Pumpkin exercises its option to lease the Option Tract, the Setback Area adjacent to the Option Tract (iden- tified on Exhibit "A") shall be of no further force or effect. Paving may be constructed and maintained in the Setback Area, but no buildings may be constructed therein. Pumpkin agrees to begin construction of the Initial Improvements within ninety (90) days after the effective date of this lease; provided that, in the event Pumpkin is hindered or delayed in the commencement of such construction by reason of the occurrence of any act of God, inclement weather, strike, lockout, shortage of material or labor, restriction by any governmental authority, civil riot, flood or other cause (whether or not similar to the foregoing) not within the reasonable control of Pumpkin, such ninety (90) day period shall be extended by the period of time in which Pumpkin shall have been so hindered or delayed. Pumpkin shall notify the City of any such hindrance or delays. B. FUTURE IMPROVEMENTS. With respect to any future improvements to be constructed on the Leased Premises (in- cluding without limitation the Option Tract in the event Pumpkin exercises its option contained in paragraph A of - 7 - Article XIII), Pumpkin will submit plans and specifications to the City for approval and review with respect to the safety and type of construction proposed. Such construction shall not commence until' such plans and specifications have been approved by the City, provided that, the City shall not unreasonably withhold its approval of such future plans and specifications. The City expressly acknowledges that Pumpkin shall have the right to build hangars of sizes other than the FS° Hangar for proper airport functions. Such hangars may be utilized for storage of aircraft or any other purpose per- mitted under this Lease. C. REMOVAL OF IMPROVEMENTS. Any or all of the hangar or hangars constructed or installed on the Leased Premises (other than the'FB0 Hangar) and any equipment or machinery installed therein may be removed at any time dur- ing the term of this Lease. Any such removal or any altera- tion to improvements constructed or installed by Pumpkin on the Leased Premises shall be undertaken in a workmanlike manner in accordance with all applicable codes and ordi- nances. ARTICLE IV ACCEPTANCE OF PREMISES The City represents and warrants that there are no underground pipelines or other easements which would hinder or affect the development of the Leased Premises for the purposes hereby permitted. Pumpkin acknowledges that the Leased Premises have been accepted and, based upon the City's warranty, accepts the Leased Premises in its present physical condition and agrees to pay the total cost incurred by Pumpkin in developing the same. 1 - 8 - :ARTICLE V TERM A. PRIMARY TERM. This lease shall be for an ini- tial term (the "Primary Term") of twenty (20) years, com- mencing on the effective date of this lease and expiring twenty (20) years after the Rental Commencement Date (here- after defined); provided, that, in the event the Rental Com- mencement Date occurs on a day other than the first day of a calendar month, the Primary Term shall extend to the last day of the calendar month in which the twentieth (20th) anniversary of the Rental Commencement Date occurs. B. OPTION TERM. Pumpkin shall have the right to extend the term of this lease for one (1) term (the "Option Term") of ten (10) years:, commencing upon the expiration of the Primary Term, upon all of the terms and provisions of this lease except that (i) the rental payable at the com- mencement of the Option Term shall be the lower of the escalated base rental determined in accordance with the formula contained in Article VI of this lease or the rental calculated at the rate then being charged for comparable premises in the Airport Or being charged to competitors of Pumpkin then operating in the Airport, (ii) Pumpkin shall have the right to terminate this Lease at any time during 1 the Option Term by delivering written notice of termination (which notice shall be effective upon the expiration of ninety (90) days after the date of delivery thereof to the City and (iii) at the expiration or earlier termination of the Option Term Pumpkin shall have no further right to extend the term of this lease. Pumpkin's option to extend the term of this lease for the Option Term shall be exer- cised by delivering written notice of such exercise to the City at least ninety (90) days prior to the expiration of the Primary Term. - 9 - ARTICLE VI RENT A. BASE RENTAL: As used herein the term "Rental Commencement Date" shall mean the first to occur of the date on which the Leased Premises are first used by Pumpkin, its successors, assigns or subtenants for the operation of heli- copter or fixed wing aircraft or the first anniverary of the Effective Date. From and after the Rental Commencement Date, Pumpkin will pay the City a base rental calculated in accordance with the following formula (subject to the provi- sions of paragraph B of this Article VI): (1) Three cents ($0.03) per square foot per year for the area within the Leased Premises covered by hangars, shops, offices and other above -ground improvements (provided that the term "improvements" shall not include ramps, taxiways and other exterior paved areas). Fuel stor- age tanks Or other equipment or improvements installed below ground shall not be deemed to constitute improvements within the intent of this paragraph. (2) One cent ($0.01) per square foot per year for the area within the Leased Premises between the building setback lines where buildings could legally be constructed (it being understood that no rental shall be payable in respect of areas within Which no buildings could be con- structed. (3) Two cents ($0.02) per gallon for each gal- lon of gasoline and/or other propellents and fuels purchased by Pumpkin, provided that Pumpkin shall be entitled to a credit against such flowage fee for gasoline sold to commer- cial airline aircraft holding valid operating contracts for operations in the Airport and for loss of fuels due to theft or leakage. In the case of loss of fuels due to theft or - 10 - leakage, Pumpkin shall furnish the City with reasonable documentation of such loss. Rental calculated under paragraphs A(1) and A(2) shall be prorated for any partial calendar years following the Rental Commencement Date, and preceding the expiration or earlier termination of the term of this lease. B. ESCALATION OF BASE RENTAL. At the end of each three (3) year period after the effective date of this lease, either the City or Pumpkin may request an adjustment in the ground rental rates and the flowage fees set out in paragraph A, which adjustment shall be computed by multiply- ing such rate and fee by a fraction, the denominator of which shall be the arithemitic average as of July, 1960 of the indeces (i) of the United Bureau of Labor Statistics for hourly wage rates of all workers in manufacturing and (ii) of all commodity wholesale prices, and thenumeratorof which shall be the arithemitic average of said indeces (i) and (ii) effective as of the last day of such three (3) year period. Such formula must result in a change of at least 1/4 cent per unit or no adjustment shall be made, and all adjustments shall be made to the nearest 1/4 cent. Should either of said indeces change substantially as to form or basis of data:or manner of publication, the above adjustment provision may be amended in writing. On the base date, July, 1960, the United States Bureau of Labor Statistics Index for hourly wage rates for all manufacturing employees was $2.26 per hour and the com- modity wholesale price index was 100.8. The City retains the right to adjust the rates for fuel flowage fees set forth herein, such rates to be pub- lished by ordinance duly adopted by the City Council. The City will put this same paragraph B any renewal, amendment or extension of any other existing fixed base operator lease - 11- or helicopter operator lease as well as any other new fixed based operator lease, helicopter lease and the leases of any others required to pay fuel flowage fees at the Airport. As used in this paragraph or other provisions of this Lease, references to other fixed base operators shall be deemed to refer to other persons or entities which service and main- tain fixed wing aircraft at the Airport. Effective as of the date of execution of this lease, the rents based on the foregoing formula are as follows: The Improved Area, seven and one-fourth cents (7-1/40) per square foot per year; the Unimproved Area, two and one-half cents (2-1/20) per square foot per year; flowage fee, six cents (60) per gallon. Ground rentals as set out in para- graphs A(1) and A(2) above shall be computed on a monthly basis and shall become due and payable on the first day of each calendar month throughout the term of this lease. On the first day of the next calendar month after rentals begin under this lease Pumpkin'shall prepare a report in writing on a form approved by the City showing the total number of gallons of gasoline fuels and other propellents purchased by Pumpkin, together with any credit for sales to commercial airline aircraft or for loss due to theft or leakage. Pumpkin shall submit said report to the City along with the rental to be paid thereunder prior to the tenth day of said calendar month. Pumpkin shall submit a like report and pay- ment therefor for each succeeding month during the term of this lease. Pumpkin will keep full and accurate records of all transactions, purchases, sales and income, both from cash sales and credit sales, that in any way concern rental to the City; and will hold all books and records covering such sales in any year open to inspection by the City at all reasonable time for a period of two (2) years after the close of such year. 12- C. OTHER FUEL STORAGE FACILITIES. Fuel storage sites on property outside of the Leased Premises will require a separate lease. D. GENERAL PROVISIONS RELATING TO RENTAL. (1) After Completion of the paving of the road and parking area designated on Exhibit "A" by an arrow and reference to this paragLph D(1), Pumpkin shall deliver to the City a written statement (the "Initial Cost Statement") setting forth the cost of constructing such road and parking area [including a pro rata portion of all costs incurred in the designing, constructing and financing the same (includ- ing without limitation,.fees for architects, engineers, attorneys and other professional consultants, permit fees and interest accruing during the construction period)]. Thereafter, notwithstanding any other provision of this lease to the contrary, the flowage fee calculated in accord- ance with paragraph A(3) shall be retained by Pumpkin as its property until the first to occur of (i) an aggregate retainage by Pumpkin equal to the total cost set forth on the Initial Cost Statement or (ii) the expiration of the calendar month in which :the fifth (5th) anniversary of the Rental Commencement Date occurs. (2) In the event Pumpkin exercises its option to lease the Option Tract, Pumpkin shall have the right to construct a road across City property from International Boulevard to the Option Tract and to recoup the costs incurred in designing, constructing and financing such road and the parking area on the Option Tract flowage fee otherwise payable under this in accordance with paragraph A(3), until of (i) an aggregate retainage by Pumpkin cost incurred in designing, constructing road and parking area (calculated in the - 13 - by retaining the Lease, calculated the first to occur equal to the total and financing such same manner as in the Initial Cost Statement) or (ii) the fifth anniversary of the date on which rental commences in respect of the Option Tract. Upon completion of any such road and parking lot Pumpkin shall deliver to the City a further cost statement setting forth all costs in designing, constructing and financing such road and parking area (calculated in the same manner as the Initial Cost Statement). In the event the. abatement in this paragraph becomes applicable at the same time as the abatement provided for in paragraph D(1), all flowage fees payable under this Lease shall first be applied to recoupment under paragraph D(1) until all costs included in the Initial Cost Statement are fully recouped or the period of such abatement expires (whichever first occurs) and then such flowage fees shall be applied to the recoup- ment provided in this paragraph. (3) The City appoints its Airport Manager as its agent to receive all rentals and reports under this lease and Pumpkin will submit said reports and payments to the Airport Manager. The City may designate others as agents to inspect Pumpkin's relevant books and records, such inspections to be performed at reasonable times during working hours. (4) In addition to all other remedies which the City may have to enforce.the obligations of Pumpkin under this lease, the City shall have a lien on all property of Pumpkin placed in or on the Leased Premises for all monies, rents, shares of gross receipts and other obligations of Pumpkin under this lease. So long as Pumpkin is not in default in the payment of any rent or other sum of money due under this lease, any and all property removed by Pumpkin from the Leased Premises shall be free and clear of such lien. - 14 - (5) The City reserves the right to change the base date of July, 1960 referred to above in the event the the City makes the same change in all other existing or new fixed based operator leases, helicopter operator leases and the leases of others paying fees established by a base date of July, 1960. ARTICLE VII UNDERTAKINGS OF CITY The City covenants A. OPERATION OF AIRPORT. To operate the Airport as a public airport during the term of this lease subject to and consistent with and pursuant to the assurances given to the City by the United States Government under the Federal Airport Act, and to Pumpkin by this lease. B. UTILITIES. To make water and waste water service available upon the same basis as applies to the residents Within the City of Corpus Christi. Pumpkin shall pay all charges for water, waste water, electricity and other public utilities supplied to Pumpkin and/or the Leased Premises during the term.of this lease as such charges become due and payable. C. CONSTRUCTION AND MAINTENANCE BY THE CITY. The City will install and construct a taxiway providing access to the Leased Premises in the location indicated on Exhibit "A" within two (2) years'from the effective date of this lease. Such taxiway shall be constructed in accordance with all applicable laws, ordinances, statutes, codes, rules and regulations pertaining to the design and construction of airport taxiways, including without limitation the appli- cable Federal Aeronautics Administation Standards. The City shall maintain the road and utilities installed by Pumpkin pursuant to the Approved Plans and in connection with any - 15- development on the Option Tract on the same terms as other public roads and utilities are maintained by the City. D. COMPETITIVE OPERATIONS BY THE CITY. During the term of this lease (including the Option Term if Pumpkin exercises its right to extend the term of this lease through the Option Term) the City covenants and agrees that neither the City nor any entity which may operate the Airport under any agreement with the City will engage in the sale of air- craft services or fuel, or any other competitive activity with Pumpkin or its successors, subtenants or assignees. 'ARTICLE VIII UNDERTAKINGS OF PUMPKIN Pumpkin further covenants as follows: (1) At its own expense, to improve the Leased Prem- ises by construction of a hangar, offices, shops and/or other improvements, as hereinabove mentioned, and to main- tain said improvements and Leased Premises in a presentable condition consistent with good business practice. (2) To remove from the Leased Premises all waste, garbage, rubbish, junk, worn-out parts and other refuse and not to deposit the same or allow the same to accumulate, except temporarily in connection with collection for removal, on any part of the Leased Premises or other prop- erty located within the Airport; provided, however, that the City may provide garbage service for a reasonable fee con- sistent with charges made to commercial establishments of a similar nature. (3) To make adequate provision for and to dispose of waste oils and lubricants off the Airport property and not to put or allow to be put any such waste oils or lubricants into the Airport wastewater system. (4) To operate the Leased Premises in accordance with the terms of this' lease free of any unlawful discrimi- nation. - 16 - ARTICLE IX GENERAL PROVISIONS A. INDEMNIFICATION. Pumpkin is and shall be deemed to be an independent contractor and operator responsible to all parties for its respective acts or omissions and those of its agents, servants; employees, invitees, tenants and sublessees, and the City shall in no way be responsible therefor. In the use of the Airport and in the maintenance, erection or construction of any improvements on the Leased Premises, and the exercise and enjoyment of the rights herein granted, Pumpkin will indemnify and save harmless the City from any and all losses or claims for damages that may approximately result to the City from any negligence on the part of Pumpkin, Pumpkin's agents, servants, employees, con- struction contractors and invitees, or which may approxi- mately result from the negligence of Pumpkin's tenants or sublessees; Pumpkin shall carry public liability insurance in a minimum sum of $1,000,000, single limit. All public liability insurance shall be carried with a responsible com- pany and shall name the City as an additional insured. Such policy shall, in addition, be endorsed to provide for cross - liability between assureds. Such policy shall be in form reasonably satisfactory to the City. All such policies shall provide for a minimum of ten (10) days' notice to the City in the event of cancellation or material change in the terms thereof. B. NOTICES. Notices to the City shall be in writ- ing and mailed, postage prepaid, certified mail, return receipt requested, to the Airport Manager, Route 2, Box 902, Corpus Christi, Texas 78410, or to such other address as may have been designated in writing by the City from time to time. Notice to Pumpkin shall be in writing and either delivered in person to 4650 Airport Parkway, Addison : - 17- Airport, Dallas, Texas 75248, Attention: Hugo W. Schoellkopf, Jr. or mailed postage prepaid, certified mail, return receipt requested, addressed to Pumpkin at P. 0. Box 1110, Addison, Texas 75001, Attention: Hugo W. Schoellkopf, Jr., or to such other address as may be designated in writ- ing by Pumpkin from time to time. C. TAXES. Pumpkin shall be obligated to pay any and all real estate and personal property ad valorem taxes levied from time to time on the improvements placed on the Leased Premises; provided that, Pumpkin shall have the right to contest the validity or amount of any such taxes in the manner provided by law. , D. TERMS BINDING. All of the terms, covenants and agreements herein contained shall be binding upon and shall inure to the benefit of the heirs, successors and assigns of Pumpkin and the City. 1 E. DAMAGE OR DESTRUCTION. In the event that the improvements on the Leased Premises or the Airport are destroyed or damaged to the extent that the Leased Premises cannot reasonably be used by Pumpkin for the purposes for which the same are then being used, then, Pumpkin shall undertake to repair and restore the improvements on the Leased Premises and the City shall undertake to repair and restore the public area facilities and improvements in the Airport. Until such damaged or destroyed improvements on the Leased Premises or Airport are restored to the extent required to permit such operations on or from the Leased Premises to be resumed, rental under this lease shall be abated. In the event the Leased Premises or the Airport are damaged, but the extent of such damage reduces the level or extent of business operations from the Leased Premises (rather than preventing all business operations from the Leased Premises), then the rental payable under this Lease - 18 - shall be partially abated to the extent required to reflect the reduction in business operations from the Leased Prem- ises. Any such partial abatement shall continue until necessary repairs have been effected to the Leased Premises and/or the Airport. Pumpkin, at its own expense shall purchase and main- tain property damage insurance with respect to the hangar and/or other improvements on the Leased Premises in amounts and covering risks reasonably deemed by Pumpkin to be ade- quate and suitable. Evidence of Pumpkin's insurance shall be delivered to the City within thirty (30) days after the commencement of construction thereof. Such policy shall provide for a minimum of ten (10) days' advance notice to the City in the event of a cancellation or reduction in the coverage thereunder. All insurance proceeds from Pumpkin's policies for such casualty losses to hangars or improvements on the Leased Premises shall be payable solely to Pumpkin. Notwithstanding anything herein to the contrary, after any destruction or damage to.the improvements on the Leased Premises, Pumpkin shall have the right to terminate this lease by delivery of written notice of termination to the City within sixty (60) days after the occurrence of such destruction or damage; provided, however, that if the FBO Hangar is damaged and Pumpkin elects to terminate this lease, then Pumpkin shall remit to the City an amount from the proceeds of such policies (to the extent such proceeds relate to the FBO Hangar) equal to three percent (3%) of the total insurance proceeds payable to Pumpkin in respect of the FBO Hangar, multiplied by the number of years (to the nearest month) from the date of execution of this lease, not to exceed one hundred percent (100%). Any such notice of termination shall be effective on receipt thereof by the City. - 19 - F. MUTUAL WAIVER OF SUBROGATION. Each party hereto waives any and every claim which arises or may arise in such party's favor against the other party hereto during the term of this lease or any and all loss of, or damage to, any of such party's property located within or upon, or constitut- ing a part of, the Leased Premises, which loss or damage is or could be covered by valid and collectible fire and extended coverage insurance policies, regardless of whether or not such party maintains such insurance. Such mutual waivers shall be in addition to, and not in limitation or derogation of, any other!waiver or release contained in this lease with respect to any loss of or damage to, property of the parties hereto. Inasmuch as such mutual waivers will preclude the assignment of any aforesaid claim by way of subrogation or otherwise to an insurance company (or any other person), each party hereto agrees to give to each insurance company which has issued to such -party policies of fire and extended coverage insurance immediate written notice of the terms of such mutual waivers, and to cause such insurance policies to be properly endorsed, if neces- sary, to prevent the invalidation of such insurance cover- ages by reason of such waivers. G. SUBORDINATION. This lease shall be subordinate to the provisions of any existing or future agreement between the City and the United State of America relative to the operation or maintenance of the Airport, the execution of which has been or may be required as a condition to the expenditure of federal funds for the development of the Airport. Should the effect of any such future agreement with the United State of America be to take any of the Leased Premises out of the control of the City or to sub- stantially destroy the commercial value of the Leased Prem- ises, or any part thereof, the the City must provide to - 20 - Pumpkin other comparable improved premises in the Airport to be leased on the same terms as this lease as of the date on which such agreement becomes effective in respect of the Leased Premises. It is understood that a relocation of the Airport Terminal Building within the Airport boundaries will not affect the commercial value of the Leased Premises. H. EXPIRATION OF TERM. This lease shall expire at the end of the term set forth in Article V hereinabove (including the Option Term provided for in Article V to the extent Pumpkin exercises its right to extend the term of the lease through the Option Term), and Pumpkin shall have no further right or interest in any of the Leased Premises or rights, uses or other interests contained in this lease and Pumpkin will vacate and remove all equipment placed there- upon by Pumpkin unless Pumpkin and the City enter into a new lease mutually satisfactory to both parties further extend- ing the term hereof. PuMpkin shall have the right to remove its hangar building or buildings (other than the FB0 Hangar) from the Leased Premises after the expiration or earlier termination of this lease. Pumpkin shall have one hundred twenty (120) days after the expiration or earlier termina- tion of this lease within which to remove Pumpkin's equip- ment and personal property and hangar or hangars (other than the FBO Hangar) from the Leased Premises. In the event Pumpkin fails to do so, Pumpkin shall be deemed to have abandoned the same and title thereto shall pass to the City. In the event Pumpkin is deemed to have abandoned any of its equipment, personal property or hangar or hangars, the City shall have the right to remove any hangars or other above ground improvements other than paving within a period of one hundred twenty (120) days, after the expiration of Pumpkin's one hundred twenty (120) day renewal period and Pumpkin will - 21 - reimburse the City for its reasonable expenditures in remov- ing the same (other than the FB0 Hangar). (2) At the'expiration or earlier termination of this lease, all underground improvments, paving and other improvements attached to the real estate (other than the hangar or hangars which may be removed under paragraph (1) next above) shall revert to City in accordance with the City Charter, Article VIII, Secton 2, as amended. I. REMEDIES OF CITY. Default in the payment of any of the rentals payable under this lease shall give City the right to terminate this lease at any time after the expira- tion of thirty (30) days after the date of receipt by Pumpkin of written notice of default, unless within said time Pumpkin shall have tendered the amount in default. Default in the performance of any of the other cove- nants on the part of Pumpkin under this lease shall likewise give City the right to terminate this lease at any time after the expiration of thirty (30) days after the date of receipt by Pumpkin of written notice of default unless said default shall have been corrected or waived by City within such thirty (30) day period; provided that in the event such default cannot reasonably be cured within such thirty (30) day period (including but not limited to the inability to cure such default by reason of the occurrence of any hin- drance or delay beyond the control of Pumpkin), then such thirty (30) day period shall be extended for such additional period of time as may be reasonably required to cure the same. The City will specify in such default notice the lease provision under which the City claims Pumpkin is in default and the acts or omissions giving rise to the claim of default. J. COVENANT OF QUIET ENJOYMENT. The City cove- nants, represents and warrants that the City has full right - 22 - and power to execute and perform its obligations under this lease and to grant the estate demised herein, and that Pumpkin, upon payment of the rents herein reserved, and the performance of the terms, conditions, covenants and agree- ments herein contained, shall peaceably and quietly have, hold and enjoy the Leased Premises during the full term of this lease, including the Option Term to the extent Pumpkin exercises its option to 'extend the term of this lease through the Option Term. K. HOLDING OVER. Should Pumpkin or any of Pumpkin's successors in interest fail to surrender the Leased Premises or any part thereof upon the expiration or earlier termination of the term of this lease, such holding over shall constitute a tenancy from month-to-month at a monthly rental equal to the rental then being payable by Pumpkin hereunder. L. FORCE MAJEURE. In the event the performance by the City or Pumpkin of any term, condition or covenant in this lease is delayed or, prevented by any act of God, incle- ment weather, strike, lockout, shortage of material or labor, restriction by any governmental authority, civil riot, flood or any other'cause (whether or not similar to the foregoing) not within the control of such party the period for performance of such term, condition or covenant shall be extended for a period equal to the period of time that such party is so delayed or hindered. M. SEVERABILITY. If any provision of this lease should be held to be invalid or unenforceable, the invalid or unenforceable provision shall be deemed to be severable from the remainder of this lease and the validity and enforceability of the remaining provisions of this lease shall not be affected thereby. : - 23 - ARTICLE X ASSIGNMENT OR TRANSFER OF LEASE A. ASSIGNMENT OR SuBLEASE. Pumpkin shall have the right to assign this lease or sublease all or part of the Leased Premises to (i) any subsidiary or parent corporation of Pumpkin, (ii) any corporation into which Pumpkin may be merged or consolidated, (iii) any successor in interest to Pumpkin, (iv) Hugo W. Schoellkopf, Jr. and/or Caroline Hunt Schoellkopf and/or their respective lineal descendants, (v) any corporation or other entity owned or controlled by Pumpkin or Hugo W. Schoellkopf, Jr. and/or Caroline Hunt Schoellkopf and/or their respective lineal descendants, or (vi) any trust for the primary benefit of Hugo W. Schoellkopf, Jr. and/or Caroline Hunt Schoellkopf and/or their respective lineal descendants (the persons or entities described in clauses (i) through (v) are herein collectively called the -"Pumpkin Group"). Any other assignment of this lease or sublease of all part of the Leased Premises shall be made only with the approval of the City, such approval not to be unreasonably withheld. Any assignment of this lease or subletting of all or part of the Leased Premises shall be subject to all Of the terms and conditions of this lease, provided that, the use of the Leased Premises by any assignee or subtenant may be changed to any use which is permitted by the then existing agreements between the City and the United States of America pertaining to the operation of the Airport or otherwise consistent with the use of prop- erty within the Airport, in addition to the uses hereby set forth. B. LEASEHOLD FINANCING. (1) Pumpkin shall have the right to mortgage the leasehold estate of Pumpkin created hereby in order to secure a mortgage loan. lIn the event Pumpkin pursuant to - 24 - mortgages or deeds of trust mortgages the leasehold estate of Pumpkin created hereby, the leasehold mortgagee shall in no event become personally liable to perform the obligation of Pumpkin under this lease unless and until said mortgagee becomes the owner of the leasehold estate pursuant to fore- closure, transfer in lieu of foreclosure, or otherwise, and thereafter said leasehold mortgagee shall remain liable for such obligations only so long as such mortgagee remains the owner of the leasehold estate. Notwithstanding the fore- going, it is specifically understood and agreed that no such mortgaging by Pumpkin and/or any actions taken pursuant to the terms of such mortgage shall ever relieve Pumpkin of Pumpkin's obligation to pay the rental due hereunder and otherwise fully perform the terms and conditions of this lease. (2) If and so long as the leasehold estate •^ created under this lease is encumbered by a leasehold mort- gage and written notice to such effect has been given to the City, then the City shall give to the holder of such lease- hold mortgage at such address or addresses as may be speci- fied in such written notice to the City for the giving of notices to the leasehold'mortgagee, or as otherwise may be specified by the leasehold mortgagee to the City in writing, written notice of any default hereunder by Pumpkin, simul- taneously with the giving of such notice to Pumpkin, and the holder of any such leasehold mortgage shall have the right, for a period of thirty (30) days after its receipt of such notice, or within any longer period of time as may be pro- vided to Pumpkin hereunder for curing any such default or as may be specified in such notice, to take such action or to make such payment as may be necessary or appropriate to cure any such default so specified, it being the intention of the parties hereto that the City shall not exercise the City's - 25- right to terminate this lease without first giving any such leasehold mortgagee the notice provided for herein and affording any such leasehold mortgagee the right to cure such default as provided for herein. (3) The City further agrees to execute and deliver to any proposed .leasehold mortgagee of Pumpkin a "Non -Disturbance Agreement" wherein the City agrees that the City will (i) recognize such mortgagee and its successor and assigns after foreclosure, or transfer in lieu of foreclo- sure, as Pumpkin hereunder, and (ii) continue to perform all of the City's obligations hereunder so long as such mort- gagee or its sucessors and assigns performs all of the obli- gations of Pumpkin hereunder. The City also agrees to exe- cute and deliver to such'proposed leasehold mortgagee any other documents which such proposed leasehold mortgagee may reasonably request concerning the mortgaging by Pumpkin of the leasehold estate created hereby; provided, however, that the City shall never be required to subordinate the City's interest in the Leased Premises to the mortgagee of such proposed leasehold mortgge. ARITCLE XI AIR OPERATIONS AREA SECURITY Pumpkin shall provide for the security of the air operations area to prevent ground entry or movement of unauthorized persons in accordance with Section 9-32 of the City Code of Corpus Christi and any regulations imposed upon the City by the Federal Aviation Administration. Pumpkin shall indemnify and hold harmless the City, its officers and employees from any charges, fines or penalties which may be .levied by the United States of America or the State of Texas by reason of Pumpkin's failure to comply with this require- ment. - 26 - Physical barriers to prevent access to air operations area must be in effect during construction upon the Leased Premises. This covenant is in addition to the above indem- nication provisions. ARTICLE XII CIVIL RIGHTS In exercising any of the rights or privileges pro- vided hereunder Pumpkin shall not on the grounds of race, sex, creed or national origin discriminate or permit dis- crimination against any person or group of persons in manner prohibited by Part 21 of.the Regulations of the Secretary of Transportation. The City hereby expressly retains the right to take such action as the United State of America may direct to enforce this non-discrimination covenant. ARTICLE XIII OPTION TO LEASE ADJACENT PROPERTY A. OPTION. The 'City hereby grants to Pumpkin an option to lease the tract or parcel of real property (the "Option Tract") contiguous to the Leased Premises measuring approximately 760 feet by 395 feet, identified on Exhibit "A" at any time prior to the expiration of this option pursuant to the provisions of paragraph B below (the "Option Period). Pumpkin's option to lease the Option Tract shall be exercised by delivering written notice thereof to the City. In the event Pumpkin elects to exercise its option to lease the Option Tract, the Option Tract shall become a part of the Leased Premises and Pumpkin shall have the right to the exclusive beneficial use and occupancy of the Option Tract commencing upon the expiration of ten (10) days after the date of delivery of the notice of exercise of the option. In the event.Pumpkin exercises such option, the rental payable in respect of the Option Tract shall be - 27 - calculated in the same rental payable in respect of the premises originally designated as the Leased Premises and shall commence accuring and being payable upon the first to occur of (i) the completion of improvements on the Option Tract and commencement of the use thereof for the purpose of operating helicopters'or fixed wing aircraft or (ii) the expiration of one (1) year from the date on which Pumpkin initially takes possession of the Option Tract. At the written request of either of the City or Pumpkin, each of the City and Pumpkin agree to execute and deliver a memoran- dum of this option in recordable form giving notice of the existence of the option herein granted to lease the Option Tract and identifying the Option Tract. B. TERMINATION OF OPTION. The option granted to Pumpkin to lease the Option Tract under the terms of para- graph A of this Article'XIII shall expire On the last to occur of (i) the expiration of six (6) months after comple- tion by the City of all ,ramps and taxiways necessary to con- nect the Option Tract with Airport runways and permit the Option Tract to be utilized for the operation of fixed wing aircraft or (ii) the expiration of five (5) years after the commencement of the term of this Lease. - 28 - „I : IN WITNESS WHEREOF, the parties hereby have executed and delivered this lease on the day of 1982. PUMPKIN AIR, INC. ATTEST: By CITY OF CORPUS CHRISTI ATTEST: By Edward A. Martin City Secretary City Manager APPROVAL: J. BRUCE AYCOCK CITY ATTORNEY By Assistant City Attorney 411/14°41) sistant City Manager go - 29 - • CITY OF CORPUS CHRISTI DISCLOSURE OF OWNERSHIP INTERESTS City of Corpus Christi Ordinance 17112 requires all persons (APPLICANT) seeking to do business with the City to provide the following information, Every question must be answered. If the question is not applicable, answer with "NA". APPLICANT NAME Pumpkin Air, Inc., a Texas corporation APPLICANT ADDRESS P. 0. Box 1110, Addison, Texas 75001 - APPLICANT is 1. Corporation OD 2. Partnership ( ) 3. Sole Owner ( ) 4. Association ( ) 5. Other ( ) Please answer the following questions on a separate attached sheet if necessary. SECTION 1 - CORPORATION la. Names and addresses of all Officers and Directors of Corporation. See Exhibit A attached hereto. lb. Names and addresses of all shareholders of the Corporation owning shares equal to or in excess of 3% of the proportionate ownership interest and the percentage of each shareholder's interest. (Note: Corporations which submit S.E.C. form 10K may substitute that statement for the material required herein.) Caroline Hunt Schoellkopf 3821 Windsor Ave. Dallas, TX. 75205 50% Hugo W. Schoellkopf, Jr. 3821f Windsor Ave. Dallas, TX. 75205 50% SECTION 2 - PARTNERSHIP/ASSOCIATION/JOINT VENTURE 2a. The name, address, and percentage of interest of each partner whose interest therein, whether limited or general, is equal to or in excess of 3%. NA JD. Associations: The name and address of all officers, directors, and other members with 3% or greater interest. NA SECTION 3 — ALL APPLICANTS — ADDITIONAL DISCLOSURE 3a. Specify which, if any, interest disclosed in Section 1 or 2 are being held by agent or trustee and give the name and address of principal AND/OR by a trust and give the trust number, institution, name and address of trustee or estate administrator, and name, address, and percentage of interest in total entity. None 3b. If any interest named in Section 1 or 2 is being held by a "holding" corporation or other "holding" entity not an individual, state the names and addresses of all parties holding more than a 3% interest in that "holding" corporation or entity as required in 1(a), 1(b), 2(a), and 2(b). None 3c. If "constructive control" of any interest named in Section 1 or 2 is held by another party, give name and address of party with constructive control. ("Constructive control" refers to control established through voting trusts, proxies, or special terms of venture or partnership agreements.) None 3d. If any interest named in Section 1, 2, 3a, 3b, or 3c is being held by a member of the City Council, an employee, or a member of a Board or Commission appointed by the City Council of the City of Corpus Christi, state the name, address, and whether the individual is a member of the City Council, an employee, or a Board or Commission member. None I have not withheld disclosure of any interest known to me. Information provided is accurate and current. I will be responsible for submitting a revised form if any of the above information changes. August 30, 1982 Date Title: President and Treasurer Sign tur of Person Preparintfent Hugo W. Schoellkopf, Jr. ATTEST: Notary Pubic EXHIBIT A PUMPKIN AIR, INC. Schedule of Officers and Directors attached to and made a part of City of Corpus Christi Disclosure of Ownership Interests Title Name Address President and Treasurer* Hugo W. Schoellkopf, Jr. 3821 Windsor, Dallas, Texas Secretary* Caroline H. Schoellkopf 3821 Windsor, Dallas, Texas Vice President and Robert S.Pyland 2916 Woodcroft, Carrollton, Asst. Secretary Texas Vice President Max A. Stone 7126 Edgerton, Dallas, Texas Director David K. Sands 6316 Douglas, Dallas, Texas Director John B. Sands 4340 Rheims, Dallas, Texas Director Stephen H. Sands 3601 Beverly, Dallas, Texas Director Donald W. Crisp 9616 Faircrest, Dallas, Texas *Also Directors That the foregoing ordinance„wp read fo second reading on this the /at day o e tirstitime ,and passed to its 7.e47nAUW19,42- , by the following vote: . Luther Jones Betty N. Turner Jack K. Dumphy Bob Gulley Herbert L. Hawkins, Jr. Dr. Charles W. Kennedy Cliff Zarsky That the foregoing ordinance,pi re d for t.,1 selond time passed to its third reading on this the day of A'', 19 , by the following vote: Luther Jones Betty N. Turner Jack K. Dumphy Bob Gulley Herbert L. Hawkins, Jr. Dr. Charles W. Kennedy Cliff Zarsky That the forege Ag ordinance d fo on this the ,/ /5- day of the third time and passed finally , 19 /2-, by the following vote: Luther Jones Betty N. Turner Jack K. Dumphy Bob Gulley Herbert L. Hawkins, Jr. Dr. Charles W. Kennedy Cliff Zarsky PASSED AND APPROVED, this the Ai- day ATTEST: APP gyp: DAY J. BRUCE ant , § CITY ATTORNEY City Attorney / T CITY OF CORPUS CHRISTI, TEXAS. MAYOR 17253 L/ PUBLISHER'S AFFIDAVIT STATE OF TEXAS, .} ss: County of Nueces. - #V391603 CITY OF C.C. ria3 Before me, the undersigned, a Notary Public, this day personally came ...... LORRAINE C. MARTINEZ who being first duly sworn, according to law, says that he is the -ACCOUNTING CLERK of the Corpus Christi Caller and The Corpus Christi Times, Bally Newspapers published at Corpus Christi, Texas, in said County and State, and that the publication of NOTICE OF PASSAGE OF ORDINANCE NO. 17253, • • • of which the annexed is a true copy, was published in THE CORPUS CHRISTI CALLER -TIMES on the....2.0th day of SEPTEMBER 82 19_, and once each— day one thereofter consecutive.. daY ..... LORRAINE C. MARTINEZ ...Z.CPLUOIL. ACCOUNTING CLERK 2tOCTOBER 82 Subscribed and sworn to before me this.. 1h day o 19. EUG7NTA S. CORTEZ Notary Pul=leces County, Texas #V391009 . PUBLIHEFVS AFFIDAVIT - CITY OF C.0 ST&TE OF TEXAS, ss: County of Nueces. Before me, the undersigned, a Notary Public, this day personally came LORRAINE C. MARTINEZ who being first duly sworn, according to law, says that he is the ACCOUNTING CLERK of the Corpus Christi Caller and The Corpus Christi Tunes, Daily 'Newspapers published at Corpus Christi, Texas, in said County and State, and that the publication of NOTICE OF PASSAGE OF ORDINANCE,.. THE = of which the annexed is a true copy, was published in CORPUS CHRISTI GALLEEMIXELL_ on the.i3_.til day of___LEEILME _ 19 82 , and once eaell . y _thereafter consecutive____day_. one Times. 25.2O LORRAINE C. MARTINEZ. 6. ACCOUNTING CLERK Subscribed and sworn to before me this 22nd SEPTEMBER 19 82of EUGENIA S. CORTEZ - Public, Nueces County, xas r NOTIC 0 '6E72". ORDINAW °j/.11ZeNI.10DV CANCE_ THE WITH PUMPKIN AIR AU THORIZED BY tOlot? NANCE NN°G 1422,P! LEAS' ''Fs INGIVEmENT: WITH PUMPKIN MR FORV COMMERCIAL tiANGAR Was piisSed on t0 CIlyncunnjir- ofT 100 co"treadfl� Yhl P8111 duasYCotTel teernaer,n198Z OravnllqY ap- proved on first reltding September 1, 1982AThefU I _ text of said ordirienc%If available to the pupjic In eh Office 01 1110 City Secretar' -s-Bill G. Read City Secretary, COrPUO Chrgaii r ,,