ORDER NO. 15987 APPROVAL OF AIRPORT SUB-LEASE, BY AND BETWEEN EAA SOUTHWEST REGIONAL FLY-IN, INC., A TEXAS NON-PROFIT CORPORATION, SUB- LESSOR, AND CITY OF KERRVILLE, TEXAS AND KERR COUNTY, TEXAS, LESSORS, AND AVIATION MUSEUM OF TEXAS, INC., A TEXAS NON- PROFIT CORPORATION, SUB-LESSEE On this the 26 th day of March 1985, upon motion made by Commissioner H;ag;ns seconded by Commissioner Guthrie the Court unanimously approved a Sub-Lease, recommended by The Kerrville-Kerr County Joint Airport Advisory Board and entered into by and between EAA SOUTHWEST REGIONAL FLY-IN, INC., a Texas non-profit corporation, SUB-LESSOR, and CITY OF KERRVILLE, TEXAS and KERR COUNTY, TEXAS, LESSORS, and AVIATION MUSEUM OF TEXAS, INC., a Texas non-profit corpora- tion, SUB-LESSEE, for a period of twenty (20) years, begin- ning ~?a~~h 1, 1985 and terminating on February 28, 2005, subject to concurrence by the City of Kerrville. It is ordered by the Court that County Judge Morriss be authorized to execute said sub-lease on behalf of Kerr County. March 20, 1985 Judge Gordon S. Morriss County Courthouse Kerrville, Texas 78028 RE: AVIATION MUSEUM OF TEXAS, INC. SUB-LEASE '~ E.A.A. FLY-IN Dear Judge Morriss: Enclosed is the Sub-Lease Proposal for the Aviation Museum of Texas, Inc. The Kerrville-Kerr County Joint Airport Advisory Board recommends this contract for approval by the City Council and County Commissioners' Court. It will be on City Council Agenda for March 26, and we would appre- ciate it being placed on the Commissioners' Agenda as soon as possible. Thanks for your cooperation. CITY OG KERRVILLE, TEXTS Sincerely, c_~' ~ . ,,:. /ice i.~ Joseph W. Mennella ~- Airport Manager CITY OF KERRVILLE Enclosures is 512 ~ 257 ~ $000 KERRVILLE, TEXAS 78028 AIRPORT SUB-LEASE -- AVIATION MUSEUM OF TEXAS, INC. This Sub-lease entered into by and between EAA SOUTHWEST REGIONAL FLY-IN, INC., a Texas non-profit corporation, SUB-LESSOR, and CITY OF KERRVILLE, TEXAS and KERB COUNTY, TEXAS, LESSORS, and AVIATION MUSEUM OF TEXAS, INC., a Texas non-profit corporation, SUB-LESSEE, as follows: 1. Premises. Sub-Lessor hereby sub-leases to Sub-Lessee a tract of land 180 feet by 483.33 feet, more particularly described on Exhibit 2 attached hereto and incorporated herein by reference. 2. Rent. Rent is $1.00 per year, payable in advance. -~ 3. Term. The term of this sub-lease shall be for a twenty (20) year period, .beginning March 1, 1985, and terminating on February 28, 2005. 4. Use of the Premises. The premises shall be used for an aircraft historical museum, to be operated by Sub-Lessee. Such use shall further include all uses which may be directly incident and necessary to such use. Sub- Lessee's use and operation shall be pursuant to a non-profit use, and in the event either Lessee's use substantially changes, or a Lessee engages in for-profit commercial activities, then Lessor, upon sixty (60) days written notice may terminate this lease as to such Lessee. 5. Utilities. Sub-Lessee shall be responsible for obtaining and-'paying for all utilities. 6. Continuance of Sub-Lease. A. To encourage the building of improvements that will enhance and promote a successful museum operation, the Lessor and Sub-Lessor agrees to continue the sub-lease of the tract with Sub-Lessee regardless of whether or not Sub-Lessor should cease operations or relocate to other airport facilities. B. Upon the termination of Sub-Lessor's term, this lease agreement shall remain in effect as a lease between Lessor and Sub-Lessee. 7. Termination by Lessee. Sub-Lessee may terminate this lease by six (6} months written notice thereof to Lessor and Sub-Lessor 8. Improvements. The improvements built or installed on the premises by Sub-Lessee, which under the laws of the State of Texas, constitute real estate, shall become the property of Lessor at the termination of this lease, including any renewal terms hereof. 9. Museum Use. Sub-Lessee, Aviation Museum of Texas, Inc. shall erect substantial museum improvements upon the leased property and continue to operate an ongoing and attractive museum for the benefit of Kerrville and Kerr County during the term of this lease. In the event that construction of such substantial museum improvements have not begun within two years of the date of this lease, then Lessor may cancel this lease as to the museum Lessee upon sixty (60) days written notice to Museum. If, during the term of this lease, the Museum Lessee should fail to operate or to continue to operate as provided in this paragraph, then, Lessor upon sixty (60) days written notice to the museum lessee may terminate this lease as to the museum lessee. Except, however, in the event of fire, windstorm, flood or other force majeure, Lessee is prevented from constructing or operating as required herein, then the museum lessee shall have an additional reasonable time within which to construct, restore, or put operations back into effect. 10. Lessor and Sub-Lessor hereby warrant and represent that the lease agreement between them covering the subject property and dated February 2, 1982, and attached hereto as "Exhibit 1" is the current lease agreement between them; that same has not been altered or amended; that there exists no breaches or defaults by Lessor and Lessee therein known to them; and that such lease is currently in full force and effect. 11. This sub-lease in no manner, directly or indirectly, by implication or otherwise, changes, or alters any provision whatsoever of the said lease agreement between Lessor and Sub-Lessor. 12. Renewal. (1) Sub-Lessee shall have the right to notify the Lessor that it desires to renew the lease upon the same terms and conditions for an additional ten (10) year term. Such renewal request shall be made in writing to Lessor and shall be made not earlier than one (1) year before the end of this lease term, nor later than six (6) months before the end of this lease term. Upon receipt of such request for renewal, then Lessor shall have ninety (90) days within which to notify Sub-Lessee whether the premises are required for other paramount aviation uses incident to the operation and development of Louis Schreiner Field. In the event Lessor so notifies Sub-Lessee, and if such notification by Lessor be bona fide and true, then the renewal term shall not come into effect. The parties shall thereupon promptly negotiate in good faith for other terms of renewal, relocation, or other matters upon which the parties may agree. In the event that Lessor makes no response within the ninety (90) day period, or in the event that the premises are not bona fidely needed for such other paramount aviation use, then this lease term shall be extended for a term of ten (10) years upon the same terms and conditions. ,'ti %+ .~ •'d~ (2) In the event that the first ten (10) year renewal term comes into existence, then Sub-Lessee shall have the right to notify the Lessor that it desires a second renewal upon the same terms and conditions for an additional ten (10) year term. Such renewal request shall be made in writing to Lessor, and shall be made not earlier than one (1) year before the end of the first renewal term, nor later than six (6) months before the end of the first renewal term. Upon receipt of such request for renewal, then Lessor shall have ninety (90) days within which to notify Sub-Lessee whether the premises are required for other paramount aviation uses incident to the operation and development of Louis Schreiner Field. in the event Lessor so notifies Sub-Lessee, and if such notification by Lessor be bona fide and true, then the second renewal term shall not come into effect. The parties shall thereupon promptly negotiate in good faith for other terms of renewal, relocation, or other matters upon which the parties may agree. in the event that Lessor makes no response within the ninety (90) day period, or in the event that the premises are not bona fidely needed for such other paramount aviation use, then this lease term shall be extended for a second renewal term of ten (10) years, upon the same terms and conditions. (i) Uiscrimination a. Each party hereto shall furnish services on a fair, equal, and not unjustly discriminatory basis to all users thereof; and b. Each party hereto shall charge fair, reason- able, and not unjustly discriminatory prices for each unit or service; provided that reasonable and nondiscriminatory dis- counts, rebates, or other similar types of prlce reductions to volume purchasers may be made. c. Each party, in exercising any of the rights or privileges herein granted to it shall not on the grounds of race, color, or national origin, discriminate or permit discrimination against any person or group of persons in any manner prohibited by Part 21 of the regulations of the Secretary of Transportation. The Lessor is granted hereby the right to take such action, anything to the contrary herein notwithstanding, as the United States may direct to enforce this nondiscrimination covenant. "d' (2) National Emergency In the event the United States Government requires the use of said premises in the event of a national emergency, or for any defense program, or defense purposes on the part of the government, the party in possession agrees to deliver up possession within ninety (90) days after notice where practical. After use by the United States Government has terminated, if in fact the government has taken over the Airport, the said party is entitled to re-enter the premises covered by this agreement and resume its operation, and such loss of time shall be added to the term of the agreement so that the full term may be enjoyed without being penalized on account of the occupancy of the United States Government. Lessee does not, however, waive any right to compensation for any taking under power of eminent domain. (3) Self-Service No right or privilege has been granted which would operate to prevent any person, firm or corporation operating aircraft on the Airport from performing any services on its own aircraft with its own regular employees (including but not limited to maintenance and repair) that it may choose to perform. (4) No Exclusive rranchise Nothing herein shall be construed to grant or authorize the granting of an exclusive franchise or right, except the lawful right of a Lessee to exclusive possession of leased premises. (5} Development Lessor reserves the right, in a reasonable and non-discriminatory manner, to further develop or improve the landing area of the Airport as it sees fit, regardless of the desires or views of any party and without interference or hindrance. (6) Maintenance of Airport Lessor shall keep the Airport in an operable condition and shall have the right to direct and control all activities of any party in this regard. (7) Paintenance of Facilities All hangars, buildings, properties or land on the Airport, shall be maintained in a clean, attractive, weed free, we12 painted, junk free condition. If an operator or Lessee has an area where it normally keeps damaged aircraft, aircraft parts, construction fixtures, and jigs, barrels, containers, or other unattractive items, Lessee shall enclose such an area with a screen that will hide such area from public view. ~~ (8) Structural Flazards 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 the erection of any building or other structure on or adjacent to the Airport which would Iimit the usefulness of the Airport or constitute a hazard to aircraft. (9) Subordination to Federal Agreement This agreement shall be subordinate to the provisions of any existing or future agreement between Lessor and the United States, relative to the operation 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 Airport. Lessee, however, does not waive any right to compensation resulting from a taking under power of eminent domain. (10) Laws and Regulations Incorporated into this agreement, by reference and as though set forth herein verbatim, are the policies, standards, and regulations adopted or to be adopted by the Kerrville/Kerr County Joint Airport Board, or by any other governmental agency legally responsible for the Airport. Such policies, standards and regulations shall be lawful, reasonable and non-discriminatory. Further, all parties hereto agree to comply with any and all laws and regulations, including those of the Federal Aviation Administration, and will not permit the premises covered by this agreement to be used for any unla~~~ful or improper purpose. (11) Insurance Each Lessee shall at all times have in effect liability insurance for all of Lessee's operations in the amounts of 5100,000.00 per person, 5300,000.00 per accident-bodily injury, and 5100,000. per accident- property damage. Such insurance policies shall further name the City of Kerrville, the County of l:err and the Board, as additional insureds. Certificates of such insurance shall be furnished by Lessee to the Kerrville/Kerr County Joint Airport Board, and a Certificate presently then in effect shall be on file at all times. (12) Use Charges The standards and regulations enacted by the Joint Airport Board, or other governmental agency responsible for the operation of the Airport, now or in the future, may provide for use charges to be paid by those using, occupying. or conducting operations at the Airport. Such charges may be based upon square footage, receipts or other reasonable •~ basis, to be established by such standards and regulations. Lessee agrees to pay such charges as same are due and owing under any such standards or regulations now or hereafter in effect. Any such use charges shall be lawful, reasonable and non-discriminatory. (13) Consent ~ Board This agreement shall contain an appropriate space for approval by the Kerrville/Kerr County Joint Airport Board, Kerr County and the City of Kerrville. This agreement shall never be effective without the consent of all three. (14) Default of Lessee Lessor may on account of the breach of any provision hereof, including the policies, standards, and regulations incorporated herein by reference, terminate this agreement and effect the party in violation. (15) Indemnity Lessee agrees to save and hold harmless the City of Kerrville, County of Kerr, the Kerrville/Kerr County Joint Airport Board, and their agents, servants, and employees of and from any and all liabilities, expenses, causes of action, damages, and attorney's fees resulting or to result from any of Lessee's businesses, operations, occupancy, or use of the airfield, or resulting from any act or omission of Lessee's agents, servants, or employees. And this indemnity agreement shall apply and protect such City, County and Board, and their agents, servants, and employees, even though it be contended, or even established, that said City, County, or Board, or their agents, servants, or employees uaere negligent, or that their conduct, or omission, in any way caused, or contributed to, any such liability, expense, damage, cause of action, or attorney's fees. (16) Purpose and Premises The purpose of the lease and be conducted by Lessee or sub-lessee, and premises to be occupied, are set forth in other operation; operations, business, or had or done without the additional writte Board. the operations to the identity of the this lease. No occupancy may be consent of the (17) Assignment and Sublease This agreement may not be assigned, in whole or in part, nor may the premises described herein be subleased, in v? ,r in part, without the prior written consent of the Bo u: .h consent shall not be unreasonably withheld. (18) Liens and Insolvency In the event Lessee becomes insolvent, or the subject of any kind or chapter of bankruptcy proceeding, or ~~ if a receiver, assignee, or other liquidating officer is appointed for the business of Lessee, then Lessor may cancel this lease at Lessor's option upon giving written notice to Lessee. (19) 1. DOT Assurances The Lessee for himself, his heirs, personal representatives, successors in lnterest, and assigns, as a part of the consideration hereof, does hereby covenant and agree "as a covenant running with the land" that in the event facilities are constructed, maintain- ed, or otherwise operated on the said pro- perty described in this lease for a purpose for which a DOT program or activity is ex- tended or for another purpose involving the provision of similar services or benefits, the Lessee shall maintain and operate such facilities and services in compliance with all other requirements imposed pursuant to 49 CFR Part 21, Nondiscrimination in Federally Assisted Programs of the Depart- ment of Transportation, and as said Regula- tions may be amended. 2. The Lessee for himself, his heirs, personal representatives, 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 participation in, denied the benefits of, or be otherwise subjected to discrimination in the use of said .•, ~ . facilities, (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 participation in, denied the benefits of, or otherwise be subjected to discrimination, (3) that the 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. DATED this ~ day of ~~~~ !~ , 1985. ATTEST: r ~ ~~~. c S ei a L. Bran City Clerk ~PPROVED.~AS_TO FORM: T omas S. Terre City Attorney ATTEST: CITY OF ERRVILLE, TEXAS By .J. Brou , M or PATRICZA DYE County C er & Ex-Officio Clerk ~ LESSOR of the Commissioners' Court of Kerr Co}~nty, Texas By if~q~ ~ ~ EAA SOUTHWEST REGIONAL FLY-IN, INC. ty Dorothy Pfeiff rg~~ By //y-/. ~iffa~lAsC/i!~ KKR~VI'LLE/KERB COUNTX Its' 'Peas~ol~.-~'~ ' JOINT AIRPORT BOARD LESSEE By C airman AVIA/TIO~N ~MU~S U~M OF TE S, ZN . B `~~~""'`"~ l ' Y I is ,Q~J/ Gr'iu y` LESSEE facilities, (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 participation in, denied the benefits of, or otherwise be subjected to discrimination, (3) that the 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. DATED this ,day of ~, ATTEST: 1965. CITY OF KERRVILLE, TEXAS By A.J. Brough, Mayor S ei a L. Bran City Clerk ~PPROVED~AS_TO FORM: 1 C/-^°ui S L~ ~~~Q~~S T oTi ma s S . Te---~ City Attorney KERR COUNTY, TEXAS By County Judge ATTEST: County C er K£RRVI'LLE/KERR COUNTX JOINT AIRPORT BOARD Ey C airman LESSOR EAA SOUTHWEST REGIONAL FLY-IN, INC. BY G~ l • ,~ifSbGG~2~- - t~~~s~fl~.~,r . LESSEE AVIATION MUS U~M OF TE S, IN . By l Its ,Q~i/Y g'Ny- LESSEE '~ EXHIBIT 1 ~• AIRDORT LEASE - EM SOUTHWEST REGIONAL FLY-IN. INC. iNi3 LEASE entered Into by and between the City of Kerrville and Kerr County, LESSOR, and EM SOUTHYEST RE610MAL-FLY-IX, INC., a Texas non-prolft corporation, LESSEE, as follows: ' 1. Premi e . lessor leases to Lessee a tract of land 180 feet Dy gB3.33 teat, more parttcuiarly desert bed on Exhib/t 2 attached heroin and incorporated herein by nferente. 2. Rent. Rent is one dollar (51.00) per year payable 1n advance. 3. Term. Term of this Lease shall De for a twenty-year period beginn- ing NoveMer 1, 1981 and terminating oh October 31. 2001. ~.dv 4. Use of the Premises. Premises :ha?i be used for an office of the Lessee and an str- cratt historical ewzeum to De operated Dy a tax-free foundattan. All of lessees use and oDeratlon shell be purswnt to a non-profit use, and in the even! such use substantially changes, or Lessee engages in for-profit commercial actlvlttes, than Lessor, upon sixty days (60) written notice, sny terminate this Lease. 5. Utflitfes. Lessee iha11 DB responsible for obtaining and d~ying for all e J YL1 H L1 es. 6. Flo-tn. Lessee agrees to wnduet its yearly fly-In at the Kerrvilb Airport end Lessor agrees that it may do so. Such fly-In shell ba con- , ducted the third weekend of September eacA year unless otherwise ~mutualty agreed by the Lessee and Lessor, and shall 6e of the same general nature as those conducted in the past. In the event that no Fly-(n is held fn one catender year, then Lessor nay terminate this Lease upon sixty days (60) written notice. 7. Termtnati on by Lessee. Lessee may terminate this Lease Dy a six-month written notice thereof to the City Manager of the city of Kerrvllie. -1' B. Improvements. ' i pny taprovesents built In or Installed m Ina premises Dy lessor ~ which under tW taws of the State of Texas constitute real estate, shat) I, become the property of Lesiar at the termination of this Lease. Except, I however, fn the event Lessor determines that legrovements are of no benefit _- to Lessor, then-at Lessor's written roquest and at Lessee's expanse, any such taprovements designated by Lessor shall W removed by Lessee within sixty days (60) of such request. ~ '~ g. Standard Lease Provis loos. (1) Discrimination. ' a. Eeth party hereto shell furnish services on a fair, pool, and not un,lustly dtzcrimatory basis to all users thereof; and b. Each party hereto shall charge fair, reasonable, and not unjustly distriminatory prices for each unit or service; provide that reasonable and nondiscriminatory discounts, rebates, or other similar types of price reductions to volume purchasers my be made. h c. Each party, 1n exercising any of the rights or DriW leges .~ herein granted to it shall not on the grounds o1 race, color, or national origin, dlscrfminate or permit dtscri minatf on against any person or group ~, of Darsonz In any manner proh iblted by Part 21 of the regulations of the Secretary pf TransDOrtation. The Lessor iz granted Hereby the right to take such action, anything to the contrary hereto not wlthstl7nding, ai the United States may direct to enforce this nondiscrimination covenant. (2) National Emergency. I ~~ !n the event the United States Government requires the use of said premises in the event of a national emergency, or for any defense program, or defense purposes on the part o1 the government, CM party in possession ' agrees to deliver uD possession within ninety (90) days after notice. After use by the United States 6overnrent has terminated, if in fact the Government ' has taken over the airport, the said party is entitled to re-enter th! premises covered Dy this agreement and resume its operation, and such loss of ' time shall be added to Lhe term of the agreaaent ao that the full term may be en~oyad without Wing penaN led on account of the occupancy of the United States Government. Lessee does not, however, valve any Hght to compensation for any taking under power of eminent domain. '2- (3) Serf-Service. No ri yh[ or pr?vitege has been gran [dd which would operate to ' prevent any person, firm or corporation operating aircraft on Che airport from performing any services on its own aircraft with itz own regular i, employees (including but not limi [eh to maintenance and repair) that it may choose to perform. _ (4) No Exclusive Franchise. r Nothing here In Shall De construed to grant or authorize the ~ granting of an exclusive franchise or right, except the lawful right of ~ a lessee to exclusive possession of leased premises. i (5) Oevel oumen t. Lessor reserves the right, in a reasonable and non-dis`I[. \ E%HI61T ~ ~~ ORDER NO. 15987 APPROVAL OF AIRPORT SUB-LEASE, BY AND BETWEEN EAA SOUTHWEST REGIONAL FLY-IN, INC., A TEXAS NON-PROFIT CORPORATION, SUB- LESSOR, AND CITY OF KERRVILLE, TEXAS AND KERR COUNTY, TEXAS, LESSORS, AND AVIATION MUSEUM OF TEXAS, INC., A TEXAS NON- PROFIT CORPORATION, SUB-LESSEE On this the 2& th day of March 1985, upon motion made by Commissioner x;crainc Guthrie seconded by Commissioner , the Court unanimously approved a Sub-Lease, recommended by The Kerrville-Kerr County Joint Airport Advisory Board and entered into by and between EAA SOUTHWEST REGIONAL FLY-IN, INC., a Texas non-profit corporation, SUB-LESSOR, and CITY OF KERRVILLE, TEXAS and KERR COUNTY, TEXAS, LESSORS, and AVIATION h1USEUM OF TEXAS, INC., a Texas non-profit corpora- tion, SUB-LESSEE, for a period of twenty (20) years, begin- na.ng ?:.arch 1, 1985 and terminating on February 28, 2005, subject to concurrence by the City of Kerrville. It is ordered by the Court that County Judge Morriss be authorized to execute said sub-lease on behalf of Kerr County. ORDER N0. 15987 APPROVAL OF AIRPORT SUB-LEASE, BY AND BETWEEN EAA SOUTHWEST REGIONAL FLY-IN, INC., A TEXAS NON-PROFIT CORPORATION, SUB-LESSOR, AND CITY OF KERRVILLE, TEXAS AND KERR COUNTY, TEXAS, LESSORS, AND AVIATION MUSEUM OF TEXAS, INC., A TEXAS NON-PROFIT CORPORATION, SUB-LESSEE 3-26-85 VOL. Q, Page 43