URDEFi N(:1. ~T7k =i
GF'f--'RUNE LE:F-15E AGREEt4ENT E~ETWE:EN
CT"f `r` OF I-:EfiRVILLE9 L'iJl_JN'fY QF I:ERF29 HNIi TRI~~D t+IfJNIJ~'i~C;l"UIaTt•JC
Un tt-~:i> L-he ~_fth d<~.y i)i' H~_iyu.>t9 r(b~cy ~_~pon motion made t:~y
Commis=~ioner (~riFfin, seconded by Commissioner Raldwin~ the
Cv~_irt i_tnanimo~_isly approved by a vote of 4-~--Q~ the Con~unercial
Wa'r•eho~as-e Luse f~greemer~t between tl'ie Ci~.y nt I=,errv:ii:Ee.~ tine
Cu~_uity of Kerr, fcxas and 1"ri~td hlaru_tFact~_ir-i.ny9 E_tr9. and
a~_ithori-~e Co~..inty .7~_idye i.o ,iyn th-~e same.
COMMISSIONERS' COURT AGENDA REQUEST
PLEASE FURNISH ONE ORIGINAL AND NINE COPIES OF THIS REQUEST AND DOCUMENTS TO BE
REVIEWED BY THE COURT.
MADE BY: Fred Henneke OFFICE: County Judge
MEETING DATE: August 26, 2002 TIME PREFERRED:
SUBJECT: (PLEASE BE SPECIFIC)
Consider and discuss Commercial Warehouse Lease Agreement between the City of Kerrville, the
County of Kerr, Texas and Triad Manufacturing, Ltd.
EXECUTIVE SESSION REQUESTED: (PLEASE STATE REASON)
NAME OF PERSON ADDRESSING THE COURT:
ESTIMATED LENGTH OF PRESENTATION:
IF PERSONNEL MATTER -NAME OF EMPLOYEE:
Count~ge/Megan Caffall
Time for submitting this request for Court to assure that the matter is posted in accordance with Title 5, Chapter
551 and 552, Government Code, is as follows:
Meeting scheduled for Mondays:
THIS REQUEST RECEIVED BY:
THIS REQUEST RECEIVED ON:
5:00 P.M. previous Tuesday.

All Agenda Requests will be screened by the County Judge's Office to determine if adequate information has been
prepazed for the Court's forn~al consideration and action at time of Court Meetings. Your cooperation will be
appreciated and contribute towazds you request being addressed at the eazliest opportunity. See Agenda Request Rules
Adopted by Commissioners' Court.
i~
THE Cliv Of
KERRVILLE, TEXAS
August 20, 2002
The Honorable Judge Fred Henneke
Kerr County Judge
Kerr County Courthouse
700 Main Street
Kerrville, Texas 78028
RE: Commercial Warehouse Lease Agreement among the City of Kemille, Texas, The County
of Kerr, Texas and Triad Manufacturing, Ltd.
Dear Judge Henneke:
BA Products, L.L.P., a local wildlife feeder manufacturer has relocated their business to the airport
warehouse at 1994 Airport Loop Road. Since BA Products relocation in May of this year, their
business has grown 20%, and completed inventory and raw materials for production are crowding the
manufacturing space in the warehouse. BA Products has requested consideration of leasing 1,500
square feet of storage space in the City/County owned warehouse at 1700 Airport Loop Road (the
Former EAA building) to store completed product awaiting shipment and raw materials for
production.
BA Products currently has twenty five employees, and provides revenue source diversity at the
airport with anon-aviation related business.
The Tease Agreement for storage space in the warehouse at 1700 Airport Loop Road is on the
August 27, 2002 Kerrville City Council Agenda, and I am requesting consideration on the August
26, 2002 Kerr County Commissioner's Court Agenda.
Thank you,
~/
Megan Caffall
Airport Manager
n
c,r
800 JUNC110N HIGHWAY • KERRVIl1E, TEXAS 78028-5069 • 830/257-8000
COMMERCIAL WAREHOUSE LEASE AGREEMENT
AMONG THE CITY OF KERRVILLE, TEXAS, THE COUNTY
OF KERR, TEXAS AND TRIAD MANUFACTURING, LTD.
THIS LEASE AGREEMENT, made this Z 7day of ~„~~_ r , 2002, by
and among the City of Kerrville, Texas, a home rule municipal co~foration, hereinafter called
"City", and the County of Kerr, Texas, a political subdivision of the State of Texas, hereinafter
called "County" (City and County sometimes collectively being referred to as "Lessor"), and Triad
Manufacturing, Ltd. d/b/a BA Products, a Texas limited liability partnership, whose principal offices
are located in Kerrville, Texas, hereinafter referred to as "Lessee".
RECITALS
WHEREAS, Lessor owns and operates the Kerrville-Ken County Airport, located in the City
of Kerrville, Texas, hereinafter referred to as "Airport"; and
WHEREAS, Lessee desires to lease space within certain Lessor-owned facilities at the
Airport to store finished product and raw materials for the manufacture, sales, service and
distribution of feeders for the wildlife, aquaculture, and agricultural industries; and
NO W, THEREFORE, for and in consideration of the covenants and conditions herein stated,
Lessor and Lessee agree as follows:
ARTICLE 1. GRANT OF LEASE
1.O1 Leased Premises: Lessor agrees to lease to Lessee approximately 1500 square feet
within the facility located at 1700 Airport Loop Road, which location is within the Airport and is
more particularly described as Tract 16, as indicated on the Airport Leasing Plan, recorded at
Volume 6, Page 331, Plat Records of Kerr County, Texas, and as shown on Exhibit "A", hereinafter
being referred to collectively as the "Leased Premises." Lessor intends to partition off the Leased
Premises by adding walls and/or other such structures. However, until such time, Lessor will define
the portion of area within the facility for Lessee's use by tloor markings or other such means.
1.02 Easements: This Agreement shall be subject to such easements, rights-of--way, drill
sites, or other rights or reservations affecting the Leased Premises which are of record or are clearly
visible as of the date of this Agreement, or which are shown on the Airport Leasing Plan, recorded at
Volume 6, Page 331, Plat Records of Kerr County.
1.03 Acceptance of Leased Premises: Lessee accepts the buildings and improvements,
including all fixtures, apparatus and equipment located therein, in the condition they are in at the
commencement of the Lease Term, subject to all defects therein whether known or unknown to the
Lessor, and does hereby release and forever discharge the Lessor from any and all damages of every
kind and nature that may be in any way occasioned thereby. Lessee hereby further agrees to
indemnify, defend, and hold harmless City, County, and their respective officers, employees, and
agents, for any damages or injuries arising from any such defects.
ARTICLE 2. TERM OF AGREEMENT
2.01 Lease Term: This Agreement shall commence at 12:01 a.m. on September 1, 2002, and
terminate at midnight on August 31, 2003, ("the Lease Term") unless terminated earlier pursuant to
the provisions of this Agreement.
2.03 Holdover of Lessee: If Lessee holds over or remains in possession of the Leased
Premises after the termination of this Agreement in the absence of a new lease agreement between
the Lessor and Lessee, such continuation beyond the date of termination, or the collection or
acceptance of rent, fees and/or other chazges by the Lessor, shall not be construed as a renewal or
extension of this Agreement, but shall be construed solely as creating a tenancy at will and not for
any other term whatsoever. During the term of such tenancy at will, Lessee shall pay to Lessor the
fees and charges herein reserved, and Lessee shall be bound by and comply with all the relevant
provisions of this Agreement. In such case, the Lessor may terminate the tenancy at will by giving
Lessee thirty (30) days written notice thereof.
ARTICLE 3. RENT
3.01. Amount of Base Rent: Lessee agrees to pay Lessor a monthly rental rate in the amount
of $225.00 per month ("the Base Rent") commencing on September 1, 2002, with the first payment
being due on or before such date.
302. Delivery of Rent: All payments required of Lessee by this Agreement shall be
delivered by mail, or in person, to the Office of the Director of Public Works, City of Kerrville,
Texas, 800 Junction Highway, Kerrville, Texas 78028, or to such other location as specified in
writing by the Lessor from time to time, no later than the first (1st) day of each calendar month of
the Lease Term for which the payment is due, unless such due date falls on a Saturday, Sunday, or
legal holiday, in which case such rent shall be due on the first C ity business day following the date
such payment is due.
3.03. Delinquent Rent Payments: In the event that payments to the Lessor for rent or other
fees or charges are not received by the Lessor on or before the tenth day following the due date,
Lessee shall pay a late rental charge of Two Percent (2.0%) of the rent amount due for that month.
All rent and other payments which are past due more than thirty (30) days shall accrue simple
interest at the rate of eighteen percent (18.0%) annually or (b) the maximum percentage rate allowed
by law, whichever is less. Notwithstanding anything to the contrary in this Section 3.03, if at the
time performance of the provisions set forth in this Section 3.03 becomes due the interest to be paid
in accordance with this Section 3.03 exceeds the limits on the payment of interest established by law,
then the amount of interest to be paid shall be reduced to the maximum limit allowed by law;
furthermore, if, from any circumstances, Lessor should ever receive as interest an amount that would
exceed the highest lawful rate, the amount that would be excessive interest shall be applied to the
payment of rent owing pursuant to the provisions of this Lease Agreement and not to the payment of
interest.
3.04. Application of Amounts Received: Payments received shall be applied in the
following order: (1) interest accrued for late payments, (2) late rental charges, (3) past due rent,
_z_
beginning with the oldest amount due, (4) other past due amounts, (5) rent currently due, (6) other
amounts currently due.
3.05. Other Charges: Nothing herein shall be deemed to relieve Lessee and its tenants,
sublessees, patrons, invitees and others from Airport use charges, including automobile parking
permit fees for parking areas that are not included within the Leased Premises, or from security fees.
ARTICLE 4. USE OF LEASED PREMISES
4.01 Permitted Uses: Lessee shall be permitted to use the Leased Premises for the purpose of
conducting for-profit commercial activities consisting of any or all of the following and no others:
The storage of raw materials and finished products which are awaiting
shipment. The storage of any such materials or products shall be done in a
manner that will not violate state or City laws or regulations. All materials
and products shall be kept within the Leased Premises and Lessee shall not
store any materials or products outside of the facility.
Such other uses as may be permitted in writing by the Lessor.
4.02 Prohibited Uses: Lessee agrees at all times to comply with the following:
Lessee shall at no time use, or permit the use of, the Leased Premises in a
manner that is contrary to applicable federal, state, or local laws, ordinances,
rules, or regulations, which shall include, but not be limited to, applicable
Federal Aviation Administration rules and regulations and applicable
regulations for the use of the Airport as may from time to time be
promulgated by the Lessor;
2. Lessee sha-1 not permit any permanent, unshielded light or illumination
source to cause glare as viewed from any street, adjacent properties or
operating aircraft;
Lessee shall not cause or permit the burial or storage above ground on the
Leased Premises of any hazardous waste or materials, as defined by federal
or state law;
4. Lessee shall not cause or permit any use or activity on the Leased Premises
which would create a hazardous condition for aircraft operating at the
Airport;
Lessee shall not allow the Leased Premises to be used for parking of motor
vehicles, motorcycles, or motor driven equipment by anyone other than
customers, employees, or contractors of Lessee except as may be authorized
by the Director of Public Works, with all such parking being limited to areas
designated by Lessor for such parking. Lessee shall not be in default for the
3_
improper parking of vehicles over which neither Lessee nor any of its
subtenants, customers, employees, or contractors have any control.
6. Lessee shall not undertake any construction, alterations, or changes to the
Leased Premises.
7. Lessee shall not erect, maintain or display any signs or any advertising at, or
on, the exterior part of the Leased Premises, or inside the Leased Premises so
as to be visible through the window or exterior doors thereof.
4.03 Compliance with Minimum Standards: All activities conducted upon the Leased
Premises, whether by Lessee or its sublessees, shall be in substantial conformance with Title 3,
Chapter V, of the Code of Ordinances of the City of Kerrville, Texas, "Airport Rules, Regulations,
and Minimum Standards", as such regulations exist or may be duly amended from time to time by
the Lessor to the extent that such regulations apply to Lessee's operations.
4.04 Non-exclusive Uses: Lessee understands and acknowledges that, as to that part of the
Airport not included within the Leased Premises, the allowable uses permitted herein are on a non-
exclusive basis with respect to other potential providers of aeronautical services at the Airport.
ARTICLE 5. REPAIRS, MAINTENANCE AND RESTORATION
5.01 Maintenance by Lessor: Lessor shall, at Lessor's sole expense, keep in good repair,
condition and appearance the taxiways and roadways which have been or may be constructed by
Lessor. Lessor shall commence required repairs as soon as reasonably practicable after receiving
written notice from Lessee thereof. This Section 5.01 shall not apply in case of damage or
destruction by fire or other casualty, in which event Sections 5.03 and 5.04 shall control the
obligations of Lessor. Except as provided in Sections 5.03 and 5.04, Lessor shall not be obligated to
make repairs, replacements or improvements or any kind upon the Leased Premises.
5.02 Maintenance by Lessee: Lessee shall, at Lessee's sole expense, keep the Leased
Premises and all improvements of any kind, which may be existing at the commencement of the
Lease Term or erected, installed, or made thereon by Lessor after commencement of the Lease Term
and not required herein to be maintained by Lessor, in good repair, condition and appearance.
Without limitation of the foregoing sentence, Lessee specifically acknowledges its obligations, at its
sole expense, to keep in good repair, condition and appearance all doors and door operating systems
located on the Leased Premises. This section shall not apply in case of damage or destruction by
fire, other casualty, or acts of God, in which event the Lessor shall be obligated to repair as provided
in Sections 5.03 and 5.04. Lessor shall be the sole judge of the quality of Lessee's maintenance;
provided, however, Lessor shall not unreasonably withhold acceptance of said repairs or
maintenance. Upon written notice by Lessor to Lessee, Lessee shall be required to perform such
reasonable maintenance under this Section 5.02 as Lessor considers necessary. If such maintenance
is not undertaken by Lessee within ten (] 0) days after receipt of written notice, Lessor shall have the
right to enter on the Leased Premises and perform the necessary maintenance, the cost ofwhich shall
be borne by Lessee. On the last day of the Lease Term, or on any sooner termination, Lessee shall
_4_
surrender the Leased Premises to Lessor in the same condition as received and clean and free of
debris, except for fire and casualty damages or ordinary wear and tear.
5.03 Substantial Damage or Total Destruction; Lessor's Options: If the Leased Premises is
destroyed or substantially damaged by fire or any other cause, the Lessor may:
terminate this Lease as to the building damaged or destroyed; or
rebuild the destroyed or substantially damaged building or buildings as
expeditiously as possible, but in no event more than one hundred eighty (180)
days after the date of such damage, and to treat this Lease as continuing in
effect.
5.04 Substantial Damage or Total Destruction; Lessee's Options: If the Leased Premises are
destroyed or substantially damaged by fire or any other cause, the Lessee may terminate this Lease
as ofthe date of such damage as to the building or buildings substantially damaged or destroyed and
the land on which the building or buildings were located if:
Lessee has not received written notice from Lessor regarding Lessor's
election pursuant to Section 5.03, above within thirty (30) days after the date
of such damage, or
2. the building which has been substantially damaged or destroyed cannot be
rebuilt within one hundred eighty (180) days after the date of such damage.
If any dispute arises with respect to whether any damage is susceptible of
repair within the one hundred eighty (180) day period, the ability of Lessor to
obtain a contract For the completion of such repairs within the one hundred
eighty (180) day period shall be determinative of whether such damage is
susceptible to repair within such period.
5.05 Temporary Facilities During Reconstruction: In the event Lessor elects to treat this
Lease as continuing in effect as to that building which is substantially damaged or destroyed, Lessor
is not obligated to provide temporary facilities to Lessee during any period of reconstruction.
5.06 Abatement of Rent During Reconstruction or Upon Termination: In the event Lessor or
Lessee elects to terminate this Lease as permitted by this Article as to the building substantially
damaged or destroyed, Lessee's obligation to pay rent hereunder shall terminate as of the date the
building was damaged or destroyed. If this Lease is terminated in its entirety as of the date of such
damage, Lessor agrees to promptly reimburse Lessee for any rent paid by Lessee attributable to the
period following the date of such damage. If this Lease is terminated as to some buildings as of the
date of such damage, any reimbursement of rent shall be credited toward the rent otherwise due
during the remainder of the Lease Term.
5.07 Partial Damage of Leased Premises (Usable): In the event any part of the building on
the Leased Premises is partially damaged by fire or other cause so as to require repair, but remain
usable for the purposes permitted by this Agreement, then Lessor shall repair any such damage as
_s_
expeditiously as possible, but in no event more than one hundred eighty (180) days after the date of
such damage, and without cost to Lessee. Lessee shall remain obligated to pay rent and comply with
all other provisions of this Agreement.
5.08 Trash and Waste Removal: Lessee agrees to cause to be removed from the Leased
Premises, at its own expense, all waste, garbage and rubbish, and agrees not to deposit same on the
Leased Premises except temporarily in waste or garbage containers provided by Lessee at Lessee's
expense.
ARTICLE 6. ACCESS TO AND USE OF AIRPORT
6.01 Access to Airport: Lessor shall maintain all roads on the Airport giving access to the
Leased Premises in good and adequate condition for use by cars and trucks and shall maintain free
and uninterrupted access to the Leased Premises over said roads at all times; provided, however,
Lessor shall not be in default of this Agreement if access is interrupted for any of the reasons set
forth in Section 14.03, below.
6.02 Right to Use Airport: Lessee and Lessee's employees and guests shall have the right to
use that part of the Airport and its facilities not included within the Leased Premises in common with
others authorized to do so. Such use shall be subject to any and all applicable federal, state or local
laws, ordinances, statutes, rules, regulations, or orders of any governmental authority, lawfully
exercising jurisdiction over the Airport or the activities and business operations of Lessee, including
any limitations, restrictions or prohibitions affecting the aviation activities or operations of Lessee.
6.03 Vehicular Operations on the Airfield: No vehicles of Lessee, its employees, customers
or invitees will be allowed to operate on, or cross, the runways of the Airport except pursuant to the
Airport Rules and Regulations.
6.04 Airport Certification Rules and Regulations: Lessee shall comply with such rules that
pertain to its operation on the Airport under the Airport Certifications Rules of Federal Aviation
Regulations Part 139, as amended [14 CFR Part 139, as amended], to the extent such regulations are
applicable to the operation of the Airport.
6.05 Airport Security Rules and Regulations: Lessee, its directors, officers, employees, and
contractors shall comply with all federal and local Airport Security Regulations adopted by the
Lessor as such rules and regulations exist or may hereafter be amended. LESSEE AGREES TO
INDEMNIFY AND HOLD HARMLESS THE LESSOR ITS OFFICERS AND EMPLOYEES,
from any charges, fines or penalties that may be assessed or levied by the FAA or the Texas
Department of Transportation by reason of the NEGLIGENT OR INTENTIONAL FAILURE OF
LESSEE, [TS DIRECTORS, OFFICERS, EMPLOYEES, OR CONTRACTORS to comply with
such Airport Security Regulations.
6.06 Additional Structures: Lessee shall not erect nor permit the erection of any structure or
object on the Leased Premises. Lessor reserves the right to enter upon the Leased Premises and to
remove the offending structure or object.
_6_
6.07 Aerial Approaches: 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 erecting or permitting to be erected any building or other structure on or adjacent to the
Airport which, in the opinion of the Lessor, would limit the usefulness of the Airport or constitute a
hazard to aircraft.
6.08 Right of Overflight: There is hereby reserved to the Lessor, for the use and benefit of
the public, a right of flight for the passage of aircraft above the surface of the Leased Premises,
together with the right to cause in said 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 the Airport.
ARTICLE 7. INSURANCE
7.01 Lessee's Minimum Insurance Amounts: Lessee shall obtain and maintain continuously
in effect at all times during the Lease Term, at Lessee's sole expense, at least the following minimum
insurance with a carrier or carriers licensed to do business in the State of Texas and satisfactory to
the Lessor:
Commercial General Liability Insurance against claims for bodily injury,
death, or property damage occurring on, in or about the Leased Premises, or
any other portion of the Airport, in at least the amount of $1,000,000.00 per
individual, $2,000,000.00 per occurrence and $1,000,000.00 with respect to
property damage. In the event that the Texas Torts Claims Act, as amended
(Tex. Civ. Prac. & Rem. Code. 101.001, et seq.) or its successor statute, is
amended to increase the amount of liability of municipalities for acts
described in said Act above the levels set forth in this Section 7.01.1, Lessee
agrees to increase the amount of insurance coverage required by this Section
7.01.1. to an amount sufficient to provide coverage to the level of potential
liability per occurrence under said Act; and
2. Automobile Liability Coverage on all motor vehicles owned and/or operated
by Lessee on the Leased Premises or other Airport property in amounts of not
less that $1,000,000 combined single limit or equivalent, provided, however,
separate automobile coverage shall not be required if such coverage is
provided under Lessee's comprehensive general liability policy.
7.02 Lessee's Coverage Primary: All insurance herein required shall apply as primary and
not in excess of or contributing with other insurance which the Lessee may carry. Insurance
provided pursuant to Section 7.01 shall name the Lessor as an additional insured or loss payee as the
case may be. The comprehensive general liability policy as provided in Section 7.01 shall provide
contractual liability coverage sufficiently broad so as to include the liability assumed by Lessee in
the indemnity and hold harmless provisions included in Article 8 ofthis Agreement. The Lessee's
insurance policies as required by this Agreement shall apply separately to the Lessor as if separate
policies had been issued to Lessee and [,essor.
~_
7.03 Contents of General Liability Policy: Lessee's Comprehensive General Liability policy
shall protect the Lessor and Lessee against any and all liability to any person or persons whose
property damage or personal injury arises out of or is in connection with the occupation, use, or
condition of the Leased Premises or resulting from any injury or damage occurring on or about the
roads, driveways or other public areas of the Leased Premises used by Lessee, its trustees, officers,
employees, students, invitees, and contractors at the Airport, whether or not such damage or injury is
the result ofnegligence ofthe Lessee or its officers, employees, representatives, invitees, licensees,
contractors, agents, guests, or students.
7.04 Cancellation; Certificates of Insurance: Lessee's insurance as required by this
Agreement shall not be subject to cancellation or material alteration until at least thirty (30) days
written notice has been provided to the Lessor. Lessee shall furnish to the Lessor, annually,
Certificates of Insurance showing Lessor as an additional insured and evidencing that all of the
herein stated requirements have been met.
7.05 Lessor's Right to Purchase Insurance: In the event such insurance as required by
Section 7.01, above, shall lapse, the Lessor reserves the right to obtain such insurance at Lessee's
expense. Following sixty (60) days prior written notice from Lessor, Lessee shall reimburse Lessor
for the full amount of the premium paid on Lessee's behalf.
ARTICLE 8. INDEMNITY
LESSEE AGREES T(
AND HOLD
COUN"1'Y, AND THEIR RESPECTIVE OFFICERS EMPLOYEES AND AGENTS from and
against any and all loss, damage, liability, claims, demands, costs, charges, expenses and causes of
action including all costs of defense thereof (and including reasonable attorney fees) of whatsoever
character which the Lessor may incur, sustain, or be subjected to on account of loss, damage to
property and loss thereof and for bodily injury to or death of any persons (including but not limited
to the property, employees, customers, contractors, agents, invitees and licensees of each party
hereto) ARISING OUT OF THE CONDUCT OR OPERATIONS, NEGLIGENT OR OTHERWISE
OF LESSEE, ITS DIRECTORS, OFFICERS, EMPLOYEES SUBLESSEES CONTRACTORS
SUBCONTRACTORS OR AGENTS on the Leased Premises. The Lessor will give Lessee prompt
notice of any claim made or suit instituted which in any way affects or might affect the Lessor.
Similarly, Lessee will accord the Lessor the same notice and rights.
AK'fICLE 9. UTILITIES
Lessor shall be solely responsible for the payment of all electric, telephone, water, natural gas
and other public utility services used in conjunction the use of the Leased Premises. Lessee shall be
prohibited from using any of the facility's utility services with the exception of the overhead light.
-8-
ARTICLE ] 0. ASSIGNMENT AND SUBLEASING
At no time shall Lessee sublease any portion of the Leased Premises or assign its interests or
obligations in this Lease Agreement without the written consent of Lessor, such consent not to be
unreasonably denied. Any such assignment or attempted assignment shall be void.
ARTICLE 11. TAX LIENS
Lessee shall be solely responsible for the collection and payment of all applicable federal,
state, and local taxes, including, but not limited to, sales, use, amusement, or excise tax required to
be collected and paid over by Lessee to the appropriate taxing authority. Furthermore, Lessee shall
be responsible for the payment of any applicable ad valorem taxes and any taxes on Lessee's
personal property located on the Leased Premises. Lessee shall at no time permit the foreclosure of
any tax liens to Lessee's leasehold interest or personal property in the Leased Premises or the
buildings, fixtures, or other improvements located on the Leased Premises. The Lessor shall have
the right to pay such taxes due after Lessee's refusal to pay such taxes, and upon demand Lessee
shall reimburse the Lessor for the amount of taxes paid plus any penalties, interests, and attorney's
fees incurred, subject to Lessee's right to challenge the validity of such taxes in whole or in part. In
the event that Lessee is successful in any challenge regarding the payment of any tax, the Lessor
shall he subrogated to any recovery obtained by Lessee to the extent of the amount of taxes,
interests, penalties, and attorneys fees previously paid by the Lessor and not already reimbursed by
Lessee.
ARTICLE 12. DEFAULT AND REMEDIES
12.01 Default by Lessee: The following shall be deemed to be events of default by Lessee
under this Agreement:
1. Lessee shall fail to pay when due any installment of rent or any other
payment required pursuant to this Agreement;
2. Lessee or any guarantor of Lessee's obligations hereunder shall file a petition
or be adj udged bankrupt or insolvent under any applicable federal or state bankruptcy
or insolvency law or admit that it cannot meet its financial obligations as they
become due, or a receiver or trustee shall be appointed for all or substantially all of
the assets of Lessee or any guarantor of Lessee's obligations hereunder;
3. Lessee or any guarantor of Lessee's obligations hereunder shall make a
transfer in fraud of creditors or shall make an assignment for the benefit of creditors;
4. Lessee shall do or permit to be done any act which results in a lien being filed
against the Leased Premises;
5. The liquidation, termination, dissolution of Lessee or any guarantor of
Lessee's obligations hereunder; or
_9_
6. Lessee shall be in noncompliance with any other term, provision or covenant
of this Agreement.
12A2 'termination Upon Lessee's Default: Except for an event ofdefault resulting from the
filing of a petition in bankruptcy, if an event of default by Lessee shall continue for ten (10) days
after service of notice of such event ofdefault, Lessor may give notice of its election to terminate
this Agreement, and thirty (30) days after service of such notice of election to terminate, this
Agreement shall cease and terminate as if the day of Lessor's election were the day originally fixed
for termination of this Agreement. Such election to terminate by Lessor shall not be construed as a
waiver of any claim it may have against the Lessee consistent with such termination. If, however,
the event of default is of such nature that it cannot reasonably be remedied within ten (] 0) days after
receipt of notice, and if the Lessee shall have commenced curing such event ofdefault within ten
(10) days after receipt of such notice, and shall continuously and diligently proceed in good faith to
cure such event of default, then the period for curing the event of default shall be extended for such
length of time as is reasonably necessary to cure the event ofdefault. Furthermore, if the event of
default is the result of Lessee tiling a petition in bankruptcy, then termination shall not occur unless
the trustee in bankruptcy has failed to ratify this lease within sixty (60) days following the date of
filing of the petition in bankruptcy.
12.03. Abandonment of Business by Lessee: Lessee further agrees that the abandonment for
a period of thirty (30) days by Lessee of the conduct of its business activities at the Airport shall
terminate Lessee's rights under this Agreement. By so terminating this Agreement, Lessor does not
waive any other claim or rights against Lessee. For the purposes of this paragraph, the term
"abandonment" shall mean the failure of Lessee to be open for business on the Leased Premises
except in the case of war, strike, catastrophe or causes beyond Lessee's control.
12.04 No Remedv Exclusive: No remedy herein conferred upon or reserved to the Lessor or
Lessee is intended to be exclusive of any other available remedy or remedies, but each and every
such remedy shall be cumulative and shall be in addition to every other remedy given under this
Agreement or hereafter existing under law or in equity. No delay or omission to exercise any right
or power accruing upon any default shall impair any such right or power or shall be construed to be a
waiver thereof, but any such right and power may be exercised from time to time and as often as
may be deemed expedient. In order to entitle the Lessor and Lessee to exercise any remedy reserved
to it in this section, it shall not be necessary to give any notice, other than such notice as may be
herein expressly required.
12.05 No Waiver of Breach: Lessor's failure or delay in declaring the existence of an event
of default by Lessee shall not be construed as a waiver thereof, nor shall it be construed so as to
waive or to lessen the right of the Lessor to insist upon the performance by Lessee of any term,
covenant or condition hereof, or to exercise any rights given it on account of any such event of
default. A waiver of any particular event of default shall not be deemed to be a waiver of the same,
similar of any other subsequent event ofdefault.
12.06 Expeditious Action. Notwithstanding any provision as to notice in this Agreement
herein contained, if in Lessor's reasonable judgment the continuance of any event of default by
Lessee for the full period of the notice to cure the event of default will jeopardize the operation of
in
the Airport or the rights of the Lessor or the other Airport tenants, Lessor may, without notice, elect
to perforni those acts in respect to which Lessee is in default. Lessee shall reimburse Lessor for any
reasonable and necessary costs incurred by the Lessor pursuant to this Section 12.06.
12.07 Default in Rent Payment: Notwithstanding anything to the contrary above, if there
should be any default in the payment by Lessee of any rates, fees or charges due to Lessor as
provided herein, the Lessor may give Lessee a ten (10) day written notice to pay all sums then due or
cease operations, and if such payment is not made within such ten (10) day period or such longer
time as Lessor may set forth, Lessee's rights under the Agreement shall terminate. By so terminating
this Agreement, the Lessor does not waive any other claim or rights against Lessee. However, if
such monetary default consists only of underpayment of a disputed and unliquidated sum, under
$1,000.00, the termination of this Agreement may be forestalled by tender of the liquidated sum and
deposit of the amount in controversy in escrow.
ARTICLE 13. TERMINATION BY LESSEE
Except for the payment by Lessee to Lessor of rents or other amounts past due or accrued but
not yet due, Lessee shall have the right to terminate this Agreement in its entirety, and all rights and
obligations ensuing therefrom immediately upon the material restriction ofthe Lessor's operation of
the AirpoR by action of the Federal Government, or any department or agency thereof, under its
wartime or emergency powers, and the continuance thereof for a period of not less than sixty (60)
days, to the extent such action prevents or reduces Lessee's ability to conduct it's activities specified
in Section 4.01, above; provided however, that without prejudice to the rights of Lessee to terninate
as above provided, the Lessor and Lessee may mutually agree to adjust fees and charges. If Lessee
terminates this Lease for any of the reason described herein, Lessor shall promptly repay Lessee any
rent previously paid by Lessee attributable to the period following the effective date of such
termination.
ARTICLE 14. MISCELLANEOUS PROVISIONS
]4.01 Dama es:
AND
TO LESSEE FOR ANY DAMAGE TO THE PERSONAL PROPERTY OF LESSEE caused by the
act of negligence of any of those hereby released or any other user of the Airport, the bursting,
leaking or running of any cistern, water closet, waste pipe, tank, water, gas, steam or sewer pipe, or
oil and/or gas pipelines in, above, upon or about the Leased Premises, the Airport, or any part
thereof, any heating, gas or electrical device, or vehicle, or any flooding or other weather related
casualty. Lessor acknowledges that the Leased Premises is not within the boundaries of any known
flood plain.
14.02 Quiet Enjoyment: Upon the performance of the covenants and agreements on the part
of the Lessee to be performed hereunder, the Lessee shall peaceably have and enjoy the Leased
Premises, appurtenances, facilities, licenses and privileges granted in this Agreement.
14.03 Force Majeure: Neither the Lessor nor Lessee shall be deemed in violation of this
Agreement if it is prevented from performing any of its obligations hereunder except the obligation
ii
to pay rent by reason of strikes, boycotts, labor disputes, embargoes, shortages of materials, act of
God, acts of the public enemy, act of superior governmental authority, weather conditions, floods,
riots, rebellions, acts of sabotage or any other circumstances for which it is not responsible or which
are not in its control.
14.04 No Partnership Agency, Joint Venture: It is mutually understood and agreed that
nothing in this Agreement is intended or shall be construed as in any way creating or establishing
any partnership, joint venture, agency, or any other relationship between the Lessor and Lessee other
than landlord and tenant, respectively.
14.05 Inspection by Lessor: Lessor may enter upon the Leased Premises at any reasonable
time for any purpose necessary, incidental to or connected with the performance of Lessor's
obligations hereunder, or in the exercise of its governmental functions, for fire protection or security
purposes, or for inspecting or maintaining the Leased Premises, or doing any and all things Lessor is
obligated to do, or which may be deemed by Lessor necessary or desirable for the proper conduct
and operation of the Airport or the protection of Lessor's interests.
14.06 On-Site Representatives: Lessee shall select and appoint a representative or
representatives for its operations at the Airport. The representatives shall be qualified and
experienced, and vested with the full power and authority to act in the name of the Lessee with
respect to the method, manner and conduct of the operation of Lessee to be performed under this
Agreement. Lessor's on-site representative shall be the Lessor's Director of Public Works or such
other personas may be appointed by the City Manager.
14.07 Conformance with Rules and Regulations: The use of the Airport by Lessee shall be
subject [o any and all rules, regulations and ordinances which are now in force or which may be
hereafter adopted by the Lessor with respect to the operation and use of the Airport, but no such
rules, regulations, or ordinances shall increase the Base Rent payable by Lessee under this Lease or
otherwise materially and adversely affect Lessee's tenure of the Leased Premises under this Lease.
Furthermore, this Agreement and Lessee's use of the Airport shall be subject to any and all
applicable laws, ordinances, resolutions, statutes, rules, regulations or orders ofany Federal, State or
local governmental authority lawfully exercising jurisdiction over the Airport or the activities and
business operations of Lessee, including any limitations, restrictions or prohibitions affecting the
aviation activities or operations of Lessee.
14.08 Licenses and Permits: Lessee hereby agrees that it shall, at its own expense and cost,
procure and obtain all lawfully required licenses and permits, certificates and other authorizations
required by any governmental authority, in connection with or covering the operations or activities
perniitted to be performed by it under the provisions of this Agreement.
] 4.09 Notices: Notices provided for in this Agreement shall be either hand delivered or sent
by certified mail, return receipt requested, postage prepaid, and properly addressed as follows:
If to Lessor: City Manager
800 Junction Highway
Kerrville, Texas 78028
iz
If to Lessee: Hill Gilstrap
c/o Scott Stooksberry
1400 W. Abram
Arlington, TX 76013
With copy to: Chris Barley
Triad Holdings, Inc.
1994 Airport Loop Road
Kerrville, TX 78028
The parties may change the representative or address for delivery of notices from time to time by
sending written notices to the other party. All notices shall be in writing and effective only upon
actual receipt.
14.10 Governing Law and Venue: This Agreement and all of the transactions contemplated
herein shall be governed by and construed in accordance with the laws of the State of Texas. Venue
for any cause of action shall be in a court of competent jurisdiction in Kerr County, Texas.
14.11 Severability: If any provision of this Agreement is invalid or unenforceable, this
Agreement shall be considered severable as to such provision, and the remainder ofthis Agreement
shall remain valid and binding as though such invalid or unenforceable provision were not included
herein.
14.12 Captions: Section headings are inserted herein only as a matter of convenience and
for reference, and in no way defines, limits or describes the scope or intent to any provision herein.
14.13 Use of Language: Words of any gender used in this Agreement shall be held and
construed to include any other gender, and words in the singular shall be held to include the plural,
unless the context otherwise requires.
14.14 Counterparts: 'this Agreement may be executed in multiple counterparts, each of
which shall be deemed as original, and all of which constitute but one and the same instrument.
14.15 Development of the Airport: Future development, changes, alterations, modifications
or improvement to the Airport shall be at the sole discretion of the Lessor, subject only to such
notification to Lessee that the Federal Aviation Administration may dictate. The Lessor will strive
not to hinder the Lessee's operations in carrying out the provisions of this paragraph. Where
reasonably possible, Lessor shall provide Lessee with ninety (90) days advanced notice of any
Airport development projects that may interfere with or cause change to Lessee's normal business
operations (i. e., roadwork projects).
14.16 Subordination to State or Federal Agreements: This Agreement shall be subordinate
to the provisions and requirements of any existing or future agreement between the Lessor and the
United States or the Lessor and the State of Texas, relative to the development, operation or
maintenance of the Airport.
13
14.17 No Exclusivity on Aeronautical Services: Nothing herein contained shall be construed
to grant or authorize the granting of the exclusive right to provide aeronautical services to the public
as prohibited by Section 308(a) of the Federal Aviation Act of 1958, as amended.
14.18 Discrimination Prohibited: Lessee, for itself, its trustees, officers, legal
representatives, successors-in-interest and assigns, as a part of the consideration hereof, agrees (1)
that no person on the grounds of race, color, sex, national origin, veteran status or disability shall be
excluded from participation in, denied the benefits of or be otherwise subjected to discrimination in
the use of the Leased Premises; (2) that Lessee shall use the Leased Premises and the Airport in
compliance with all other requirements imposed by, or pursuant to, Title 49, Code of Federal
Regulations, Department of Transportation, Subtitle A, office of the Secretary, Part 21,
Nondiscrimination inFederally-Assisted Programs ofthe Department ofTransportation-Effectuation
of Title V I of the Civi- Rights Act of 1964, and as said regulations may be amended. In the event of
breach of any of the above nondiscrimination covenants, the Lessor shall have the right to terminate
this Agreement and to re-enter and repossess the Leased Premises and the improvements thereon,
and hold the same as if said Agreement were terminated by its own term pursuant to Section 2.01,
above.
14.19. Entire Agreement: This Agreement embodies the entire agreement between the
Lessor and Lessee, and supersedes all prior agreements and understandings, whether written or oral,
and all contemporaneous oral agreements and understandings relating to the subject matter hereof.
This Agreement shall not be changed, modified, discharged or extended, except by written
instrument duly executed by Lessor and Lessee. The parties agree that no representations or
warranties shall be binding upon either party unless expressed in writing in the aforesaid Agreement.
14.20. Representation of Counsel; Mutual Negotiation: Each party has had the opportunity
to be represented by counsel of its choice in negotiating this Agreement. This Agreement shall
therefore be deemed to have been negotiated and prepared at the joint request, direction, and
construction of the parties, at arms length, and with the advice and participation of counsel.
14.21 Authority to Sign: Each person signing below represents that he or she is duly
authorized to execute this Agreement on behalf of the party indicated below by his or her name and
agrees on behalf of such party that such party will be bound by the terms of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
legally executed in duplicate this Z '7 day of CC , 2002.
CITY K I LE, TEXAS COUNTY OF KERR, TEXAS
:~
S P. Fine, Mayor County Judge
14
ATTEST:
Sheila L. Brand, City Clerk
APPROVED AS TO FORM:
Michael C. ayes, Inter' City Attorney
TRIAD MANUFACTURING, LTD.
By: Triad Holdings, Inc., Its Sole General Partner
C
Chri opher Ba ey, P wide t
L\Le˘al\AIRPORT':CONTRACT\Warehouse lease II 15M1 SF_BA Pmduds_OB20U3 d«
IS
50'x50' Bldg.
50'x50'		30'x50'
Covered	~ j~	Leased
Area		Area
Base Material Drive
Airport Loop Rd.
EXHIBIT "A"