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HomeMy WebLinkAboutResolution - 2135 - Lease Agreement - Federal Express - Space, OTB LIA - 09/12/1985Resolution #2135 September 12, 1985 Agenda Item #28 MH:cl 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 between the City of Lubbock and Federal Express for terminal and apron space at the old airport terminal, attached herewith, which shall be spread upon the minutes of the Council and as spread upon the minutes of this Council shall constitute and be a part of this Resolution as if fully copied herein in detail. Passed by the City Council this 12th day of September , 1985. ALA HENRY, KAYOR ATTEST: y APPROVED AS TO CONTENT: W-') 0.(0� Marvin Coffee, DireV6r of Aviation APPROVED AS TO FORM: r� S Michele Hart, Assistant City Attorney .", -J(3,5 MEMO TO: Jim Bertram, Asst. City Manager for Development Services FROM: Marvin Coffee, Director of Aviation SUBJECT: Agenda Comments - September 12, 1985 Council Meeting DATE: August 26, 1985 ITEM IV. I Lease Agreement with Federal Express Corporation for space at Lubbock International Airport. Federal Express has been operating an air express business in the old terminal at Lubbock International Airport since June 1984. This lease agreement is for a five year term commencing June 1, 1985 with no option. This lease provides for an exclusive lease of 800 square feet of space in the old terminal at $3.63 per square foot, and 40,000 square feet of priority use of apron area adjacent to the old terminal at $3,000 per year. The rates are subject to an annual CPI adjustment starting on January 1, 1986. This lease for some reason was delayed by Federal Express however, they have been paying each month same as is re- quired by the lease. The Airport Board has reviewed this and recommends to City Council. SPACE LEASE - OLD TERMINAL BUILDING LUBBOCK INTERNATIONAL AIRPORT Resolution #2135 THE STATE OF TEXAS § COUNTY OF LUBBOCK § This Lease Agreement is entered into at Lubbock, Texas, by and between the City of Lubbock, hereinafter referred to as "Lessor," and Federal Express Corporation of Memphis, Tennessee, hereinafter referred to as "Lessee." WITNESSETH: WHEREAS, Lessor owns and operates a public airport desig- nated as Lubbock International Airport hereinafter called "Airport;" and WHEREAS, the Lessee desires to lease approximately 800 square feet of space in the Old Terminal Building of the Airport for the purpose of housing an air express operation; and WHEREAS, the Airport Board of the City of Lubbock has approved a five (5) year Space Lease in the Old Terminal Building of the Airport and the priority use of 40,000 square feet of ramp area adjacent to the Old Terminal Building for the term of said Lease; 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; ARTICLE I NOW THEREFORE, for and in consideration of the covenants and conditions herein contained and other valuable consideration the Lessor authorizes the Lessee to exercise the rights, powers and privileges hereinafter set forth and does hereby lease to the Lessee certain exclusive premises hereinafter described and called "Leased Premises" and grants to Lessee priority use of 40,000 square feet of ramp area adjacent to the Old Terminal Building of the Airport. 1.01. EXCLUSIVE LEASED PREMISES. Exclusive Leased Premises comprised of an area of 800 square feet, more or less, in the Old Terminal Building of the Airport, located in Lubbock County, Texas, the location of which is designated in red on Exhibit "A" attached hereto and by this reference made a part hereof. 1.02. NONEXCLUSIVE PRIVILEGES. In addition to the exclu- sive Leased Premises hereinabove described, Lessee is hereby granted the nonexclusive use of such space and facilities in and adjacent to the Terminal Building as may be designated by Lessor and which shall be necessary to provide access to Lessee's exclusive Leased Premises, which nonexclusive use includes, but is not limited to, a priority use of 40,000 square feet of ramp area adjacent to the Old Terminal Building at the Airport, the location of which is designated in blue on Exhibit "A" attached hereto and incorporated herein. 1.03. NONEXCLUSIVE. It is understood and agreed that nothing herein contained shall be construed to grant or authorize the granting of an exclusive right within the meaning of Section 308(a) of the Civil Aeronautics Act. 1.04. PURPOSE. Lessee's use of said leased facilities shall be for the sole purpose of providing space for an air express operation. 1.05. SIGNS. Lessee shall have the right to place or replace existing signs identifying Lessee's business on and in the Old Terminal Building. Said signs shall be of a type, size and design approved in writing by the Director of Aviation of the City of Lubbock. Such installation shall comply with all applicable City Codes and shall be without cost to Lessor. ARTICLE II TERM 2.01. The term of this Agreement shall be for a period of five (5) years commencing on , ctAe, /0 15gs- ARTICLE III RENTAL 3.01. RENTAL. In consideration of the rights and pri- vileges herein granted, Lessee shall pay to Lessor an annual - 2 - rental of FIVE THOUSAND NINE HUNDRED FOUR AND NO/100 DOLLARS ($5,904.00), payable in advance by the tenth (10th) day of each month in a sum equal to one -twelfth (1/12) of said annual amount. Said rental is computed as follows: Space rental for 800 square feet at $3.63 per square foot per year, payable in monthly installments of $242.00 per month. Ramp use fee for 40,000 square feet of ramp area at $3,000.00 per year, payable in monthly installments of $250.00 per month. The aforesaid rental rate but not the use fee shall be annually adjusted upward or downward in direct proportion to fluctuation in the Consumer Price Index published by the Bureau of Labor Statistics of the United States Department of Labor. For the purpose of computing all adjustments, the Consumer Price Index as of January 1, 1985 shall be construed as the base and the first such adjustment shall be made on January 1, 1986. 3.02. DEFAULT FOR FAILURE TO PAY RENTALS, FEES AND CHARGES. If Lessee fails to pay rentals, charges and fees due hereunder within thirty (30) days after City transmits a statement there- fore to Lessee, City may, at its option, upon fifteen (15) days written notice to Lessee (unless in such fifteen (15) day period Lessee shall have corrected such failure to pay) immediately or at any time thereafter, enter into and upon the Leased Premises, or any part thereof in the name of the whole, and repossess said Premises. 3.03. PAYMENTS. All payments that become due and payable by Lessee shall be made to the City of Lubbock at the office of the Director of Aviation, Lubbock International Airport, Lubbock, Texas, or as specified by the City Secretary -Treasurer. ARTICLE IV RIGHTS RESERVED TO LESSOR The following rights are reserved to Lessor and Lessee agrees that all rights, powers and privileges granted under the - 3 - terms of this Lease shall be subordinated to Lessor's rights as hereinafter stated. 4.01. AIRPORT HAZARDS. Lessor reserves the right to take action it considers necessary to protect the aerial approaches of the Airport against obstruction, together with the right to prevent Lessee from erecting or permitting to be erected any building or other structure on the Airport which in the opinion of Lessor would limit the usefulness of the Airport or constitute a hazard to aircraft. 4.02. AGREEMENT WITH UNITED STATES. During the time of war or national emergency the Lessor shall have the right to enter into an agreement with the United States Government for military or naval use of part or all of the landing are, the publicly owned air navigation facilities, and other area or facilities of the Airport. And if any such agreement is executed, the provi- sions of this instrument, insofar as they are inconsistent with the provisions of the agreement with the Government, shall be suspended. 4.03. SUBORDINATION OF LESSEE'S RIGHTS. This Agreement shall be subordinate to the provisions of any existing or future agreement between the Lessor and the United States relative to 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. 4.04. SUSPENSION OF LESSEE'S RIGHTS. All rights, privi- leges and interests acquired herein by Lessee at the option of the Lessor, following written notice of thirty (30) days, may be suspended if such suspension is found by the Lessor, acting in good faith, to be necessary to secure federal financial aid for the development of the Airport, or further development and provisions of aeronautical operations thereon. ARTICLE V GENERAL CONDITIONS This Lease is granted subject to the following provisions and conditions: - 4 - I 5.01. RULES AND REGULATIONS. In conducting its business, hereunder, Lessee shall comply with all applicable laws of the United States of American and the State of Texas; the rules and regulations promulgated by their authority with reference to aviation and air navigation, and all reasonable and applicable rules, regulations and ordinances of City now in force or hereafter prescribed or promulgated by authority or by law. 5.02. IMPROVEMENTS OR ALTERATIONS. The Lessee shall not make, permit, or suffer any additions, improvements or altera- tions to the property without prior written consent of the Lessor. Any such additions, improvements or alterations made with the consent of the Lessor shall be solely at the expense of the Lessee and unless such consent provides specifically that title to the addition or improvement so made shall vest in the Lessee, title thereto shall at all times remain in the Lessor and such additions or improvements shall be subject to all terms and conditions of this instrument. 5.03. REMOVAL AND DEMOLITION. Lessee shall not remove or demolish in whole or in part, any improvements that already exist on the Leased Premises without prior written consent of City which may, at its discretion, condition such consent upon the obligation of Lessee to replace the same improvements specified in such consent upon termination of this Lease. City shall not withhold consent unreasonably and shall not impose unreasonable condition on its consent. 5.04. MECHANIC'S LIENS. The Lessee shall not bind or attempt to bind Lessor for payment of any money in connection with installations, alterations, additions, or repairs on the Leased Premises or any of Lessee's equipment or facilities located on the Leased Premises and shall not permit any me- chanic's, materialman's or contractor's liens to arise against the Premises or any improvements, equipment, machinery, or fixtures thereon belonging to the Lessor, and Lessee expressly agrees that it will keep and save the Premises and Lessor harmless from all costs and damages resulting from any lien or - 5 - liens of any character created or that may be asserted through any act or thing done by the Lessee. 5.05. LESSEE'S DUTY TO DEFEND. In the event any mechanic's of other liens or orders for payment shall be filed against the Premises or improvements thereon, or the property of Lessor located thereon, during the term of this Lease Agreement, Lessee shall within ten (10) days cause the same to be canceled and discharged of record, by bond or otherwise at the election and expense of Lessee, and shall also defend on behalf of Lessor, at Lessee's sole cost and expense, any action, suit or proceeding which may be brought thereon or for the enforcement of such lien or order.. 5.06. LESSOR'S RIGHT TO INSPECT. The Lessor, acting by and through the Director of Aviation, or other designated representa- tive shall have the right to inspect the property at all reason- able times during the term of this Lease. 5.07. JANITORIAL SERVICES. Lessee shall, at its own expense, provide janitorial services in the Leased Premises. Said services may be provided by Lessee alone, or by Lessee in conjunction with other tenants who are now or may hereafter be Lessees at the Airport. 5.08. MAINTENANCE BY LESSOR. Lessor shall be responsible for and shall perform exterior building maintenance, structural maintenance and maintenance of heating and air conditioning units. 5.09. MAINTENANCE BY LESSEE. Lessee agrees that it will at all times during the term of this Lease maintain, without cost to Lessor, its exclusive Leased Premises and all facilities and equipment therein, including but not limited to installed equipment owned by Lessee, in good and serviceable condition, ordinary wear and tear accepted. Lessee shall relamp light fixtures as necessary and shall repaint the interior of the exclusive Leased Premises as necessary. All such maintenance, repairs, and replacement shall be of quality equal to the original condition in materials and workmanship. All paint - 6 - colors or schemes shall harmonize with the decor of the Terminal Building subject to the prior approval of the Director of Aviation. 5.10. LESSEE'S DUTY TO REPAIR. Except as provided herein, any property of the Lessor, or for which Lessor may be respon- sible, 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 Lessor and its authorized representatives, or in lieu of such repair or replace- ment, the Lessee shall, if so required by the Lessor pay to the Lessor money in any amount deemed sufficient by the Lessor to compensate for the loss sustained or expense incurred by the Lessor by reason of the loss of, damage to, or destruction of such property. 5.11. TRASH DISPOSAL. 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 caused as a result of the operation of its business at its sole expense. 5.12. UTILITIES. Lessee agrees to pay for all heating, lighting, and air conditioning energy consumption in the Leased Premises and all utility charges associated with the occupancy of the Leased Premises. 5.13. TAXES AND LICENSES. Lessee shall pay all taxes of whatever character that may be lawfully levied or charged upon Lessee's leasehold improvements and upon Lessee's rights to use the Leased Premises. Lessee shall obtain and pay for all licenses or permits necessary or required by law for the con- struction of any additional improvements, the installation of equipment and furnishings, and any other licenses necessary for the conduct of its business. 5.14. HOLD HARMLESS. The Lessee agrees to indemnify, defend and forever save the Lessor, its authorized agents, - 7 - representatives and employees, harmless from and against any and all penalties, liability, annoyances, or loss resulting from claims or court action of any nature arising directly or in- directly out of any acts or omissions of the Lessee, his agents, servants, guests, employees or business visitors under this Agreement. 5.15. PUBLIC LIABILITY AND PROPERTY DAMAGE INSURANCE. The Lessee shall maintain at all times during the term of this Lease, at its sole expense, insurance with an insurance underwriter acceptable to the Lessor and from one authorized to do business in the State of Texas, against claims of public liability and property damage resulting form Lessee's business activities at the Airport. The amount of insurance coverage shall be not less than ONE HUNDRED THOUSAND DOLLARS ($100,000) for property damages as a result of any one event, or less than THREE HUNDRED THOUSAND DOLLARS ($300,000) for personal injury or death of any one person in any one event; or less than FIVE HUNDRED THOUSAND DOLLARS ($500,000) for personal injury or death of two or more persons in any one event. All policies shall contain an agreement on the part of the respective insurers, waiving the right of such insurers to subrogation. Certificates of insurance or other satisfactory evidence shall be filed with the City Secretary and an additional copy given to the Director of Aviation prior to the commencement of the term of this Lease. Each policy shall name the Lessor, City of Lubbock, as an additional insured as its interest may appear. Each policy shall provide, "It is agreed that insurer shall notify the City of Lubbock, Texas, of any alteration, renewal or cancellation of this policy and that this policy shall remain in full force and effect until ten (10) days after such notice is received by the Director of Aviation." 5.16. FIRE INSURANCE. Lessee shall insure for fire and extended coverage risks all Lessee's improvements on Leased Premises and shall keep such insurance in full force and effect during the entire term of this Lease. Such insurance shall be in an amount equal to the full insurable replacement value of such - 8 - improvements. All fire insurance policies shall contain loss payable endorsements in favor of the parties as their respective interests may appear hereunder, and an agreement on the part of the insurer waiving the right of such insurer to subrogation Lessee shall furnish three (3) copies of certificates of in- surance or other satisfactory evidence of compliance with this provision to the City Secretary prior to the commencement of the term of this Lease. 5.17. WORKER'S COMPENSATION. Lessee shall furnish to the Lessor satisfactory evidence that it carries Worker's Compensa- tion Insurance in accordance with the laws of the State of Texas. 5.18. LESSEE SHALL VACATE. On or before the date of expiration of this Agreement, the Lessee shall as required by the Lessor, vacate said Premises, remove all property of the Lessee and restore the Leased Premises, improvements, facilities and equipment included herein to as good condition on such date of expiration or termination as when received, ordinary wear and tear accepted. If, however, this Lease is revoked, the Lessee shall vacate the Leased Premises, remove said property and restore the Leased Premises, improvements, facilities and equipment included herein as aforesaid within thirty (30) days following the date of such termination; provided however, that Lessee's right to remove its property is subject to the condition that Lessee has paid in full all amounts due and owing Lessor under this Lease Agreement. If the Lessee shall fail or neglect to remove said property and so restore the Leased Premises, improvements, facilities and equipment included herein, on or before.said expiration or within thirty (30) days of such termination, then at the option of the Lessor said property shall either become the property of the Lessor without compensation therefor or the Lessor may cause the property to be removed, the Leased Premises, improvements, facilities and equipment included herein to be restored at the expense of the Lessee and no claim for damages against the Lessor or its officers, agents, or - 9 - employees shall be created or made on account of such removal and restoration. 5.19. NONDISCRIMINATION. The Lessee, its agents and employees will not discriminate against any person or class of persons by reason of sex, race, color, creed or national origin in providing any services or in the use of any of its facilities provided for the public. The Lessee shall not discriminate against any person or class of persons on the basis of age in a manner that violates any prohibition against such discrimination under the Age Discrimination Act of 1975, 42. U.S.C. §6101 et sem. The Lessee further agrees to comply with such enforcement procedures as the United States might demand that the Lessor take in order to comply with the sponsor's assurances (City). Lessee agrees to not discriminate against any employees or applicant for employment because of race, creed, color, age, sex or national origin. The Lessee agrees to take affirmative action to insure that applicants are employed and that employees are tested during employment without regard to their race, creed, color, age, sex or national origin. Such action shall include, but not be limited to employment, upgrading, demotion or trans- fer, recruitment, layoff, rates of pay or other forms of compen- sation, and selection for training, including apprenticeship. The Lessee will conduct its activities and operate its facilities in accordance with the requirements of Section 504 of the Rehabilitation Act of 1973 and will assure that no qualified handicapped person shall, solely by reason of his or her handicap be excluded from participation in, be denied the benefits of, or otherwise be subjected to discrimination, including discrimina- tion in employment, under any program or activity of the Lessee. 5.20. WARRANTY OF NO SOLICITATION. The Lessee warrants that it has not employed any person employed by the Lessor to solicit or secure this Lease Agreement upon any agreement for a commis- sion, percentage, brokerage or contingent fee. 5.21. NO ASSIGNMENT OR SUBLETTING. Except with prior written consent of the Lessor the Lessee shall not sublet any - 10 - part of the Premises or assign the Lease or any of its rights hereunder. No such assignment or subletting, made with Lessor's consent, shall affect Lessee's obligations to make all required rental payments hereunder upon default of its assignee or subtenant. 5.22. WAIVER. The failure of the Lessor to insist in any one or more instance upon performance of any of the terms or conditions of this Lease shall be construed as a waiver or relinquishment of the future performance of any such term or conditions but the Lessee's obligation with respect to such future performance shall continue to full force and effect. 5.23. LESSOR'S RIGHT TO LEASE REMAINING PORTIONS OF BUILDING. Lessee agrees that Lessor has the right to lease remaining portions of the Terminal Building to any such other tenants as Lessor desires. ARTICLE VI TERMINATION This Agreement is subject to termination for the reasons set forth below, provided that thirty (30) days written notice is given to the nonterminating party. 6.01. LESSEE'S RIGHT TO TERMINATE. The Lessee may terminate upon the happening of any of the following: A. The permanent abandonment of the Airport as an air terminal. B. The issuance by any court of competent jurisdiction of an injunction in any way preventing or restraining the use of the Airport and the remaining in force of such injunction for at least thirty (30) days. C. The breach of the Lessor of any of the terms, covenants or conditions of this Agreement to be kept, performed and observed by the Lessor, and the failure of the Lessor to remedy such breach for a period of sixty (60) days after written notice for the Lessee of the existence of such breach. D. The assumption by the United States Government, or any authorized agency of same, of the operation, control or use of the Airport and its facilities in such a manner as to substantially restrict the Lessee from operating under the terms of this Agreement, if such restriction is to continue or has continued for a period of three (3) months or more. 6.02. LESSOR'S RIGHT TO TERMINATE. The Lessor may terminate upon the happening of any of the following: A. If the Lessee shall file a voluntary petition of bankruptcy; or, if the proceedings in bankruptcy shall be instituted against it and it is thereafter adjudicated a bankrupt pursuant to such proceedings; or if a court shall take jurisdiction of the 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 under State or Federal law; or if Lessee shall be divested of its rights, powers and privileges under this Agreement by other operation of law. B. If the Lessee shall abandon and discontinue operations under this Agreement. C. If the Lessee shall default in or fail to make any payments at the time and in the amount as required of it under this Agreement. D. If the Lessee shall fail to perform, keep and observe all of the covenants and conditions contained in this Agreement to be performed, kept and observed by it. E. 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 or Director of Aviation of the City of Lubbock. F. If Lessor, acting in good faith, finds termination of the rights, privileges and interests of Lessee acquired under this Lease to be necessary to secure federal financial aid for the development of the Airport, or further develop- ment and provisions of aeronautical operations thereon. - 12 - 6.03. FIRE DAMAGE. In the event the Old Terminal Building at the Airport is damaged by fire or other accidental cause during the term of this Lease Agreement so as to become totally or partially untenantable, Lessor shall have the option to restore the Premises to their former condition. If Lessor exercises its option to restore the Premises, Lessor shall proceed with due diligence. If the damage is so extensive as to amount practically to the total destruction of the utility of the Leased Premises for uses expressed in this Lease Agreement, Lessee's obligation to pay rent hereunder shall abate for the time and to the extent that the Premises have been rendered untenantable. Should Lessor not exercise its option to restore the Premises, this Lease shall terminate, such termination to be effective on the date of damage by fire or other accidental cause, and the rent shall be apportioned to that date. ARTICLE VII MISCELLANEOUS PROVISIONS 7.01. NOTICES. Notices to City provided for herein shall be sufficient if sent by certified mail, postage prepaid, addressed to the Director of Aviation, Route 3, Box 389, Lubbock, Texas 79401, and notices to Lessee, if set by certified mail, postage prepaid, addressed to Federal Express Corporation, Box 727, Memphis, Tennessee 38194, or to such other addresses as the parties may designate to each other in writing from time to time. 7.02. ATTORNEY'S FEES. Should Lessor institute legal action to collect rentals due under this Lease Agreement or damages for breach of any covenant made herein, a reasonable sum shall be added to the amount of recovery for attorney's fees together with all costs of court. 7.03. HOLDING OVER NOT RENEWAL OF LEASE. In the event Lessee remains in possession of the Leased Premises after the expiration of this Lease Agreement without any written renewal or extension of this Lease, such holding over shall not be deemed as - 13 - a renewal or extension of this Lease, but shall create only a tenancy from day to day which may be terminated at any time by Lessor. Executed this 12th day of September , 1985. FEDERAL .. ATION Ir 42 1 CITY OF L BOCK, T AS BY: AL HENRY, MAY ATTEST: Ranette Boyd City Secretary APPROVED AS TO CONTENT: 0 Marvin Coffee Director of Aviation APPROVED AS TO FORM: 11A� Michbre Hart Assistant City Attorney - 14 - No Text