HomeMy WebLinkAbout021269 ORD - 10/22/1991AN OI?IIINANCE
AUTHORIZING THE EXECUTION OF A 10 YEAR LEASE AGREEMENT
BETWEEN CITY OF CORPUS CHRISTI, TEXAS, AND CORPUS CHRISTI AIRPORT
DEVELOPMENT CORPORATIOi., .._PPROVING AND AUTHORIZING EXECUTION
OF A 10 YEAR SUBLEASE BY CORPUS CHRISTI AIRPORT DEVELOPMENT
CORPORATION TO SEMTECH CORPUS CHRISTI CORPORATION OF THE
PROPERTY LEASED TO CORPUS CHRISTI AIRPORT DEVELOPMENT
CORPORATION; AUTHORIZING CITY OF CORPUS CHRISTI TO EXECUTE A 20
YEAR LEASE WITH SEMTECH CORPUS CHRISTI CORPORATION (ON THE SAME
TERMS AND CONDITIONS) UPON TERMINATION OF THE 10 YEAR LEASE AND
SUBLEASE ABOVE REFERENCED; AND PROVIDING FOR PUBLICATION.
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CORPUS CHRISTI,
TEXAS:
SECTION 1. That the City Manager is hereby authorized to execute a 10 year lease
agreement with Corpus Christi Airport Development Corporation, a substantial copy of which is
attached hereto and made a part hereof, marked Exhibit "A," included in Exhibit "A" is a metes and
bounds property description of the property herein leased.
SECTION 2. That the City Council approves and the City Manager is hereby
authorized to execute a 10 year sublease agreement between Corpus Christi Airport Development
Corporation and Semtech Corpus Christi Corporation, a substantial copy of which is attached hereto
and made a part hereof as Exhibit "B."
SECTION 3. That the City Council hereby approves and authorizes the City Manager
to execute a 20 -year lease with Semtech Corpus Christi Corporation on the same terms and
conditions as the sublease herein approved, except that the land rental rate shall be at the fair
market value rental rate, (1) in the event Semtech exercises its option to purchase the building as
set out in Exhibit "B," or (2) at the expiration of the 10 year lease and sublease.
SECTION 4. Publication shall be made in the official publication of the City of
Corpus Christi as required by the City Charter of the City of Corpus Christi.
AGS000.033.kp
021269
MiF11 MEU.
STATE OF TEXAS
COUNTY OF NUECES
MODIFICATION OF LEASE
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This Modification of Lease is made and entered into
and year hereinbelow stated, by and between the City
Christi, a Texas municipal corporation, (the "City")
Christi Airport Development Corporation, a Texas
corporation, (the "Lessee");
W ITNESSET H:
City does by these presents lease and demise unto Lessee, and
Lessee hereby leases from City, that certain tract of land situated
in the City of Corpus Christi, Nueces County, Texas, described as
follows:
on the day
of Corpus
and Corpus
non-profit
Being a portion of land out of Block Twenty -Three (23),
J. C. RUSSELL FARM BLOCKS, a Subdivision of the City of
Corpus Christi, Nueces County, Texas, more specifically
described on Exhibit "A" attached hereto.
1. DEFINITIONS: For the purposes of this Modification of
Lease 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:
"Agreement of Sublease" - the Agreement of Sublease covering
the Leased Premises entered into on the date hereof between the
Corpus Christi Airport Development Corporation, as Landlord, and
Semtech Corpus Christi Corporation, as Tenant.
"Building" - the building constructed by Lessee containing no
less than 25,000 square feet on the Leased Land together with other
improvements related thereto.
"FAA" - Federal Aviation Administration and its successor
agency, or agencies, if any.
"Indebtedness" - the Promissory Note of even date herewith in
the original principal sum of $575,000 executed by Lessee payable
to the order of First City, Texas - Corpus Christi and secured by
the Renewal Deed of Trust.
"Indenture" - the Indenture of Mortgage and Deed of Trust
dated as of December 31, 1973, by and between the Lessee and First
City, Texas - Corpus Christi, as Trustee, securing the $1,750,000
in tax-exempt bonds originally issued to finance the construction
of the Building.
"Leased Land" - the tract of land hereinabove described.
"Leased Premises" - the Leased Land and Building.
"Renewal Deed of Trust" - the Deed of Trust, Assignment of
Leasehold, Security Agreement and Financing Statement executed by
Lessee in favor of First City, Texas - Corpus Christi, as Mortgag-
ee, renewing and extending the terms of the Indenture covering the
Leased Premises.
2. MODIFICATION OF PRIOR LEASE: This Modification of Lease
amends and restates that original Agreement of Lease between the
parties hereto dated December 31, 1973. Such original Agreement of
Lease is superseded hereby and is replaced in its entirety as of
the date hereof by this instrument.
3. TERM: This Lease shall commence as of the effective date
hereof and continue thereafter for a term of thirty (30) years,
subject to earlier termination as provided herein.
4. USE: The Leased Land and Building (collectively the
"Leased Premises") are to be used for the purposes of manufactur-
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ing, warehousing, offices, and any other lawful purpose and in
accordance with the Burke Master Plan for City Airport Development
(on file in the official records of the City of Corpus Christi,
Texas) as approved by the FAA.
5. RENTAL: During the term of this Lease, the annual
rentals due hereunder shall be the following:
During the first four (4) years of the term of this Lease,
representing the remaining term under the original Agreement
of Lease, the annual rental shall be the sum of $1,970 per
year.
During the next six (6) years of the term of this Lease, the
annual rental shall be the sum of $3,940 per year.
The rentals due for the remaining twenty (20) years of the
term of this Modification of Lease shall be established in
the manner provided in the Lease Rate Adjustment provisions of
this Lease.
All rentals for the Leased Premises due under this Modifica-
tion of Lease shall be payable in advance in equal quarterly
installments, the first quarterly installment being due and payable
to the City on the effective date of this Modification of Lease,
with a like payment to be due on the first day of every third month
thereafter during the term hereof. All rentals are payable at City
Hall in Corpus Christi, Nueces County, Texas.
6. MAINTENANCE: The Lessee shall cause the Leased Premises
to be kept in good condition and repair during the term of this
Lease and upon the termination hereof shall deliver the same to
city in good condition, ordinary wear and tear, damage by fire or
other casualty, acts of God, riot and civil commotion, excepted.
Lessee shall require its Tenant to be responsible for and shall
perform, or cause to be performed, maintenance, including custodial
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maintenance, and repair of the Leased Land and Building. Lessee
shall require its Tenant at all times to:
a. Perform all routine maintenance and ordinary repairs
and inside painting, of a quality not inferior to the original
material and workmanship.
b. Perform all routine maintenance and ordinary repairs
on all heating, cooling, and ventilation systems, and all
electrical systems.
c. Perform all routine maintenance and ordinary repairs
to the exterior of the Building, including without limitation
the roof.
d. Remove all waste, including without limitation
hazardous waste, waste oils and lubricants, and empty contain-
ers which held hazardous products, from the Leased Premises.
e. Perform all routine maintenance and ordinary repairs
on all parking lot and driveway areas, and maintain all
landscaped areas.
7. TAXES: Lessee shall cause to be paid all taxes and
assessments of every nature, kind and description lawfully levied
against the Leased Premises and all personalty situated on the
Leased Premises legally classified as personal property.
8. HAZARD INSURANCE: Lessee shall maintain or cause to be
maintained at least the following insurance coverages:
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. Such other hazard insurance coverages as may be
reasonably required from time to time by City and usually
placed on buildings of similar character in Corpus Christi,
Texas.
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The insurance coverages set forth in subparagraphs a and b
above are hereinafter sometimes collectively called "hazard
insurance."
All such hazard insurance policies shall name City, Lessee and
Lessee's Tenant under that Agreement of Sublease as insureds, as
their interests may appear, and shall contain a loss payable clause
in favor of the Mortgagee under the Renewal Deed of Trust. Lessee
shall cause such hazard insurance policies or copies thereof, to be
delivered to City and the Mortgagee under that Renewal Deed of
Trust.
9. DAMAGES: If the Building is damaged in an amount in
excess of $30,000 by any cause insured against under the hazard
insurance policies, the following shall occur:
a. 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 City within sixty (60)
days after the date of such damage. In the event of cancella-
tion of this Lease, then the proceeds from the hazard insur-
ance policy shall first be paid to Mortgagee under the Renewal
Deed of Trust, to the extent of any outstanding Indebtedness
and the accrued interest thereon to date of payment, and the
remainder, if any, shall be payable to City.
If Lessee elects to cancel this Lease and the insurance
proceeds are not sufficient to pay off all the outstanding
Indebtedness and the accrued interest thereon to date of
payment, then Lessee shall pay the remaining balance due.
In the event this Lease is not canceled as hereinabove
provided, then Lessee shall promptly restore or cause to be
restored the Building to the extent the insurance proceeds
will permit, and the title to such restoration shall vest in
City upon completion of the restoration work.
b. In the event Lessee elects to restore the Building,
all funds collected from the hazard insurance policies shall
be delivered to and used by Lessee (or the Tenant under that
Agreement of Sublease) to restore the Building.
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c. In the event the Lease is not canceled, Lessee shall
continue to pay the rental provided for in this Lease Agree-
ment.
10. LIABILITY INSURANCE: Lessee shall cause to be carried
the following policies of liability insurance by Lessee's Tenant
under that Agreement of Sublease:
a. Comprehensive general liability insurance coverage
with limits of not less than $500,000 per person for bodily
injury or death, $1,000,000 per occurrence for bodily injury
or death, and $100,000 per occurrence for property damage or
a combined single limit coverage of not less than $1,000,000.
Such policy shall include endorsements for contractual
liability covering the Lessee's Tenant's obligations under
that Agreement of Sublease, and personal injury liability
extending to claims arising from employees of Lessee's Tenant.
b. Automobile liability insurance covering all owned,
hired and non -owned automobiles used in connection with
Lessee's Tenant's operations with limits not less than
$500,000 per person for bodily injury or death, $1,000,000 per
occurrence for bodily injury or death and $100,000 per
occurrence for property damage, or a combined single limit
coverage of not less than $1,000,000.
c. Workers' Compensation Insurance as required by the
laws of the State of Texas and employers' liability insurance
with minimum limits of liability of $100,000. The workers'
compensation insurance shall be endorsed to waive any rights
of subrogation the insurance company may acquire by reason of
the payment of any claims against the City or Lessee and any
of its respective officers, directors, employees, agents and
attorneys.
The insurance coverages as set forth in subparagraphs a, b and c
above are hereinafter sometimes collectively called the "liability
insurance."
All such liability insurance policies shall name the City and
Lessee as additional insureds.
11. NOTICES OF INSURANCE: No insurance policies required
under this Lease, whether for hazard insurance or liability
insurance, shall be canceled, or materially changed or not renewed
without 30 days prior written notice to the City, addressed to the
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attention of the Director of Aviation. Copies of such insurance
policies shall be promptly provided to the City, upon the City's
written request. Failure to maintain such insurance coverages for
the entire term of this Lease shall be grounds for terminating this
Lease.
12. UTILITIES: Lessee agrees to cause to be paid when due
all lawful charges for electricity, power, gas, water and any other
utilities used by it or its sublessees upon and in the operation of
the Leased Premises.
13. SUBLEASE: Upon receipt of the City's prior written
approval exercised by the City Manager, which shall not be
unreasonably withheld, Lessee may sublease or assign the Leased
Premises and the leasehold estate created hereby for the remainder
of the term of this Lease; but, notwithstanding any such assignment
or sublease, Lessee shall remain liable to City for performance of
all the terms, conditions and provisions of this Lease. Any
sublease or assignment hereof shall conform to the terms of this
Lease. Lessee shall promptly notify City of any sublease or
assignment of this lease by giving written notice thereto to City.
City acknowledges receipt of notice of the sublease to Semtech
Corpus Christi Corporation under that Agreement of Sublease
referenced herein.
14. COMPLIANCE WITH LAWS: Lessee shall require its Tenant to
comply with all laws, ordinance, orders, rules, regulations, and
requirements of all federal, state, and local governmental
authorities having jurisdiction over the Leased Premises.
15. INDEMNITY: The Lessee and the Tenant under that
Agreement of Sublease or assignee thereof shall forever save and
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hold harmless the City 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, said Tenant, or their assignees on said Leased Premises, or
in connection with the operation of said business, whether on said
Leased Premises or otherwise.
16. ALTERATIONS: Lessee may make or permit to be made, such
alterations and modifications of, and additions to, the Leased
Premises as Lessee, or its Tenant under that Agreement of Sublease,
may deem desirable for the use thereof and may, at Lessee's or such
Tenant's option and without cost to City, at any time and from time
to time do any one or more of the following:
a. Alter or remodel the Building or other improvements
on the Leased Premises, provided the rental value of the
Building or improvements so altered or remodeled is not
adversely affected thereby;
b. Construct an addition, or additions thereto, and
install 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 improvement which in the judgment of Lessee, or
its Tenant under that Agreement of Sublease, has become unfit
for use, obsolete, surplus or is no longer necessary for
operations of the Lessee, or such Tenant, provided, if the
property to be demolished and removed shall have 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 Tenant, for which
Lessee, or its Tenant shall not have provided replacements,
shall exceed $100,000) the City shall be entitled to condition
its consent to such demolition and removal on the receipt from
Lessee, or its Tenant, of an undertaking, satisfactory to
City, that Lessee, or its Tenant, will at its own expense (or
pursuant to arrangements reasonably satisfactory to City)
construct on the Leased Land new improvements to the extent
reasonably necessary to compensate for such loss of rental
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value of the Leased Premises as may result from such demoli-
tion and removal. In determining whether there has been a net
diminution of such value, consideration shall be given to any
new improvements Lessee, or its Tenant, may have constructed
from time to time on the Leased 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 City; and
d. Construct an additional new building or buildings on
the Leased Premises.
Plans and specifications for the foregoing alterations and
modifications shall be subject to approval of City if such
alterations or modifications involve an expenditure or scope of
work in excess of $50,000.00 in value, and such approval shall not
be unreasonably withheld.
At the expiration or termination of this Lease, Lessee, or its
Tenant, 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 commotion, and Lessee,
or its Tenant, 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 City shall
accept the Leased Premises with such alterations, remodeling,
additions, or new construction, as may have been made pursuant to
authorization contained in this paragraph. Lessee agrees that it
will not permit or allow any mechanic's, materialman's, or other
liens to stand against the Leased Premises for work or materials
furnished Lessee, or its Tenant, in connection with any such
alterations, remodeling, additions or new construction, it being
provided, however, that Lessee, or its Tenant, shall have the right
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Tenant, shall at its expense repair or cause to be repaired any
damage caused to the Leased Premises by virtue of the removal
thereof.
19. FINANCIAL REPORTS: Lessee shall furnish to City a
financial report relating to Lessee's financial condition annually
during the term of this Lease, and Lessee shall cause to be
furnished to the City a financial report of the Tenant and Tenant's
Guarantor under that Agreement of Sublease referenced herein
relating to such parties financial condition annually during the
term of this Lease.
20. CONDEMNATION: In the event of the commencement,
prosecution or consummation during the term of this Lease of any
condemnation proceeding, or proceedings in eminent domain (herein-
after called "condemnation"), covering, touching or affecting all
or any part of the Leased Premises, City and Lessee 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 Leased Premises, or any part
thereof, and receive their respective awards as provided by law.
However, if such proceeds are not used to restore or improve
the Leased Premises, then City shall pay its portion of such
proceeds (except as to that portion allocable to the Leased Land)
to Lessee as consideration for the diminution of the Leased
Premises herein bargained for. If such proceeds are not used to
restore or improve the Leased Premises, then Lessee shall pay the
condemnation proceeds to the Mortgagee under the Renewal Deed of
Trust to the extent sufficient in amount to pay all outstanding
Indebtedness.
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If there is a taking or a partial taking sufficient to impair
the business operations of Lessee, or its Tenant under that
Agreement of Sublease, then Lessee shall have the option to
terminate and cancel this Lease; however, such cancellation shall
not be effective unless Lessee pays an amount sufficient to pay all
outstanding Indebtedness, after reduction for any condemnation
funds applied against said Indebtedness.
21. WAIVER OF LIEN: City hereby waives the statutory
landlord's lien on any property of Lessee or its Tenant placed on
the Leased Premises.
22. MORTGAGES: (a) Lessee borrowed the funds required to
pay all costs of constructing the Building pursuant to the
Indenture. The Indebtedness represents the remaining amounts owing
pursuant to the Indenture as of the effective date of this
Modification of Lease. Lessee is obligated to pay the principal
and interest on the Indebtedness from revenues derived by Lessee
from its sublease of the Leased Premises pursuant to the Agreement
of Sublease. The Leased Land and Building are owned by City,
subject to the terms of this Lease.
(b) Any rights retained by the City in this Lease shall be
and remain subordinate to the rights of the Mortgagee under the
Renewal Deed of Trust so long as there is any outstanding Indebted-
ness secured thereby.
(c) Under no circumstances shall City be liable for any
bonds, notes or any other indebtedness incurred by Lessee, the
Tenant under that Agreement of Sublease, their successors or
assigns.
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23. TITLE TO BUILDING: Title to all buildings and all
permanent improvements annexed to the realty under the terms of
this paragraph is vested in the City.
24. DEFAULT: If Lessee shall violate any of the terms and
conditions it has obligated itself to fulfill and comply with under
this Lease, or shall fail to cause to be maintained the hazard
insurance and liability insurance in the amount set out herein, or
shall fail to cause all taxes assessed to be paid prior to
penalties being owed, or if the Building remains unoccupied for
twelve (12) months, City by notice may advise Lessee that such
violation has occurred; and unless Lessee shall within sixty (60)
days after such notification commence and prosecute with diligence
the curing of such violation, City may, after such 60 -day period
declare this Lease 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
this paragraph notwithstanding the rights of the City set forth
this paragraph shall be subject to the rights of the Mortgagee
set forth in the Renewal Deed of Trust.
In addition to the notices to be sent Lessee hereunder, City
at the same time notices are sent to Lessee, shall send copies of
such notices to the Mortgagee under the Renewal Deed of Trust if
there is any outstanding Indebtedness, and to the Tenant under that
Agreement of Sublease of Lessee, if the Leased Premises are
subleased. Such Tenant and Mortgagee, in addition to Lessee, may
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of
in
as
whether or not any federal agency or any state or local
environmental agency has taken or threatened any action in
connection with the presence of any Hazardous Materials. The
foregoing indemnity shall survive the expiration of the Lease.
in the event Lessee fails, after reasonable notice, to pay any
amounts described in this provision, City may, but shall not
be obligated to, cause the Hazardous Materials to be removed
from the Leased Land and the cost of such removal shall be
added to the rentals due hereunder. The City shall have the
right to conduct an environmental audit of the Leased Land and
Lessee shall cooperate in the conduct of such environmental
audit.
With respect to liabilities for Hazardous Materials arising
from conditions prior to the effective date of this Modification of
Lease, Lessee's Tenant under that Agreement of Sublease has
assigned to Lessee its rights and remedies concerning such
Hazardous Materials liabilities contained in that sale and purchase
agreement between said Tenant and the prior holders of the
leasehold interest under that original Agreement of Sublease dated
December 31, 1973. Lessee hereby assigns such rights and remedies
to the City, without recourse upon Lessee. Lessee's Tenant has
expressly not assumed any liability for Hazardous Materials
releases prior to the effective date of this Modification of Lease.
Lessee's Tenant has agreed to cooperate with the City and Lessee in
the enforcement of any such rights and remedies against said
Tenant's predecessors in interest. Lessee hereby assigns to the
City its rights and remedies received from Lessee's Tenant
described above, and Lessee agrees to cooperate with the City in
any action for enforcement of same. Any such actions may be
brought by the City, in its name alone or jointly with Lessee and
its Tenant, provided that neither Lessee nor its Tenant shall be
responsible for any court costs, attorney's fees or other claims or
liabilities associated with such action.
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29. NOTICES: All notices required
writing and deemed to have been given when sent by registered mail
or certified mail as follows:
To Lessee:
hereunder shall be in
Corpus Christi Airport
Development Corporation
P. O. Box 640
Corpus Christi, Texas 78403
To City:
City of Corpus Christi, Texas
P. O. Box 9277
Corpus Christi, Texas 78469
Attn: Director of Aviation
Such addresses may be changed by
notice.
30. AMENDMENT: No amendment, modification, or alteration of
the terms hereof shall be binding unless the same is expressed in
writing and executed by duly authorized representatives of the
parties hereto.
31. ATTORNEY'S FEES: Any party to this Lease who is a
prevailing party in any legal proceeding against any other party
brought under or with relation to this Lease shall be additionally
entitled to recover court costs, reasonable attorney's fees, and
all other out-of-pocket costs of litigation, including deposition,
travel and witness costs, from the non -prevailing party.
32. LIENS: Lessee shall not permit any mechanics', material -
men's or other liens to be fixed or placed against the Leased
Premises and agrees immediately to discharge (either by payment or
by filing the necessary bond, or otherwise) any mechanics',
materialmen's or other lien which is allegedly fixed or placed
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To the Tenant under that
Agreement of Sublease:
Semtech Corpus Christi
Corporation
121 International Boulevard
Corpus Christi, Texas 78406
To Mortgagee:
First City, Texas -Corpus Christi
P. O. Box 4666
Corpus Christi, Texas 78469
the parties hereto by written
against the Leased Premises. Lessee and its Tenant reserve the
right to contest the reasonableness of any such charges or
impositions against the Leased Premises, and upon providing
reasonable security to assure their performance, the City agrees
not to interfere with such contested proceedings or otherwise
declare a default due to the placement of a lien against the
Premises.
33. SUCCESSORS: The provisions of this Lease shall be
binding upon and shall inure to the benefit of the parties hereto
and their respective successors and assigns.
34. ENTIRE AGREEMENT: This Lease contains the entire
agreement between the parties hereto, and no representations,
warranties, expressed or implied, inducements, promises or
agreements, oral or otherwise, between the parties not embodied
herein shall be of any force or effect.
35. EARLY TERMINATION OF SUBLEASE: (a) The Agreement of
Sublease provides, "Tenant shall have the right to terminate this
Sublease at any time during the first ten (10) years hereof by
paying to [Lessee] a sum equal to the aggregate principal amount of
the outstanding [Indebtedness], plus the interest which will accrue
to the date the [Indebtedness] is paid, plus the remaining annual
rental payments due for the Leased Land through the date of said
termination." In the event the Tenant under that Agreement of
Sublease exercises the option to terminate the Agreement of
Sublease in accordance with the quoted provision, this Modification
of Lease shall terminate upon such payment and all of the City's
right, title and interest in the Leased Premises shall be released
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from the encumbrance of this Lease, the Sublease and any mortgage.
(b) Lessee's
have the option to
for the successive
Tenant under that Agreement of Sublease shall
terminate its occupancy of the Leased Premises
two additional ten (10) year periods of this
Modification of Lease term upon the following terms and conditions.
Not more than two (2) years nor less than 180 days prior to the
tenth (10th) anniversary and twentieth (20th) anniversary,
respectively, of the Lease term, Lessee's Tenant shall have the
option to provide Lessee and City written notice of its intent to
cause an early termination of this Lease. Said termination shall be
effective upon such tenth (10th) or twentieth (20th) anniversary of
this Modification of Lease, whereupon this Lease shall terminate.
(c) Upon termination of this Lease,
all right, title and
interest of Lessee's Tenant in the Leased Premises and Building
shall cease.
36. RIGHT OF FIRST REFUSAL: City grants to Lessee and its
Tenant under that Agreement of Sublease a right of first refusal
during the term of this Modification of Lease to lease the 220 -foot
strip adjacent to the west side of the Leased Land as shown on
Exhibit "A" attached hereto in accordance with the terms and
conditions of this paragraph. In the event City obtains an offer
to lease said 220 -foot strip from a qualified tenant on terms and
conditions acceptable to City, City agrees to notify Lessee and its
Tenant of the rental rate, terms and conditions of such offer and
afford Lessee and its Tenant the opportunity to lease said property
at the same rental rate, terms and conditions. Lessee and its
Tenant shall have thirty (30) days from the date of written notice
of the offer to tender an executed written lease containing
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identical terms to City at the notice address provided herein.
Notice of the offer to lease shall be deemed given when deposited
by City in the U.S. mail, postage prepaid, properly addressed to
Lessee and its Tenant and mailed by certified mail, return receipt
requested. In the event City fails to receive in response a
written contractual offer by 5:00 p.m. (Corpus Christi time) on the
30th day following the date of notice of the offer to lease, the
right of first refusal hereunder shall terminate and be of no
further force or effect. The time period allowed for consummating
the transaction and other terms and conditions of the lease
agreement shall be the same as set forth in the notice of the
offer to lease except as otherwise agreed by City, Lessee and its
Tenant.
37. OPTION TO PURCHASE BUILDING: Lessee and its Tenant under
the Agreement of Sublease shall have the option during the first
ten (10) years of the term of this Sublease to purchase the
Building and improvements related thereto located on the Leased
Land from the City for a purchase price of $500,000, as adjusted by
any increases in the Consumer Price Index maintained by the U.S.
Department of Labor (or any successor index maintained on a
comparable basis by such Department, or any successor agency) from
the date of this Lease; provided, however, that in the event such
option is exercised prior to the expiration of the first ten (10)
years of the term of this Lease, the purchase price shall be
increased by amount equal to the balance owing by Lessee on the
Indebtedness incurred to finance the construction of said Building
and improvements. Upon the exercise of said purchase option, the
City agrees to convey title to the Building by General Warranty
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Deed and furnish Lessee's Tenant an Owner Policy of Title Insur-
ance, at said Tenant's expense.
38. LEASE RATE ADJUSTMENTS: During the remainder of the
Lease term following the initial ten-year period of this Modifica-
tion of Lease, the Lease rates due hereunder shall be payable as
follows:
(a) In the event the option to purchase the Building from the
City has been exercised, the rentals shall be based upon Fair
Market Value (FMV) to be calculated as follows:
The annual rental for the Leased Land shall be based
on the fair market value of the Leased Land, excluding
any value associated with the Building or the improve-
ments related thereto, as determined by three appraisals.
The City shall pay for one appraiser and Lessee shall pay
for one appraiser. The City's and Lessee's appraiser
shall choose the a third appraiser, and the City and
Lessee shall each pay one-half of the third appraiser's
fee. Once the FMV has been determined for the Leased
Land, the rental rate shall be adjusted effective on the
tenth anniversary of this Modification of Lease and
thereafter adjusted annually based on increases, or
decreases, and the Consumer Price Index issued by the
federal government, or such other successor index, each
year. The foregoing procedure to determine the FMV of
Leased Land and a new Lease rate shall be repeated on the
twentieth anniversary of this Modification of Lease.
(b) In the event said option to purchase the Building and
improvements as above provided is not exercised, the lease of said
Building and improvements may be continued at a rental rate equal
to $10,000 per month, being the rental rate in effect for the
Building in the tenth year of the Sublease, as such rate is
adjusted annually to cover increases in the Consumer Price Index
each year. Lessee shall additionally be responsible for the rental
for the Lease Land provided above.
39. TERMINATION OF LIABILITIES OF LESSEE: Upon the expira-
tion of the initial ten-year period of this Modification of Lease
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and the full payment of the Indebtedness, Lessee's Tenant's
occupancy shall continue thereafter as a direct lessee of the City
under the terms and conditions of this Lease, and Lessee shall be
under no further obligation or liability to either Lessee's Tenant
or the City for the continuation of this Lease or continue as a
party hereto.
40. FAA APPROVAL: All terms and conditions of this Lease,
and any amendments hereto, and any sublease and any amendments
thereto, are subject to FAA's prior approval. If FAA requires any
modification of this Lease and/or any Sublease or any amendment to
same prior to its approval, such modification will be immediately
furnished to Lessee and its Tenant for their review. Lessee and
its Tenant reserve the right to withdraw any such amendment in the
event the FAA modifications are not acceptable.
41. FAA AGREEMENT WITH CITY: This Lease and any Sublease is
subordinate to provisions of any existing or future agreement
between
thereof
the City and the United States of America or any agency
related to the operation, development, or maintenance of
the City's Airport, the execution of which has been or may be
required as a condition precedent to the expenditure of federal
funds for the development of the Airport. Should any such
agreement require modification of this Lease and any Sublease, such
modification will immediately be incorporated into the Lease and
Sublease terms without need for official action on the part of the
City or Lessee; provided however, that in the event such modifica-
tion materially impairs the ability of Lessee's Tenant to continu-
ous business operations on the Leased Premises to the full extend
authorized under the Lease and Sublease, such Tenant shall have
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ninety (90) days following receipt of notice of such modification
to elect to terminate its obligations under the Sublease, whereupon
Lessee's obligations under this Lease shall be terminated. The
effective date of such termination shall be as set forth in said
Tenant's notice of termination, and on such effective date all
liability for further rentals due hereunder shall cease. Notwith-
standing the foregoing, in the event any indebtedness remains
secured under the Renewal Deed of Trust at the time of such
termination, such indebtedness shall be paid in full in a lump sum
by said Tenant as a condition of termination of the Sublease and
this Lease.
42. NONDISCRIMINATION: (a) Lessee assures that it will
undertake an affirmative action program, as required by 14 Code of
Federal Regulations Part 152, Subpart E, to insure that no person
shall on the grounds of race, color, creed, national origin, or sex
be excluded from participating in any employment activities covered
by 14 Code of Federal Regulations Part 152, Subpart E. Lessee
assures that no person shall be excluded on these grounds from
participating in or receiving the services or benefits of any
program or activity covered by this subpart. Lessee assures that
it will require that its covered suborganizations provide assuranc-
es to Lessee that they similarly undertake affirmative action
programs and that they will require assurance from their suborgani-
zations, as required by 14 Code of Federal Regulations Part 152,
Subpart E, to the same effect.
(b) Lessee for itself and its successors in interest, and
assigns, as a part of the consideration hereof, does hereby
covenant and agree as a covenant running with the land that: (1)
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no person on the grounds of race, color, or national origin shall
be excluded from participating in, denied the benefits of, or be
otherwise subjected to discrimination in the use of said facili-
ties, (2) that in the construction of any improvements on, over, or
under such land and the furnishing of services thereon, no person
on the grounds of race, color, or national origin shall be excluded
from participating in, denied the benefits of, or otherwise subject
to discrimination, (3) that Lessee shall use the Premises in
compliance with all other requirements imposed by or pursuant to 49
CFR Part 21, Nondiscrimination in Federally Assisted Programs of
the Department of Transportation, and as said regulations may be
amended.
(c) That, in the event of breach of any of the proceeding
nondiscrimination covenants, after written notice of default and
opportunity to cure as provided herein the City shall have the
right to terminate this Lease and to reenter and repossess said
land and the facilities thereon, and hold the same as if said Lease
had never been made or issued.
43. HEIGHT RESTRICTIONS: Lessee shall require its Tenant to
restrict the height of structures, objects, or natural growth and
other obstructions on the Leased Premises to such a height as to
comply with Federal Aviation Regulations, Part 77, as same may be
amended.
44. NONINTERFERENCE: Lessee shall require its Tenant to
prevent any use of the Leased Premises which would interfere with
or adversely affect the operation or maintenance of the Airport, or
otherwise constitute a hazard to the Airport.
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45. RIGHT TO AIRSPACE: City reserves to itself, its
successors and assigns, for the use and benefit of the public, a
free and unrestricted right of flight for the passage of aircraft
in the airspace above the surface of the Leased Premises, together
with the right to cause in such airspace such noise as may be
inherent in the operation of aircraft, now known or hereafter used
for navigation of or flight in the air, using said airspace for
landing at, taking off from, or operating on or about the Airport.
46. 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 Lease, then except as otherwise
expressly provided in this Lease, 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 Lessee's Tenant 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 time 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 public enemy, orders of any kind of the Government of the
United States or the State of Texas or any civil or military
authority, insurrections, riots, restraining of government and
people, epidemics landslides, lightning, earthquakes, fires,
hurricanes, storms, floods, washouts, droughts, arrests, civil
-25-
disturbances, explosions, breakage or accidents to machinery,
transmission pipes or canals, partial or entire failure of
utilities, shortages of labor, material, supplies or transporta-
tion, or any other cause not reasonably within the control of the
party claiming such inability. It is understood and agreed that
the settlement of existing or impending strikes, lockouts or other
industrial disturbances shall be entirely within the discretion of
the party having the difficulty and that the above requirements
that any force majeure shall be remedied with all reasonable
dispatch shall be deemed to be fulfilled even though such existing
or impending strikes, lockouts, and other industrial disturbances
may not be settled and could have been settled by acceding to the
demands of the opposing person or persons.
47. AUTHORITY OF PARTIES: Each party signing this Lease by
its signature certifies that it possesses authority to execute this
Lease, and all amendments thereto, and be bound thereby, and that
all prerequisites to such authorized execution have been accom-
plished.
48. NO WARRANTIES: The City 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 its Tenant's
purposes or needs. Lessee releases the City from, and the City
shall not be liable for, and Lessee will hold City 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; provided,
-26-
that the indemnity in this sentence shall be effective only to the
extent of any loss that may be sustained by City in excess of the
sums paid for the benefit of City from any insurance carried by
Lessee's Tenant with respect to the loss sustained.
49. NONEXCLUSIVITY: Notwithstanding anything herein
contained that may be or appear to be to the contrary, it is
expressly understood and agreed that the rights granted under this
Lease are nonexclusive as to the property comprising the City's
airport, and the City herein reserves the right to grant similar
privileges to another party or parties on other parts of the
airport property.
EXECUTED on this day of , 1991.
ATTEST: CITY OF CORPUS CHRISTI, TEXAS
By:
City Secretary Juan Garza
City Manager
APPROVED:
day of , 1991:
City Attorney
ATTEST: CORPUS CHRISTI AIRPORT
DEVELOPMENT CORPORATION
By:
Secretary President
\11\AGMT\AtrLease.150-15/234 -27-
EXHIBIT A
Being a 6.162 acre tract of land out of Block 23, J. G Russell Farm Blocks as shown
by map of record in Volume 3, Page 53, Map Records, Nueces County, Testas, said
6.162 acre tract of land being more particularly described by metes and bounds as
follows:
Beginning at 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 comer of said Block 23; thence S. 50 feet to
a point in the west right-of-way of the International Drive;
Thence S. 1° 19' 56" E. along a line 50' westerly of and parallel to the east boundary
of said Block 23, a distance of 50' to the true point of beginning of the herein
described tract; thence continuing S. 1° 19' 5C E, a distance of 610.0 feet to 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-way line of said State Highway No. 44, a distance of 440.0 feet to the
southwest corner of the tract herein described;
Thence N. 1° 19' 56" W, with a line that is 440.0 feet west of and parallel to the west
line of International Drive, a distance of 610.0 feet to the northwest corner of the
tract herein described;
Thence N. 88° 35' 46" E. along a line 50' southerly of and parallel with the south
right-of-way line of State Highway No. 44, a distance of 440.0 feet to the point of
beginning and containing 6.16162 acres more or less.
STATE OF TEXAS
COUNTY OF NUECES
AGREEMENT OF SUBLEASE
S
S
This Agreement of Sublease is made and entered into by and
between CORPUS CHRISTI AIRPORT DEVELOPMENT CORPORATION, a Texas
non-profit corporation, (the "Landlord") and SEMTECH CORPUS CHRISTI
CORPORATION, a Texas corporation, (the "Tenant") on the terms and
conditions hereinafter set forth.
1. LEASED PREMISES: Landlord subleases unto Tenant and
Tenant subleases from the Landlord the following described Leased
Land:
Being a portion of land out of Block Twenty -Three (23),
J. C. RUSSELL FARM BLOCKS, a Subdivision of the City of
Corpus Christi, Nueces County, Texas, more particularly
described on Exhibit "A" attached hereto.
TOGETHER WITH the buildings and improvements located thereon (the
Building) which collectively shall herein be referred to as the
Leased Premises.
2. TERMINATION OF PRIOR SUBLEASE: This Agreement of
Sublease terminates and replaces that prior Agreement of Sublease
between Landlord and Power Monolithics, Inc. dated December 31,
1973. Tenant has assumed the rights of occupancy under that prior
Agreement of Sublease by one or more assignments, and such prior
Agreement of Sublease is superseded hereby and is replaced in its
entirety as of the date hereof by this instrument.
3. TERM: The term of this Sublease shall be for a period of
thirty (30) years commencing as of January 1, 1991, subject to the
provisions on early termination contained herein.
4. USE: The Leased Premises shall be continuously used and
occupied during the term of this Sublease by Tenant for no other
purpose than for the operation of a light manufacturing facility in
compliance with all applicable laws and regulations.
5. RENTAL: (a) Tenant agrees to pay to Landlord, or its
designated agent, at the address specified herein or such other
place as Landlord shall designate, for the initial ten (10) years
of the Sublease term the sum of ONE MILLION TWENTY THOUSAND
($1,020,000), payable in one hundred twenty (120) consecutive
monthly installments, without demand, in advance on the first day
of each month during the term hereof, as follows:
Thirty-six (36) installments of $6,000.00 each;
Thirty-six (36) installments of $9,000.00 each; and
Forty-eight (48) installments of $10,000.00 each.
Said sum shall constitute the "Base Rentals" under this Sublease.
(b) Tenant shall also pay as Additional Rentals hereunder
during the initial ten (10) years of the term of this Sublease the
amount of the rent assessed by the City of Corpus Christi, Texas
(the "City") for the Leased Land pursuant to the terms and
conditions of that Modification of Lease of even date herewith
between Landlord and said City as follows:
During the first four (4) years of this Sublease, annual
rentals of $1,970 per year.
During the next six (6) years of this Sublease, annual rentals
of $3,940 per year.
Said annual rentals for the Leased Land shall be payable in advance
in equal quarterly installments, the first quarterly installment
being due and payable on the effective date of this Agreement of
Sublease, with a like payment to be due on the first day of every
-2-
third month thereafter during the term hereof. Landlord agrees to
promptly remit such Additional Rentals to the City within 60 days
of receipt from Tenant and indemnify and hold harmless Tenant from
any claims by the City for non-payment under the Modification of
Lease for any periods in which Tenant has timely paid the Addition-
al Rentals. In the event Landlord fails to promptly remit such
sums as required herein, Tenant reserves the right to pay such
Additional Rentals directly to the City in discharge of its
obligations under this provision.
(c) The Base Rentals and Additional Rentals due for the
remaining twenty (20) years of the term of this Sublease shall be
established in the manner provided in the Lease Rate Adjustment
provisions of this Sublease.
(d) The obligation of the Tenant to pay the rentals due
hereunder shall be absolute and unconditional, irrespective of any
rights of setoff, recoupment or counterclaim it might otherwise
have against Landlord. The Tenant will not suspend or discontinue
any such payment for any cause or terminate this Agreement of
Sublease for any cause. Notwithstanding the foregoing, the Tenant
may, at its own cost and expense, and in its own name or in the
name of the Landlord, prosecute or defend any action or proceedings
or take any other action against the Landlord, the City of Corpus
Christi, Texas, or any third persons which the Tenant deems
reasonably necessary in order to secure or protect its right of use
and occupancy and other rights hereunder.
6. MAINTENANCE: Tenant acknowledges that it has fully
inspected the Leased Premises and the buildings and improvements
thereon, and on the basis of such inspection, Tenant hereby accepts
-3-
the Leased Premises, and the buildings and improvements situated
thereon, as suitable for the purposes for which same are leased, in
their present condition, AS IS, and WITH ALL FAULTS. Tenant shall
throughout the term of this Sublease take good care of the Leased
Premises including the buildings and other improvements located
thereon, keep them free from waste or nuisance of any kind, and
shall be responsible for and shall perform, or cause to be
performed, maintenance, including custodial maintenance, and repair
of the Leased Land and Building. Tenant shall at all times:
(a) Perform all routine maintenance and ordinary repairs and
inside painting, of a quality not inferior to the original material
and workmanship.
(b) Perform all routine maintenance and ordinary repairs on
all heating, cooling, and ventilation systems, and all electrical
systems.
(c) Perform all routine maintenance and ordinary repairs to
the exterior of the Building, including without limitation the
roof.
(d) Remove all waste, including without limitation hazardous
waste, waste oils and lubricants, and empty containers which held
hazardous products, from the Leased Premises placed on the Leased
Premises by Tenant.
(e) Perform all routine maintenance and ordinary repairs on
all parking lot and driveway areas, and maintain all landscaped
areas.
If any repairs required to be made by Tenant hereunder are not made
within sixty (60) days after written notice delivered to Tenant by
Landlord, Landlord may at its option make such repairs without
-4-
liability to Tenant for any loss or damage which may result by
reason of such repairs, and Tenant shall pay to Landlord upon
demand as additional rent hereunder the cost of such repairs plus
interest. At the end or other termination of this Sublease, Tenant
shall deliver the Leased Premises to the Landlord and City with all
improvements located thereon in good repair and condition,
reasonable wear and tear excepted.
7. TAXES: As additional rentals hereunder, Tenant agrees to
cause to be paid before they become delinquent all real property
taxes and assessments lawfully levied or assessed against the
Leased Premises or any part thereof, provided, however, Tenant may,
at its sole expense dispute and contest same, and in such case,
such disputed item need not be paid until finally adjudged to be
valid. Tenant shall additionally pay all taxes levied against
personal property, equipment, trade fixtures and inventory placed
by Tenant in, on or about the Leased Premises. Landlord agrees to
cooperate with Tenant in any effort by Tenant to contest, at
Tenant's sole cost and expense, the valuation of properties for tax
purposes or the method of assessment of ad valorem taxes, including
the execution of necessary documents and providing access to any
records held by Landlord concerning market value.
8. HAZARD INSURANCE: Tenant agrees to maintain at least
the following insurance coverage 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 or to the maximum amount
available from the Texas Catastrophe Insurance Pool (if such
Pool coverage is the only coverage available to Tenant),
whichever is less;
(b) Such other hazard insurance coverages as may be
reasonably required from time to time by Landlord or the City
-5-
and usually placed on buildings of similar character in Corpus
Christi, Texas.
The insurance coverage set forth above is hereinafter sometimes
called "hazard insurance."
All such hazard insurance policies shall name the Landlord and
the City of Corpus Christi as insureds, as their interests may
appear, and shall contain a loss payable clause in favor of First
City, Texas - Corpus Christi, as Mortgagee. Tenant shall furnish
such hazard insurance policies or copies thereof, to the Landlord,
the City and said Mortgagee.
Tenant shall additionally be solely responsible for any and
all property damage insurance coverage for contents and any
personal property or equipment on the Leased Premises.
9. DAMAGES: If any building on the Leased Premises is
damaged in an amount in excess of $30,000 by any cause insured
against under the hazard insurance policies, the following shall
occur:
(a) Tenant shall have the option either to terminate and
cancel this Sublease or to restore said Building, as hereinaf-
ter provided, and to continue this Sublease. Such election
shall be made by written notification to the Landlord within
fifty (50) days after the date of such damage. In the event
of cancellation of this Sublease, then the proceeds from the
hazard insurance policy shall first be paid to the Mortgagee
under the Renewal Deed of Trust, to the extent of any out-
standing indebtedness and the accrued interest thereon to the
date of payment, and the remainder, if any, shall be payable
to City of Corpus Christi.
If Tenant elects to cancel this Sublease and the insur-
ance proceeds are not sufficient to pay off all the outstand-
ing indebtedness and the accrued interest thereon to date of
payment owing to said Mortgagee, then Tenant shall pay the
remaining balance due.
In the event this Sublease is not canceled as hereinabove
provided, then Tenant shall promptly restore or cause to be
restored said Building to the extent the insurance proceeds
-6-
will permit; and the title to such restoration shall vest in
the City upon completion of the restoration work.
(b) In the event Tenant elects to restore the Building,
all funds collected from the hazard insurance policies shall
be delivered to and used by Tenant to restore the Building.
(c) In the event the Sublease is not canceled, Tenant
shall continue to pay the rental provided for in this Sub-
lease.
10. LIABILITY INSURANCE: Tenant shall carry and pay the
premiums for liability insurance of the types and in the limits
stated below. Landlord and the City of Corpus Christi shall be
endorsed as an additional named insureds by the Tenant with respect
to each such policies of insurance other than the insurance
required for workers' compensation.
(a) Comprehensive general liability insurance
coverage with limits of not less than $500,000 per person
for bodily injury or death, $1,000,000 per occurrence for
bodily injury or death, and $100,000 per occurrence for
property damage, or a combined single limit coverage of
not less than $1,000,000. Such policy shall include
endorsements for contractual liability covering the
Tenant's obligations herein, and personal injury liabili-
ty extending to claims arising from employees of the
Tenant.
(b) Automobile liability insurance covering all
owned, hired and non -owned automobiles used in connection
with Tenant's operations with limits not less than
$500,000 per person for bodily injury or death,
$1,000,000 per occurrence for bodily injury or death, and
$100,000 per occurrence for property damage, or a
combined single limit coverage of not less than
$1,000,000.
(c) Workers' compensation insurance is required by
the laws of the State of Texas and employers' liability
insurance with minimum limits of liability of $100,000.
The workers' compensation insurance shall be endorsed to
waive any rights of subrogation the insurance company may
acquire by reason of the payment of any claim against the
Landlord and any of its respective officers, directors,
employees, agents and attorneys.
The insurance coverage set forth above is hereinafter sometimes
called "liability insurance."
-7-
Tenant shall furnish to Landlord proof of such insurance
coverage in the form of a certificate of insurance, and it shall
maintain such coverage in effect and certificates of insurance
reflecting such coverage throughout the term of this Sublease.
11. NOTICES OF INSURANCE: No such insurance policies,
whether being the hazard insurance or liability insurance policies,
shall be canceled, materially changed, or not renewed without
thirty (30) days priors written notice to the Landlord and to the
City, addressed to the attention of the Director of Aviation.
Copies of insurance policies shall be promptly provided to the
Landlord or the City upon their written request. Failure to
maintain said insurance for the entire term of this Sublease shall
be grounds for terminating this Sublease.
12. UTILITIES: Tenant shall be responsible for obtaining
water, sewer, electricity, and gas service connections into the
Leased Premises; and Tenant shall pay all utility connection
charges including meters, if any, and all charges incurred for any
utility services used on the Leased Premises, and shall furnish all
electric light bulbs and tubes.
13. ASSIGNMENT: During the first ten (10) years of the term
hereof, Tenant shall have the right to assign or transfer this
Sublease, as to the whole or any part of the Leased Premises
without Landlord's written consent; provided that Tenant shall
nevertheless remain liable to Landlord for the full payment of rent
and Tenant's other obligations under this Sublease. Thereafter,
Tenant's rights hereunder may be assigned or sublet upon the prior
written consent of the City Manager of the City, which consent
shall not be unreasonably withheld. No such consent shall be
-8-
required, however, for the assumption of Tenant's rights and
obligations hereunder pursuant to a corporate merger, consolidation
or acquisition of Tenant's stock.
14. LAWS: Tenant agrees to comply with all laws, ordinances,
orders, rules, regulations and requirements of federal, state and
local governments and all of their departments applicable to the
Leased Premises.
15. INDEMNITY: Tenant hereby covenants and agrees at all
times to indemnify and save harmless Landlord and the City of
Corpus Christi, Texas, their agents, officers, employees, and
invitees, and the Leased Premises from and against any cost,
liability, damages or expense arising out of any claims of any
person or persons whatsoever by reason of the use or misuse of the
Leased Premises, parking area, or facilities by Tenant or any
person or persons holding under Tenant, and shall indemnify and
save harmless Landlord from any penalty, damage, or charge incurred
or imposed by reason of any violation of law or ordinance by Tenant
or any person or persons holding under Tenant, and shall indemnify
and save harmless Landlord and the City from any cost, liability,
damages, or expense arising out of the death of or injury to any
person or persons or damage to property arising out of Tenant's
operations on the Leased Premises.
Landlord hereby covenants and agrees at all times to indemnify
and save harmless Tenant from and against any cost, liability,
damages or expense arising out of any claims of any person or
persons whatsoever by reason of the actions of Landlord.
16. ALTERATIONS: Tenant may make such alterations and
modifications of, and additions to, the Leased Premises as Tenant
-9-
may deem desirable for the use thereof and may, at Tenant's option
and without cost to Landlord or City, at any time and from time to
time do any one or more of the following:
(a) Alter or remodel the Building or other improvements
on the Leased Premises, provided the rental value of the
Building or improvements so altered or remodeled is not
adversely affected thereby, provided, that any such alter-
ations and remodeling shall be in accordance with applicable
laws, ordinances, rules and regulations;
(b) Construct an addition, or additions thereto, and
install 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 improvement which in the judgment of Tenant has
become unfit for use, obsolete, surplus or is no longer
necessary for operations of Tenant, provided, if the property
to be demolished and removed shall have an original construc-
tion cost, or an allocable purchase cost, in excess of
$100,000 (or, in the event that such cost, when taken together
with the original construction cost, or allocable purchase
cost, of property previously demolished and removed by Tenant
for which Tenant shall not have provided replacements, shall
exceed $100,000) Landlord and the City shall be entitled to
condition their consent to such demolition and removal on the
receipt from Tenant of an undertaking, satisfactory to City
and Landlord that Tenant will at its own expense (or pursuant
to arrangements reasonably satisfactory to Landlord and City)
construct on the Leased Premises new improvements to the
extent 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 diminution of such value, consideration shall be given
to any new improvements Tenant 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
any buildings, 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 buildings on the Leased Premises be effected without the
approval of Landlord and the City; and
(d) Construct an additional new building or buildings on
the Leased Premises.
Plans and specifications for the foregoing alterations and
modifications shall be subject to approval of City if such
-10-
alterations or modifications involve an expenditure or scope of
work in excess of $50,000.00 in value, and such approval shall not
be unreasonably withheld. Tenant will comply with all City Codes
and Ordinances and will acquire and pay for all permits needed in
any alterations, additions, modifications, or remodeling of the
Building, or new buildings on the Leased Premises.
17. ENTRY: The Landlord and the City, by their officers,
employees, agents, and contractors, shall have the right at all
reasonable times to enter the Land and Building for the purpose of
inspecting same, for emergency repairs to utility systems, and to
perform maintenance, repairs, and replacements in any case where
Tenant is required to do so and has failed after reasonable notice
to do so, in which event Tenant shall reimburse the Landlord and
City for the actual cost thereof within thirty (30) days of demand.
Tenant shall not be entitled to any abatement or reduction of rent
by reason thereof unless such actions of Landlord result in a
permanent reduction in the amount of square feet of the Building of
more than three percent (3%). During the last six (6) months of
the term of this Sublease or any extension thereof, Landlord shall
have the right to post "For Lease" or "For Sale" signs on the
Leased Premises. During said periods Landlord or its representa-
tives shall have the right to show the Leased Premises to prospec-
tive purchasers or tenants at all reasonable times.
18. SIGNS: The signs presently located on the Leased
Premises are hereby authorized and approved by Landlord. Tenant
shall not place any other signs or objects on the roof or any part
of the exterior of any building on the Leased Premises nor place
any signs, show cases, displays or fences on the sidewalks, parking
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lots, driveways or exterior of any building on the Leased Premises
except as and where first approved in writing by Landlord and the
City's Director of Aviation. The size and shape of such signs
shall conform to the general appearance of the City's Airport
premises, and said signs shall comply with all City ordinances.
All said signs shall be kept in a continual state of good repair,
and failure to do so may result in approval of said signs being
withdrawn and the removal of said signs. Tenant shall remove all
signs at the termination of this Sublease. Such installations and
removals shall be made in such manner as to avoid injury, deface-
ment or overloading of any building or other improvements.
19. FINANCIAL REPORTS: Tenant shall furnish to Landlord and
the City of Corpus Christi annual financial reports relating to
Tenant and Tenant's Guarantor covering their financial condition
each year during the term of this Sublease.
20. CONDEMNATION: In the event of the commencement, prosecu-
tion or consummation during the term of this Sublease of any
condemnation proceeding, or proceedings in eminent domain (herein-
after called "Condemnation"), covering, touching, or effecting all
or any part of the leased premises, Landlord, the City and Tenant
at their option many 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 Leased Premises,
or any part thereof, and receive their respective awards as
provided by law. If the whole of the Leased Premises, or such
portion thereof as will make the premises unusable for the purposes
herein leased, is subjected to Condemnation, then in either of said
events Tenant shall have the option to terminate this Sublease as
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of the time when possession thereof is taken by public authorities,
and rental shall be abated as of that date. Such termination,
however, shall be without prejudice to the right of either Landlord
or Tenant to recover compensation and damages caused by condemna-
tion from the condemnor.
21. WAIVER: No waiver at any time of the right to terminate
this Sublease shall impair the right of Landlord to insist upon
such termination in the event of subsequent breach or default by
Tenant, nor shall the acceptance of rent at any time constitute
such waiver of default or waiver of damages, and in addition to any
other remedies which Landlord may have, Landlord may apply for and
obtain an injunction or use any other legal process to enforce
Landlord's rights.
22. MORTGAGES: This Sublease is and shall always be
subordinate to that Deed of Trust, Assignment of Leasehold,
Security Agreement and Financing Statement (the "Renewal Deed of
Trust") in favor of First City, Texas - Corpus Christi, as
Mortgagee, of even date herewith executed pursuant to the Modifica-
tion of Lease with the City of Corpus Christi, a copy of which is
attached hereto as Exhibit "B", together with any and all renewals,
extensions or modifications of such Renewal Deed of Trust, however
evidenced or arising. Tenant agrees to execute and deliver any
instrument, without cost, which may be deemed necessary to further
effect the subordination of this Sublease to any such mortgage or
mortgages.
23. POSSESSION: Possession of the Leased Premises shall be
granted to Tenant at the time of the effective date of this
Sublease.
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24. DEFAULT: In the event that Tenant shall default in the
prompt payment of rent when the same is due, shall fail to at all
times during the term of this Sublease maintain hazard insurance
and liability insurance in the amount set out herein, shall fail to
pay all taxes assessed prior to penalties and/or interest being
owed on said taxes, shall fail to occupy said Building for twelve
(12) months, shall fail to maintain the Building as set out herein,
shall violate any terms and conditions contained herein, or shall
violate or omit to perform any of the other provisions of this
Sublease, Landlord may, if it so elects, send written notice of
such default, violation or omission to Tenant, by mail or other-
wise, and unless Tenant shall have completely cured or removed said
default within sixty (60) days after the sending of such notice by
Landlord, Landlord may thereupon re-enter the Leased Premises, by
summary proceedings or by force or otherwise without being liable
for prosecution therefor, take possession of said premises and
remove all persons and property therefrom, and may elect to either
cancel this Sublease or relet the premises as agent for Tenant or
otherwise, and receive the rent therefor, applying the same first
to the payment of such expenses as Landlord may incur in entering
and letting; and then to the payment of the rent payable under this
Sublease and the fulfillment of Tenant's covenants hereunder; the
balance (if any) to be paid to Tenant who shall remain liable for
any deficiency. On any sums due under the terms of this Sublease
placed in the hands of an attorney after default or collected
through any judicial probate or bankruptcy proceedings, Tenant
agrees to pay a reasonable attorney's fee, together with all court
costs. Past due installments of rent shall bear interest at the
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rate of fifteen percent (15%) per annum until paid. In the event
Tenant shall continue to hold the Leased Premises, after demand
therefor by Landlord, at the termination of this Sublease, or for
default or breach of this Sublease, Landlord shall be entitled to
institute and maintain a forcible entry and detainer suit in the
Justice Court and obtain a writ of possession for the Leased
Premises.
25. BANKRUPTCY: In the event that Tenant shall become
bankrupt, voluntary or involuntary, or shall make a voluntary
assignment for the benefit of creditors, or in the event that a
receiver for Tenant shall be appointed, then, at the option of
Landlord and upon ten (10) days notice to Tenant or Tenant's
representatives, of the exercise of such notice, this Sublease
shall terminate.
26. HOLDING OVER: It is agreed and understood that any
holding over by Tenant of the Leased Premises at the expiration of
this Sublease shall operate and be construed as a tenancy from
month to month at a rental of one and one-fourth (1.25) times the
then current monthly rental payable directly to the City, and
Tenant shall be liable to Landlord and the City for all loss or
damage on account of any holding over against the will of the
Landlord or the City after the termination of this Sublease,
whether such loss or damage may be contemplated at this time or
not. All other terms and conditions of the expired lease shall
remain in full force and effect during any hold -over period.
27. SEVERABILITY: In the event of litigation on this
instrument and should one or more clauses be found invalid, all
other provisions of the Sublease are to stand as written.
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28. HAZARDOUS MATERIALS: With respect to any substances
defined as or included in the definition of "hazardous substances,"
"hazardous wastes," "hazardous materials" or "toxic substances"
under any applicable federal, state or local laws, ordinances or
regulations (including, without limitation, friable asbestos and
asbestos deemed hazardous by federal or state regulations) (such
substances collectively referred to hereinafter as "Hazardous
Materials" and such laws, ordinances and regulations together with
all rules, orders and permits pursuant thereto collectively
referred to hereinafter as "Hazardous Materials Laws"), Tenant:
(a) represents that neither Tenant nor any affiliate,
employee, or agent of Tenant will store, bury, install,
transport, treat or dispose of any Hazardous Materials at, to
or from the Leased Premises in violation of any applicable
Hazardous Materials Laws, or (ii) will cause or allow the
release, discharge, emission, leak, spill or dumping of any
Hazardous Materials at or from the Leased Premises except for
those releases allowed under applicable Hazardous Materials
Laws;
(b) covenants to (i) comply with all applicable Hazard-
ous Materials Laws with respect to the manufacture, storage,
transmission, presence, discharge and removal of Hazardous
Materials at or from the Leased Premises, (ii) pay promptly
within thirty (30) days of when demand is made the costs of
any required removal of any Hazardous Materials from the
Leased Premises and keep the Leased Premises free of any lien
imposed pursuant to any Hazardous Materials Laws, (iii) not
locate nor allow location of any underground storage tanks on
the Leased Premises, (iv) not locate any materials containing
asbestos of any type or nature on the Leased Premises, and (v)
notify Landlord promptly in writing of the commencement of any
legal or regulatory proceedings relating to Hazardous Materi-
als affecting the Leased Premises; and
(c) agrees to indemnify and to hold harmless Landlord,
the City of Corpus Christi, Texas, their officers, employees,
agents, successors and assigns (the "Indemnitees") from and
against, and to reimburse the Indemnitees with respect to, any
and all claims, demands, causes of action, loss, damage,
liabilities, costs, and expenses (including attorneys' fees
and court costs) of any and every kind or character, known or
unknown, fixed or contingent, asserted against or incurred by
the Indemnitees at any time or from time to time, by reason of
or arising out of any violation of any Hazardous Materials
-16-
Laws occurring since the commencement of Tenant's occupancy of
the premises (including, without limitation, all claims,
demands, loss, damage, liabilities, costs and expenses in
connection with the presence on the Leased Premises or release
from or to the Leased Premises of Hazardous Materials disposed
of or otherwise released), regardless of whether the act,
omission, event, or circumstance constituted a violation of
applicable law at the time of existence or occurrence.
Tenant's obligations hereunder shall arise upon the discovery
of the presence of any Hazardous Materials, whether or not any
federal agency or any state or local environmental agency has
taken or threatened any action in connection with the presence
of any Hazardous Materials. The foregoing indemnity shall
survive the expiration of the Sublease. In the event Tenant
fails, after reasonable notice, to pay any amounts described
in this provision, Landlord may, but shall not be obligated
to, cause the Hazardous Materials to be removed from the
Leased Premises and the cost of such removal shall be added to
the Rentals due hereunder; provided, however, that Tenant may
in good faith contest the reasonableness or necessity of any
requirement by any federal, state or local environmental
agency, and upon Tenant's providing reasonable security to
assure its performance, Landlord agrees not to interfere in
Tenant's proceedings with such agency. Landlord and the City
shall have the right to conduct an environmental audit of the
Leased Premises, and Tenant shall cooperate in the conduct of
such environmental audit.
Nothing herein shall be construed to require Tenant to be responsi-
ble for pollution or Hazardous Materials generated by any other
uses of the Leased Premises authorized by the City or the Landlord,
included but not limited to, oil and gas wells, petroleum pipe-
lines, and farming operations.
With respect to liabilities for Hazardous Materials arising
from conditions prior to the effective date of this Agreement of
Sublease, Lessee's Tenant assigns to Landlord, and its assigns, its
rights and remedies concerning such Hazardous Materials liabilities
contained in that sale and purchase agreement between said Tenant
and the prior holders of the leasehold interest under that original
Agreement of Sublease dated December 31, 1973. Tenant expressly
does not assume any liability for Hazardous Materials releases
prior to the effective date of this Agreement of Sublease. Tenant
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agrees to cooperate with the City and Landlord in the enforcement
of any such rights and remedies against Tenant's predecessors in
interest. Any such actions may be brought by the City, in its name
alone or jointly with Landlord and Tenant, provided that neither
Landlord nor Tenant shall be responsible for any court costs,
attorney's fees or other claims or liabilities associated with such
action. Landlord has assigned to the City its rights and remedies
received from Tenant described above in the Modification of Lease
referenced herein.
29. NOTICES: All notices, requests or other communications
relating to this Sublease shall be made in writing and may be given
by (i) depositing same in the United States mail, postage prepaid,
certified mail, with return receipt requested, addressed as set
forth in this paragraph, or (ii) delivering the same to the party
to be notified. Notice given in accordance with (i) hereof shall
be effective upon deposit in the United States mail. The notice
addresses of the parties hereto shall, until changed in the manner
of giving notice is provided herein, be as follows:
Landlord:
Corpus Christi Airport Development Corporation
1201 N. Shoreline Drive
P. O. Box 640
Corpus Christi, Texas 78403
Attn: Director of Aviation
Tenant: Semtech Corpus Christi Corporation
121 International Blvd.
Corpus Christi, Texas 78406
The City: City of Corpus Christi, Texas
P. O. Box 9277
Corpus Christi, Texas 78469
Mortgagee: First City, Texas - Corpus Christi
P. O. Box 4666
Corpus Christi, Texas 78469
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30. AMENDMENT: No amendment, modification, or alteration of
the terms hereof shall be binding unless the same is expressed in
writing and executed by duly authorized representatives of the
parties hereto. The City of Corpus Christi shall be made aware of
and approve in writing all amendments prior to their execution.
31. ATTORNEY'S FEES: Any party to this Sublease who is a
prevailing party in any legal proceeding against any other party
brought under or with relation to this Sublease shall be addition-
ally entitled to recover court costs, reasonable attorney's fees,
and all other out-of-pocket costs of litigation, including
deposition, travel and witness costs, from the non -prevailing
party.
32. LIENS: Tenant shall not permit any mechanics', material -
men's or other liens to be fixed or placed against the Leased
Premises and agrees immediately to discharge (either by payment or
by filing the necessary bond, or otherwise) any mechanics',
materialmen's or other lien which is allegedly fixed or placed
against the Leased Premises. Tenant reserves the right to contest
the reasonableness of any such charges or impositions against the
Leased Premises, and upon Tenant's providing reasonable security to
assure its performance, Landlord agrees not to interfere with
Tenant's contested proceedings or otherwise declare a default due
to the placement of a lien against the Premises.
33. SUCCESSORS: The covenants and agreements herein
contained shall inure to the benefit of and be binding upon the
parties hereto, their respective heirs, legal representatives,
successors and assigns.
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34. ENTIRE AGREEMENT: This Sublease contains the entire
agreement between the parties hereto, and no representations,
warranties, expressed or implied, inducements, promises or
agreements, oral or otherwise, between the parties not embodied
herein shall be of any force or effect.
35. EARLY TERMINATION OF SUBLEASE: (a) Tenant shall have
the right to terminate this Sublease at any time during the first
ten (10) years hereof by paying to Landlord a sum equal to the
aggregate principal amount of the outstanding indebtedness owing to
First City, Texas - Corpus Christi, as Mortgagee, plus the interest
which will accrue to the date such indebtedness is paid, plus the
remaining annual rental payments due for the Leased Land through
the date of said termination.
(b) Tenant shall have the option to terminate its occupancy
of the Leased Premises for the successive two additional ten (10)
year periods of the lease term upon the following terms and
conditions. Not more than two (2) years nor less than 180 days
prior to the tenth (10th) anniversary and twentieth (20th)
anniversary, respectively, of the term of the lease, Tenant shall
have the option to provide City written notice of its intent to
cause an early termination of this lease. Said termination shall
be effective upon such tenth (10th) or twentieth (20th) anniversary
of this lease, whereupon this lease shall terminate.
(c) Upon termination of this Sublease, all right, title and
interest of Tenant in the Leased Premises and Building shall cease.
36. RIGHT OF FIRST REFUSAL: Tenant shall have a right of
first refusal during the term of this Sublease to lease the 220 -
foot strip adjacent to the west side of the Leased Premises as
-20-
shown on Exhibit "A" attached hereto in accordance with the terms
and conditions of this paragraph. In the event the City obtains an
offer to lease the 220 -foot strip from a qualified tenant on terms
and conditions acceptable to the City, the City has agreed pursuant
to the Modification of Lease with Landlord to notify Landlord and
Tenant of the rental rate, terms and conditions of such offer and
afford Tenant the opportunity to sublease said 220 -foot strip at
the same rental rate, terms and conditions. Tenant shall have
thirty (30) days from the date of written notice of the offer to
tender an executed written sublease containing identical terms to
Landlord and the City at the notice addresses provided in the
notice of the offer. Notice of the offer to lease shall be deemed
given when deposited by the City in the U.S. mail, postage prepaid,
properly addressed to Landlord and Tenant and mailed by certified
mail, return receipt requested. In the event the City and Landlord
fail to receive in response a written contractual offer from Tenant
by 5:00 p.m. (Corpus Christi time) on the 30th day following the
date of notice of the offer to lease, Tenant's right of first
refusal hereunder shall terminate and be of no further force or
effect. The time period allowed for consummating the transaction
and other terms and conditions of the sublease agreement shall be
the same as set forth in the notice of the offer to sublease except
as otherwise agreed by the City, Landlord and Tenant.
37. OPTION TO PURCHASE BUILDING: At any time during the
first ten (10) years of the term of this Sublease, Tenant shall
have the option to purchase the Building and improvements related
thereto located on the Leased Land from Landlord and assume the
rights and obligations of Landlord under that Modification of Lease
-21-
of even date herewith between Landlord and the City of Corpus
Christi upon the following terms and conditions. The purchase
price for such Building and improvements shall be equal to FIVE
HUNDRED THOUSAND DOLLARS ($500,000), as adjusted by any increases
in the Consumer Price Index as maintained by the U. S. Department
of Labor (or any successor index maintained on a comparable basis
by such Department or a successor agency) from the date of this
Sublease. Provided, however, that in the event Tenant exercises
such option prior to the expiration of said ten-year period of this
Sublease, the purchase price shall be increased by an amount equal
to the balance owing by Landlord on the indebtedness incurred to
finance the construction of said Building and improvements as
evidenced by that indebtedness in the original principal amount of
$575,000.00 payable to First City, Texas - Corpus Christi, as
Mortgagee. The City shall convey title to said Building by General
Warranty Deed and furnish Tenant an Owner Policy of Title Insurance
covering the Building, at Tenant's expense. Upon the purchase of
the Building by Tenant, the Base Rentals under this Sublease shall
terminate, and Tenant shall continue to pay the Additional Rentals
for the Land Lease portion only.
38. LEASE RATE ADJUSTMENTS: During the remainder of the
Sublease term following the initial ten-year period, the Lease
rates due hereunder shall be payable as follows:
(a) In the event Tenant has exercised its option to purchase
the Building, Tenant shall only pay the Additional Rentals
comprising the land rent which shall be based on fair market value
(FMV) of the Leased Land to be calculated as follows:
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The annual rental for the Leased Land shall be based on
the fair market value of the Leased Land, excluding any
value associated with the Building or the improvements
related thereto, as determined by three appraisals. The
City shall pay for one appraiser and Tenant shall pay for
one appraiser. The City's and Tenant's appraisers shall
choose a third appraiser, and the City and the Tenant
shall each pay one-half of the third appraiser's fee.
Once the FMV has been determined for the Leased Land, the
rental rate shall be adjusted annually on the anniversary
date of the new Lease between the City and the Tenant
based on increases, or decreases, in the Consumer Price
Index issued by the Federal Government, or such other
successor index, each year.
(b) In the event Tenant does not exercise its option to
purchase the Building and improvements as above herein, Tenant
shall continue to lease the Building and improvements during the
remainder of the Sublease term at a Base Rental rate equal to
$10,000 per month, being the Base Rental rate in effect for the
Building in the tenth year of this Sublease, as such rate is
adjusted annually to cover increases in the Consumer Price Index
each year. Tenant shall additionally be responsible for the Base
Rentals covering the Leased Land as provided above.
39. TERMINATION OF LIABILITIES OF LANDLORD: Upon the
expiration of the initial ten-year period of this Sublease and the
full and final payment of the indebtedness secured by the Renewal
Deed of Trust, Tenant shall become the direct lessee of the City
under that Modification of Lease of even date herewith, and this
Sublease shall terminate. Tenant's continued occupancy of the
Leased Premises shall continue as a direct lessee of the City, and
Landlord shall be under no further obligation or liability to
either Tenant or the City for the continuation of this Sublease or
continue as a party hereto.
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40. FAA APPROVAL: All terms and conditions of this Sublease,
and any amendments hereto, are subject to FAA's prior approval. If
FAA requires any modification of this Sublease or any amendment
prior to its approval of same, such modification will be immediate-
ly furnished to Landlord and Tenant for their review. Landlord and
Tenant reserve the right to withdraw any such amendment in the
event the FAA modifications are not acceptable.
41. FAA AGREEMENT WITH CITY: This Sublease is subordinate to
provisions of any existing or future agreement between the City and
the United States of America or any agency thereof related to the
operation, development, or maintenance of the Airport, the
execution of which has been or may be required as a condition
precedent to the expenditure of federal funds for the development
of the City's Airport. Should any such agreement require modifica-
tion of this Sublease, such modification will immediately be
incorporated into the Sublease terms without need for official
action on the part of the City, Landlord or Tenant; provided,
however, that in the event such modification materially impairs the
ability of Tenant to continue its business operations on the Leased
Premises to the full extent authorized under this Sublease, Tenant
shall have ninety (90) days following receipt of notice of such
modification to elect to terminate this Sublease. The effective
date of such termination shall be as set forth in Tenant's notice
of termination, and on such effective date all liability for
further Rentals due hereunder shall cease. Notwithstanding the
foregoing, in the event any indebtedness remains secured under the
Renewal Deed of Trust at the time of such termination, such
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indebtedness shall be paid in full in a lump sum by Tenant as a
condition of termination of this Sublease.
42. NONDISCRIMINATION: (a) Tenant assures that it will
undertake an affirmative action program, as required by 14 Code of
Federal Regulations Part 152, Subpart E, to insure that no person
shall on the grounds of race, color, creed, national origin, or sex
be excluded from participating in any employment activities covered
by 14 Code of Federal Regulations Part 152, Subpart E. Tenant
assures that no person shall be excluded on these grounds from
participating in or receiving the services or benefits of any
program or activity covered by this subpart. Tenant assures that
it will require that its covered suborganizations provide assuranc-
es to Tenant that they similarly undertake affirmative action
programs and that they will require assurance from their suborgani-
zations, as required by 14 Code of Federal Regulations Part 152,
Subpart E, to the same effect.
(b) Tenant for itself and its successors in interest, and
assigns, as a part of the consideration hereof, does hereby
covenant and agree as a covenant running with the land that: (1)
no person on the grounds of race, color, or national origin shall
be excluded from participating in, denied the benefits of, or be
otherwise subjected to discrimination in the use of said facili-
ties, (2) that in the construction of any improvements on, over, or
under such land and the furnishing of services thereon, no person
on the grounds of race, color, or national origin shall be excluded
from participating in, denied the benefits of, or otherwise subject
to discrimination, (3) that Tenant shall use the Premises in
compliance with all other requirements imposed by or pursuant to 49
-25-
CFR Part 21, Nondiscrimination in Federally Assisted Programs of
the Department of
amended.
(c) That, in the event
nondiscrimination covenants,
Transportation, and as said regulations may be
of breach of
after written
any of the proceeding
notice of default and
opportunity to cure as provided herein the Landlord shall have the
right to terminate this Sublease and to reenter and repossess said
land and the facilities thereon, and hold the same as if said
Sublease had never been made or issued.
43. HEIGHT RESTRICTIONS: Tenant shall restrict the height of
structures, objects, or natural growth and other obstructions on
the Leased Premises to such a height as to comply with Federal
Aviation Regulations, Part 77, as same may be amended.
44. NONINTERFERENCE: Tenant shall prevent any use of the
Leased Premises which would interfere with or adversely affect the
operation or maintenance of the City's Airport, or otherwise
constitute a hazard to the Airport.
45. RIGHT TO AIRSPACE: City has reserved to itself, its
successors and assigns, for the use and benefit of the public, a
free and unrestricted right of flight for the passage of aircraft
in the airspace above the surface of the Leased Premises, together
with the right to cause in such airspace such noise as may be
inherent in the operation of aircraft, now known or hereafter used
for navigation of or flight in the air, using said airspace for
landing at, taking off from, or operating on or about the Airport.
46. 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
-26-
expressly 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 time 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 public enemy, orders of any kind of the Government of the
United States or the State of Texas or any civil or military
authority, insurrections, riots, restraining of government and
people, epidemics landslides, lightning, earthquakes, fires,
hurricanes, storms, floods, washouts, droughts, arrests, civil
disturbances, explosions, breakage or accidents to machinery,
transmission pipes or canals, partial or entire failure of
utilities, shortages of labor, material, supplies or transporta-
tion, or any other cause not reasonably within the control of the
party claiming such inability. It is understood and agreed that
the settlement of existing or impending strikes, lockouts or other
industrial disturbances shall be entirely within the discretion of
the party having the difficulty and that the above requirements
that any force majeure shall be remedied with all reasonable
dispatch shall be deemed to be fulfilled even though such existing
or impending strikes, lockouts, and other industrial disturbances
-27-
may not be settled and could have been settled by acceding to the
demands of the opposing person or persons.
47. AUTHORITY OF PARTIES: Each party signing this Sublease
by its signature certifies that it possesses authority to execute
this Sublease, and all amendments thereto, and be bound thereby,
and that all prerequisites to such authorized execution have been
accomplished.
48. MEMORANDUM OF SUBLEASE: Landlord agrees to execute a
Memorandum of Sublease in recordable form outlining the basic terms
of this Sublease, including Tenant's right of first refusal and
option to purchase as provided herein, and Tenant may record such
Memorandum of Sublease in the Real Property Records of Nueces
County, Texas, at its own expense.
49. GUARANTY OF SUBLEASE: Semtech Corporation (the "Guaran-
tor"), for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and to induce Landlord
to enter into this Agreement of Sublease with Tenant, and at the
special insistence and request of Landlord, hereby unconditionally
guarantees the prompt payment and performance of all obligations
and liabilities of any kind whatsoever by Tenant to Landlord under
this Agreement of Sublease. This guaranty is an absolute,
completed and continuing one. No demand upon Guarantor shall be
required for the effectiveness of this obligation on the part of
Guarantor. Guarantor specifically authorizes Landlord, without
further notice and without affecting the enforceability of this
guaranty to deal in all matters arising under this Agreement of
Sublease directly with Tenant and to enforce, waive or release any
of the terms and conditions hereof. Guarantor waives any right to
-28-
require Landlord to proceed against the Tenant or exercise any
right of setoff or pursue any other remedies against Tenant within
Landlord's power whatsoever. This guaranty shall continue in full
force and effect for the term of the Agreement of Sublease and for
a period of four years thereafter or until all obligations of
Tenant are fully discharged hereunder, whichever shall occur first.
This guaranty does not supersede, cancel, amend, discharge or limit
any other obligations of Tenant under this Agreement of Sublease,
but this guaranty is in addition to and cumulative of any other
remedies available to Landlord.
EXECUTED in original copies this the day of
, 1991, to be effective as of January 1,
1991.
Landlord Tenant
CORPUS CHRISTI AIRPORT SEMTECH CORPUS CHRISTI
DEVELOPMENT CORPORATION CORPORATION
By.
G. Robert Welch
President
By:
Name:
Title:
GUARANTOR:
ATTEST: SEMTECH CORPORATION
By By:
John W. Cr field Name:
Vice Pres].ent Title:
-29-
This Sublease is approved and accepted by Juan Garza as City
manager of the City of Corpus Christi this day of ,
1991.
ATTEST: CITY OF CORPUS CHRISTI
By: By:
Armando Chapa Juan Garza
City Secretary City Manager
APPROVED:
THIS DAY OF , 1991.
By:
City Attorney
\ 11 \ W ork.91 \assemtec .15415 /238
-30-
EXHIBIT A
Being a 6.162 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, Teras, said
6.162 acre tract of land being more particularly described by metes and bounds as
follows:
Beginning at 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. 50 feet to
a point in the west right-of-way of the International Drive;
Thence S. 1° 19' 56" B. along a line 50' westerly of and parallel to the east boundary
of said Block 23, a distance of 50' to the true point of beginning of the herein
described tract; thence continuing S. 1° 19' 56" E., a distance of 610.0 feet to 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-way line of said State Highway No. 44, a distance of 440.0 feet to the
southwest corner of the tract herein described;
Thence N. 1° 19' 56" W., with a line that is 440.0 feet west of and parallel to the west
line of International Drive, a distance of 610.0 feet to the northwest corner of the
tract herein described;
Thence N. 88° 35' 46" E. along a line 50' southerly of and parallel with the south
right-of-way line of State Highway No. 44, a distance of 440.0 feet to the point of
beginning and containing 6.16162 acres more or less.
at the foregoing ordinance was read fo the first time and passed to its second reading on '
e I day of ‘,� ti' (II��G� 19�
Mary Rhodes
Cezar Galindo
Leo Guerrero
Betty Jean Longoria
That the f
this theo2
, by the following vote:
Edward A. Martin
Joe McComb
Dr. David McNichols
Clif Moss
Mary Pat Slavik
egoing ord' ante was rad for thesecond time and passed to its third reading on
day of y. C QtC rrk "(kW , 197 / , by the following vote:
Mary Rhodes
Cezar Galindo
Leo Guerrero
Betty Jean Longoria
y
(L r
That the . re of ordinance s read for the
Edward A. Martin
Joe McComb
Dr. David McNichols
Clif Moss
Mary Pat Slavik
third time and passed finally on this the ,92\
dayof �i '[
, 1 / , by the following vote:
J
(ter
Mary Rhodes
Cezar Galindo
Leo Guerrero
Betty Jean Longoria
Edward A. Martin
Joe McComb
Dr. David McNichols
Clif Moss
Mary Pat Slavik
�1��
PASSED AND APPROVED, this the J(day of ei'L�'l,l� , 19qr.
AI ST:
City Secretary MA OR
THE Y OF CORPUS CHRISTI
APPROVED: 6, DAY OF 2cest , 10>i
JAMES R. BRAY, JR., CITY ATTORNEY
By,
044
t ; ��� y, Assistant City Attorney
PUBLISHER'S AFFIDAVIT
State of Texas, ) CITY OF CORPUS CHRISTI
County of Nueces } ss: Ad #64097
PO #
Before me, the undersigned, a Notary Public, this day personally
came Kerri Lesmeister, who being first duly sworn, according to
law, says that she is a Business Office Secretary of the Corpus
Christi Caller -Times, a daily newspaper published at Corpus
Christi in said County and State, generally circulated in
Aransas, Bee, Brooks, Cameron, Duval, Hidalgo, Jim Hogg, Jim
Wells, Karnes, Kenedy, Kleberg, Live Oak, Nueces, Refugio, San
Patricio, Victoria, and Webb Counties, and that the publication
of NOTICE OF PASSAGE OF ORDINANCE ON SECOND READING AUTHORIZING
which the annexed is a true copy, was published in the Corpus
Christi Caller -Times on the 29th day of September 1991.
One Time(s)
$ 94.50
t
Business Office Secretary
Subscribed and sworn to before me this 2nd day of
October , 1991.
- L ,ca kAY
Notary Public, Nueces County, Texas
My commission expires on
PUBLISHER'S AFFIDAVIT
State of Texas, } CITY OF CORPUS CHRISTI
County of Nueces } ss: Ad 462241
PO #
Before me, the undersigned, a Notary Public, this day personally
came Kerri Lesmeister, who being first duly sworn, according to
law, says that she is a Business Office Secretary of the Corpus
Christi Caller -Times, a daily newspaper published at Corpus
Christi in said County and State, generally circulated in
Aransas, Bee, Brooks, Cameron, Duval, Hidalgo, Jim Hogg, Jim
Wells, Karnes, Kenedy, Kleberg, Live Oak, Nueces, Refugio, San
Patricio, Victoria, and Webb Counties, and that the publication
of NOTICE OF PASSAGE OF ORDINANCE NO. 021269 AUTHORIZING THE
which the annexed is a true copy, was published in the Corpus
Christi Caller -Times on the 27th day of October 1991.
One Time(s)
$ 91.80
Business Office Secretary
Subscribed and sworn to before me this 31st day of
October , 1991.
t r a V (abov eo2
Notary Public, Nueces County, Texas
My commission expires on
PUBLISHER'S AFFIDAVIT
State of Texas, }
County of Nueces } ss:
CITY OF CORPUS CHRISTI
Ad #64471
PO #
Before me, the undersigned, a Notary Public, this day personally
came Kerri Lesmeister, who being first duly sworn, according to
law, says that she is a Business Office Secretary of the Corpus
Christi Caller -Times, a daily newspaper published at Corpus
Christi in said County and State, generally circulated in
Aransas, Bee, Brooks, Cameron, Duval, Hidalgo, Jim Hogg, Jim
Wells, Karnes, Kenedy, Kleberg, Live Oak, Nueces, Refugio, San
Patricio, Victoria, and Webb Counties, and that the publication
of NOTICE OF PASSAGE OF ORDINANCE ON FIRST READING AUTHORIZING
which the annexed is a true copy, was published in the Corpus
Christi Caller -Times on the 22nd day of September 1991.
One Time(s)
S 90.45
mill l_ LiK t 91
Business Office Secretary
Subscribed and sworn to before me this 24th day of
September , 1991.
00(0 l.L1/11(1(4/
Notary Public, Nueces County, Texas
My commission expires on
..err. .
NOTICE OF 156AGE OF OR-
DINANCER �f PIIRRT READING
AUTHO/IG r EXECU- p
TION OF A 10 YEAR LEASE N
AGREIMENT BETWEEN CITY T
OF CORPUS CHRISTI, TEX-
AS. AND CORPUS CHRISTI g
AIRPORT DEVELOPMENT b
CORPORATION; APPROVING Ti
AND AUTHORIZING EXECU- bi
TION OF A 10 YEAR bt
SUBLEASE BY CORPUS TI
CHRISTI AIRPORT DEVELOP- ce
MENT CORPORATION TO
SEMTECH CORPUS CHRISTI B
CORPORATION OF THIS
PROPERTY LEASED TO COR-
PUS CHRISTI AIRPORT
DEVELOPMENT CORPORA-
TION; AUTHORIZING CITU OF b,
CORPUS CHRISTI TO EXE- 1!
CUTE A 20 YEAR LEASE
WITH SEMTECH CORPUS 0
CHRISTI CORPORATION ON 1
THE SAME TERMS AND b.
CONDITIONS UPON TERMI-
NATION OF THE 10 YEAR c
LEASE AND SUBLEASE 3
ABOVE REFERENCED; AND
PROVIDING FOR PUBLICA•
TION; the term will be fbr 0
thirty years; at the end of tan c
years, the sublease involving v
the Airport Development Cor-
poration wig terminate upon
payment of $575,000 and I
Semtech will then beoortr e
tenant of the City. Payment to
the City will be $1,970 per
year for four years; $3,940
per Year for the next six
years, and rentals for the re-
maining twenty years will be
based on fair market -value of
the land as determined by
three appraisals. Rentals for
the building to Airport Devel-
opment Corporation will be
$6,000 per month for the first
three years, 59,000 per
month for the next three
years, and $10000 for the
last four years. At the end of
ten years, Semtech may pur-
chase the building for
$500,000 or continue to
lease the building for $10,000
per month.
The ordinance was passed
and approved on first
reading by the City Council of
the City of Corpus Christi,
Texas on the 17th day of
September. 1991.
IN
I*41,01 Cense
/ NOTICE OF PASSAGE
OF ORDINANCE NO. 021269
AUTHOIIZ1NO THE EXECU-
TION OF A 10 YEAR LEASE
AGREEMENT BETWEEN CITY
OF CORPUS CHRISTI, TEX-
AS, AND CORPUS CHRISTI
AIRPORT DEVELOPMENT'
CORPORATION: APPROVING
AND AUTHORIZING EXECU-
TION OF A 10 YEAR
SUBLEASE BY CORPUS
CHRISTI AIRPORT DEVELOP-
MENT CORPORATION TO
SEMTECH CORPUS CHRISTI
CORPORATION OF THIS
PROPERTY LEASED TO COR-
PUS CHRISTI AIRPORT
DEVELOPMENT CORPORA-
TION: AUTHORIZING CITY OF
CORPUS CHRISTI TO EXE-
CUTE A 20 YEAR LEASE
WITH SEMTECH CORPUS
CHRISTI CORPORATION ON
THE SAME TERMS AND
CONDITIONS UPON TERMI-
NATION OF THE 10 YEAR
LEASE AND SUBLEASE
ABOVE REFiRENCED: AND
PROVIDING FOR PUBLICA-
TION: es term will be for
thirty yfls; at the and of ten
years, theaublease involving
the Airport Development Cor-
poration will terminate upon
payment of $575,000 and
Semtech will then become a
tenant of the City. Payment to
the City will be $1,970 per
year for four years; 53,940
per year for the next six
years: and rentals for the re-
maining twenty years will be
based on fair market value of
the land as determined by
three appraisals. Rentals tot
the building to Airport Devel-
opment Corporation will be
56.000 per month for the first
three years, $9,000 per
month for the next three
years, and 510.000 for the
laet four yeaAt the end of
ten years, Sers.mtech may pur-
chase the building for
$500,000 or continue to
lease the building for $10,000
per month.
A copy of the lease is on file
in the City Secretary's office.
The ordinance was passed
and approved on third reading
by the City Council of City of
Corpus Christi, Texas on the
22nd day of October, 1991.
/s/ Armando Chapa
City Secretary
City of Corpus Christ
ND
OF
unloo MIe, -• �(ECU-
' ION OF A to YSMUASE
AGREEM INT $TWEEN CITY
SOF CORPUS CHRISTI, TEX-
AS, AND CORPUS CHRISTI
AIRPORT DEVELOPMENT!
CORPORATION: APPROVING
AND AUTHORIZING EXECU-
TION OF A 10 YEAR
SUBLEASE BY CORPUS
CHRISTI AIRPORT DEVELOP-
' WENT CORPORATION TO
I SEMTECH CORPUS CHRISTI
i CORPORATION OF THIS
I PROPERTY LEASED TO COR -
'PUS CHRISTI AIRPORT
DEVELOPMENT CORPORA-
TION; AUTHORIZING CITY OF
CORPUS CHRISTI TO EXE-
CUTE A 20 YEAR LEASE
WITH SEMTECH CORPUS
CHRISTI CORPORATION ON
THE SAME TERMS AND
CONDITIONS UPON TERMI-
NATION OF THE 10 YEAR
LEASE AND SUBLEASE
ABOVE REFERENCED; AND
PROVIDING FOR PUBLICA-
TION: me term will be for
thirty years; at the end of ten
years. the subteen involving
the Airport Development Cor-
- poration will terminate upon
payment of 5676.000 and
Semtech will then become a
tenant of the City. Payment to
the City WI be 91,970 per f
year for four years; 93,940 s,
par yew for -the next six P
years; and senna for the re- h
minify twenty years will be 1
based on fair market value of 1
the land n determined by tl
three appraisals. Renals for
the Ebidingo� Airport Devel- b
opment Corporation will be -
96.000 per month for the fin P
three years, 99.000 per d
Mow Ci
years, rhe 910,000 for the tfor the S:
Int four years. At the end of A,
ten yearn, Sennett may pur- an
chase the building for In
9500,000 orntinue 10 Rlia
lease the building
per month. re
A copy of the Nan is on file a.1
in the City Secretary's office. Bi
The ordinance was passed AI
and approved on second ch
reading by the City Council of ca
the City of Corpus Christi, al
Tens on the 24th day of lea
September. 1991.
/s/ Armando Chapa J
Cita ilearetary K
C-rq of CoPOIN Caristi a
- '•' ''IL# t