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HomeMy WebLinkAbout126-93 RESOLUTION.1 1 RESOLUTION NO. 126-93 r A RESOLUTION AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE A CONTRACT WITH AIR HOST FAYETTEVILLE, INC. TO PROVIDE A RESTAURANT CONCESSION AT THE AIRPORT TERMINAL. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1. That the Mayor and City Clerk are hereby authorized and directed to execute a contract with Air Host Fayetteville, Inc. to operate a restaurant concession at the airport terminal. A copy of the contract is attached hereto marked Exhibit "A" and made a part hereof. PASSED AND APPROVED this 7�1L day of December , 1993. ATTEST: By: Sherry YL Thomas, City Clerk APPROVED: By: 717414/14t ed Hanna, Mayor • CONCESSION AGREEMENT AND LEASE This CONCESSION AGREEMENT AND LEASE (hereinafter referred to as the "Agreement") is made and entered into on this 7,4 day of , 1993, by and between the City of Fayetteville (hereinafter referred to as the "Lessor") and AIR HOST FAYETTEVILLE, INC., an Arkansas corporation (hereinafter referred to as the "Concessionaire"). \ WITNESSETH: WHEREAS, Lessor operates an airport known as the Fayetteville Municipal Airport in Washington County, Arkansas (hereinafter referred to as the "Airport"); and, WHEREAS, Lessor desires to enter into this Agreement with Concessionaire for the providing of certain concessions in the Terminal, as that term is defined in Section 1.1; and, WHEREAS, Concessionaire is ready, willing and able to provide the concessions in the Terminal as contemplated in this Agreement. NOW, THEREFORE, for good and valuable consideration and in consideration of the mutual covenants and agreements contained herein, Lessor and Concessionaire have agreed and do by these presents hereby agree as follows: ARTICLE I DEFINITIONS 1.1 "Agreement" shall mean this contract between Lessor and Concessionaire for the right to use such Airport property as defined herein for the conduct of food and beverage concessions and other concessions as set forth herein. 1.2 "Airport" shall mean the tract of land, with all improvements thereon and to be erected thereon, designated as the Fayetteville Municipal Airport. 1.3 "Terminal" shall mean the existing terminal building at the Airport, as well as any expansions or additions thereto. 1.4 "Assigned Area" shall mean the area or areas at the Airport designated by this Agreement and Exhibits 1 and 2 attached hereto as the place or places where the business of Concessionaire may be conducted. Exhibit 1 sets forth the space to be used initially by Concessionaire; and, Exhibit 2 sets forth the expanded space to be used by Concessionaire upon its completion. For the purposes of this Agreement, the space described in Exhibit 2 shall be referred to as the "Expanded Space." 1.5 "Director" shall mean the Director of Aviation of Lessor, who is designated by Lessor to act with respect to certain of the matters contained in this Agreement. 1.6 "Gross Receipts" shall mean all charges or other fees charged by Concessionaire for all sales of products from the food and beverage, in-flight catering and any other concessions at the Airport. There shall be allowed, when properly recorded and accounted for, as a reduction from Gross Receipts, sales tax or similarly imposed taxes where stated separately and collected from the customer, as well as refunds made by Concessionaire to Airport customers because of unacceptable or unsatisfactory goods or services, and credit card service fees. 1.7 "Percentage Payment" is the sum of money due Lessor on account of Lessor's share of Gross Receipts. 1.8 "Date of Beneficial Occupancy" shall mean the first day of the month following the date that Concessionaire commences full operations to the general public in the Expanded Space. 1.9 "Contract Year" shall mean a 12 month period, the first of which shall commence on the Date of Beneficial Occupancy. "Contract Year" shall also include each 12 month period of the option period, if such option is exercised by Concessionaire. ARTICLE II ASSIGNED AREA 2.1 Concessionaire's Assigned Area is shown on Exhibits 1 and 2 attached hereto and incorporated herein. ARTICLE III TERM 3.1 This Agreement shall be effective and binding on the parties upon its execution. The term of this Agreement shall commence on the Date of Beneficial Occupancy and shall continue for a period of five (5) years. Concessionaire is further granted an option to extend the term for an additional five (5) years by giving Lessor written notice at least six (6) months prior to the expiration of the initial Lease Term. Commencing on December 18, 1993 and continuing thereafter on a month-to-month basis until the Date of Beneficial Occupancy, the parties shall operate under the terms of this Agreement. 3.2 In the event Concessionaire shall, with the consent of Lessor, hold over and remain in possession of any of the Assigned Area after the expiration of the term of this Agreement, such holding over shall not be deemed to operate as a renewal or -2- 1 extension of this Agreement but shall only create a month-to-month tenancy on the same terms, conditions and covenants, including consideration herein contained, unless otherwise agreed to in writing by both parties. ARTICLE IV USES AND PRIVILEGES 4.1 Concessionaire has the right, privilege, and obligation to operate and manage the food and beverage concessions in the Assigned Area for the sale of food and beverages, including alcoholic beverages, in the Terminal. Concessionaire shall also have the right to provide airline in-flight catering services from the Terminal. 4.2 In addition to the use of the Assigned Area, Concessionaire shall have the right and the obligation to install and maintain, at its own expense, such product dispensing vending machines (as well as machines used for amusement or entertainment) within the Terminal as may be authorized or reasonably required by Lessor. The location, number, and type of such machines authorized or required, as well as the goods to be sold therefrom, shall be subject to prior approval of Lessor, which may be rescinded or modified, in whole or part, at any time, in Lessor's reasonable discretion. 4.3 Upon the request of either party, Concessionaire shall provide such additional or expanded food and beverage services in the Terminal outside of the Assigned Area during the term of this Agreement as Lessor and Concessionaire may decide by mutual written consent. 4.4 The Concessionaire has the right, privilege, and obligation to operate and manage gift shop related concessions for the sale of retail merchandise within the Terminal. The Concessionaire shall have the right and obligation to sell the categories of items set forth on Exhibit 3, and such other items as may be permitted by this Agreement, or as may be otherwise agreed upon by the parties. 4.5 The Concessionaire shall have the exclusive right to provide the above referenced concessions within the Terminal to the traveling public for the five (5) year period commencing on the Date of Beneficial Occupancy. Nothing contained herein shall be construed, however, to prevent Lessor from permitting the establishment of food and beverage facilities vending concessions or gift shop concessions on the Airport other than in the Terminal. In addition, nothing herein shall be construed to prohibit the installation and operation of vending machines by others in backroom areas which are not made available to the general public. -3- f • • 4.6 Concessionaire shall have reasonable rights of ingress and egress from its Assigned Area over Airport roadways, including common use roadways, subject to any rules or regulations which may have been established or shall be established in the future by Lessor. Such rights of ingress and egress shall apply to Concessionaire's employees, guests, patrons, invitees, suppliers and other authorized individuals. The rights of ingress and egress shall likewise apply to the transport of equipment, material, machinery and other property. Lessor shall have the right, however, to establish reasonable hours during which deliveries will be permitted. 4.7 Lessor will provide and pay the costs of adequate heating, ventilation, and air conditioning for the Assigned Area and shall provide periodic washing of the windows on the outside only. Concessionaire shall provide, at its own cost, for janitorial services in the Assigned Area and for all lamps and supplies. ARTICLE V OPERATIONAL STANDARDS 5.1 The Director shall be Lessor's representative in determining whether Concessionaire is in compliance with the operational standards contained herein. Concessionaire's failure or refusal to comply with operational standards as stated herein shall be deemed a default in its performance hereunder and may be grounds for termination of this Agreement. Prior to any such termination, however, Concessionaire shall be notified of its failure or refusal to comply and allowed an opportunity to remedy such default as provided in Section 13 of this Agreement. Both parties reserve all of their rights under this Agreement and under law and equity in the event of such termination. 5.2 Food and beverage services in the Terminal shall be provided by Concessionaire at such hours to ensure that the reasonable demands of the traveling public are satisfied. Food and beverage services shall be provided daily from one hour before the first departure (containing a significant passenger load) until the last departure (containing a significant passenger load). Concessionaire shall also be open at such other times as may be mutually agreed upon between Concessionaire and the Director. 5.3 All items served by the food and beverage operations in the Terminal shall be of good quality, shall conform to all applicable regulations and laws, and shall be purchased from reliable sources. Concessionaire shall serve adequate portions and charge reasonable and justifiable prices which are comparable to those maintained at other similar first class establishments in U.S. airports, while at the same time maximizing revenues. Concessionaire shall sell, dispense and serve only quality food and -4- 1 1 beverage products, the selection of which shall be comparable to the food and beverage selections offered at other first class establishments in U.S. airports. Lessor shall have the right to suggest changes in menu items and/or pricing but shall rely upon the experience and expertise of Concessionaire relating to these matters. 5.4 Concessionaire shall make all reasonable efforts to maintain, develop and increase business conducted by it in the Terminal. 5.5 A11 food and beverage operations shall be maintained in a first class manner with regard to safety and cleanliness. Concessionaire shall, at its sole cost and expense, keep the Assigned Area clean and free from garbage, rubbish, refuse, dust, dirt, insects, rodents and vermin. Waste disposal and regular extermination treatments are mandatory. 5.6 Concessionaire shall comply with all health codes and laws applicable to the sale of food, as well as non alcoholic and alcoholic beverages. Concessionaire shall cooperate with all local health and fire officials, and comply with all applicable codes, laws, rules and regulations. 5.7 All operations shall be supervised by an active, qualified, competent manager. 5.8 All personnel employed by Concessionaire shall be neat, clean and courteous at all times. Employees shall wear appropriate uniforms and name tags while on duty. No loud, boisterous or otherwise improper actions or language shall be tolerated while on or about the Airport. 5.9 Concessionaire shall have the right to place and erect signs and advertising materials within the Assigned Area at Concessionaire's discretion, so long as said signs and advertising materials are harmonious with the decor of the Terminal. In addition, Concessionaire may, at its own expense, install and maintain necessary and appropriate identification signs within the Terminal and outside the Assigned Area, subject to the approval of the Director as to the number, size, height, location, color and general type and design. All signage shall be approved by the Director prior to installation; such approval shall not be unreasonably withheld. 5.10 All items for sale in the gift shop shall be first quality and be purchased from reliable sources. The Concessionaire shall provide at least the items, set forth on Exhibit 3, or their equivalent. The Lessor shall have the right to suggest changes in inventory items and/or pricing, but shall rely on the experience and expertise of Concessionaire relating to these matters. -5- • • • 5.11 The gift shop area shall be maintained in a first class manner at the Concessionaire's sole cost and expense. 5.12 Concessionaire shall not mark up any pre -priced items. 5.13 The news and gift facility areas in the Terminal shall be operated daily at such hours that will provide adequate service to the travelling public. The facility's daily hours of operation shall be as mutually agreed upon between the Concessionaire and the Director. ARTICLE VI FEES. CHARGES AND ACCOUNTABILITY 6.1 For the period December 18 through December 31, 1993, Concessionaire shall pay percentage rent only to Lessor. The percentage rent shall be 6% of Gross Receipts realized by Concessionaire during said period. Such rent shall be due and payable by January 20, 1994. 6.2 Until the Date of Beneficial Occupancy, rent shall be computed on a month-to-month basis. The monthly rent shall be six percent (6%) of Concessionaire's Gross Receipts during each month; however, in no event shall the monthly rent be less than $1,675.00 ("Minimum Rent"). Minimum Rent shall be paid on the first day of each month; and, the balance of monthly rent, if any, shall be paid within 20 days after the end of each month. By the 20th day of each month, Concessionaire shall provide Lessor with a statement showing Concessionaire's Gross Receipts for the previous month. 6.3 For each Contract Year, Concessionaire agrees to pay Lessor the greater of either: (1) rent based upon a percentage of annual Gross Receipts received by Concessionaire as detailed below for each applicable Contract Year or (2) a Minimum Annual Guarantee as detailed below for each applicable Contract Year. 6.4 For the purposes of this Agreement, the term "Minimum Annual Guarantee" means the minimum amount of rent due Lessor for each Contract Year. The Minimum Annual Guarantee for each Contract Year shall be $10.00 per square foot of space contained in the Expanded Space. The parties estimate that such square footage will be approximately 2,412 square feet. 6.5 Rent calculated on a percentage of Gross Receipts ("Percentage Rent") shall be computed as follows: a sum equal to 6% of the Gross Receipts derived by Concessionaire during each Contract Year from all sales on or in connection with Concessionaire's operations at the Airport. Notwithstanding, commencing on the first day of the month following the date on which Lessor gives written notice to Concessionaire that enplaned passengers have reached 250,000 during any 12 consecutive months, -6- • • • • • • Percentage Rent shall be increased from 6% to 7% of Gross Receipts on a prospective basis during the remainder of that Contract Year; and, for each Contract Year thereafter, Percentage Rent shall be computed at 7% of Gross Receipts. 6.6 Beginning on the Date of Beneficial Occupancy, and on or before the first day of each month thereafter during the term of this Agreement (as may be extended by the exercise of the option), Concessionaire shall pay to Lessor one -twelfth (1/12) of the Minimum Annual Guarantee until Concessionaire has paid Lessor an amount sufficient to satisfy the Minimum Annual Guarantee for such Contract Year. On or before the 20th day of each month, Concessionaire shall submit to Lessor a report setting forth the amount of Concessionaire's Gross Receipts for the previous month, as well as the cumulative Gross Receipts for such Contract Year. Each report shall be signed by a responsible accounting officer of Concessionaire. Accompanying each such report shall be the Percentage Rent which exceeds the monthly portion of the Minimum Annual Guarantee. 6.7 Notwithstanding the above, on or before December 18, 1993, Concessionaire shall pay Lessor the sum of $1,675.00 to be credited by Lessor against the rental payment to be made by Concessionaire no later than January 1, 1994. Contemporaneously therewith, Concessionaire shall also pay Lessor the sum of $2,001.00 (1/12 of the estimated Annual Minimum Guarantee) which shall be applied against the monthly rental payment due Lessor for the last month of the initial Lease Term hereof. 6.8 Any rentals not paid when due shall be subject to a penalty of 1.0% of the outstanding balance, per month, for such delinquency, payable without notice from the Lessor. 6.9 Concessionaire shall keep full and accurate books and records showing its said Gross Receipts. Lessor shall have the right through its representatives, and at reasonable times, to inspect such cash receipts, books and records. All such records will be made available to Lessor. Such records shall be maintained and retained by Concessionaire for a period of two (2) years following the relevant reporting period. 6.10 Concessionaire shall install and use, or cause to be installed and used at the Assigned Area, sealed cash registers, sales slips, invoicing machines and other automatic accounting equipment or devices required to record properly and accurately the Gross Receipts on all sales, services and other business transactions made by Concessionaire under this Agreement. 6.11 Should any examination, inspection, and audit of Concessionaire's books and records by Lessor disclose an underpayment by Concessionaire in excess of two (2%) of the total consideration due for the Contract Year, Concessionaire shall -7- • promptly reimburse Lessor for all reasonable costs incurred by Lessor in the conduct of such examination, inspection, and audit, in addition to remitting the amount of such underpayment plus interest computed at the then current prime interest rate. ARTICLE VII MAINTENANCE AND REPAIRS 7.1 Concessionaire agrees to provide at its own expense such maintenance, custodial, and cleaning services and supplies as may be necessary or required in the operation and maintenance of its Assigned Area, including, but not limited to the proper maintenance of all grease traps, ventilation fans, and hoods. 7.2 Concessionaire agrees to maintain and make necessary repairs to the interior of all of its Assigned Areas, the fixtures and equipment therein and appurtenances thereto including, without limitation, the interior windows, doors and entrances, storefronts, signs, floor coverings, interior walls and ceiling, the surfaces of interior columns (exclusive of structural deficiencies), any columns erected by Concessionaire, and any partitions and lighting within the Assigned Area. 7.3 All repairs done by Concessionaire or on its behalf shall be of good quality in both materials and workmanship. All repairs shall be made in conformity with rules and regulations prescribed from time to time by Federal, state and/or local authorities having jurisdiction over the work in Concessionaire's Assigned Area. 7.4 The Director or the Director's duly appointed supervisory representatives shall have the right to enter Concessionaire's Assigned Area to: A. Inspect the Assigned Area at reasonable intervals during Concessionaire's regular business hours or at any time in case of emergency, to determine whether Concessionaire has complied with and is complying with the terms and conditions of this Agreement. The Director may, at such Director's discretion, upon the provision of written notice, require Concessionaire to effect reasonably needed repairs at Concessionaire's own cost; and, B. Perform any and all things which Concessionaire is obligated to and has failed to do after providing Concessionaire fifteen (15) days written notice to act, including maintenance, repairs and replacements to Concessionaire's Assigned Area. The cost of all labor, materials and overhead charges required for performance of such work will be paid by Concessionaire to Lessor within ten (10) -8- • • • 0 • days following receipt of an invoice for said charges. ARTICLE VIII LIABILITY, INDEMNITY, AND INSURANCE 8.1 Each party hereto shall give to the other prompt and timely written notice of any claim made or suit instituted coming to its knowledge which in any way directly or indirectly, contingently or otherwise, affects or might affect either, and each shall have the right to participate in the defense of the same to the extent of its own interest. 8.2 It is expressly understood and agreed by and between the parties hereto that Concessionaire is an independent contractor and operator, responsible to all parties for all of its acts or omissions, and Lessor shall in no way be responsible therefor. Concessionaire, and its officers, directors, employees, and agents shall not be construed to be employees of Lessor. It is further agreed that in its use and enjoyment of the Airport or premises and facilities herein referred to, Concessionaire will indemnify and save harmless Lessor, its officers, employees, agents, and its elected and appointed officials from any and all claims, liabilities, causes of action or losses (including the cost of defense) that may result in liability to Lessor from any actions or omissions on the part of Concessionaire, and/or its employees, authorized agents or representatives, and shall in all ways hold said parties harmless from same. Concessionaire shall save harmless the said parties from all liabilities, claims, judgments, costs, and expenses, including all costs of defense, which may in any manner arise against said parties in consequence of this Agreement, or which in any way may result from the negligence of Concessionaire, its agents, servants, or employees. Under no circumstances shall this section be construed as a waiver of Lessor's tort immunity. 8.3 During the term of this Agreement, Concessionaire shall effect and maintain, with a company satisfactory to Lessor: A. Bodily Liability and Prooertv Damage Liability Insurance covering claims for damages for bodily injury, including accidental death, and for claims for property damage to third parties which may arise from operations under this Agreement, whether such operations are by Concessionaire or its duly authorized agents, representatives or employees. Concessionaire's bodily injury and property liability insurance shall include coverage for the sale of alcoholic beverages, and shall be in the amount of Two Million Dollars ($2,000,000) for each occurrence (and in the aggregate), and One Million Dollars ($1,000,000) for property damage liability covering the acts of Concessionaire, its agents and employees. Concessionaire agrees to place this -9- • • • • • coverage with insurers of recognized financial responsibility, and to deliver copies of any and all policies of insurance and certificates of said insurance required by this Agreement to the Director at least thirty (30) days prior to the commencement of the first Contract Year B . Worker's Compensation and Employer's Liability Insurance - in the amounts and form required by the Worker's Compensation laws of the State of Arkansas. C. Fire Insurance - •Concessionaire shall adequately insure against the perils of fire, extended coverage, and other perils on any and all of Concessionaire's improvements in the Assigned Area. D . Fire Legal Liability Insurance. Concessionaire will provide fire legal liability insurance in favor of Lessor inthe amount of One Hundred Thousand Dollars ($100,000.00). 8.4 Except for Workmen's Compensation and employers' liability coverage, all policies shall include Lessor and all of its officers, employees, and agents as additional insured and shall contain a standard cross -liability provision and shall stipulate that no insurance held by Lessor will be called on to contribute to a loss covered thereunder unless the same shall exceed or extend beyond the coverage maintained under this Agreement. Lessor shall have no liability for any premium charges for such coverage, and the inclusion of the Lessor as an additional insured is not intended to, and shall not make the Lessor a partner or joint venturer with Concessionaire in Concessionaire's operations at the Airport. 8.5 Except for Workmen's Compensation and employer's liability coverage, all policies shall provide that Lessor shall be notified in writing by the insurer at least thirty (30) days prior to the cancellation, material alteration or nonrenewal of such coverages required under this Agreement. 8.6 Notwithstanding any provision contained herein to the contrary or by law, Concessionaire shall not be liable to Lessor for any physical damages sustained to the Terminal or Lessor's property as a result of fire, or any other casualty except to the extent of insurance carried by Concessionaire, regardless of the fault of Concessionaire. -10- • • 1 • • ARTICLE IX ASSIGNMENT AND SUBLEASE • • 9.1 Concessionaire shall not assign this Agreement or any of the rights and privileges granted herein or sublease the Assigned Area or any part thereof without the prior written consent of Lessor, such consent not to be unreasonably withheld; provided, that the foregoing shall not prevent the assignment of this Agreement or any of the rights and privileges granted Concessionaire herein to any corporation with which Concessionaire may merge or consolidate, or which may succeed to the business of Concessionaire, so long as Concessionaire gives Lessor at least thirty (30) days prior written notice of such merger or consolidation. ARTICLE X DAMAGE OR DESTRUCTION OF ASSIGNED AREA 10.1 Partial Damage. If all or a portion of the Assigned Area is partially damaged by fire, explosion, the elements, public enemy or other casualty, but not rendered untenantable, the same will be repaired with due diligence by Lessor at its own cost and expense. In such event, insurance proceeds received by Concessionaire in connection with damage sustained to its improvements, furniture, fixtures and equipment shall be used to repair and/or replace the same. 10.2 Extensive Damage. If the damages are so extensive as to render the Assigned Area or a portion thereof untenantable, but are capable of being repaired within thirty (30) days, the same shall be repaired with due diligence by Lessor at its own cost and expense. In such event, insurance proceeds received by Concessionaire in connection with damage sustained to its improvements, furniture, fixtures and equipment shall be used to repair and/or replace the same. 10.3 Complete Destruction. In the event all or a substantial portion of the Assigned Area is completely destroyed by fire, explosion, the elements, public enemy or other casualty, or is so damaged that it is untenantable and cannot be replaced except after more than ninety (90) days, Lessor shall be under no obligation to repair, replace or reconstruct said premises. If Lessor chooses to reconstruct said premises and it is determined that the reconstruction can reasonably be accomplished within six (6) months, then insurance proceeds received by Concessionaire in connection with damage sustained to its improvements, furniture, fixtures and equipment shall be used to repair and/or replace the same. -11- • • . • 10.4 Limits of Lessor's Obligations Defined. It is understood that in the application of the foregoing provisions, Lessor's obligations shall be limited to repair or reconstruction of the concession premises to the same extent and of equal quality as obtained by Concessionaire from Lessor at the commencement of its operations hereunder. Redecoration and replacement of finishings, fixtures, furniture, equipment and supplies shall be at the sole cost and responsibility of Concessionaire and any such redecoration and refurnishing /re-equipping shall be equivalent in quality to that orginally installed. ARTICLE XI COMPLIANCT 11.1 Concessionaire, its officers, agents, servants, employees, contractors, licensees, and any other person over which Concessionaire has the right to control shall comply with all present and future laws, ordinances, orders, directives, rules, and regulations of federal, state, county and municipal governments which may be applicable to its operations at the Airport. 11.2 Concessionaire shall pay, or in good faith contest, on or before their respective due dates, to the appropriate collecting authority, all federal, state, and local taxes and fees which are now or may hereafter be levied upon Concessionaire, or upon the business conducted by Concessionaire at the Airport, or upon any of Concessionaire's property used in connection therewith; and, Concessionaire shall have and maintain in current status all federal, state, and local licenses and permits required in the operation of the business conducted by Concessionaire. 11.3 Concessionaire agrees to pay, or in good faith contest, all lawful fines and penalties as may be assessed against it for violation of federal laws, rules or regulations caused by Concessionaire's acts or omissions or those of its employees or agents. ARTICLE XII CANCELLATION BY CONCESSIONAIRE 12.1 In addition to all other remedies available to Concessionaire provided herein or at law or in equity, this Agreement shall be subject to cancellation by Concessionaire by giving a thirty (30) day written notice to Lessor, should any one or more of the following events occur: A. The abandonment of the Airport as an airline terminal or the permanent removal of all certified passenger airline service from the Airport for longer than six (6) months; -12- • • • • B . The assumption by the United States Government, or any authorized agency thereof, of the operation, control or use of the Airport, or any substantial part or parts thereof in such manner as to substantially restrict Concessionaire from operating thereon for a period of at least six (6) months; C. The complete destruction of all or a substantial portion of the Assigned Area to such an extent that the Assigned Area cannot reasonably be repaired or reconstructed within six (6) months after such destruction; D . The breach by Lessor in the performance of any covenant or any agreement required to be performed by Lessor and the failure of Lessor to commence to remedy such breach for a period of thirty (30) days after receipt of written notice of such breach by Lessor from Concessionaire and to continue such performance without interruption, except for causes beyond its control; E . The issuance by any court of competent jurisdiction of any injunction preventing or restraining the use of the Airport in such a manner as to substantially restrict Concessionaire from conducting its concession not caused by the act or omission of Concessionaire and the remaining in force of such an injunction for at least ninety (90) days. F. If, at any time while Concessionaire's concession rights in the Terminal are nonexclusive, Lessor should allow anyone other than Concessionaire to provide concessions which are the same as or similar to the concessions provided by Concessionaire, then, in such event, Concessionaire shall have the right at any time while such competitor is operating to cancel this Agreement by giving Lessor at least sixty (60) days prior written notice of such election. ARTICLE XIII CANCELLATION BY LESSOR 13.1 In addition to all other remedies provided herein or at law, or equity, Lessor may cancel this Agreement by giving a thirty (30) days written notice to Concessionaire, should any one or more of the following events occur: A. Concessionaire fails to make any payments required hereunder when due to Lessor or within thirty (30) days after receipt of written notice from Lessor of non- payment. -13- • • • • B . Concessionaire permits to continue, for a period of fifteen (15) days after receipt of written notice from Director, the existence of unsafe or unsanitary conditions or practices in or about the concession premises; provided however, if the unsafe or unsanitary condition is such as to require replacement, repair, or construction, Concessionaire shall have a reasonable time in which to correct said condition, but must begin action within a reasonable time after receipt of said notice; C. The interest of Concessionaire under this Agreement is transferred, passes to or devolves upon, by operation of law or otherwise, any other person, firm or corporation, except as specifically provided for and allowed under this Agreement. D . Concessionaire shall neglect or fail to perform and observe any other promise, covenant or condition set forth in this Agreement within thirty (30) days after receipt of written notice of breach from Lessor or Director, except where fulfillment of such obligation requires activity over a period of time and Concessionaire has commenced to perform whatever may be required within thirty (30) days after receipt of such notice and continues such performance without interruption, except for causes beyond its control; E . The levy of any attachment or execution, or the appointment of any receiver by any court of competent jurisdiction which is not vacated, dismissed or set aside within a period of one hundred twenty (120) days and which does, or as a direct consequence of such process will, interfere with Concessionaire's use of the Assigned Area or with its operations under this Agreement; F. Concessionaire becomes insolvent, or takes the benefit of any present or future insolvency statute, or makes an assignment for the benefit of creditors, or files a voluntary petition in bankruptcy, or a petition or answer seeking an arrangement for its reorganization, or the readjustment of its indebtedness under the Federal bankruptcy laws or under any other law or statute of the United States, or under any state law, or consents to the appointment of a receiver, trustee or liquidator of all or substantially all of its property or its property located within the concession area; G . A petition under any part of the Federal bankruptcy laws, or an action under any present or future insolvency law or statute is filed against Concessionaire and is not dismissed within one hundred twenty (120) days; -14- 13.2 specified Agreement Lessor to cancel this Agreement on account of such breach, unless said breach is fully and completely corrected and cured to the reasonable satisfaction of Lessor prior to said cancellation, or of Lessor's right to cancel this Agreement because of any subsequent breach of a similar or different nature. • • • • H. By or pursuant to, or under authority of, any legislative act, resolution or rule, order or decree of any court, governmental board, agency or officer having jurisdiction, a receiver, trustee or liquidator takes possession or control of all or substantially all of the property of Concessionaire, and such possession or control continues in effectfor a period of one hundred twenty (120) days; 1. Cessation or deterioration of the nature and/or quality of service provided by Concessionaire for a period of time that the operation and services required to be performed by Concessionaire under this Agreement are objectively, materially and adversely affected. Prior to any cancellation of this Agreement upon this ground, Lessor shall first provide Concessionaire thirty (30) days from its receipt of said notice to correct such problems, except for those conditions also constituting an unsafe or unsanitary condition as provided in Section 13.1B hereinabove, in which case Concessionaire shall have fifteen (15) days from the receipt of said written notice to correct, as provided in said Section. J. Except as set forth in Section 14 hereof, any lien is filed against the Assigned Area because of any act or omission of Concessionaire and such lien is not removed, enjoined, or a bond for satisfaction of such lien is not posted within sixty (60) days; or L. Concessionaire abandons, deserts, vacates or discontinues its operation of the business herein required for a period of five (5) days without prior written consent of Lessor. Acceptance by Lessor of any rentals or other payments herein, after a breach of any of the terms of this shall not be deemed a waiver of any right on the part of 13.3 Once Concessionaire's time period to cure a default has expired, Lessor may reenter the premises and may remove all persons and property from same. Upon any removal of Concessionaire's property by Lessor hereunder, said property may be stored at a public warehouse or elsewhere at Concessionaire's sole cost and expense. -15- • • ARTICLE XIV EQUIPMENT FINANCING • • 14.1 Lessor acknowledges and understands that Concessionaire may finance the furniture, fixtures, and equipment for use in its concession operations at the Airport through a third party lender. Such lender may require Concessionaire to pledge the furniture, fixtures, and equipment as collateral for said loan. Lessor agrees that it will execute any documents reasonably requested by such lender of Concessionaire to evidence that such lender's security interest in such collateral is and shall at all times will be superior to any of Lessor's interests in such collateral. ARTICLE XV GENERAL PROVISIONS 15.1 Nondiscrimination. The Concessionaire, for itself, its personal representatives, successors in interest, and assigns, as a part of the consideration hereof, does hereby covenant and agree: (1) that no person, on the grounds of race, color, religion, creed, political ideas, sex, age, or physical or mental handicap, shall be excluded from participation, denied the benefits of, or be otherwise subjected to discrimination in the use of said facilities; (2) that in the construction of any improvements and the furnishing of services, no person on the grounds of race, color, religion, creed, political ideas, sex, age, or physical or mental handicaps, shall be excluded from participation in, denied the benefits of, or otherwise be subjected to. discrimination; (3) that the Concessionaire shall use the Assigned Areas 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 of 1964, and as said Regulations may be amended; (4) that Concessionaire will not block, close or otherwise cause the accessibility of handicapped accessible ingress and egress to be nonfunctional without providing an alternative means of access approved in writing by the Director. The Concessionaire shall furnish its accommodations and/or services on a fair, equal, and nondiscriminatory basis to all users thereof, and it shall charge fair, reasonable, and nondiscriminatory prices for each unit of service; however, the Concessionaire may be allowed to make reasonable discounts or other similar type of price reductions to purchasers (such as employees of the Lessor or other vendors at the Airport) on a nondiscriminatory basis. 15.2 Disadvantaged Business Development. This Agreement is subject to the requirements of the U.S. Department of Transportation's regulations, 49 CFR part 23, Subpart F. -16- • • • • • • Concessionaire agrees that it will not discriminate against any business owner because of the owner's race, color, national origin, or sex in connection with the award of performance of any concession agreement covered by 49, CFR part 23, Subpart F. Concessionaire agrees to include the above statements in any subsequent concession agreements that it enters and cause those businesses to similarly include the statements in further agreements. Concessionaire shall cooperate in Lessor's approved Disadvantaged Business Enterprise (DBE) program submitted in compliance with all other requirements imposed by or pursuant to Title 49, Code of Federal Regulations, Department of Transportation, Office of the Secretary, Part 23, Participation by Minority Business Enterprise programs of the Department of Transportation -Effectuation of Title VI of the Civil Rights Act of 1964, and as said Regulations may be amended. 15.3 Federal Aviation Act, Section 308. Nothing herein contained shall be deemed to grant the Concessionaire any exclusive right or privilege within the meaning of Section 308 of the Federal Aviation Act for the conduct of any aeronautical activity on the Airport, except that, subject to the terms and conditions hereof, the Concessionaire shall have the right to possess the Assigned Area under the provisions of this Agreement. 15.4 Right to Amend - In the event that the Federal Aviation Administration or its successors requires modifications or changes in this Agreement as a condition precedent to the granting of funds for the improvement of the Airport, or otherwise, Concessionaire agrees to consent to such amendments, modifications, revisions, supplements, or deletions of any of the terms, conditions, or requirements of this Agreement as may be reasonably required. If, however, Concessionaire should, within its discretion, determine that such compliance would not be in its best interest, then Concessionaire shall have the right to cancel this Agreement by giving Lessor written notice within sixty (60) days of the date on which Concessionaire receives written notice of the change in its obligations under this Agreement. In such event, the cancellation shall be effective. on the first day of the month following the month in which Concessionaire gives Lessor its notice of election to cancel this Agreement. 15.5 Nonwaiver of Rights - No forbearance in the enforcement of this Agreement or waiver of breach by either party of any of the terms, covenants, and conditions hereof to be performed, kept, and observed by the other party shall be construed as, or shall operate as, a waiver of any subsequent breach or default of any of the terms, covenants, or conditions herein contained, to be performed, kept, and observed by the other party. The provision of this Agreement making time to be of the essence in the performance of the terms hereunder shall not be deemed to be waived by any forbearance or waiver of breach by either party. -17- • • • 15.6 $otices - Notices required herein shall be given by each party to the other party by depositing the same in the United States mail in the continental United States, certified or registered mail, return receipt requested. Notices in writing may also be delivered by personal service of said notice to the agents for each party at the addresses listed below, provided that a written copy is also mailed as provided herein. Either party shall have the right, by giving written notice to the other, to change the address at which its notices are to be received. Notices and the time limits specified in connection herein shall be deemed to commence from the date of receipt. Until any such change is made, notices shall be delivered as follows: To Lessor: CITY OF FAYETTEVILLE MUNICIPAL AIRPORT ATTN: AIRPORT MANAGER 4500 SOUTH SCHOOL, SUITE F FAYETTEVILLE, ARKANSAS 72703 To Concessionaire: AIR HOST FAYETTEVILLE, INC. ATTN: JOHN RAGLAND 1355 LYNNFIELD ROAD, SUITE 205 MEMPHIS, TN 38119-5883 If notice is given in any other manner or at any other place, it will also be given at the place and in the manner specified above. 15.7 Captions - The headings of the several articles of this Agreement are inserted only as a matter of convenience and for reference and in no way define, limit, or describe the scope or intent of any provisions of this Agreement and shall not be construed to affect in any manner the terms and provisions hereof or the interpretation or construction thereof. 15.8 Severability - If one or more clauses, sections, or provisions of this Agreement shall be held to be unlawful, invalid, or unenforceable; it is agreed that the remainder of the Agreement shall not be affected thereby. 15.9 Right to Develop Airport - It is further covenanted and agreed that Lessor reserves the right to further develop or improve the Airport, including the Terminal and all landing areas and taxi ways as it may see fit, regardless of the desires or views of Concessionaire and without interference or hindrance, so long as Concessionaire's rights granted herein are not affected adversely. -18- • • • • • • 15.10 Incorporation of Exhibits - All exhibits referred to in this Agreement are intended to be and hereby are specifically made a part of this Agreement. 15.11 Relationshin of Parties - Nothing contained herein shall be deemed or construed by the parties hereto, or by any third party, as creating the relationship of principal and agent, partners, joint venturers, or any other similar such relationship between the parties hereto. The parties understand and agree that neither the method of computation of rent, nor any other provision contained herein, nor any acts of the parties hereto creates a relationship other than the relationship of lessor and lessee. 15.12 Noniiability of Agents or Employees - No officer, agent, employee or affiliate of Lessor, or of the Concessionaire shall be charged personally or held contractually liable by or to the other party under the provisions of this Agreement or because of any breach thereof or because of its or their execution or attempted execution. 15.13 Successors and Assians Bound - This Agreement shall be binding upon and inure to the benefit of the successors and assigns of the parties hereto, where permitted by this Agreement. 15.14 Time of Essence - Time is expressed to be of the essence in this Agreement. 15.15 Gender - Words of shall be held and construed to in the singular number shall be the context otherwise requires. any gender used in this Agreement include any other gender and words held to include the plural, unless 15.16 Force Maieure - Neither party hereto shall be liable to the other for any failure, delay or interruption in the performance of any of the terms, covenants or conditions of this Agreement due to causes beyond the control of that party including, without limitation, strikes, boycotts, labor disputes, embargoes, acts of God, acts of the public enemy, weather conditions, floods, riots, rebellion, sabotage or any other circumstance for which such party is not responsible or which is not in its sole power to control. 15.17 Capacity. Bindina Effect - By the execution of this Agreement by their respective representatives, both Lessor and Concessionaire warrant that they have the legal authority, capacity, and ability to enter into and perform this Agreement, and to legally and validly bind and obligate themselves by the terms hereof. 15.18 Representative of Lessor - The Director shall be designated as the official representative of Lessor in all matters pertaining to this Agreement and shall have the right and authority -19- to act on behalf of Lessor with respect to all action required of Lessor in this Agreement. 15.19 Governing Law. Venue - This Agreement is governed by the Laws of the State of Arkansas. Any disputes relating to this Agreement shall be resolved • in accordance with the laws of the State of Arkansas. Jurisdiction and venue for any action brought construing, enforcing, or otherwise determining the rights of the parties relating to this Agreement shall only be appropriate in the proper state court in and for Washington County, Arkansas. 15.20 Attorney's Fees - In any action brought by either party pertaining to this Agreement, the prevailing party shall be entitled to recover reasonable attorney fees and expenses from the other party. 16.1 The parties hereto understand and agree that this instrument and the attached Exhibits contain the entire Agreement between the parties to be performed during the term hereof. The parties further understand and agree that neither party nor its agents have made representations or promises with respect to this Agreement, except as may be expressly set forth herein; and, that no claim or liability shall arise for any representations or promises not expressly stated in this Agreement, any other writing or parole agreement with the other party being expressly waived. This document cannot be amended except by a writing signed by both parties hereto. IN WITNESS WHEREOF, the parties have set their hands on this 7* day of lJ 4 ,. G.—' 1993. ATTEST: City C1e*k ATTEST: CITY OF FAYETTEVILLE By: ayor AIR HOST FAYETTEVILLE, INC. An Arkansas Corporation, Concessionaire p -20- By: v/ se rP: r i iiaimca r I � _ — r S e� Q Z 0 U- ck a CL z Iii W I— F — Iii Li - E) I) PIT 3 MERCHANDISE LIST NEWS/GIFT SHOP CONCESSION Concessionaire will sell, or offer for sale, those items specifically listed in this Exhibit I-3 unless prior written approval is received from the Board. CATEGORY A - REqUIRED-'- Ccncessionaire shall be required to offer for sale the Items listed below from the news/gifts shop in the Terminal. Current magazines and periodicals, at least different titles in the shop in the Terminal. Paperback books, at least different titles, including the national best sellers. popular brand cigarettes, cigars, and pipe tobacco. post cards prepackaged snacks, candy bars, gum Breathmints, Lifesavers, and nuts A full assortment of popular brand camera film and basic camera accessories (flashbulbs and batteries) to meet reasonable public demand minor nonprescription drugs, including but not limited to items such as aspirin and aspirin -type remedies, antacids, iodine, merthiolate, travel sickness ickness remedies, cold capsules, inhalers, chapstic):s, etc. ,with at least one aspirin -type medication and one travel sickness remedy being c "_e=ed in single -dosage pac):ets . Traveler necessities, inducing but not limited and pocket `facial tissues, utility pencaids, ens), =_ncils (_nexpens=ve wood pencils and ballpoint p utility ..:siting tablets, pocket notebooks, paper eyeglass cleaners, :,and% -.e chis, disposable diapers, toothbrushes, c: i(i clothes :ahpackets.9 .ash n:thpaster sha'.p00, dec-4 ants, ^anieure aids, pocket ::c-..er.'s cc_ -it. hosiery (nondesigner), sewing :':tts. ispcsabL9 razors, etc., e'_1 in travel sizes. C�i.:≤c C. -.aps r c.E_ Books and Magazines * Top Ten Paperback Books * Weekly and Monthly Magazines * Newspapers - Local -Area - National * Postcards * Special Occasion Cards * Travel Guides and Maps Sundries * Cigarettes * Assorted Cigars * Pipe Tobacco * Candy, Nuts, snacks Gum * Assorted mints, Life Savers, Certs, etc. * Nail Files * Nail Clippers * trail Polish * hail polish Remover * Combs, Brushes Toothbrushes, Toothpaste * Disposable Razors * Photo Film * Flash Accessories * Batteries * Kleenex Hair Spray * Hosiery * Bic Pens * Stationery, Legal Pads, Notebooks, etc. * Scotch Tape * Envelopes * Rain Hats * Pen and Pencil Refills Health and Beauty Aids * Antiseptics * Band Aids * Eye Drops * Alka Seltzer * Cold Capsules * Contac Capsules * Dramamine * Aspirin and Aspirin Type Remedies Tylenol, Anacin, Bayer, Advil, etc. * Peoto Bismol * Deodorants Ta.npax Blistea, Chapstick * Hand Lotion * Mouth Wash * After Shave Lotion, Shaving Cream * Shampoo * Eye Glass Cleaners * Cough Drops and Cough Syrup * Nasal Spray * Vic}:s Inhalers * Sunburn Lotion * Disposable Diapers Gifts * High Quality "T" Shirts - Featuring local attractions - Featuring local universities & NFL * Sweatshirts Baseball Caps * Sunglasses - Sun Class products City and State Souvenirs - cues and saucers - rugs- - plates - spxr.s key chains - glassware - pennants - graphics * University and NFL Ceramics • - ash tray - shot glasses - steins * Tote and Flight Bags - assorted selection, sizes, and logos * Stuffed Animals - Applause - Russ Berrie -Elan - Kinder Friends * Figurines ceramic alabaster acrylic crystal dolls and bells - pewter collectibles * Assorted Children's Toys and Games * Pen and Pencil Sets Cross - Pentel - Parker * Novelties cxlliplT 3 • MERCHhNDISE LIST EhSlGIFT SHOP CONCESSION Concessionaire will sell, or offer for sale, those items specifically listed in this Exhibit I-3 unless prior written approval is received from the Board. CATEGORY A REQUIRED ITEMS TRAVELER NECESSITIES Concessionaire shall be required to offer for sale the items listed below from the news/gifts shop in the Terminal. current magazines and periodicals, at least different titles in the shop in the Terminal. paperback books, at least different titles, including the national best sellers. Popular brand cigarettes, cigars, and pipe tobacco. Post cards prepackaged snacks, candy bars, gum Breathmints, Lifesavers, and nuts A full assortment of popular brand camera film and basic camera accessories (flashbulbs and batteries) to meet reasonable public demand minor nonprescription drugs, including but not limited to items such as aspirin and aspirin -type remedies, antacids, iodine, merthiolate, travel sickness remedies, cold capsules, inhalers, chapstic}:s, sunburn lotions, etc., with at '_east one aspirin -type medication and one z.avel sickness remedy being ce=ed in single -dosage packets. Traveler necessities. including but not limited to bandaids, poc):et racial tissues, utility pens and nenc_ls (inexpensive wood pencils and ballpoint pens), citing tablets, pocket notebooks, paper handke' eyeglass cleaners, :,and::e=chis, disposable diapers, 9 `oothbrushes, clothes ::ash packets, p---�-pocket pzste, sha`.pGo, deccc=a".` 1..zn:cu:e aids, sewing .:c-.er's cz_='-ty hosier (non5esrgner), g k-- all in travel sizes. __aVe GCi-c-c and 'laps OS .. © • Books and Magazines * Top Ten Paperback Books * Weekly and Monthly Magazines + * Newspapers - Local -Area - National * postcards * Special Occasion Cards * Travel Guides and Maps Sundries * cigarettes * Assorted Cigars * Pipe Tobacco * Candy, nuts, Snacks Gum Assorted Pints, Life Savers, Certs, etc. * Nail Files * Nail Clippers Nail Poli s� * Nail polish Remover * Combs, Brushes Tcothbrushes, Toothpaste * Disposable Razors I * Photo Film * Flash Accessories * Batteries * Kleenex * Hair Spray * Hosiery * Bic Pens * Stationery, Legal Pads, Notebooks, etc. * Scotch Tape * Envelopes * Rain Hats * Pen and Pencil Refills Health and Beauty Aids * Antiseptics * Band Aids * Eye Drops * Alka Seltzer * Cold Capsules * Contac Capsules * Dramamine * Aspirin and Aspirin Type Remedies Tylenol, Anacin, Bayer, Advil, etc. * Pepto Bismol * Deodorants Ta.mpax Q 0 . n * Blistex, Chapstick * Hand Lotion * Mouth Wash * After Shave Lotion, Shaving Cream * Shampoo * Eye Glass Cleaners * Cough Drops and Cough Syrup Nasal Spray * Vicl:s Inhalers * Sunburn Lotion * Disposable Diapers Gifts * High Quality "T" Shirts - Featuring local attractions - Featuring local universities & NFL * Sweatshirts * Baseball Caps * Sunglasses - Sun Glass products City and State Souvenirs - cups and saucers Muas plates_ spot.^.s }:ey chains glassware - pennants - graphics F * University and NFL Ceramics - ash tray - shot glasses - steins * Tote and Flight Bags assorted selection, sizes, and logos * Stuffed Animals - Applause - Russ Berrie - Elan - Kinder Friends * Figurines ceramic alabaster acrylic - crystal dolls and bells pewter collectibles * Assorted Children's Toys and Games * Pen and Pencil Sets - Cross - Pentel - Parker * Novelties