HomeMy WebLinkAboutOsprey Aviation, LLC - Hangar and Ground Site Lease Agmnt - 12/30/2019 REGIONALWATERLOO
AIRPORT
CRUISE A NEW ALTITUDE
and
OSPREY AVIATION, LLC
Hangar and Ground Site Lease Agreement
Effective Date: January 1, 2020
TABLE OF CONTENTS
Page
ARTICLE1 -PREMISES.......................................................................................................................1
ARTICLE 2 - OBJECTIVES AND PURPOSE OF LEASE................................................................1
Section 2.01 Use of Premises........................................................................................................ 1
Section2.02 Prohibited Uses. .......................................................................................................2
Section 2.03 Conduct of Operations on Premises.........................................................................2
ARTICLE 3-TERM AND COMPENSATION....................................................................................3
Section3.01 Initial Term...............................................................................................................3
Section3.02 Rent..........................................................................................................................3
Section3.03 Options to Renew.....................................................................................................3
Section 3.04 Future Adjustments of Rents and Fees.....................................................................4
Section3.05 Holding Over............................................................................................................4
Section3.06 Late Charges.............................................................................................................4
Section 3.07 Surrender of Possession............................................................................................4
Section3.08 Chronic Late Payment..............................................................................................5
Section 3.09 Dishonored Checks. .................................................................................................5
Section 3.10 Application of Payment............................................................................................5
ARTICLE 4- OPERATOR'S FUTURE CONSTRUCTION REQUIREMENT...............................5
Section 4.01 Requirements for Improvements on Premises..........................................................5
Section 4.02 Initial Construction Dates.........................................................................................5
Section 4.03 Approvals of Construction Plans..............................................................................6
Section 4.04 Extension of Utilities or Special Facilities...............................................................6
Section 4.05 Construction of Additional or Future Facilities........................................................6
Section 4.06 Alterations or Repairs to Premises...........................................................................6
Section 4.07 Lien Indemnification................................................................................................6
Section 4.08 Cost of Construction and Alterations.......................................................................7
Section 4.09 As-Built Drawings....................................................................................................7
Section 4.10 Security Interest on Leasehold Improvements for Construction..............................7
Section 4.11 Ownership of Improvements....................................................................................8
Section 4.12 Performance Bonds—Construction Guarantee. .......................................................9
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ARTICLE 5-OBLIGATIONS OF OPERATOR.................................................................................9
Section5.01 Net Lease..................................................................................................................9
Section 5.02 Maintenance and Operation......................................................................................9
Section5.03 Utilities................................................................................................................... 10
Section 5.04 Trash, Garbage, Etc................................................................................................ 10
Section5.05 Signs. ..................................................................................................................... 1 I
Section 5.06 Non-Discrimination................................................................................................ 11
Section 5.07 Observance of Statutes and Regulations. ............................................................... 11
Section5.08 Hazard Lights......................................................................................................... 1 l
Section5.09 Airport Security...................................................................................................... I 1
ARTICLE 6- OBLIGATIONS OF THE AIRPORT.......................................................................... 12
Section 6.01 Operation as a Public Airport................................................................................. 12
Section 6.02 Ingress and Egress.................................................................................................. 12
Section 6.03 Snow Removal Operation and Turf Maintenance .............................. ......... 12
ARTICLE 7—AIRPORT'S RESERVATIONS..................................................................................12
Section 7.01 Improvement,Relocation or Removal of Structure. .............................................. 12
Section 7.02 Airfield Operations................................................................................................. 12
Section 7.03 Inspection of Premises............................................................................................ 13
ARTICLE 8-INDEMNITY AND INSURANCE...............................................................................13
Section8.01 Indemnification. ..................................................................................................... 13
Section8.02 Insurance. ............................................................................................................... 13
Section 8.03 Environmental Impairment..................................................................................... 14
Section 8.04 Fire and Extended Coverage Insurance.................................................................. 14
Section 8.05 Waiver of Subrogation........................................................................................... 15
Section 8.06 Application of Insurance Proceeds......................................................................... 15
Section 8.07 Performance Bonds................................................................................................ 15
Section 8.08 Destruction of Premises(Uninsured Cause)........................................................... 15
ARTICLE 9- CANCELLATION BY THE AIRPORT ....................................................................15
Section 9.01 Events of Default by Operator................................................................................ 15
Section 9.02 Remedies for Operator's Default. .......................................................................... 16
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ARTICLE 10- CANCELLATION BY OPERATOR FOR EVENTS OF DEFAULT BY AIRPORT 17
Section 10.01 Event of Default by Airport ................................................................................. 17
Section 10.02 Remedies for Airport's Default............................................................................ 18
ARTICLE 11 -RIGHTS UNDER TERMINATION..........................................................................18
Section 11.01 Fixed Improvements............................................................................................. 18
Section 11.02 Personal Property. ................................................................................................ 18
ARTICLE 12 -ASSIGNMENT AND SUBLETTING........................................................................19
Section12.01 Assignment........................................................................................................... 19
ARTICLE 13- QUIET ENJOYMENT................................................................................................19
ARTICLE 14-GENERAL PROVISIONS..........................................................................................19
Section 14.01 Non-Interference with Operations of Airport....................................................... 19
Section 14.02 Attorney's Fees. ................................................................................................... 19
Section 14.03 Taxes and Special Assessments. ..........................................................................20
Section 14.04 Right to Contest....................................................................................................20
Section 14.05 License, Fees and Permits....................................................................................20
Section 14.06 Non-Exclusive Rights...........................................................................................20
Section 14.07 Paragraph Headings..............................................................................................20
Section 14.08 Interpretations.......................................................................................................20
Section14.09 Non-Waiver..........................................................................................................20
Section14.10 Severability...........................................................................................................21
Section 14.11 Binding Effect. .....................................................................................................21
Section 14.12 No Partnership......................................................................................................21
Section 14.13 Duty to be Reasonable..........................................................................................21
Section14.14 Notices..................................................................................................................21
Section 14.15 Entire Agreement. ................................................................................................22
Section 14.16 No Construction Against Drafting Party..............................................................22
Section 14.17 Third-Party B eneficiaries....................................................................................22
Section 14.18 Authorization and Execution................................................................................22
EXHIBIT A Diagram and Legal Description of Lease Area.................................................23-27
EXHIBIT B Lease Area Legal Description........................................................................28
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THE CITY OF WATERLOO—WATERLOO REGIONAL AIRPORT
and
OSPREY AVIATION, LLC
LEASE SUMMARY
TYPE OF AGREEMENT Hangar and Ground Site Lease Agreement
TENANT Osprey Aviation,LLC
REPRESENTATIVE(S) Michael L.Peterson
NOTICE ADDRESS 1710 Adams Street,Cedar Falls,IA 50613;Office: 266-1731;Mobile: 319-290-1732
EFFECTIVE DATE January 1,2020
TERM 40 years,with two(2)five(5)year option periods thereafter
Operator has an option to further extend the lease agreement beyond the full 40-year
RENEWAL OPTIONS term.
Operator's option shall extend to no greater than two(2)five(5)year option periods,
TERMINATION DATE Initial Term:December 31,2059
LEASEHOLD/ASSIGNED Ground Site:TBD pending final construction drawings
PREMISES
INITIAL RENTAL RATE Ground Rent-$365.15 per month($0.125 per s.f.per year-35,055 s.f._$4,381.80 per
yr-)-
RENTAL ADJUSTMENT Adjusted by CPI,Midwest Region every five years
A Fuel Flowage Fee (FFF) will be imposed by the Airport Operator if the tenant
OTHER FEES,RATES AND installs a self-fueling station for the sole purpose of fueling company aircraft. Fuel
CHARGES Flowage Fee, at Cents per Gallon, will be the same FFF as the Operator imposes on
other aviation tenants as part of the Airport's Standard Rates and Charges.
AUTHORIZED USE(S) Private aircraft storage and private aircraft maintenance.
Note: This summary is presented as a reference of the agreement information at the time of execution. If
there is a discrepancy between the information contained in this summary and the requirements contained
in the remainder of the agreement, the requirements as stated in the remainder of the agreement will
prevail.
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City of Waterloo, Iowa and Waterloo Regional Airport
AND
OSPREY AVIATION,LLC
Ground Site Lease Agreement
THIS GROUND SITE LEASE AND DEVELOPMENT AGREEMENT (hereinafter referred to as the
"Agreement", is entered into on Dc-c 3 O , 2020, to be effective as of the Effective Date stated in
Section 3.01, by and between the City of Waterloo, Iowa, c/o Waterloo Regional Airport (hereinafter
referred to as the "Airport"), and OSPREY AVIATION, LLC, an Iowa Limited Liability Company
(hereinafter referred to as the"Operator").
WITNESSETH:
In consideration of the lease of certain real property and the covenants and agreements contained herein,
the parties agree as follows:
ARTICLE 1
PREMISES
1. The Airport hereby Ieases to Operator, for Operator's and its Affiliates' (as defined herein)
exclusive use as specifically authorized herein, and for no other use except as agreed to, and
authorized herein, a tract(s)of land for construction of a hangar building as described below and
located at the Waterloo Regional Airport (the "Airport"), on a plot of land containing
approximately 35,055 square feet(154'x 202'and 68.85'x 57.33'),as shown on Exhibits A and B
attached hereto and incorporated herein by reference(the"Premises").
ARTICLE 2
OBJECTIVES AND PURPOSE OF LEASE
Section 2.01 Use of Premises
1. The Operator's use of the Premises, including building[s] and facilities constructed thereon, is
limited to the private storage and maintenance of Operator's and its Affiliates' aircraft,and those
uses incidental thereto, in accordance with the Airport Rules & Regulations. For the purpose of
this Agreement, the term "Affiliates" shall include any entity under the common control of
Osprey Aviation,LLC.
2. The Operator and its Affiliates, in addition to the use of the Premises, shall be entitled to the
general use, in common with others, of all Airport facilities made available for use to the general
public except as may be otherwise hereinafter provided.
3. For the purpose of this Agreement, "Airport facilities" shall include runways, taxiways, ramps,
aircraft and automobile parking areas, roadways, sidewalks, navigation and navigational aids,
lighting facilities, terminal facilities, aircraft fueling facilities or other areas of the Airport, that
have been constructed at Airport's expense for the benefit of the Operator, Operator's tenants,
and the general public. Provided, however,that the use of the above-mentioned airport facilities,
by the Operator, shall be subject to their full compliance with such rules and regulations as now
exist or may hereafter be enacted by the Airport. Operator understands and agrees that approved
uses of Airport facilities are also subject to the payment of such fees and charges, including, but
not limited to, landing fees, fuel flowage fees, airfield access charges, commissions on gross
receipts, or ground site rents, if any, as may be established from time to time by the Airport for
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the maintenance, operation or replacement of the Airport, and Airport related facilities, with the
parties' intent being that Operator be treated no differently from other users of Airport.
The Airport will provide the Operator with notice and an opportunity to comment prior to
implementation of any such new fees,and charges.
4. The aircraft maintenance permitted on the Premises is maintenance that can routinely be
performed by the Operator and its Affiliates, employees of the Operator and its Affiliates, or
persons contracted by the Operator and its Affiliates to perform warranty or specialty work,
having the required licenses, certificates and permits to perform the work. Referenced
maintenance shall be accomplished in accordance with all applicable building and fire codes and
Airport Rules and Regulations/Minimum Standards.
Section 2.02 Prohibited Cases
The following activities are expressly prohibited:
1. The Operator may not use any part of the Premises or the improvements located thereon for any
aviation or non-aviation activity or purpose, other than as expressly set forth and authorized in
Section 2.01,unless such use is approved,in writing,by the Airport.
2. Operator may not offer commercial aeronautical services to the public from the Premises.
3. The Operator will not block the taxiways, runways or aircraft ramps or store aircraft upon
taxiways or grass areas of the Airport.
4. The operation of automobiles,trucks,or other vehicles in the Air Operations Areas(AOA)of the
Airport is prohibited, without approval of the Airport.
5. The Operator, if constructing a self-fueling station, shall not undertake fueling operations for non-
company aircraft, or retail fuel to non-company aircraft. Said self-fueling station shall be used
only by Operator or employees of the Operator.
6. Any other activity not specifically authorized by this Agreement.
Section 2.03 Conduct of Operations on Premises
In its exercise and carrying out of the rights, privileges, duties, and obligations granted herein, and in its
use of the Premises, Operator hereby obligates itself, and agrees to obligate all of its sub-lessees and/or
occupants,to the following requirements and regulations:
1. Operator shall not consent to any unlawful use of the Premises, nor permit any such unlawful use
thereof.
2. Operator agrees that all local, federal and state ordinances and laws will be observed in its use
and occupancy of the Premises, including the rules and regulations of the federal and state
aeronautical authorities and the local governing authorities.
3. Operator shall comply with all Airport rules,regulations and ordinances as they now exist or may
hereafter be amended or adopted.
4. The operations of Operator, its sub-lessees,employees, invitees and those doing business with it,
shall conduct all activities in an orderly and proper manner so as not to annoy, disturb or be
offensive to others at the Airport. The Airport shall have the right to complain to Operator as to
the demeanor, conduct and appearance of Operator's employees, sub-lessees, invitees and those
doing business with it, and as to its and/or their failure to utilize said facilities at times, and in the
manner, and according to the standards, mandated by the Airport, whereupon Operator will take
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all steps reasonably necessary to remove the cause of the complaint and bring the operations and
services into compliance with such standards as promptly as possible.
5. Operator shall comply with all rules and regulations of the local and/or state fire marshal in the
conduct of its operations on the Premises.
6. Operator shall abide by all environmental laws, rules and regulations contained in the Rules and
Regulations as are applicable to Operator's activities.
7. Operator shall be responsible for the payment of water, gas and sewer charges and electric
current, telephone service and other utilities utilized or consumed on the Premises and shall
separately meter same.
8. Operator may have coin-operated telephones in the building[s] on the Premises, and may have
any other reasonably appropriate vending machines as Operator deems necessary and appropriate
on the Premises without having to secure the written consent of Airport.
9. Operator shall not use or permit the Premises to be used for the sale to its employees or to the
public of any goods or services not directly related to those activities authorized in this
Agreement.
The Airport reserves the right to further develop its land and to lease the same for any lawful purpose
whatsoever or to provide any services it deems necessary or desirable in its sole and absolute discretion,
for the public,regardless of the desires or views of Operator,and without interference or hindrance.
ARTICLE 3
TERM AND COMPENSATION
Section 3.01 initial Term
The initial term of this Agreement shall be for forty(40)years, effective January 1,2020 or the first of the
month following the month in which the occupancy permit is first issued to the Operator(the "Effective
Date"), and terminating at 11:59 p.m. on December 31, 2059 or the date that is the last day of the month
forty (40) years from the date in which an occupancy permit is first issued to the Operator, whichever
occurs later,and subject to earlier termination as provided herein.
Section 3.02 Rent
1. Ground Site Rent. In addition to financing all improvements and development of the Premises,
the Operator shall pay an annual ground rent of 381.!10, which is equal to $0.125 per square
foot for 35,055 square feet of improved ground site. Said agreed rent shall be paid in advance
monthly on the first day of each month in twelve (12) equal installments of3$ 65.15. Rent is
subject to adjustment as set forth in Section 3.04.
2. Payments. All payments are to be made at the office of the Waterloo Regional Airport, 2790
Livingston Lane, Waterloo, Iowa 50701. Payments are due on or before the first day of each
month, starting the first month following the month in which an occupancy permit is first issued
to Operator.
Section 3.03 Options to Renew
1. Operator shall have the option to renew this Agreement for two(2)additional five(5)year(sixty
(60) month) periods, provided that Operator is not then in default of this Agreement. The
Operator may exercise its option to renew this Agreement by giving the Airport written notice of
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Operator's desire to renew at least one hundred eighty (180) days prior to the expiration of the
Initial Term and the first renewal term,as applicable.
2. Upon termination of this Agreement, through default or lapse of time, all fixed improvements to
the Premises shall, automatically and without payment of any compensation, become property of
the City of Waterloo/Airport as detailed in Article 11.
Section 3.04 Future Adiustments of Rents and Fees
As of the fifth anniversary of the Effective Date, and every five years thereafter, the annual rental
payment shall be adjusted to reflect changes in economic conditions by multiplying the rental by a
fraction, the denominator of which is the Consumer Price Index All Urban Consumers, All Cities, non-
seasonally adjusted, (CPI, Midwest Region) 1982-1984 = 100, published by the Bureau of Labor
Statistics of the United States Department of Labor (the "Index") for the third month preceding the
Effective Date and the numerator of which is the Index for the third month immediately preceding the
beginning of each fifth year. In no event shall the Operator's rental obligation be reduced below the rent
that is initially established by this Agreement. Should the United States Government revise its price
index at any time, the parties hereto will follow such suggestions as the Government may issue for
making an arithmetical changeover from one index to another. Should the price index be wholly
discontinued, then its successor or the most nearly comparable successor index thereof, adjusted back to
the date that is three(3)months prior to the date of this Agreement, shall be used.
Section 3.05 Holdine Over
If Operator holds possession of the Premises after the expiration or termination of the Term, including
any renewal term, by lapse of time or otherwise,Operator shall become a tenant at sufferance upon all of
the terms contained herein, except as to Lease Term and Rent. During such holdover period, Operator
shall pay to the Airport a monthly rental equivalent to one hundred fifty percent (150%) of the Rent
payable by Operator to the Airport with respect to the last month of the Lease Term. The monthly rent
payable for such holdover period shall in no event be construed as a penalty or as liquidated damages for
such retention of possession.
Without limiting the foregoing, Operator hereby agrees to indemnify, defend and hold harmless the
Airport, its officials, agents, contractors and employees, from and against any and all claims, liabilities,
actions, losses, damages (including without limitation, direct, indirect, incidental and consequential) and
expenses (including, without limitation, court costs and reasonable attorneys' fees) asserted against or
sustained by any such party and arising from or by reason of such retention of possession, which
obligations shall survive the expiration or termination of the Lease Term. Nothing herein shall be
construed as requiring Airport to allow Operator to hold over,and doing so shall not be a waiver of any of
Airport's rights at termination.
Section 3.06 hate Charees
The Operator shall pay to the Airport a late charge equal to 1.5% per month on all rent and fee charges
which are 30 days past due. Said late charge shall commence on the past due amount from the date said
payment was due and shall be computed to the date the past due amount is paid. This shall be in
addition to, and in no way alters, any other rights reserved to the Airport, or existing in the Airport by
virtue of the laws of the State of Iowa,or by the terms of this Agreement.
Section 3.07 Surrender of Possession
At the expiration of the term of this Agreement, including any renewal term(s),whether by lapse of time
or otherwise, Operator shall promptly and peacefully surrender the Premises to the Airport in the
condition in which it was received, subject to those improvements as outlined in Article 4 below and
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reasonable wear and tear excepted.
Section 3.08 Chronic Late Payment
Airport may also terminate this Agreement for the reason that Operator is chronically late with rental
payments. Chronic late payments are defined as making a rental payment more than ten (10) days after
the due date on three (3) or more occasions during any consecutive 12-month period during the term of
this Agreement.
Section 3.09 Dishonored Checks
If Operator makes a payment due under this Agreement with a check or other payment method that has
been retumed/dishonored by the bank, Operator shall pay a$20.00 administrative fee to Airport and shall
also reimburse Airport for any fees charged to Airport by its bank (collectively, "Dishonored Funds
Fees"), payable with the next rental payment due after receipt of Airport's written demand for such fee.
This amount is in addition to the"Late Fee". Dishonored Funds Fees shall be deemed additional rent.
Section 3.10 APpllication of Payment
Money paid by Operator to Airport shall be applied first to interest, second to court costs legally
chargeable to Operator, third to attorney fees chargeable to Operator, fourth to outstanding repair bills
that are the responsibility of the Operator,and fifth toward rent.
ARTICLE 4
OPERATOR'S CONSTRUCTION REQUIREMENTS
Section 4.01 Rea uirements for Improvements on Premises
Unless otherwise agreed by the Airport, Operator shall, at its sole expense, construct on the Premises, as
provided in Sections of this Article 4, such buildings, structures, fencing, roadways, utility lines,
additions, and improvements as are necessary in furtherance of the purposes set forth in Article 2,and the
Operator shall install herein and thereon such equipment and facilities as the Operator or the Airport may
deem necessary or desirable.
Provided, however,that no building,structure, fencing,roadway,utility lines,addition or improvement of
any nature shall be made or installed by the Operator without the prior written consent of the Airport as
herein provided.
The Operator shall provide to Airport, upon written request, with proof that funds necessary to complete
construction of the improvements have been irrevocably dedicated to such construction.
All improvements constructed under this Agreement shall be in accordance with all applicable laws,rules,
regulations and ordinances.
Section 4.02 Initial Construction Dates
Construction of the initially approved Operator Improvements,which are more fully described in Exhibit
C attached hereto and fully incorporated herein by reference,on the Premises shall begin no later than 120
days from the date the City/Airport approves such construction, and shall be completed no later than 12
months from the date of such approvals, or a date as mutually agreed to by Airport and Operator in
writing. Operator shall be responsible, at its own expense, to demolish any structures or other
improvements on the Premises that obstruct or interfere with approved Operator Improvements, to
properly abate any asbestos or other Hazardous Materials as defined in Section 8.03, and to properly and
safely dispose of demolition materials, including but not limited to hazardous materials, away from the
Airport.
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In the event Operator shall fail to begin construction within the initial 120-day period, Airport shall have
the right to terminate construction authorization and this Agreement,through written notice. In the event
Operator shall fail to complete construction within the 12-month construction period, Airport shall have
the right to terminate this Agreement through written notice, after filing a claim against the performance
bond provided in accordance with Section 4.12 in order to fund the completion of the construction. Even
if this Agreement is terminated for non-performance, Operator shall remain obligated to pay any unpaid
rent or other charges.
Section 4.03 Approvals of Construction Plans
The Operator covenants and agrees that prior to the preparation of detailed construction plans,
specifications and architectural renderings of any such building, structure, roadway, addition or
improvement, it shall first submit plans showing the general site plan, design and character of
improvements and their locations, including drainage and roadways to the Airport for approval.
The Airport agrees to review such plans within 30 days of receipt from the Operator. The Operator
covenants and agrees that prior to the installation or construction of any present and future building,
roadway, structure, addition or improvement on the Premises, it shall first submit to the Airport / City
Planning and Zoning, for final approval, final detailed construction plans and specifications and
architectural renderings prepared by registered architects and engineers, and that all construction will be
in accordance with such plans and specifications, and all other applicable rules, regulations, laws and
ordinances.
Section 4.04 Extension of Utilities or Special Facilities
The Operator shall contract, and extend, at its sole expense, all necessary utility, electrical, water, sewer
and other lines needed to service any hangars and buildings initially constructed or constructed in the
future by the Operator on the Premises. Airport will cooperate with relocation of utilities and related
easements as necessary.
The Operator shall construct for the Premises, at its expense, connecting roadways and taxiways to the
existing roadway and taxiway systems. All utility extensions,relocations, and other construction shall be
undertaken by Operator at its own expense and in accordance with all applicable City Codes and
ordinances.
Section 4.05 Construction of Additional or Future Facilities
The Operator has the right to construct additional buildings or facilities on the Premises. Prior to such
construction, the Operator agrees to submit to the Airport for approval, final plans, specifications and
architectural renderings prepared by registered architects and engineers, and comply with all other
requirements of Section 4.03. The use of additional or future facilities shall also be subject to the terms
and conditions hereof.
Section 4.06 Alterations or Repairs to Premises
The Operator shall not construct, install, remove and/or modify external or structural portions of the
buildings constructed upon the Premises without the prior written approval of the Airport. The Operator
shall submit for approval by the Airport, its plans and specifications for any proposed project and shall
comply with all applicable code requirements and such other conditions considered by the Airport to be
necessary. The Operator can make internal improvements to the Premises without the Airport's consent
as long as said changes meet all applicable Code requirements.
Section 4.07 Lien Indemnification
Operator shall keep the Premises and the building(s) free from liens arising out of any work performed
and/or materials ordered, or from any obligations incurred by Operator. In the event any person or
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corporation shall, as a result of construction work being performed by or for the Operator, attempt to
assess a lien against the Premises,the Operator shall hold the Airport harmless from such claim, including
the cost of defense.
Section 4.08 Cost of Construction and Alterations
Within thirty (30) days of completion of the construction or alterations, the Operator shall present to the
Airport for examination and approval a sworn statement of the construction and/or alteration costs.
Construction and/or alteration costs for the purpose of this Section are hereby defined as all money paid
by the Operator for actual site preparation, construction or alteration, including architectural and
engineering costs plus pertinent fees in connection therewith.
In the event that the Operator makes further improvements or alterations on the Premises,the use thereof
shall be enjoyed by the Operator during the term hereof without the additional rental therefor.
Section 4.09 As-BuiltDrawings
Within one-hundred eighty (180) days following completion of any future construction by the Operator
and any subsequent additions, alterations or improvements, the Operator shall present to the Airport a
complete set of"As-Built" drawings including, but not limited to,architectural renderings, specifications,
plumbing,and electrical plans.
Section 4.10 Security Interest on Leasehold Improvements for Construction
Operator is not authorized to initiate a security interest in property or facilities financed and constructed
by the Airport. Operator shall have the right to place a security interest, hereinafter referred to as "the
mortgage," upon, and for, improvements financed by the Operator on the Premises only and shall not
encumber or be a lien upon the land.
All of the Operator rights and obligations under this Agreement shall inure to the benefit of such
mortgagee named in said mortgage ("the Lender") and its assignees. The rights granted in this Section
4.10 are contingent upon Operator providing the Airport with copies of the signed loan documents, if
applicable, and security agreements, and the name, address and mailing address of the Lender for
purposes of providing any notices thereto.
The Lender named in such a mortgage shall have the following rights and shall be subject to the following
duties:
1. The term of the mortgage may not exceed the Initial Term of this Agreement detailed in 3.01.
2. In the case of a default by the Operator under the terms of the mortgage against Operator's
building, the Lender shall have the right to assume the rights, benefits, duties and obligations
granted and imposed upon the Operator under the terms of this Agreement, including the
obligation to pay all delinquencies in rent or other obligations of the Operator.
Such Lender shall have the right to assign its interest in this Agreement to a third party with the
Airport's approval, which will not be unreasonably withheld, provided that such assignee meets
all of the requirements of this Agreement and possesses the financial and managerial experience
to perform the commercial activities and to pay the rents specified in this Agreement.
3. Any Lender acquiring ownership and possession of the building(s) located upon the Premises
shall have a reasonable period of time, not to exceed 30 days, to provide or arrange for providing
all the services that are required to be provided of the Operator under the terms of this
Agreement,or a tenant that is otherwise satisfactory to the Airport.
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4. All notices required by Section 14.14 hereof to be given by Airport to Operator shall also be
given to Lender at the same time and in the same manner. Upon receipt of such notice, Lender
shall have the same rights as Operator to correct any default.
5. Within ten (10) days after Operator's request, Airport shall deliver an Estoppel Certificate, a
declaration to any person designated by Operator:
a. Ratifying this Agreement;
b. Stating the commencement and termination date and the rent commencement date;and
c. Certifying:
• That this Agreement is in full force and effect has not been, to the knowledge of the
Airport, assigned, modified, supplemented or amended (except by such writings as shall
be stated);
• That all conditions under this Agreement to be performed by Operator have been satisfied
(stating exceptions,if any);
• No defenses or offsets against the enforcement of this Agreement by Operator exist (or
stating those claimed);
• The date to which rent has been paid, and such other information as Operator reasonably
requires.
Section 4.11 Ownership of Improvements
For the initial term and any extension or renewal term as may be agreed to, any building, or other
improvements to Premises, constructed and paid for by the Operator shall be owned by the Airport,
subject to this Agreement, and may be encumbered by a security interest for construction funding only as
provided for in Section 4.10 hereof.
No other lien or encumbrance shall be permitted except as provided for in Section 4.10 hereof other than
by lien of the Airport on account of default by the Operator in payment of sums required to be paid to the
Airport under the terms of this Agreement. Any building or other improvements constructed and paid for
by the Airport shall remain the property of the Airport.
During the entire term of this Agreement, which is an initial term of forty(40)years and includes two(2)
five (5) year options to renew, the Operator is obligated to pay ground rent only and is not obligated to
pay rent on the buildings and improvements erected and installed by Operator.
If, upon expiration of the total term of fifty (50) years, Operator's occupancy is extended by mutual
agreement of the parties, it is intended that Operator will pay ground and building rent and other sums as
may be provided for herein.
However, should this Agreement not be extended by Operator as provided herein, Operator shall no
longer have the right to sublet,assign,mortgage,or otherwise encumber the Premises or the buildings and
improvements erected thereon.
Following such termination at the end of the initial term, any further lease of the Premises by the Airport
to any other party shall be based upon the Fair Market Rental Value (FMV) of the land and buildings on
the Premises according to the Airport's then applicable leasing policies.
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Section 4.12 Performance Bonds—Construction Guarantee
For the initial and any future construction funded by the Operator, Operator shall, before commencing
construction, cause a surety bond or another form of security acceptable to the Airport to be issued in the
amount equal to 100% of the building(s) and site development construction costs, that assures that the
funds to cover the cost of the project are irrevocably set aside and available to the Airport to complete the
improvement to Airport-owned property should the Operator fail to do so. The Performance Bond shall
be delivered to the Airport with a copy delivered to the Beecher Law Firm,attn: Richard R.Morris
ARTICLE 5
OBLIGATIONS OF OPERATOR
Section 5.01 Net Lease
The use and occupancy of the Premises by the Operator will be without cost or expense to the Airport.
The Operator shall not use any facilities for any residential purposes. Additionally, it shall be the sole
responsibility of the Operator to maintain, repair and operate the entirety of the Premises, and any
approved improvements and facilities constructed thereon, at the Operator's sole cost and expense.
Section 5.02 Maintenance and Operation
The Operator shall maintain the Premises at all times in a safe, neat and clean condition free of weeds,
rubbish, or any unsightly growths or accumulations of any nature whatsoever. The Operator shall repair
all damage to the Premises caused by its employees, patrons, or its operation thereon; shall maintain and
repair all equipment thereon, including any buildings and improvements; and shall repaint the buildings
as necessary.
1. Upon occupancy, the Operator shall be responsible for and perform all maintenance,
including but not limited to:
a. Janitorial services, providing janitorial supplies, window washing, rubbish, and trash
removal.
b. Supply and replacement of light bulbs in and on all buildings and the Premises,
obstruction lights and replacement of all glass in building, including plate glass.
c. Cleaning of stoppages in plumbing fixtures, drain lines and septic system to the first
manhole outside the Premises.
d. Replacement of floor coverings.
e. Maintenance of all building and overhead doors and door operating systems including
weather stripping and glass replacement.
f. Building interior and exterior maintenance, including painting, repairing and
replacement.
g. Repair or replacement of equipment and utilities to include electrical, mechanical and
plumbing in all buildings, including but not limited to air conditioning and heating
equipment. All repairs to electrical and mechanical equipment are to be made by
licensed personnel. Other repairs are to be made by craftsmen skilled in work done and
performing such work regularly as a trade or career.
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h. The Operator shall perform all maintenance on the Premises or Operator-constructed
structures, pavements and equipment and utilities to the point where connected to the
main source of supply or the first manhole outside of the Premises or to the utility
corridor.
L The Operator shall advise the Airport, and obtain the Airport's consent in writing,before
making changes involving structural changes to buildings or Premises.
j. The Operator is responsible for maintaining electric loads within the designed capacity
of the system. Prior to any change desired by the Operator in the electrical loading
which would exceed such capacity, written consent shall be obtained from the Director
of Aviation of the Airport.
k. The Operator shall provide and maintain hand fire extinguishers for the interior of all
buildings, shop, parking, storage, and ramp areas in accordance with applicable fire and
safety codes.
1. The Operator shall during the term of this Agreement, comply with all applicable
Federal Aviation Regulations, to include, but not be limited to FAR Part 77 (Airspace)
and applicable lighting of the structure so as not to inhibit aircraft operations.
2. The Operator,upon written notice by the Airport to the Operator, shall be required to perform
maintenance. If said maintenance is not undertaken by the Operator within thirty (30) days
after receipt of written notice, the Airport shall have the right to enter upon the Premises and
the buildings and improvements constructed thereon,and perform the necessary maintenance,
the cost of which shall be borne by the Operator as additional rent,which shall be paid by the
Operator to the Airport in full within ten(10)days after the same has been billed.
Section 5.03 Utilities
The Operator shall assume and pay for all costs or charges for utility services, including water, gas,
electrical,sewer, telephone,and other utilities, furnished to the Operator during the term hereof.
Provided, however, that the Operator shall have the right to connect to any and all storm and sanitary
sewers and water and utility outlets at its own cost and expense for the Premises, any future
improvements; and,the Operator shall pay for any and all service charges incurred therefore.
Section 5.04 Trash,Garbage, Etc,
The Operator shall collect, store and properly handle and dispose of, away from the Airport, all trash,
garbage,hazardous materials and other refuse caused as a result of its operations.
The Operator shall provide and use suitable covered metal receptacles (dumpsters) for all such garbage,
trash, and other refuse. Receptacles shall not be located on the aviation side of the Operator's facilities
unless advance approval is obtained by the Director of Aviation.
The piling of boxes, cartons, barrels, pallets, debris, or similar items in an unattractive or unsafe manner,
on or about the Premises,shall not be permitted.
At the option of the Operator, it may elect to utilize the Airport refuge and recycling dumpsters located in
the Airport employee parking lot at an initial cost to the Operator to be paid monthly to the Airport of
$25.00 a month.
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Section 5.05 Siens
The Operator shall not erect, maintain,or display upon the outside of any improvements on the Premises
any billboards or advertising signs without prior written approval by the Airport which approval shall
follow normal City of Waterloo sign approval standards.
Section 5.06 Non-Discrimination
The Operator, for itself, its personal representatives, successors in interest, and assigns, as part of the
consideration hereof,does hereby covenant and agree that(A) 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 the Premises; (B) that in the construction of any improvements on, over, or
under such land and the furnishing of services thereon no persons 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; (C) that the Operator shall use the Premises 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 in Federally-assisted programs of the Department
of Transportation, Effectuation of Title VI of the Civil Rights Act of 1964, and Transportation, and said
Regulations may be amended,to the extent that said requirements are applicable,as a matter of law,to the
Operator.
With respect to the Premises, the Operator agrees to furnish services on a fair, equal and not unjustly
discriminatory basis to all users thereof, and to charge fair, reasonable and not unjustly discriminatory
prices for each unit or service, if applicable; Provided, that the Operator may be allowed to make
reasonable and nondiscriminatory discounts, rebates, or other similar types of price reductions to volume
purchasers.
Section 5.07 Observance of Statutes and Regulations
The granting of this Agreement and its acceptance by the Operator is conditioned upon the right to use the
Airport facilities in common with others authorized to do so, provided, however, that the Operator shall
observe and comply with any and all requirements of the constituted public authorities and with all
federal, state, or local statutes, ordinances,regulations and standards applicable to the Operator for its use
of the Premises, including but not limited to, rules and regulations or standards promulgated from time to
time by the Airport for the administration of the Airport.
Section 5.08 Hazard Lights
The Operator shall, at its expense, provide and maintain hazard lights on any future structure erected by
the Operator on the Premises, if required by the Airport and Federal Aviation Administration regulations.
Any hazard lights so required shall comply with the specifications and standards established for such
installations by the FAA.
Section 5.09 Airport Security
The Operator recognizes the Airport's required compliance with Federal Aviation Regulations and the
Department of Homeland Security, concerning airport security requirements and agrees to comply with
the TSA-approved Airport Security Plan as it relates to its use of the Premises and the Airport's public
facilities.
If Airport receives any notice of violation or other disciplinary correspondence or document for the
uncontrolled or unauthorized access by members of the public that do not have a business requirement to
access the air operations area(AOA)for this area of the Airport, and if Airport receives any civil penalty
caused solely by Operator's neglect to maintain a secure perimeter, Operator shall reimburse Airport for
any civil penalty imposed by the Department of Homeland Security, the Transportation Security
Administration,or other governing authority.
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ARTICLE 6
OBLIGATIONS OF THE AIRPORT
Section 6.01 Operation as a Public Airport
The Airport covenants and agrees that at all times it will operate and maintain the Airport facilities, as a
public airport consistent with, and pursuant to, the "Sponsor's Assurances" given by the Airport to the
United States Government under the Federal Airport Act.
Section 6.02 Inamss and Earress
Upon paying the rental prescribed herein, and performing the covenants of this Agreement, the Operator
shall have the right of ingress to, and egress from,the Premises for the Operator, its officers, employees,
agents, servants,customers,vendors,suppliers,patrons,and invitees over the roadway serving the area of
the Premises. Airport roadways shall be used jointly with other tenants of the Airport, and the Operator
shall not interfere with the rights and privileges of other persons or firms using said facilities and shall be
subject to such weight and type of use restrictions as the Airport deems necessary.
Section 6.03 Snow Removal Operations and Turf Maintenance
The Airport shall be responsible for all snow removal operations on the Premises and auto parking areas,
if any, in its use.
The Airport shall also perform turf maintenance during the non-winter seasons. Combined, the Airport
shall do so in a manner which does not interfere with tenant operations or damage property.
ARTICLE 7
AIRPORT'S RESERVATIONS
Section 7.01 Improvements,Relocation or Removal of Structure
The Airport, in its sole discretion, reserves the right to further develop or improve the Aircraft Operating
Area(AOA), and other portions of the Airport, including the right to remove or relocate any structure on
the Airport, as it sees fit, and to take any action it considers necessary to protect the aerial approaches of
the Airport against obstructions, together with the right to prevent the Operator from erecting, or
permitting to be erected, any buildings or other structure on the Airport which, in the opinion of the
Airport,would limit the usefulness of the Airport or constitute a hazard to aircraft.
In the event the Airport requires the Premises for expansion, improvements, or development of the
airport, the Airport reserves the right, on a twelve (12) month notice, at no cost to the Operator, to
relocate or replace the Operator's improvements, in substantially similar form at another generally
comparable location on the Airport grounds.
This Agreement shall be amended to include any such new ground site. All other Agreement terms shall
remain in full force and effect. In the event of such relocation or replacement, the Airport agrees to
suspend rental during any period such improvements are unusable.
Section 7.02 Airfield Operations
There is hereby reserved to the Airport, its successors and assigns,for the use and benefit of the public,a
free and unrestricted right of flight for the passage of aircraft in the airspace above the surface of the
Premises, together with the right to cause in said airspace such noise as may be inherent in the operation
of aircraft, now known of hereafter used for navigation of or flight in the air, using said airspace or
landing at,taking off from,or operating on or about the Airport.
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Section 7.03 Inspection of Premises
The Airport,through its duly authorized agent,shall have at any reasonable time with prior notice,the full
and unrestricted right to enter the Premises for the purpose of periodic inspection for fire protection,
maintenance and to investigate compliance with the terms of this Agreement.
ARTICLE 8
INDEMNITY AND INSURANCE
Section 8.01 Indemnification
1. The Operator agrees to indemnify, save,hold harmless and defend the Airport, its officials,agents
and employees, its successors and assigns, individually or collectively, from and against all
liability for any claims and actions and all reasonable expenses incidental to the investigation and
defense thereof, in any way arising out of or resulting from any acts, omissions or negligence of
the Operator, its agents, employees, licensees, successors and assigns, or those under its control;
in, on or about Premises or upon Premises; or in connection with its use and occupancy of
Premises or use of the Airport; PROVIDED, HOWEVER,that the Operator shall not be liable for
any injury, damage, or loss to the extent occasioned by the negligence or willful misconduct of
the Airport, its agents or employees. When knowledge of any action becomes known by the
Operator or the Airport,they shall give prompt written notice to the other party.
2. The Operator shall indemnify, save, hold harmless, and defend the Airport, its agents and
employees, its successors and assigns, individually or collectively, from and against all liability
for any claims and actions and all expenses or fines incidental to the investigation and defense
thereof, in any way arising from or based upon the violation of any federal, state, or municipal
laws, statutes, ordinances or regulations by the Operator's agents, employees, licensees,
successors and assigns,or those under its control.
The Operator shall not be liable for any claims, actions and expenses or fines, incidental to the
investigation and defense thereof, in any way arising from or based upon violation of any federal,
state,or municipal laws, statutes, ordinances,or regulations by the Airport, its agents,employees,
licensees,successors and assigns,or those under its control.
Section 8.02 Insurance
1. Without limiting the Operator's obligation to indemnify the Airport, the Operator shall provide,
pay for, and maintain in force at all times during the term of this Agreement a policy of
comprehensive general liability insurance to protect against bodily injury liability and property
damage in an aggregate amount of not less than $2,000,000.00 per occurrence; a policy of
comprehensive automobile liability insurance in a combined single limit of not less than
$2,000,000.00;and statutory workers compensation insurance.
Before Operator enters into possession of the Premises,and promptly upon renewal of any policy,
it shall furnish the Airport, as evidence that such insurance is in force, a certified copy of the
insurance certificate(s) including the City of Waterloo, Iowa and the Waterloo Regional Airport
as additional insureds on a primary and non-contributory basis. Said policies shall be in a form
and content satisfactory to the Airport and shall provide for thirty (30) days' advance written
notice to the Airport prior to the cancellation of or any material change in such policies.
2. Neither the Airport nor its agents shall be responsible for the theft of or damage to any personal
property of Operator or its guests or invitees, for damage, loss or destruction of personal property
of Operator or of Operator's guests or invitees because of fire, water, acts or omissions of third
parties or any cause whatsoever unless caused by the negligent acts of Airport of its agents.
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Operator shall procure and maintain, at its own expense, insurance covering Operator's personal
property and to the fullest extent possible without violating any such insurance coverage,
Operator waives all claims and subrogation rights against Airport arising out of any loss of or
damage to any personal property owned by or in the possession or control of Operator.
Each party also releases the other party from any other liability for loss, damage or injury caused
by fire or other casualty for which insurance is carried by the insured party to the extent of any
recovery by the insured under such insurance policy, other than as set forth in Section 8.04 and
8.05 below.
Section 8.03 Environmental impairment
1. The Operator will comply with any environmental regulations affecting its operations throughout
the term of this Agreement, including furnishing of insurance or other security against
environmental impairment risks as required by the Airport.
2. Operator shall defend, indemnify, protect, and hold the Airport harmless from and after the date
of this Agreement from and against any and all claims, costs, fines,judgments, and liabilities,
including attorney fees and costs, arising out of or in connection with the presence, storage, use,
or disposal of Hazardous Materials or contaminants in, on, under, or about the Premises caused
by the acts, omissions, or negligence of Operator or Operator's agents, employees, business
invitees, contractors, or subcontractors. To the extent permitted by applicable law, the Airport
shall indemnify and hold Operator harmless from and against any and all claims, costs, fines,
judgments, and liabilities, including attorney fees and costs, arising out of or in connection with
Hazardous Materials or contaminants that are present in, on, under, or about the Premises as of
the time that Operator, its agents or contractors,enter into possession of the Premises.
The Airport represents that as of the date of this Agreement, the Airport has no knowledge and is
not aware of any Hazardous Materials or contaminants in, under or about the Premises.
Operator's obligations under this paragraph shall survive the expiration or earlier termination of
the term of this Agreement.
For purposes of this Agreement, Hazardous Materials means any flammables, explosives,
radioactive materials, petroleum or petroleum byproducts, minerals, metals, chemical substances,
asbestos or asbestos-containing materials,hazardous or toxic substances,or any other materials or
wastes as are presently defined in or regulated under federal or state environmental laws, and the
Airport's Rules and Regulations.
Section 8.04 Fire and Extended Covernee Insurance
The Operator shall, at its expense, procure and keep in force at all times during the term of this
Agreement with a company suitable to the Airport, insurance on the building(s) and other improvements
on the Premises against loss and damage by fire, aircraft and extended coverage perils. This coverage
shall include covering the building, aircraft and contents from Acts of God, flood, tornado, high wind
conditions, snowloads or snow and ice coverage, lightning, or other adverse weather conditions not listed
above. The Operator shall furnish evidence of insurance at lease inception and annually upon renewal of
coverage. Insurance shall name the City of Waterloo, Iowa and the Waterloo Regional Airport as
additional insureds.
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Section 8.05 Waiver of Subrogation
Operator and Airport, each for itself and its respective successors and assigns (including, without
limitation, any person,firm or corporation which may become subrogated to any of its rights)waives any
and all rights and claims for recovery against the other party, and its officials, officers, board members,
employees, agents and assigns, or any of them, on account of any loss or damage to any of its property
located on the Premises insured under any valid and collectible insurance policies, to the extent of any
recovery collectible under such insurance policies. Each insurance policy carried by a party and insuring
all or any part of such property must provide that the insurance company waive all right of recovery by
way of subrogation against the other party.
Section 8.06 Application of Insurance Proceeds
If the building or improvements located upon the Premises shall be partially or totally destroyed or
damaged,the Operator and the Airport, within thirty(30)days of the damage shall decide whether or not
to proceed with restoration. If the Airport and the Operator elect not to restore the same to their previous
condition,the Airport shall be entitled to receive the proceeds of insurance payable by reason of such loss
and to apply the entire proceeds to the cleanup of the Premises,except those proceeds identified to cover
the loss of Operator's personal property contained within the Premises. The Agreement shall then be
canceled. If the damage results from an insurable cause and if the Airport elects to have the Operator
restore Premises with reasonable promptness, or the Airport and Operator decide to construct the new
building(s) on another site, the Operator shall be entitled to receive and apply the entire proceeds of any
insurance covering such loss to said restoration, including applicable site clean-up, in which event this
Agreement shall be appropriately amended as necessary and continue in full force and effect.
Section 8.07 Performance Bonds
In the event of any damage or loss, the Operator shall cause a surety bond to be issued in the amount of
100% of the rebuilding and site redevelopment construction costs, prior to the beginning of any
reconstruction and repairs financed by the Operator for the restoration of Premises that is over and above
insurance proceeds, in accordance with Section 8.05 above, or another form of security acceptable to the
Airport that assures that the funds to cover the cost of the project are irrevocably set aside and available to
the Airport to complete the improvement to Airport-owned property should the Operator fail to do so.
Section 8.08 Destruction of Premises(Uninsured Cause)
In the event of damage to or destruction or loss of the building or buildings by an uninsured cause,
Operator and the Airport shall decide, within thirty (30) days of the event, whether Operator will repair,
restore,rebuild,or raze said building or buildings.
Within sixty (60) days of the event, Operator shall initiate restoration or razing activities and complete
those activities within one hundred twenty(120)days of the event unless otherwise agreed by the Airport.
In the event Operator fails to take action as noted above, Airport shall have the right to raze the
building(s) and return the site to its original condition. Operator shall be liable for reimbursing the
Airport for all costs incurred.
ARTICLE 9
CANCELLATION BY THE AIRPORT
Section 9.01 Events of Default by Operator
Each of the following events shall constitute an"Event of Default by Operator":
1. Operator fails to pay rentals, fees and charges when due, and such default continues for a period
of ten(10)days after receipt of written notice from the Airport that such non-payment constitutes
an event of default.
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2. Operator fails after receipt of written notice from the Airport to keep, perform or observe any
term, covenant or condition of this Agreement,other than as set forth in paragraph 1 (above)and
such failure continues for thirty (30) days after such receipt, or if by its nature such event of
default by Operator cannot be cured within such thirty (30) day period, Operator fails to
commence to cure or remove such event of default by the Operator within said thirty (30) days
and to cure or remove same as promptly as reasonably practicable.
3. Operator abandons the Premises. Operator's intent not to re-occupy the Premises may be
presumed upon expiration of ten (10)days after receipt of written notice from the Airport that it
believes in good faith that Operator has abandoned the Premises.
4. Operator shall become insolvent, shall take the benefit of any present or future insolvency statute,
shall make a general assignment for the benefit of creditors, shall file a voluntary petition in
bankruptcy or a petition or answer seeking a reorganization or the readjustment of its
indebtedness under the federal bankruptcy laws or under any other law or statute of the United
States or of any state thereof, or shall consent to the appointment of a receiver, trustee, or
liquidation of all or substantially all of its property.
5. An order for relief shall be entered at the request of Operator or any of its creditors under the
federal bankruptcy or reorganization laws or under any law or statute of the United States or any
state thereof.
6. A petition under any part of the federal bankruptcy laws or an action under any present or future
insolvency law or statute shall be filed against the Operator and shall not be dismissed within
thirty(30)days after the filing thereof.
7. By or pursuant to, or under, any legislative act, resolution or rule, or any order of decree of any
court or governmental board or agency, an officer, receiver, trustee or liquidator shall take
possession or control of all or substantially all of the property of Operator and such possession or
control shall continue in effect for a period of fifteen(15)days.
8. Operator shall become a company in dissolution, or voluntarily or involuntarily forfeit its
company charter, other than through merger with a successor entity.
9. The rights of the Operator hereunder shall be transferred to, pass to, or devolve upon, by
operation of law or otherwise, any other person, firm, corporation or other entity, as a result of
any bankruptcy, insolvency,trusteeship, liquidation or other proceedings or occurrence described
in Sections 3 through 7 above.
Section 9.02 Remedies for Operator's Default
1. Upon the occurrence of an "Event of Default by the Operator",Operator shall remain liable to the
Airport for all arrearages of rentals, fees or charges payable hereunder and for all preceding
breach(es) of any term, covenant or condition herein contained. The Airport, in addition to the
right of termination,and to any other rights or remedies it may have at law or in equity, shall have
the right of re-entry and may remove all Operator's persons and property from the Premises.
Upon any such removal,Operator's property may be stored in a public warehouse or elsewhere at
the cost of, and for the account of, the Operator. Should the Airport elect to re-enter as herein
provided, or should it take possession pursuant to legal proceedings or pursuant to any notice
provided by law, it may, at any time subsequent to an "Event of Default by the Operator", either
terminate this Agreement or re-let the Premises and any improvements thereon, or any part
thereof, for such term or terms (which may be for a term extending beyond the term of this
Agreement) at such rentals, fees and charges, and upon such other terms and conditions, as the
Airport, in its sole discretion, may deem advisable,with the right to make alterations, repairs or
improvements on said Premises.
No re-entry or re-letting of the Premises by the Airport shall be construed as an election of the
Airport's part to terminate this Agreement,unless a written notice of such intention is given to the
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Operator. In re-letting the Premises, the Airport shall make a good faith effort to obtain terms
and conditions no less favorable to itself than those contained herein and otherwise seek to
mitigate any damage it may suffer as a result of the "Event of Default by the Operator".
2. Unless the Airport elects to terminate this Agreement, the Operator shall remain liable for and
promptly pay all rentals, fees and charges accruing hereunder until termination of this Agreement
at the expiration date set forth herein.
3. In the event that the Airport re-lets the Premises,rentals,fees and charges received by the Airport
from such re-letting shall be applied: first,to the payment of any obligation or indebtedness other
than rentals, fees and charges due hereunder from the Operator to the Airport; second, to the
payment of any cost of such re-letting; third, to the payment of rentals, fees and charges due and
unpaid hereunder; and, the residue, if any, shall be held by the Airport and applied in payment of
future rentals, fees and charges as the same may become due and payable hereunder. Should that
portion of such rentals, fees and charges received from such re-letting applied to the payment of
rentals, fees and charges due hereunder be less than the rentals, fees and charges payable during
the applicable period, Operator shall pay such deficiency to the Airport. The Operator shall also
pay to the Airport, as soon as ascertained, any costs and expenses incurred by such re-letting not
covered by the rentals,fees and charges received from such re-letting.
4. Notwithstanding anything to the contrary in this Agreement, if a dispute arises between the
Airport and Operator with respect to any obligation or alleged obligation of the Operator to make
payment(s)to the Airport, the payment(s)under protest by the Operator of the amount claimed by
the Operator to be due shall not waive any of the Operator's rights,and if any court or other body
having jurisdiction determines all, or any part, of the protested payment was not due, then the
Airport shall as promptly as reasonably practicable reimburse the Operator any amount
determined as not due plus interest on such amount at the rate of 12%per annum.
5. Operator shall pay to the Airport all reasonable costs, fees (including attorneys & accountants)
and expenses incurred by the Airport in the exercise of any remedy upon an event of default by
the Operator.
b. All remedies available to Airport are cumulative and no one remedy will be exclusive of another
remedy conferred by law or this Agreement.
ARTICLE 10
CANCELLATION BY OPERATOR FOR
EVENTS OF DEFAULT BY AIRPORT
Section 10.01 Event of Default by Airport
Each of the following events shall constitute an "Event of Default by Airport":
1. The Airport fails, after receipt of written notice from Operator, to keep, perform or observe any
term, covenant or condition herein contained to be kept, performed or observed by the Airport
and such failure continues for thirty (30) days; or, if, by its nature, such "Event of Default by
Airport" cannot be cured within such thirty(30)day period,the Airport fails to commence to cure
or remove such "Event of Default by Airport" within said thirty (30)days and to cure or remove
the same as promptly as reasonably practicable.
2. The Airport closes the Airport to flights in general or to the flights of the Operator, for reasons
other than weather,acts of God or other reasons beyond its control,and fails to reopen the Airport
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to such flights within sixty (60) days of such closure, and such closure negatively affects the
Operator's use of Premises.
3. The Airport is permanently closed by act of any federal, state or local government agency having
competent jurisdiction.
4. The Operator is unable to use the Airport for a period of at least sixty(60)days due to any law or
any order, rule or regulation of any appropriate governmental Airport having jurisdiction over the
operations of the Airport, or any court of competent jurisdiction issues an injunction in any way
preventing or restraining the use of the Airport,or any part thereof,for airport purposes, and such
injunction remains in force for a period of at least sixty (60) days and such situation negatively
affects the Operator's use of Premises.
5. The United States Government or any authorized agency of the same (by executive order or
otherwise)assumes the operation, control or use of the Airport and its facilities in such a manner
as to substantially restrict Operator from conducting its operations, and such restrictions shall
continue for a period of at least sixty(60)days.
Section 10.02 Remedies ror Airport's Defaults
Upon the occurrence of an "Event of Default by Airport", the Operator shall have the right to suspend or
terminate this Agreement, and all rentals, fees and charges payable by Operator under this Agreement
shall abate during a period of suspension or shall terminate,as the case may be.
In the event that Operator's operations at Airport should be substantially restricted by action of any
governmental agency having jurisdiction thereof, then Operator shall, in addition to the rights of
termination herein granted, have the right to a suspension of this Agreement, or part thereof, and
abatement of an equitable proportion of the payments due hereunder, from the time of giving written
notice of such election until such restrictions shall have been remedied and normal operations restored. In
addition to its remedy of termination,the Operator shall be entitled to all other remedies available to it by
law or equity.
Airport shall pay to the Operator all reasonable costs, fees (including attorneys & accountants) and
expenses incurred by the Operator in the exercise of any remedy upon an event of default by the Airport.
ARTICLE 11
RIGHTS UNDER TERMINATION
Section 11.01 Fixed Improvements
It is the intent of this Agreement that any buildings,leasehold improvements, alterations and items affixed
thereto,that are constructed and paid for by the Operator shall be and remain the property of the Operator
during the entire term (initial term and renewal terms) of this Agreement. Upon termination of this
Agreement, title to all buildings and leasehold improvements to or upon the Premises shall, without
payment of compensation, automatically and irrevocably pass to the Airport, and the Operator shall have
no further rights under this Agreement nor shall it have any interest in the Premises, buildings or
improvements,constructed thereon.
Section 11.02 Personal Proverty
Upon termination of this Agreement, the Operator shall remove all personal property, and items not
affixed, from the Premises within thirty (30) days after said termination. If the Operator fails to remove
said personal property, then said personal property shall be deemed abandoned and title thereto shall,
without payment of compensation, automatically and irrevocably pass to City / Airport and, at the sole
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option of City/ Airport, such personal property may thereafter be removed by the Airport at Operator's
expense,if applicable.
ARTICLE 12
ASSIGNMENT AND SUBLETTING
Section 12.01 Assignment
The Operator shall not assign or sublet this Agreement, or any part hereof, in any manner whatsoever, or
assign any of the operating privileges recited herein, without the prior written consent of the Airport and
under such terms and conditions as Airport may impose, which shall not be unreasonably withheld,delayed,
or conditioned.
The term "assignment" includes, without limitation, a transfer of a majority in interest of the ownership of
Operator or transfer by operation of law.
Provided, however, in the event the Airport approves such assignment, Operator shall remain liable to the
Airport for the remainder of the term of this Agreement to pay to the Airport any portion of the rental and
fees provided for herein upon failure of the assignee to pay the same when due. Said assignee shall not
assign said Agreement except with the prior written approval of the Airport and the Operator herein,and any
assignment by the Operator to any third party shall contain a clause to this effect.
The Airport reserves the right to require assignee,as a condition to Airport's consent to assignment, to enter
into a new lease agreement,if the then legal and operational requirements of the Airport,including Rules and
Regulations, require changes relating to such items as the commercial operating Airport, additional or
changes to the uses of leased property,or changes in term or conditions of the land lease.
ARTICLE 13
QUIET ENJOYMENT
The Airport covenants that the Operator, upon payment of the rentals reserved herein and the performance
of each and every one of the covenants, agreements and conditions on the part of the Operator to be
observed and performed, shall and may,peaceably and quietly,have, hold and enjoy the Premises for the
term of this Agreement,free from molestation,or disturbance.
ARTICLE 14
GENERAL PROVISIONS
Section 14.01 Non-Interference with Operations of Airport
The Operator, by accepting this Agreement, expressly agrees for itself, its successors and assigns, that it
will not make use of the Premises in any manner which might interfere with the landing and taking off of
aircraft at the Airport or otherwise constitute a hazard. In the event the aforesaid covenant is breached,the
Airport reserves the right, exercisable without notice, to enter upon the Premises hereby leased and cause
the abatement of such interference at the expense of the Operator.
The Airport shall maintain and keep in repair the Airport landing areas, including taxiways and aircraft
parking aprons,and shall have the right to direct and control all activities of the Operator in this regard.
Section 14.02 Attorney's Fees
In any action brought by either party for the enforcement of the obligations of the other party, the
prevailing party shall be entitled to recover interest and its reasonable attorney's fees.
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Section 14.03 Taxes and Special Assessments
The Operator shall pay any and all leasehold interest tax assessed on said Premises and all personal
property taxes which may be levied and assessed against equipment, merchandise, or other personal
property belonging to the Operator located on the Premises,or other permitted portions of the Airport.
The Operator shall pay all real estate taxes attributed to the Operator's leasehold interest and all other real
estate taxes which may be levied and assessed which are attributed to the Operator's leasehold interest in
the Premises.
The Operator shall pay all sales or use taxes and assessments, license fees or other charges of any kind or
nature, without exception, levied or assessed, arising out of the activities conducted on, and/or the
occupancy of,the Premises.
Section 14.04 Richt to Contest
The Operator shall have the right to contest the validity or amount of any tax, assessment or charge, lien
or claim of any kind in with respect to the Premises. Operator shall, if the Airport requires the same in
writing and if the taxes or other assessments have not been paid under protest or otherwise escrowed or
provided for, furnish reasonable security for the payment of all liability, costs and expenses at the end of
the litigation, and Operator, so long as the matter shall remain undetermined by final judgment, shall not
be considered in default hereunder by the nonpayment thereof;provided however,that Operator shall not,
under these provisions,permit the Premises or any buildings or improvements situated thereon, to be sold
or forfeited, and failure by the Operator to do what is necessary to prevent any such sale or forfeiture
within ten(10)days from the publication or receipt of notice for sale or forfeiture,shall be deemed to be a
default hereunder, and the Airport may, at its option, pay any such sum as may be required to avoid the
sale or forfeiture and seek reimbursement for its cost from the Operator or ownership of the buildings or
improvements involved.
Section 14.05 License Fees and Permits
The Operator shall obtain, pay for and maintain in effect all licenses, permits, fees or other authorization
or charges as required under federal, state or local laws and regulations insofar as they are necessary to
comply with the requirements of this Agreement and the privileges extended hereunder.
Section 14.06 Non-Exclusive Rights
It is hereby specifically understood and agreed between the parties that nothing herein contained shall be
construed as granting or authorizing the granting of exclusive rights to the Operator or others, as defined
in Section 308 of the Federal Aviation Act of 1958,as amended.
Section 14.07 Paragraph Headings
The Section paragraph headings contained herein are for convenience in reference only and are not
intended to define or limit the scope of any of the provision of this Agreement.
Section 14.08 Interpretations
This Agreement shall be interpreted in accordance with the laws of the State of Iowa.
Section 14.09 Non-Waiver
No waiver by City/Airport of any agreement,condition or provision contained in this Agreement will be
valid or binding unless expressed in writing and signed by the City/ Airport. The waiver by Airport of
any agreement, condition or provision contained in this Agreement will not be deemed to be a waiver of
any subsequent breach of the same or any other agreement, condition or provision contained in this
Agreement, nor will any custom or practice that may grow up between the parties in the administration of
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the terms of this Agreement be construed to waive or to lessen the right of Airport to insist upon the
performance by Operator in strict accordance with the terms of this Agreement. The subsequent
acceptance of rent by Airport will not be needed to be a waiver of any preceding breach by Operator of
any agreement, condition or provision of this Agreement, other than the failure of Operator to pay the
particular rent so accepted, regardless of Airport's knowledge of such preceding breach at the time of
acceptance of such rent.
Section 14.10 Severability
If any term or provision of this Agreement or the application thereof to any person or circumstance shall,
to any extent, be invalid or unenforceable, the remainder of this Agreement, or the application of such
term or provision to persons or circumstances other than those as to which it is held invalid or
unenforceable, shall not be affected thereby and each other term and provision of this Agreement shall be
valid and enforced to the fullest extent permitted by law.
Section 14.11 Binding Effect
This Agreement, including all of its covenants, terms, provisions and conditions, shall be binding upon,
and inure to the benefit of,the parties hereto and their respective heirs,successors and assigns.
Section 14.12 No Partnership
Nothing contained in this Agreement shall be deemed to create the relationship of principal and agent or
of a partnership or joint venture or any relationship between the Airport and Operator other than the
relationship of the Airport and Operator.
Section 14.13 Duty to be Reasonable
Wherever in this Agreement the Airport is to give its consent,approval or otherwise exercise discretion in
judgment, such consent, approval or judgment discretion shall not be unreasonably exercised or
unreasonably withheld.
Section 14.14 Notices
Any notice under this Agreement shall be in writing and shall be delivered in person, by overnight air
courier service,or by United States certified mail, postage prepaid, and addressed to:
If to Landlord,to: Waterloo Regional Airport
Attn: Director of Aviation
2790 Livingston Lane
Waterloo,Iowa 50703
If to Tenant,to: OSPREY AVIATION, LLC
Attention:Michael L. Peterson
1710 Adams Street
Cedar Falls,Iowa 50613
Delivery of notice shall be deemed to occur (i) on the date of delivery when delivered in person, (ii) 1
business day following deposit for overnight delivery to an overnight air courier service which guarantees
next day delivery,or(iii)3 business days following the date of deposit if mailed by United States certified
mail, postage prepaid. Notice sent by certified mail that is refused shall still be deemed valid. All parties
shall give the other prompt notice of any change in address, and until such notice any party may rely on
the most recent addresses furnished. Neither party shall designate more than two addresses to receive
notices.
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Section 14.15 Entire Agreement
This Hangar and Ground Site Lease Agreement constitutes the entire agreement between the parties.
There are no verbal or written agreements between the parties that are to be considered a part of this
Agreement unless they have been specifically enumerated herein and this Agreement supersedes all prior
or other agreements, understandings, and representations. This Agreement may be amended solely by a
written instrument,signed by all parties.
Section 14.16 No Construction Against Drafting Party
Airport and Operator acknowledge that each of them and their counsel have had an opportunity to review
this Agreement and that this Agreement will not be construed against Airport merely because Airport has
prepared it.
Section 14.17 Third-Party Beneficiaries
It is specifically understood and agreed that no person shall be a third-party beneficiary hereunder, and
that none of the provisions of this Agreement shall be for the benefit of, or be enforceable by, anyone
other than the parties hereto, and that only the parties hereto and their permitted assignees shall have
rights hereunder.
Section 14.18 Authorization and Execution
By its execution hereof, Operator and the Airport warrant that all necessary corporate action has been
taken with regard to the authorization and execution of this Agreement and that the individual(s)
execution of this Hangar and Ground Site Lease Agreement on behalf of Operator are is/are duly
authorized to do so.
Whoever signs this Agreement on behalf of Operator and the Airport hereby confirms that they have the
appropriate Authority and have been so authorized to execute this Agreement on behalf of Operator and
City/Airport,respectively.
IN WITNESS WHEREOF,the parties have caused this Hangar and Ground Site Lease Agreement to be
executed on their behalf by their duly authorized officers.:
City of Waterloo,Iowa OSPREY AVIATION,LLC,
an lowaLinyKed Liability o any
By: I By
Quentin M.Hart lit Michael L. eterson
Mayor Manager
Witness: Witness:
By: By: 4
rr
Name: Kelley Felc le Name: b
Title: City Clerk Title: S'
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27
Exhibit B
LEASE AREA DESCRIPTION:
Part of the Northwest Quarter of Section 4, Township 89 North, Range 13
West of the 5th Principal Meridian, City of Waterloo, Black Hawk County,
Iowa, and more particularly described as follows:
Commencing at the intersection of the Northerly Right of Way line of
Betsworth Drive and the Westerly Right of Way line of Airport Boulevard;
Thence North 67°00'10" East (assumed bearing), 139.97 feet along the
Northerly Right-of-Way line of said Betsworth Drive to the Easterly Right of
Way line of Airport Boulevard;
Thence North 58°47'49" East, 985.78 feet to the Point of Beginning;
Thence North 13'14'31" West, 202.00 feet;
Thence North 76°45'29" East, 154.00 feet;
Thence South 13°14'31" East, 91 .87 feet;
Thence North 76°45'29" East, 68.85 feet;
Thence South 13'14'31" East, 57.33 feet;
Thence South 76°45'29" West, 68.85 feet;
Thence South 13°14'31" East, 52.81 feet;
Thence South 76°45'29" West, 154.00 feet to the Point of Beginning;
containing 0.80 acre (35,055 SW. FT.), subject to other leases and
easements of record.
28