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HomeMy WebLinkAboutResolution - 2004-R0558 - Lease Agreement - S And H Metal Works & Manufacturing, Inc. - 11_18_2004Resolution No. 2004-RO558 November 18, 2004 Item No. 22 RESOLUTION BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK: THAT the Mayor of the City of Lubbock BE and is hereby authorized and directed to execute for and on behalf of the City of Lubbock a Lease Agreement with S and H Metal Works & Manufacturing, Inc. at Lubbock International Airport, and all related documents. Said Agreement is attached hereto and incorporated in this Resolution as if fully set forth herein and shall be included in the minutes of the Council. Passed by the City Council this 18th day of November '2004. ATTEST: eb cca Garza, City Secretary ED AS TO Loomis, )r of Aviation APPROVED AS TO FORM: Linda L. Chamales, Senior Attorney Office Practice Section Sh/cityatt/Linda&ccdocs/Res- S & H Lease - October 29, 2004 Resolution No. 2004-RO558 November 18, 2004 Item No. 22 THE STATE OF TEXAS § KNOW ALL MEN BY THESE PRESENTS: COUNTY OF LUBBOCK § LEASE AGREEMENT This LEASE AGREEMENT, hereinafter referred to as the "Agreement" or "Lease," is entered into at Lubbock, Texas, by and between the CITY OF LUBBOCK (referred to herein as Lessor) and S & H METAL WORKS & MANUFACTURING, INC. (referred to herein as Lessee). WITNESSTH: WHEREAS, Lessor owns, controls and operates the Lubbock International Airport (referred to herein as Airport), situated at Route 3, Lubbock, Lubbock County, Texas, and has the authority to grant certain rights and privileges with respect thereto, including those hereinafter set forth: and WHEREAS, Lessor deems it advantageous to itself and to its operation of the Airport to lease unto Lessee the premises described herein, together with certain privileges, rights, uses and interests therein, as hereinafter set forth; and WHEREAS, Lessee is a corporation primarily engaged in fabricating steel products and storage of parts and equipment; and WHEREAS, Lessee desires to lease certain Airport -owned building and land located in the East Airport District of the Lubbock International Airport from which to conduct its business; WHEREAS, the Airport Board of the City of Lubbock has approved and recommends that Lessee be granted this Agreement for the term designated below; and WHEREAS, the City Council of the City of Lubbock accepts the recommendation of the Airport Board and finds that execution of this Lease will properly serve the public interest of the citizens of the City of Lubbock; 4 NOW THEREFORE, for and in consideration of the mutual promises, covenants, terms and conditions, both general and special, as hereinafter set forth, Lessor hereby grants to Lessee the rights and privileges hereinafter described; Lessee agrees to accept the duties, responsibilities and obligations as hereinafter set forth; and the parties hereto, for themselves, their successors and assigns, agree as follows: ARTICLE ONE DEMISE OF LEASED PREMISES 1.01 LEASED PREMISES Lessor does hereby lease unto Lessee the premises described and being: The building and land as shown on Exhibit "A" attached hereto and incorporated herein by reference, which building and land are hereinafter referred to as "leased premises" or "premises." 1.02 PURPOSE AND PRIVILEGES Lessee shall use the leased premises solely for the purpose of conducting those business activities for which it was chartered as a corporation. Nothing in this Agreement shall be construed as granting to Lessee any right to operate any other business or concession on the airport premises except as enumerated herein. 1.03 PUBLIC BENEFIT If Lessee is authorized by this Lease to conduct business of any nature on the Airport, Lessee agrees to operate the leased premises for the use and benefit of the public and further agrees: A. To use reasonable efforts to furnish good, prompt and efficient services adequate to meet all the demands for its services at the Airport; B. To furnish said services on a fair, equal and not unjustly discriminatory basis to all users thereof; and C. To charge fair, reasonable and nondiscriminatory prices for each unit of sale or service, provided that the Lessee may make reasonable nondiscriminatory discounts, rebates or other similar types of price reductions for volume purchases. S & H METAL WORKS -2- ARTICLE TWO TERM 2.01 TERM. The term of this Agreement shall be for a period of five (5) years, commencing on December 1, 2004 and ending on November 30, 2009. Lessor and Lessee shall mutually agree to extend this Agreement for one (1) additional five (5) year period. Such option must be in writing thirty (30) days prior to the expiration of the initial term of this Lease. 2.02 HOLDOVER. If Lessee holds over and continues in possession of the premises after the lease term (or any extension thereof) expires, such hold over will not constitute a renewal of the Agreement. Lessee shall be considered to be occupying the premises on an at will tenancy, subject to all terms of this Lease. ARTICLE THREE RENTALS AND FEES 3.01 RENTAL. In consideration of the rights and privileges herein granted, Lessee shall pay to the Lessor the following rentals and fees: A. Building: Rental for 37,654 square feet at $0.65 per square foot per year. Annual rental shall be in the amount of TWENTY-FOUR THOUSAND FOUR HUNDRED SEVENTY-FIVE AND 10/100 DOLLARS ($24,475.10) per year, which shall be made in monthly payments in the amount of TWO THOUSAND THIRTY-NINE AND 59/100 DOLLARS ($2,039.59) per month. B. Consumer Price Index: On January 1, 2006, and each year thereafter on the same month and day for the remainder of the term of this Agreement, the rental shall be adjusted upward or downward in accordance with the increase or decrease for the preceding twelve (12) months in the Consumer Price Index (CPI) for All Urban Consumers, published by the Bureau of Labor Statistics of the United States Government. S & H METAL WORKS -3- 3.02 PAYMENTS. All rental payments are due and payable on or before the 20" day of each month this Agreement is in effect and shall be made at the office of the Director of Aviation, Lubbock International Airport, Rt. 3 Box 389, Lubbock, Texas 79403. Lessee shall pay Lessor a late payment charge of five percent (50/0) of the total amount of past due rentals if payment of such rentals is not made when due. 3.03 DEFAULT FOR FAILURE TO PAY RENTALS OR FEES. If Lessee fails to pay any rent due and owing to Lessor hereunder within fifteen (15) days of the due date, the Director of Aviation of Lessor shall provide written notice to the Lessee. Thereafter, if the rent remains unpaid for more than fifteen (15) days after such notice is received, Lessor may exercise its rights under Article Seven of this Agreement. ARTICLE FOUR RIGHTS RESERVED TO LESSOR The following rights are reserved unto Lessor, and Lessee agrees that all rights, powers and privileges granted under this Lease shall be subordinated to Lessor's rights as hereinafter stated: 4.01 AIRPORT SAFETY. Lessor reserves the right to take any action it considers necessary to protect the aerial approaches of the Airport against obstruction, together with the right to prevent Lessee from constructing or permitting construction of any building or other structure on or off the Airport which, in the opinion of Lessor, would limit the usefulness of the Airport or constitute a hazard to aircraft. 4.02 MAINTENANCE OF PUBLIC AREA. Lessor reserves the right, but shall not be obligated to Lessee, to maintain and keep in repair the landing area of the Airport and all publicly -owned facilities of the Airport. Lessee will perform no maintenance activities outside the leased premises without the consent of the Lessor's Director of Aviation. 4.03 STANDARDS. Lessor reserves the right to establish reasonable standards for the construction, maintenance, alterations, repairs, additions or improvements of Lessee's facilities. This includes structural design, color, materials used, landscaping and maintenance of Lessee's facilities and leased premises. S & H METAL WORKS -4- 4.04 TIME OF EMERGENCY. In the event of a war or national emergency, the Lessor shall have the right to lease the landing area and any other portion of the Airport to the United States for governmental use and, if such lease is executed, the provisions of this instrument, insofar as they are inconsistent with the provisions of the lease to the United States, shall be suspended. 4.05 DEVELOPMENT OF AIRPORT. Lessor reserves the right to further develop or improve the Airport as Lessor sees fit in a reasonable and nondiscriminatory manner. However, the Lessor shall notify Lessee in writing, prior to planned development effecting Lessee's Leased Premises. 4.06 SPONSOR'S ASSURANCE SUBORDINATION. This Agreement shall be subordinate to the provisions of any existing or future agreement between Lessor and the United States concerning the operation and 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 Airport. Should the effect of such agreement with the United States be to take any of the property under lease or otherwise diminish the commercial value of this Lease, the Lessor shall not be held liable therefor. The Lessor covenants and agrees that it will during the term of this Agreement operate and maintain the Airport as a public facility consistent with and pursuant to the Assurances given by the Lessor to the United States Government under federal law. ARTICLE FIVE RIGHTS & LIMITATIONS OF LESSEE 5.01 ACCESS. Lessee is herein granted the right of ingress to and egress from the leased premises over and across common or public roadways serving the Airport. Such right of ingress and egress, however, shall be subject to all laws, ordinances, rules and regulations now existing or hereafter promulgated by the City of Lubbock or other lawful authority. 5.02 WAGES. To the extent that it is applicable, Lessee shall comply with Ch. 2258, Tex. Govt. Code. S & H METAL WORKS -5- 5.03 LESSEE'S DUTY TO REPAIR. Any property of the Lessor or any property for which the Lessor may be responsible, which is damaged or destroyed incident to the exercise of the privileges herein granted, or which damage or destruction is occasioned by the negligence of Lessee, its employees, agents, servants, patrons or invitees, shall be properly repaired or replaced by the Lessee to the satisfaction of the Director of Aviation of Lessor, or in lieu of such repair or replacement, Lessee shall, if so required by the Director of Aviation, pay Lessor the replacement cost of such property. 5.04 PARKING. Lessee shall at its sole cost and expense provide adequate and suitable parking areas for use by its customers, employees, patrons, guests, and invitees. 5.05 WARRANTY OF NO SOLICITATION. Lessee warrants that it has not employed any person employed by the Lessor to solicit or secure this Agreement upon any agreement for a commission, percentage, brokerage or contingent fee. ARTICLE SIX GENERAL CONDITIONS This Lease is granted subject to the following provisions and conditions. Failure of the Lessee to comply with any requirement of Article Six shall be cause for immediate termination of this Agreement by Lessor. 6.01 RULES AND REGULATIONS. Lessor reserves the right to issue through its Director of Aviation such reasonable rules, regulations and procedures for activities and operations conducted on the Airport as deemed necessary to protect and preserve the safety, security and welfare of the Airport and all persons, property and facilities located thereon. The Lessee's officers, agents, employees and servants will obey all rules and regulations which may be promulgated from time to time by the Lessor or its authorized agents at the Airport, or by other lawful authority, to ensure the safe and orderly conduct of operations and traffic on the Airport. Lessee shall pay for all licenses, permits, clearances, rights -of -way and other matters necessary to conduct business. Lessee shall pay all fees, taxes and charges assessed under State, local or Federal statutes or ordinances insofar as they are applicable. S & H METAL WORKS -6- 6.02 ADDITIONS, IMPROVEMENTS OR ALTERATIONS. Lessee shall not make, permit or suffer any additions, improvements or alterations to the leased premises which constitute any major structural change or changes without first submitting plans and specifications for such additions, improvements or alterations to the Lessor's Director of Aviation and securing prior written consent from the Director of Aviation. Any such additions, improvements or alterations made with the consent of the Director of Aviation shall solely at the expense of the Lessee and, unless such consent provides specifically that title to the additions or improvements so made shall vest in the Lessee, title thereto shall at all times remains in Lessor, and such additions or improvements shall be subject to all terms and conditions of this Agreement, provided however, that any trade fixtures installed by Lessee may be removed by Lessee at its expense. The Lessee agrees to hold Lessor harmless from all Mechanic's and Materialman's Liens arising from any construction, additions, improvements, repairs or alterations effected by the Lessee. Any property installed or added by Lessee which becomes permanently attached to the Leased Premises shall become the property of Lessor upon termination of this Agreement, provided however, that any trade fixtures installed by Lessee may be removed by Lessee at its expense. 6.03 ADVERTISING. The Lessee will erect no outdoor advertising or identification signs and will distribute no advertising on the Airport without the prior written consent of the Lessor's Director of Aviation. Said consent will not be unreasonably withheld. However, such prior written consent shall not be required for advertising placed by Lessee with any other party having the right to sell, rent or offer Airport terminal advertising space. 6.04 LIENS PROHIBITED. The Lessee shall not bind or attempt to bind the Lessor for payment of any money in connection with the construction, installations, alterations, additions or repairs on the leased premises or any Lessee's equipment or facilities located on the leased premises, and Lessee shall not permit any mechanic's, materialsman's or contractor's liens to arise against the leased premises or any improvements thereon, or any equipment, machinery or fixtures thereon belonging to the Lessor, and Lessee expressly agrees that it will keep and save the premises and the Lessor harmless from all S & H METAL WORKS -7- costs and damages resulting from any liens of any character created or that may be asserted through any act or thing done by Lessee. In the event that, as a result of Lessee's actions, any mechanic's lien or other lien or order for payment shall be filed against the leased premises or improvements thereon, or against Lessor -owned property located thereon during the initial term hereof, or during any subsequent extension, Lessee shall defend on behalf of the Lessor, at Lessee's sole cost and expense, any action, suite or proceeding which may be brought thereon or for the enforcement of such lien or order. Failure of the Lessee to comply with any requirement of this section after having received fifteen days written notice thereof shall be cause for termination of this Agreement by the Lessor. 6.05 INSPECTION OF LEASED PREMISES. Lessee agrees that the leased premises will be kept reasonably clean and free of all debris and other waste matter. Lessor, acting by and through the Director of Aviation or other designated representative, shall have the right to conduct inspections of the leased premises at all reasonable times to ensure that fire, safety and sanitation regulations and other provisions contained in this lease are being adhered to by the Lessee. 6.06 CUSTODIAL AND MAINTENANCE SERVICES. The Lessee shall, at its own cost and expense, maintain the leased premises, in a safe, clean, and presentable condition reasonably free of trash, debris and weeds and consistent with good business practices. Lessee shall repair all damages to said leased premises caused by its employees, patrons or business operations thereon; shall perform all maintenance and repair to the interior, including all HVAC and venting systems; and shall repaint the building as necessary to maintain a clean and attractive appearance. Lessee shall also maintain any drainage structures or other improvements installed for the benefit of Lessee, septic systems, ceilings, roofs, floor coverings, locks, doors, overhead doors, specialized ramp doors, window glass, parking lots, and/or surfaces used for employee and/or customer parking. Lessor shall assume no responsibility for the condition of the leased premises and shall not assume any responsibility for maintenance, upkeep or repair necessary to keep the premises in a safe and serviceable condition. Upon written notice by Lessor to Lessee, Lessee shall be required to perform whatever reasonable maintenance Lessor deems necessary. If said maintenance is not undertaken S & H METAL WORKS -8- by Lessee within twenty (20) days after receipt of written notice, Lessor shall have the right to enter upon the leased premises and perform the necessary maintenance, the cost of which shall be borne by Lessee. Lessee shall not, in any case, be required to pay for cost of mitigation, abatement or removal of asbestos not installed by Lessee. 6.07 UTILITIES. Lessee shall pay or cause to be paid all charges for water, heat, gas, electricity, sewers, and all other utilities used on the premises throughout the lease term. Lessee shall have the right, with written approval of Lessor, to connect to any storm and sanitary sewers and water and utility outlets, the cost of usage, extension, installation and meters, where required, to be borne by the Lessee. 6.08 TRASH, GARBAGE, REFUSE, ETC. Lessee shall provide a complete and proper arrangement for the adequate sanitary handling and disposal, away from the Airport, of all trash, garbage and other refuse produced as a result of Lessee's business operations on the leased premises. 6.09 TAXES, FEES, ASSESSMENTS AND LICENSE. The Lessee agrees to pay promptly when due all federal, state and local government taxes, license fees and occupation taxes levied on either the leased premises or on the business conducted on the leased premises or on any of Lessee's property used in connection therewith, except as provided herein. Taxation may be subject to legal protest in accordance with the provisions of the taxing authority whose levy is questioned. Any protest is at the sole expense of Lessee. Delinquency in payment of such obligations after any protest has been settled shall, at the option of the Lessor, be cause for immediate termination of this lease. 6.10 INDEMNIFICATION The Lessee shall be deemed to be an independent contractor and operator responsible to all parties for its respective acts and omissions, and the Lessor shall in no way be responsible therefore. Lessee shall indemnify and hold harmless, to the fullest extent permitted by law, Lessor, and Lessor's respective officers, employees, elected officials and agents, from and against any and all losses, damages, claims or liabilities, of any kind or nature, which arise directly or indirectly, or are related to, in any way, manner or form, the activities of Lessee contemplated hereunder, or the omission of the Lessee's activities contemplated hereunder. Lessee further covenants and agrees to defend any suits or administrative proceedings brought against Lessor and/or Lessor's respective officers, S & H METAL WORKS -9- employees, elected officials and/or agents on account of any claim for which it is obligated to indemnify Lessor, and to pay or discharge the full amount or obligation of any such claim incurred by, accruing to, or imposed on Lessor, or Lessor's respective officers, employees, elected officials and/or agents, as applicable, resulting from any such suits, claims, and/or administrative proceedings or any matters resulting from the settlement or resolution of said suits, claims, and/or administrative proceedings. In addition, Lessee shall pay to Lessor, Lessor's respective officers, employees, elected officials and/or agents, as applicable, all attorneys' fees incurred by such parties in enforcing Lessee's indemnity in this section. Indemnification — Environmental Harm. Without limiting any provisions of this Agreement, Lessee shall also defend, indemnify and hold Lessor and its respective officers, employees, elected officials and agents harmless from and against all suits, actions, claims, demands penalties, fines liabilities, settlements, damages, costs and expenses (including but not limited to reasonable attorney's and consultant's fees, court costs and litigation expenses) of whatever kind or nature, known or unknown, contingent or otherwise, brought against Lessor arising out of or in any way related to: 1. Any actual, threatened or alleged contamination by hazardous substances of the premises or contamination by hazardous substances of the Airport by Lessee or its agents; 2. The presence, disposal, release or threatened release of hazardous substances by Lessee or its agents at the Airport that is on, from or affects the soil, air, water, vegetation, buildings, personal property, persons, animals or otherwise; 3. Any personal injury (including wrongful death) or property damage (real or personal) arising out of or related to hazardous substances by Lessee at the Airport; or 4. Any violation by Lessee of any Environmental Laws that affects the Airport. 6.11 INSURANCE Lessee shall carry and maintain insurance at all times that this Lease is in effect, at Lessee's sole expense with an insurance underwriter authorized to do business in the State of Texas and acceptable to the Lessor, against claims of general liability and workers' compensation resulting from Lessee's business activities at the Airport. S & H METAL WORKS -10- General Liability Insurance — The amount of insurance coverage shall not be less than THREE HUNDRED THOUSAND AND N0/100 DOLLARS ($300,000.00) for Combined Single Limit General Liability Insurance. Workers' Compensation and Employers Liability Insurance — Lessee shall elect to obtain workers' compensation coverage pursuant to Section 406.002 of the Texas Labor Code. Further, Lessee shall maintain said coverage throughout the term of this Agreement and shall comply with all provisions of Title 5 of the Texas Labor Code to ensure that the Lessee maintains said coverage. Any termination of worker's compensation insurance coverage by Lessee or any cancellation or nonrenewal of worker's compensation insurance coverage for the Lessee shall be a material breach of this Agreement. Hazard and Extended Coverage — Lessee shall purchase its own Hazard and Extended Coverage insurance based on building market value, provided that Lessor approves of the amount and type of insurance purchased by Lessee. Lessor shall be named as an additional insured on the policy. Lessee shall furnish the Director of Aviation with evidence that such insurance coverage has been procured and is being maintained. The above -mentioned policies shall all include a waiver of subrogation. Certificates of insurance or other satisfactory evidence of insurance shall be filed with the Lessor's Director of Aviation prior to entry upon the Premises by the Lessee. The General Liability policy shall name the Lessor as an additional insured, require the insurer to notify the Director of Aviation of any alteration, renewal or cancellation, and remain in full force and effect until at least ten (10) days after such notice of alteration, renewal or cancellation is received by the Director of Aviation. 6.12 NON-DISCRIMINATION PRACTICES. Lessee, its agents and employees will not discriminate against any person or class of persons by reason of age, sex, race, color, handicap, religion or national origin in providing any services or in the use of any of its facilities provided for the public, in any manner prohibited by Federal Aviation Administration Regulations. Lessee further agrees to comply with such enforcement procedures as the United States Government might demand that the Lessor take in order to comply with the Sponsor's Assurances. S & H METAL WORKS -11- Lessee agrees not to illegally discriminate against any employee or applicant for employment because of age, sex, race, color, handicap, religion or national origin. 6.13 BUSINESS SOLICITATIONS. All of Lessee's business operations and solicitations will be confined to the leased premises or such other premises at the Airport that have been leased to Lessee. 6.14 NO ASSIGNMENT OR SUBLETTING. Lessee will not directly or indirectly assign, sublet, sell, hypothecate or otherwise transfer this Lease or any portion of the leased premises without the prior written consent of Lessor's Director of Aviation. No such assignment or subletting shall affect Lessee's obligations to make all required rental payments hereunder. 6.15 EXCLUSIVITY. Lessee's right to conduct business at the Airport shall be nonexclusive. 6.16 WAIVER. The failure of Lessor to insist in anyone or more instance upon performance of any of the terms, covenants or conditions of this Lease shall not be construed as a waiver or relinquishment of the future performance of any such terms, covenants or conditions, and Lessee's obligation with respect to such future performance shall continue to be in full force and effect. Furthermore, the acceptance of rentals or fees by Lessor after Lessee's failure to perform, keep or observe any of the terms, covenants or conditions of the Lease shall not be deemed a waiver by Lessor to cancel this Agreement for such failure. 6.17 TITLE TO LEASED PREMISES. Lessee agrees that it does not acquire any equity or title to the leased premises as a result of this Agreement and that the property herein leased shall remain the sole property of Lessor. Lessor grants Lessee a leasehold interest by and through this Agreement. 6.18 STORED CONTENTS. Lessee agrees to limit the outside storage of any and all materials, components, assemblies and repaired and manufactured products to the area on the leased premises behind the screening fence and to control the growth of vegetation and weeds on the leased premises and extending outward a distance of twenty (20) feet from the fence. S & H METAL WORKS -12- 6.19 INDEPENDENT CONTACTOR. The Lessee shall be deemed to be an independent contractor and operator and solely responsible for its respective acts and omissions, and Lessor shall in no way be responsible therefor. ARTICLE SEVEN TERMINATION, CANCELLATION 7.01 TERMINATION This Lease shall terminate at the end of the term and any extension thereof. Lessee shall have no further right or interest in any of the Premises or improvements hereby demised, except as provided herein. This Agreement is subject to termination for the reasons set forth below, provided that thirty (30) days notice is given to the non -terminating party. Rental due hereunder shall be payable only to the effective date of said termination. 7.02 TERMINATION BY LESSEE This Lease shall be subject to cancellation by Lessee upon the occurrence of any one or more of the following events: 1. The permanent abandonment of the Airport by the Lessor as an air terminal. 2. The lawful assumption by the United States Government, or any authorized agency thereof, of the operation, control or use of the Airport, or any substantial part or parts thereof, in such a manner that substantially restricts Lessee for a period of at least ninety (90) days from operating thereon. 3. The issuance by any court of competent jurisdiction of an injunction in any way preventing or restraining the use and operation of the Airport for a period of at least ninety (90) days. 4. The default of the Lessor in the performance of any covenant or agreement herein required to be performed by the Lessor and the failure of the Lessor to remedy such default for a period of thirty (30) days after receipt from Lessee of written notice to remedy the same. 7.03 TERMINATION BY LESSOR S & H METAL WORKS -13- This Lease shall be subject to cancellation by Lessor after the occurrence of one or more of the following events: 1. If the Lessee shall file a voluntary petition of bankruptcy; or if proceedings in a bankruptcy shall be instituted against Lessee and Lessee is thereafter adjudicated as bankrupt pursuant to such proceedings; or if a court shall take jurisdiction of Lessee and its assets pursuant to proceedings brought under the provisions of any federal reorganization act; or if a receiver for Lessee's assets is appointed; or if Lessee shall be divested of its rights, powers and privileges under this Agreement by other operation of law. 2. The abandonment by Lessee of the Premises at the Airport for a period of thirty (30) days or more. 5. The failure by Lessee to pay any rentals or other charges hereunder after notice as specified above. 6. The default by Lessee in the performance of any covenant or agreement herein required to be performed by Lessee and the failure of Lessee to remedy such default for a period of thirty (30) days after receipt from the Lessor's Director of Aviation of written notice to remedy the same. 7. If the Lessee shall fail to abide by all applicable laws, ordinances and rules and regulations of the United States, State of Texas, City of Lubbock and Lessor's Director of Aviation. If any of the aforesaid events occur, Lessor's agents may enter upon the leased premises and take immediate possession of the same and remove Lessee's effects. Upon said entry, this Lease shall terminate, and any rental due hereunder shall be payable to said date of termination. It is agreed that failure to declare this Lease terminated upon the default of Lessee for any of the reasons set forth above shall not be construed as a waiver of any of the Lessor's rights hereunder or otherwise bar or preclude Lessor from declaring this Lease cancelled as a result of any subsequent violation of any of the terms or conditions of this Lease. 7.04 REPLACEMENT AFTER DAMAGE. In the event the leased premises are damaged by fire or other accidental cause during the initial term of this Lease so as to become totally or partially untenable, Lessor shall have the option to restore the premises to their S & H METAL WORKS -14- former condition. If Lessor elects to exercise the option to restore the premises, Lessor shall give Lessee notice in writing of its election within thirty (30) days of the occurrence of such damage. If the Lessor elects to restore the premises, the Lessor shall proceed with due diligence and there shall be an abatement of the rent until repairs have been made for the time and to the extent for which the premises, or part thereof, have been untenable. Should Lessor not exercise the option to restore the leased premises, the lease of such untenable portion of the premises shall cease and terminate, effective on the date of damage by fire or other accidental cause. 7.05 PROPERTY PERMANENTLY AFFIXED TO PREMISES. Any property belonging to Lessee which becomes permanently attached to the leased premises (except trade fixtures) shall become the property of the Lessor upon termination of this Agreement, whether upon expiration of the initial term, any extension thereof, or earlier under any provision of this Lease. 7.06 VACATION OF LEASE AND OWNERSHIP OF FIXTURES. Within thirty (30) days after expiration or termination of this Agreement, as herein provided, Lessee shall remove any furniture, machinery, equipment, chattels, goods, or other trade fixtures owned or placed by Lessee, in, under, or on the premises, or acquired by Lessee, whether before or during the Lease term and shall restore the Leased Premises to the condition in which they were received, reasonable wear and tear excepted. However, Lessee's right to remove its property is subject to the condition that Lessee has paid in full all amounts due and owed to Lessor under this Agreement. If Lessee shall fail or neglect to remove said property on or before said expiration or termination of the Agreement, then at the option of Lessor, said property shall either become the property of Lessor without compensation therefore, or the Director of Aviation of Lessor may cause such property to be removed at the expense of Lessee, and no claim for damages against the Lessor, or its officers, agents or employees shall be created or made on account of such removal and restoration. In the event Lessor terminates this Agreement for cause, as contained herein, or if Lessee discontinues its business on the Leased Premises at any time prior to expiration of the term, or the expiration of any subsequent extension, Lessor shall retain ownership of Lessee's property to the extent of the rentals due for the remainder of the term or extension if paid at the rate paid for the month prior to termination. S & H METAL WORKS -15- 7.07 SURRENDER OF LEASED PREMISES. The Lessee covenants and agrees that at the expiration of the initial term of this Lease, or any extension, or upon earlier termination as provided elsewhere in this Agreement, Lessee will quit and surrender the leased premises and the improvements in good state and condition, reasonable wear and tear excepted, and the Lessor shall have the right to take possession of the leased premises and the improvements, subject to the limitations expressed in Article Seven, of this Lease, with or without process of law. 7.08 CONFLICT OF INTEREST The Lessee acknowledges that it is informed that Texas law prohibits contracts between the City of Lubbock and its "officers" and "employees," and that the prohibition extends to officers and employees of the City of Lubbock agencies, such as Lessor -owned utilities, and certain City of Lubbock boards and commissions, and to contract with any partnership, corporation or other organization in which the officers or employees have a substantial interest. Lessee certifies (and this Agreement is made in reliance thereon) that neither the Lessee nor any person having an interest in this Agreement is an officer or employee of the City of Lubbock or any of its agencies, boards or commissions. ARTICLE EIGHT MISCELLANEOUS PROVISIONS 8.01 NOTICES. Notices to the Lessor required or appropriate under this Lease shall be deemed sufficient if in writing and mailed by registered mail with postage prepaid to the Director of Aviation, Lubbock International Airport, Route 3, Box 389, Lubbock, Texas 79403. Notices to the Lessee required or appropriate under this Lease shall be deemed sufficient if in writing and mailed by registered mail with postage prepaid to S & H Metal Works & Manufacturing, Inc., Route 3, Box 13, Lubbock, Texas 79403. 8.02 PARTIES BOUND. This Agreement binds, and inures to the benefit of, the parties to the Lease and their respective heirs, executors, administrators, legal representative, successors, and assigns. S & H METAL WORKS -16- 8.03 APPLICABLE LAW. This Agreement is to be construed under Texas law, and all obligations of the parties created by this Lease are performable in Lubbock County, Texas. Venue for any action brought pursuant to this Agreement, or any activity contemplated hereby, shall lie exclusively in Lubbock County, Texas. 8.04 ATTORNEY'S FEES. Should Lessor institute legal action to collect rent due under this Agreement or damages for default of any covenant made herein, a reasonable sum shall be added to the amount of recovery for attomey's fees together with all costs of court. 8.05 PRIOR AGREEMENTS. Both parties hereby agree that this instrument constitutes the final Agreement of the parties and that all other previous agreements, leases and contracts between the parties which pertain to the property described herein are hereby declared null and void. 8.06 AMENDMENT. No amendment, modification, or alteration of this Lease is binding unless in writing, dated subsequent to the date of this Lease, and duly executed by the parties. S & H METAL WORKS -17- EXECUTED this 18th day of November , 2004. LESSOR: CITY OF LUBBOCK ATTEST: Re ecca Garza, City Secretary AS TO CONTENT: Jarhes W. Loomis, Director of Aviation APPROVED AS TO FORM: LESSEE: S & H METAL WORKS & MANUFAC G, INC BY: Title: Linda L. Chamales, Supervising Attorney - Office Practice S & H METAL WORKS -18- No Text