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HomeMy WebLinkAbout63-03 RESOLUTIONRESOLUTION NO,63-03 A RESOLUTION APPROVING A LEASE AGREEMENT WITH THE UNIVERSITY OF ARKANSAS FOR A 80' x 120' HANGAR; AND DESIGNATING THE DISPOSITION OF THE LEASE PROCEEDS. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1. That the City Council of the City of Fayetteville, Arkansas hereby approves a Lease Agreement with The University of Arkansas for a 80' x 120' hangar. A copy of the Lease Agreement marked Exhibit "A" is attached hereto and made a part hereof. Section 2. That the proceeds of the Lease Agreement shall be returned to the Economic Development Capital Improvements Fund, less one half percent (1/2%) to the Airport Fund for facility maintenance. PASSED and APPROVED this 6kh day of May 2003. ,f FAY E E` r 't r �L �� Zms s J` , . y y6�D� C By: SONDRA SMITH, City Clerk APPROVED: By: DAN COODY, LEASE AGREEMENT This Lease Agreement ("Agreement") is entered into this day of May, 2003, by and between the City of Fayetteville, Arkansas, hereinafter referred to as the "City," and the Board of Trustees of the University of Arkansas, acting for and on behalf of the University of Arkansas, Fayetteville, hereinafter referred to as "University." WHEREAS, the City owns and operates an Airport known as Fayetteville Municipal Airport - Drake Field ("Airport"), situated in Washington County in the State of Arkansas; and WHEREAS, the University desires to lease from the City an aircraft hangar for use by the University; and WHEREAS, the City has agreed to construct the hangar in the newly constructed executive ramp area of the Airport; and WHEREAS, the University has agreed to pay rent subject to the terms and conditions herein set forth; NOW, THEREFORE, the Parties hereto agree as follows: 1. DESCRIPTION OF THE LEASED PREMISES. The City does hereby grant, demise and lease unto University an aircraft hangar located at 4166 South School Avenue, Fayetteville Municipal Airport -Drake Field situated in the City of Fayetteville, County of Washington, Arkansas (the "Leased Premises" or "Hangar"). A copy of the actual site location for the Hangar is attached hereto as Exhibit A and incorporated herein by reference. The City agrees to construct the Hangar to meet the basic specifications set forth in Exhibit B which is attached hereto and incorporated herein reference. 2. TERM. The term of this lease is for twenty (20) years beginning on the first day of the next month following the date the Occupancy Permit f r the Hangar is granted ( day of 2003), and ending at midnight on 2023) ("Term"). A. Option to Extend. The University shall have the option to extend the Term of this Agreement for one (1) period of Twenty (20) years if the University has satisfied the following conditions (extensions beyond Forty (40) years must be renegotiated and approved by the Fayetteville City Council): 1) The University has complied with and performed all conditions, covenants, and terms of the Agreement without any defaults, excluding any defaults that have been or are in the process of being cured. 2) Notice of the University's request to renew has been made in writing to the City at least One Hundred Twenty (120) days prior to the expiration of the Term. 1 3) The amount of the monthly rental fee for the additional period of 20 years shall have been successfully negotiated and agreed to by the parties in good faith. 3. RENTAL FEES. During the Term of this Agreement, the University agrees to pay the City a monthly rental fee equal to the actual cost for the City to construct the hangar amortized at four and one-half percent (4.5%) for 20 years (for example, $400,000.00 @ 4.5% = $2,530.60 per month); provided, however, the maximum monthly rent shall be the LESSER of either: (A) the amortized monthly payment or (B) Two Thousand Six Hundred Dollars ($2,600.00) per month ("Rent"). The initial Rent payment is due on or before the 15'h day of next month following the date of the Occupancy Permit is granted ( , 2003) and on or before the 15'h day of each month thereafter during the life of this Agreement. 4. UTILITIES AND JANITORIAL SERVICES. The University shall be responsible for the payment of the utilities associated with the use of the Leased Premises including, but not limited to, electric, gas, heating, water/sewer, and trash removal to the leasehold. The City shall be responsible for ensuring access to the foregoing utilities for the University at no additional cost to the University. Any such facilities or services required by the University for its use and purposes shall be its sole and exclusive responsibility; provided, however, that the City agrees not to interfere, cut-off or otherwise disrupt the University's access to any such utilities or services. 5. TERMS AND CONDITIONS. Both parties agree to comply with and abide by all terms and conditions set forth in this Agreement. 6, USE OF THE LEASED PREMISES. The University agrees that the Leased Premises shall be used and occupied only as an aircraft hangar, for any other approved use, and for related lawful purposes. A. Flammable Material. The University further agrees not to store any flammable material in the Hangar other than a limited supply of oils and agents necessary for the operation of an aircraft hangar. Fuel in the airplanes is excepted. B. No Operation of Aircraft in Hangar. The University shall not start or operate aircraft engines within the Hangar and shall not allow such operations by any other person. 7. USE OF THE AIRPORT. The University is granted the use, in common, without charge, of the Airport 24 hours per day and for 365 days each year during the Term, together with all facilities, equipment, improvements, and services which have been or may hereafter be provided at or in connection with the Airport from time to time including, but not limited to, the landing field and any extensions hereof or additions thereto, roadways, runways, ramps, aprons, taxiways, flood lights, landing lights, beacons, control tower, signals, radio aids, and all other conveniences for flying, landings and takeoffs. 8. MAINTENANCE, REPAIR AND REPLACEMENT. The City shall be solely responsible for the cost and expense of maintaining the Leased Premises, including the Hangar and all 2 equipment, fixtures and appurtenances famished by the City under this Agreement, in good repair and tenantable condition, except in case of damages arising from the acts of the University, its agents or employees. For the purpose of maintaining the Leased Premises, the City may at reasonable times and with the prior approval of the authorized University of Arkansas representative in charge, enter and inspect the same and make any necessary repairs hereto. 9. FAILURE TO PERFORM. The covenant to pay rent and the covenant to provide any service, utility, maintenance or repair required under this Agreement are dependent. If the City shall breach any of the conditions required to be performed by it under this Agreement, the University may cure such breach and deduct the cost thereof from Rent subsequently becoming due hereunder. If the City fails to correct a deficiency within thirty (30) days after written notice from the University, or within an appropriate shorter period stated in the notice, in the event of a deficiency constituting a hazard to the health and safety of the University's employees, property, or any other person, or which materially interferes with the University's ability to exercise its rights under this Agreement (including, for example, and without limitation, the right to use the Hangar to facilitate air travel), the University may elect to terminate this Agreement. In the event the University elects to terminate this Agreement, the University shall only be responsible to pay any unpaid rental payments (on a pro -rated basis for periods of less than one month) which accrued prior to the date of termination or the date the deficiency prevented the University's use of the Lease Premises, whichever is earlier. The University shall be released from any other liability. 10. DAMAGE BY FIRE OR OTHER CASUALTY. If the Leased Premises are partially damaged by fire or other casualty, said Leased Premises shall be repaired with due diligence by the City at City's expense. If the damage is so extensive as to render such building untenable, the Rent hereunder shall be paid on a pro -rated basis up to the time of the damage and shall henceforth cease until such time as the Leased Premises shall be fully restored. If the Leased Premises are completely destroyed, the City may reconstruct the Hangar at City's own cost and the rent payable hereunder shall be adjusted as set forth above, or the City may, at its option, cancel this Agreement, such cancellation to be effective as of the date the Hangar was destroyed and the Rent adjusted as set forth above. In the event the University's aircraft are partially or wholly damaged by fire or other casualty, then the University shall be free to terminate this Agreement, and the Rent shall be paid on a pro -rated basis up to the time of the loss or casualty. 11. ALTERATIONS. The University may attach fixtures and install signs in or to the Leased Premises with City's approval which shall not be unreasonably withheld. Such fixtures and signs shall remain the property of the University and may be removed from the Leased Premises within a reasonable time after the termination of this Agreement provided the University shall restore the Leased Premises to a condition as good as at the beginning of this Agreement, ordinary wear and tear excepted. No services or work will be performed for which an additional cost or fee will be charged by the City without the prior written authorization of the University. 12. TERMINATION. Without regard to any other remedies provided herein, the University may terminate this Agreement by thirty (30) days written notice to the City if the University's funds are insufficient for it to continue the operations for which the Leased Premises are being used. 3 13. SPECIAL PROVISIONS, A. The City shall be responsible, at its sole cost and expense, to ensure that the Leased Premises conforms to the Arkansas Fire Prevention Code, as amended, Arkansas State Plumbing Code, the National Electrical Code, and any other state and local laws, codes, authorities, etc., applicable to the Leased Premises, including the Arkansas adopted Americans with Disabilities Act Accessibility Guidelines for Buildings and Facilities (ADAAG). B. The City shall maintain and keep in good repair, at its sole cost and expense, so much of the Airport premises as is not under the exclusive control of individual lessees. C. The University shall provide for and supply at its expense all janitor service with respect to the Leased Premises and shall pay for all utilities serving the Leased Premises, including, but not limited to heat, light, gas, electricity and water. As part of the construction of the Hangar, the City agrees to ensure that all necessary utility hook-ups are provided. D. The University agrees to observe and obey all applicable law and regulations governing the use of the Leased Premises and Airport, including, but not limited to, the rules and regulations of the Federal Aviation Administration with respect to aircraft operations at the Airport. E. The City authorizes the University to use the Leased Premises only for the storage of airplanes and materials and equipment necessarily related to the operation of said airplanes and that no other vehicles, equipment or supplies shall be stored on the Leased Premises unless expressly agreed to by City; provided, when the University's airplane(s) are on a flight, automobiles utilized by the pilots and passengers may be stored inside the Leased Premises. F. The University agrees that it shall only be permitted to engage in routine and minor maintenance on the airplane stored in the building and shall not engage in any major overhaul of the airplane within the Leased Premises. G. The University shall procure and maintain in force during the term of this Agreement, fire and extended coverage insurance on the University's aircraft in an amount equivalent to the replacement cost thereof. The University shall also be required to insure any contents within the Hangar. H. All claims of alleged damages against the University for alleged contractual breaches, defaults, or other claims shall be submitted to the Arkansas Claims Commission for adjudication. Nothing in this Agreement shall be deemed to waive the immunities of the parties. I. The University shall maintain the Leased Premises in a clean and orderly fashion at all times. G J. The University shall not be responsible for any taxes or assessments levied or otherwise assessed against the Leased Premises for any reason whatsoever. 14. EVENTS OF DEFAULT. The following shall be "Events of Default" under this Agreement, and the terms "Events of Default" or "Default" shall mean, whenever they are used herein, any one or more of the following: A. The University shall fail to pay, when due and owing, any rent hereunder and such nonpayment shall continue for twenty (20) days after receiving written notice thereof from the Airport; B. The University voluntarily shall abandon, desert, or vacate the Leased Premises; C. The University shall fail to comply with the insurance requirements imposed hereunder; provided such noncompliance shall continue for twenty (20) days after receiving written notice thereof from the Airport; D. The University shall fail to observe or perform any other of its material obligations hereunder, and such failure shall continue un-remedied for twenty (20) days after the City shall have given written notice specifying such default to the University provided that the Airport may grant the University such additional time as may be reasonably required to correct any such default if the University has instituted corrective action and diligently is pursuing the same; 15. REMEDIES UPON UNIVERSITY OF ARKANSAS' DEFAULT. Whenever an Event of Default of the University shall occur, the City may pursue any available right or remedy at law or equity including: A. Termination. At its exclusive option, the City shall deliver to the University written notice of termination with a minimum of 30 days notice, specifying the date upon which the Agreement will terminate. In the event of termination, the University's rights to possession of the Leased Premises immediately shall cease upon the end of the actual date of termination. The City may then reenter and take possession of the Leased Premises and the University shall surrender possession of the Leased Premises. Upon termination of this Agreement due to an uncured Event of Default by the University, the University shall be liable for payment of: 1) All unpaid rent payments accrued through the date of termination. 16, EXPIRATION OR TERMINATION. On the expiration or other termination of this Agreement, the University's right to use the Leased Premises shall cease, and the University shall vacate the Leased Premises without unreasonable delay. All property installed, erected, or placed by the University in, on, or about the Leased Premises shall be deemed to remain the property of City except for signage or other items bearing or reflecting the intellectual property of the University. The University shall have the right at any time during the Term of this 5 Agreement, or any renewal or extension hereof, and for an additional period of thirty (30) days after the expiration or other termination of this Agreement, to remove any or all of the University's property, subject, however to the University's obligation to repair all damage, if any, resulting from such removal, normal wear and tear excepted. 17. TERMINATION OF AIRPORT. In the event that the Fayetteville Municipal Airport facility and property are no longer used for aviation purposes or in a manner which prevents the University from using the Airport to facilitate the air travel needs of the University, then the University may remain in possession of the Leased Premises until the end of the Term with the right to use the premises for any use allowable under Arkansas law or the University may elect to terminate the Agreement immediately with no further charges or liability. 18. NON -WAIVER. The waiver by either party of any breach of the other party of any provision hereof or any forbearance by either party to seek a remedy for any such breach shall not operate as a waiver of any other breach of either party. 19. NOTICES. Any notice or consent required by this Agreement shall be sufficient if sent by far, Certified Mail, return receipt requested, postage paid, or personally delivered to the following addresses: CITY OF FAYETTEVILLE: Airport Administration Office 4500 S. School Avenue, Suite F Fayetteville, Arkansas 72701 PH: 479-718-7642 FAX: 479-718-7646 UNIVERSITY OF ARKANSAS University of Arkansas 321 Administration Building Fayetteville, Arkansas PH: 479-575-2551 FAX: 479-575-4158 20. AMENDMENT. This Agreement expresses the entire agreement of the parties and may only be amended in writing signed by all the parties hereto or their duly authorized agents. 21. GOVERNING LAW. This Agreement shall be governed by the laws of the State of Arkansas. 22, TIME OF ESSENCE. Time is of the essence with respect to this Agreement. 0 E IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first above written. CITY OF F ;TTEVI LE, ARKANSAS By: cat Dan oody, Mayor Board of Trustees of the University of Arkansas, acting for and on behalf of the University of Arkansas at F c teville: By: Ann Kemp Vice President for Finance & Administration EXHIBIT "A" UA HANGAR LOCATION PLAN _ •II �� j i_-- 0 �.�'^�� t i 1j' • • , ' � � •erg I B�- it � o._ - '-�4- �I•�`l�s��--� i I EXHIBIT B Basic Specifications for UA Hangar Hangar Use- Aircraft Storage (not aircraft maintenance) Building Materials- Metal building with block walls for offices Hangar Size- 120' (clear span) x 80' deep, nominal Sidewall Height- 29' high Interior Liner Panel- Thigh, nominal Insulation- Vinyl -covered, batt Hangar Door- 1 00'wide x 24' high, clear Hangar Lighting- Metal halide, low bay Hangar Heating- Gas -fired Infrared System Hangar Floor- Concrete, finished smooth Offices- 24' x 30', nominal ("nice" finishes) Office A/C- Heat pump, or similar Office Walls- Concrete block, painted Office Ceilings- Suspended, with recessed fluorescent lighting Office floors- Carpeting, industrial grade Light Storage- Above office area, 20' x 30' Parking- 7 spaces; including 1 handicapped JA200311oropoulsW of AWPPENDIX B doc NAME OF FILE: Resolution No. 63-03 CROSS REFERENCE: Item # Date Document 1 1 06/17/03 Res.63-03 2 04/28/03 staff review form draft resolution draft resolution draft resolution memo to mayor/city council draft agreement draft final agreement 3 06/20/03 memo to Ray Boudreaux NOTES: FAI'ETTEV4LLE 0 THE CRY Of FAYETTEVILLE, ARKANSAS DEPARTMENTAL CORRESPONDENCE To: Ray Boudreaux Aviation & Economic Development From: Clarice Buffalohead-Pearman It City Clerk's Division Date: June 20, 2003 Re: Resolution 63-03 Attached is an executed copy of the above resolution passed by the City Council, May 6, 2003, approving a lease agreement with the University of Arkansas attached as Exhibit A. These items will microfilmed and recorded with the city clerk's office. If anything else is needed please let the clerk's office know. /cbp Attachments) a: Nancy Smith, Internal Auditor AGENDA REQUEST X CONTRACT REVIEW GRANT REVIEW STAFF REVIEW FORM TasOrder 41 - CA Hangar For the 'Fayetteville City Council Meeting of: FROM: McClelland Consult Engineers 5QAAOZO� /1uy 6th, IOU3 Ray M. Boudreaux Aviation & Economic Development Economic Development Name Division Department ACTION REQUIRED: Review and approval of Task Order #1 with McClelland Consulting Engineers, Inc., for Engineering design and construction oversite services to construct an 80'x120' hangar to be leased to the University of Arkansas Flight Department under long term agreement. Approval of a lease with the U of A which will be based on the construction cost of the hangar. The monthly lease to be paid from the U of A is estimated to be $2,530.60 and is based on a $400,000 construction contract. COST TO CITY: $60,000.00 Cost of this request 4470.9470.5315.CC Account Number 02050 Project Number $ 500,000.00 Category/Project Budget Funds Used to Date Economic Devlopment Matches Program Category / Project Name Other Capital Improvements Program / Project Category Name $ 500,000.00 Sales Tax Capital Improvement Remaining Balance BUDGET REVIEW: X Budget -f4ana4er CONTRACT/GRANT/LEASE REVIEW: &'�' , 4-7-� A/mac/c/g(�1ynttling Manager City morn y Budgeted Item y -Z3-v-.3 Date a2 � Date WL1/63 Date Fund Name Budget Adjustment Attached Ct,,c� ,- r 4, . Internal Au i�tor �-/�04 Purchasing Manager 4 2,3-I03 Date 4 la 3 1o3 Date STAFF RECOMMENDATION: Staff recomends approval of Task Order #1 with McClelland Consulting Inc. Cross Reference v' - n !!ead Date -� New Item: X Yea No Department Director Date Previous Ord/Res#: Finhnce d Internal Services Dir. -23-03 �y( Date Date Vn Dale Orig. Contract Date Orig. Contract Number 0 RESOLUTION NO, A RESOLUTION APPROVING A LEASE AGREEMENT WITH THE UNIVERSITY OF ARKANSAS FOR A 80' x 120' HANGAR; AND DESIGNATING THE DISPOSITION OF THE LEASE PROCEEDS. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1. That the City Council of the City of Fayetteville, Arkansas hereby approves a Lease Agreement with The University of Arkansas for a 80' x 120' hangar. A copy of the Lease Agreement marked Exhibit "A" is attached hereto and made a part hereof. Section 2. That the proceeds of the Lease Agreement shall the Economic Development Capital Improvements Fund, less (ih%) to the Airport Fund for facility maintenance. PASSED and APPROVED this 6th day of Ipy 2003. , Mayor Clerk RESOLUTION NO, A RESOLUTI APPROVING A ASE AGREEMENT WITH THE UNIVERS OF ARKAN AS FOR SPACE AT THE FAYETTEVILLE NICIPAL AI RT TO CONSTRUCT AN 80' x 120' HANGAR. BE IT RESOLVED B CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1. That the hereby approves a Lease E at the Fayetteville Municip the Lease Agreement mar hereof. PASSED and ►7 this 6w day of L4ky 2003. Clerk COODY, Mayor 0 RESOLUTION A RESOLUTION PPROVING A THE UNIVERSITY OF ARKAN FAYETTEVILLE MU CIPAL AIRI� x 120' HANGAR. / SE AGREEMENT WITH FOR SPACE AT THE TO CONSTRUCT AN 80' BE IT RESOLVED BY N71 CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1. That the City Vouhci hereby approves a Lease Agree ent at the Fayetteville Municipal Ai port to c the Lease Agreement marked xhibit " hereof. PASSED and APPROVED this 6th day of i :ATTESF: By: � � V Clerk of the City of Fayetteville, Arkarisds The University of Arkans��asy'fc sp e nstruct an 80' x 120fh �� !A opy of is attached�h t� n • mad a part I M 003. P OVE L , Mayor FAYETTEIILLE • THE Cr Y OF FAYETTEVILLE, ARKANSAS DAN COODY. MAYOR TO: THRU: FROM: DATE: SUBJECT: MEMORANDUM Dan Coody, Mayor City Council Staff Review Committee Ray M. Boudreaux, Director, Aviation and April 18, 2003 University of Arkansas lease and Hangar., , Background: Last Fall the University of Arkansas aircraft was damaged in an incident and as a result their aviation department acquired two aircraft to replace the one. They have a Beech King Air 200 and a Beech Jet 400. The hangar they currently lease from the airport will only hold one aircraft and it is really too small for either. The U of A has requested that we build them a hangar. They will sign a 20 year lease and will pay monthly at a rate equal to the cost to build the hangar amortized for 20 years at an agreed upon discount rate (approximately 4.5% interest). This project meets the intent of the first Vision 2020 goal: "Our City The Home of the University of Arkansas," and supports guiding principals 4 thru 7. Purpose: The purpose of this action is to approve the task order to McClelland Consulting Engineers for the design, bid administration and construction oversight of a new hangar for the U of A and to approve the lease to the U of A for 20 years. The new hangar will be 120 X 80 and will be constructed at the southwest corner of the new executive ramp. Budget Considerations: The building will cost roughly $400,000 to build including engineering, bid administration and construction oversight. The U of A will pay a monthly rate of approximately $2530.60 if the total construction cost is $400,000. Funds are available in the economic development fund. Requested Action: Approve the new hangar for the U of A and Mayor, sign the contracts. Attachments: Staff Review Form Lease with U of A Budget Amendment Task Order 1 Aviation and Economic Development Department Fayetteville Municipal Airport, Drake Field 4500 South School Avenue, Suite F Fayetteville, Arkansas 72701 Ray M. Boudreaux, Director r1 LEASE AGREEMENT Ground Lease University of Arkansas This Lease Agreement entered into this day of , 20035 by and between the City of Fayetteville, Arkansas, hereinafter referred to as the "City" and University of Arkansas, Fayetteville, Arkansas 72703 hereinafter referred to as University of Arkansas . WHEREAS, the City owns and operates an Airport known as Fayetteville Municipal Airport - Drake Field, situated in Washington County in the State of Arkansas; and WHEREAS, University of Arkansas desires to lease from the City certain space for the construction of an aircraft hangar and ramp as described below: A CERTAIN TRACT OF LAND 120 FT. X 80 FT. LOCATED AT ? S. SCHOOL AVENUE AT THE.. FAYETTEVILLE MUNICIPAL AIRPORT - DRAKE FIELD AND MORE PARTICULARLY SET FORTH AND SHOWN ON EXHIBIT "A", ATTACHED HERETO AND MADE, A PART HEREOF. NOW, THEREFORE, the Parties hereto agree as follows: 1, LEASEHOLD. The City does hereby grant, demise and lease unto University of Arkansas certain premises situated in Washington County, Arkansas, within the boundaries of the Fayetteville Municipal Airport- Drake Field. University of Arkansas will be responsible for all improvements to the Leased Premises. 2. TERM. The term of this lease is for twenty (20) years beginning on the first day of the next month following the date the Occupancy Permit is granted ( _ day of 2003), and ending at midnight the end of the previous month in the year 2023 2023). A. Option to Extend. University of Arkansas shall have the option to extend the Lease Term of this Lease for one (1) period of Twenty (20) years if University of Arkansas has satisfied the following conditions (extensions beyond Fifty (40) years must be renegotiated and approved by the City Council): 1). University of Arkansas has complied with and performed all conditions, covenants, and terms of the Agreement without any defaults known to University of Arkansas, or any defaults that are not otherwise in the process of being resolved in the manner provided in this Agreement. 2). Notice of University of Arkansas's request to renew has been made and presented in writing to the City at least One Hundred Twenty (120) days prior to the expiration of the term. 3.) The amount of rental fees shall have been successfully negotiated and agreed to by the parties for the extended lease term. 3. RENTAL FEES. During the tetra of this lease, University of Arkansas agrees to pay the City an annual ground rental monthly fee equal to the amortized cost for the Airport to construct the hangar at four and one-half percent (4.5%) per month (i.e. $400,000.00 @ 4.5% = $2,530.60). Rental is due, on or before the I" day of next month following the date of the Occupancy Permit is granted ( 2003) . However, should the lease term begin on a day other than the first day of a calendar month, or should the lease end on a day other than the last day of a calendar month, such partial month lease payment shall be a pro- rated share of the monthly lease payment. The initial lease payment is due and payable upon execution of this lease agreement, and all subsequent monthly lease payments shall be due and payable in advance on or before the first day of each calendar month thereafter. A delinquency charge will be imposed on payments not received by the close of business on the tenth day after the due date. Such delinquency charge shall be the maximum amount allowable under Arkansas law. All payments shall be delivered or mailed to: City of Fayetteville, 113 West Mountain Street, Fayetteville, Arkansas 72701. 4. UTILITIES AND JANITORIAL SERVICES. University of Arkansas shall be responsible for the payment of the utilities associated with any, but not limited to, electric, gas, heating, water/sewer, and trash removal to the leasehold. The City shall not be required to furnish to University of Arkansas any facilities or services of any kind, such as, but not limited to, water/sewer, trash removal, electricity, or gas. Any such facilities or services required by University of Arkansas for their use and purposes shall be their sole and exclusive responsibility and agree to hold City of Fayetteville harmless from any responsibility or liability therefore. 5. TERMS AND CONDITIONS. University of Arkansas agrees to comply with and abide by all terms and conditions set forth in this original Agreement of Lease. 6, USE OF THE. PREMISES. University of Arkansas agrees that the leased premises shall be used and occupied only as an aircraft hangar and for related lawful purposes. A. Flammable Material. University of Arkansas further agrees not to store any Flammable material on the demised premises other than a limited supply of oils and agents necessary for the operation of an aircraft hangar. 04 B. Hazardous Substance. University of Arkansas shall not cause or permit any Hazardous Substance to be used or stored on or in the Leased Premises with out first obtaining the City of Fayetteville's written consent. If Hazardous Substances are used, stored, generated, or disposed of on or in the Leased Premises or if the Leased Premises or any other Airport property becomes contaminated in any manner for which University of Arkansas is responsible or legally liable, University of Arkansas shall indemnify and hold harmless the City of Fayetteville from any and all claims, damages, fines, judgements, penalties, costs, liabilities, or losses (including, without limitation and decrease in value of the Lease Premises, damages caused by loss or restriction of rentable or usable space as part of the Leased Premises) arising during or after the term hereof and arising as a result of that contamination by University of Arkansas, University of Arkansas's agents, employees, and invitees. This indcmni fication includes, without limitation, and all costs incurred because of any investigation of the Airport or any cleanup, removal, or restoration mandated by a federal, state, local agency or political subdivision. C. University of Arkansas shall not start or operate aircraft engines within the facility leased hereby and shall not allow such operations by any other person. 7. USE OF THE AIRPORT. University of Arkansas is granted the use, in common, without charge, with others similarly authorized, of the airport, together with all facilities, equipment, improvements, and services which have been or may hereafter be provided at or in connection with the Airport from time to time including, but not limited to, the landing field and any extensions hereof or additions thereto, roadways, runways, ramps, aprons, taxiways, flood lights, landing lights, beacons, control tower, signals, radio aids, and all other conveniences for flying, landings and takeoffs. University of Arkansas agrees to observe and obey City ofFayetteville's Ordinances and Regulations with respect to the use of the demised premised and Airport; provided, however, such Ordinances and Regulations shall be consistent with safety and with all city, county, state, and federal ordinances, rules and regulations. University of Arkansas agrees to abide by the rulings of the Federal Aviation Administration with respect to the use of the Leased Premises. "Airport Minimum Standards for Operations and Commercial Activities" herein referred to as Airport Minimum Standards at Fayetteville Municipal Airport are made part of this lease by reference as if included word for word. 8. REPAIRS, MAINTENANCE AND APPEARANCE. A. University of Arkansas shall at all times during the term of this Lease Agreement, at University of Arkansas's expense, keep and maintain in good repair and safe condition the leased premises and the equipment and appurtenances, both inside and outside, structural and non-structural, extraordinary and ordinary, whether or not necessitated by wear, tear, obsolescence or defects, latent or otherwise. When used herein, the term "repairs" shall include all necessary replacements, renewals, alterations, additions, and betterments. University of Arkansas acknowledges that University of Arkansas shall be responsible for the repairs and maintenance necessary to maintain the structural integrity of the hangar. University of Arkansas will at all times maintain the Leased Premises in a clean, orderly, and attractive condition; not allow the accumulation of rubbish, trash, refuse and any unsightly conditions or fire hazards on the Leased Premises. University of Arkansas shall be responsible for mowing and the upkeep of the outside grounds of the Leased Premises. University of Arkansas shall be responsible for all janitorial services and trash removal from the Leased Premises. B. The necessity for and adequacy of repair to the Lease Premises, pursuant to Subparagraph (a.) hereof, shall be measured by the standard which is appropriate for improvements of similar construction and also shall meet the requirements and standards set out and promulgated by the City pursuant to the primary lease referred to above. C. University of Arkansas agrees to reimburse the City for all sums and expenses incurred in the repairs or maintenance required or caused to be made pursuant to the regulations and rules of the City mentioned in Subparagraph (b) above as a result of failure by University of Arkansas to maintain or repair the demised premised as required. 9. ALTERATIONS AND IMPROVEMENTS. University of Arkansas shall have prior written consent from the City, meeting all City requirements, to make any alterations, additions and improvements University of Arkansas deems necessary and desirable to the interior of the leased premises. University of Arkansas shall not be entitled to make any major or material alterations, additions or changes to the exterior of the leased premises without the City's prior written consent. University of Arkansas acknowledges and agrees that all such alterations, additions and improvements, including paneling, partitions, railings, floors, ceilings and the like, shall become the property of the City upon the terminations of the Lease Agreement. 10. INSURANCE. University of Arkansas shall obtain and maintain property insurance coverage for the repair or replacement of the leasehold and any adjacent improvements, with an insurance company licensed to do business in the State of Arkansas, naming the City of Fayetteville and the Fayetteville Municipal Airport and their trustees, agents, officers, and employees are named as an Additional Insured on the policy, and University of Arkansas shall provide the Airport Administration Office with a Certificate of Insurance during the term of this Lease. University of Arkansas acknowledges that it is the University of Arkansas's responsibility to maintain insurance on University of Arkansas's personal property. 11. SUB -LEASING AND ASSIGNMENT. University of Arkansas shall not be entitled to sub- lease or assign the University of Arkansas's interest in this Lease Agreement without first obtaining the written permission of the City, provided however, University of Arkansas may assign University of Arkansas's interest in this Lease Agreement for a One Hundred and Eighty (180) day period to L•1 u Qualified Escrow, LLC, in order for University of Arkansas to accomplish a tax deferred exchange under Section 1031 of the Internal Revenue Code. A request to sub -lease or an assignment of the lease will not be unreasonably withheld. 12. EVENTS OF DEFAULT. The following shall be "Events of Default" under this Agreement, and the terms "Events of Default" or "Default" shall mean, whenever they are used herein, anyone or more of the following. A. University of Arkansas shall fail to pay when due and owning any rentals hereunder and such nonpayment shall continue for twenty days after written notice thereof by the Airport; B. University of Arkansas voluntarily shall abandon, desert, or vacate the Leased Premises; C. University of Arkansas shall fail to comply with insurance requirements imposed hereunder; D. University of Arkansas shall fail to observe or perform any other of its obligation hereunder, and such failure shall continue un-remedied for twenty (20) days after the City shall have given to the University of Arkansas written notice specifying such default. Provided, the Airport may grant University of Arkansas such additional time as it's reasonably required to correct any such default if University of Arkansas has instituted corrective action and diligently is pursuing the same; E. University of Arkansas shall fail to provide and maintain any security assurances required hereunder; or 13. REMEDIES UPON UNIVERSITY OF ARKANSAS'S DEFAULT. Whenever an Event of Default of University of Arkansas shall occur, the City may pursue any available right or remedy at law or equity including: A. Termination. At its exclusive option, the City deliver to University of Arkansas written notice of termination, specifying the date upon which the Agreement will terminate. In the event of termination, University of Arkansas's rights to possession of the Leased Premises immediately shall cease. The City may then reenter and take possession of the Leased Premises and University of Arkansas forthwith shall surrender possession of the Leased Premises. Upon termination of this Agreement, University of Arkansas shall be liable for payment of: 1.) All sums accrued through the date of termination. 2.) The reasonable costs incurred by the City to re -let the Leased Premises, or any portion thereof; and 5 3.) The reasonable cost incurred by the City to restore the Leased Premised or any portion thereof to the condition in which they originally were leased, ordinary wear and tear excepted. All rentals received by the City from re -letting the Leased Premises after the termination of this Agreement shall be credited against the Outstanding Rental Balance. The acceptance by the City of any rentals from University of Arkansas after the termination of this Agreement shall not reinstate this Agreement. Upon such notice, University of Arkansas agrees to vacate the premises immediately. Should it become necessary for City to resort to judicial process to enforce the terms of this Agreement, or reclaim possession of the premises, University of Arkansas agrees to pay a reasonable attorneys fee. 14. EXPIRATION OR TERMINATION. On the expiration or other termination of this Lease, University of Arkansas's right to use the demised premises shall cease, and University of Arkansas shall vacate the premises without unreasonable delay. All property installed, erected, or placed by University of Arkansas in, on, or about the premises leased hereunder shall be deemed to remain the property of City. University of Arkansas shall have the right at any time during the term of this agreement, or any renewal or extension hereof, and for an additional period of seven (7) days after the expiration or other termination of this agreement, to remove any or all of University of Arkansas's property, subject, however to University of Arkansas's obligation to repair all damage, if any, resulting from such removal. Any and all property not removed by University of Arkansas prior to the expiration of the aforesaid seven (7) day period shall thereupon become a part of the land on which it is located and title hereto shall thereupon vest in City. 15, TERMINATION OF AIRPORT. In the event that the Fayetteville Municipal Airport facility and property arc no longer used for aviation purposes, the University of Arkansas may remain in possession of the premises until the end of the lease term with the right to use the premises for any use allowable under Arkansas law. 16. TAXES. University of Arkansas shall pay all ad valorem taxes and assessments upon the leased premises and upon all personal property located upon the leased premises which are assessed during the lease term. 17. MORTGAGING OF LEASEHOLD. University of Arkansas is hereby given the absolute right without the City of Fayetteville's consent to mortgage his interest in the leased premises, provided that no such mortgage shall extend to or affect the fee, the reversionary interest, or the estate of City of Fayetteville in and to the land and building (hangar facility complex) erected thereon. 18. INDEMNITY. University of Arkansas agrees to indemnify the City against any liability for injuries to persons or damage to property caused by University of Arkansas's gross negligent use or occupancy of the leased premises; provided, however, that University of Arkansas shall not be liable 0 for any personal injury, damage or loss occasioned by the negligence of City or its agents or employees, and provided further, that each party shall give prompt and timely notice of any claim made or suit instituted which in any way directly or indirectly affects or might affect either party, and each party shall have the right to compromise and defend the same to the extent of its own interest. This clause shall not be construed to waive that tort immunity asset forth under Arkansas Law. 19. NON -WAIVER. Neither the waiver by City of any breach of University of Arkansas of any provision hereof nor any forbearance by the Airport to seek a remedy for any such breach shall operate as a waiver of any other breach of University of Arkansas. 20. NOTICES. Any notice or consent required by this Agreement shall be sufficient if sent by Certified Mail, return receipt requested, postage paid, to the following addresses: CITY OF FAYETTEVILLE: Airport Administration Office 4500 S. School Avenue, Suite F Fayetteville, Arkansas 72701 PH: 479-718-7642 FAX: 479-718-7646 UNIVERSITY OF ARKANSAS University of Arkansas ??? Fayetteville, Arkansas PH: ??? FAX: ??? 21. NON-DISCRIMINATORY CLAUSE. A. University of Arkansas agrees to not discriminate by segregation or otherwise against any person or persons because of race, creed color, religion, national origin, sex, martial status, or handicap in the furnishing, or by refusing to furnish, to such persons the use of any facility, including any and all services, privileges, accommodations, and activities provided thereby. Nothing herein shall require the furnishing to the general public of the use of any facility customarily furnished by the City solely to tenants, their employees, customers, patients, client, guests, and invites. B. This Agreement shall be construed under the laws of the State of Arkansas. 22. All the covenants, conditions, and provisions under this agreement shall extend to and bind the legal representatives, successors, and assign of the respective parties hereof. IN WITNESS WHEREOF, the parties have executed this lease on the day and year first above written. ATTEST: By: City Clerk ATTEST: By: Title: CITY OF FAYETTEVILLE, ARKANSAS By: Dan Coody, Mayor University of Arkansas: By: V1 Title LEASE ATTACHMENT NUMBER ONE Rent adjustments shall be made as of the commencement of each of the Dates Upon Which Rent Increases Apply and shall be determined by the following formula: Rent as last so increased under this Lease multiplied by: 1 + Current Index - Base Index Base Index Plus one percent (1 %) of the Rent as last so increased under this Lease Where, "Current Index" shall be the CPI (D-1 Consumer Price Index -All City Average, '"all items groups, subgroups and special groups, "published monthly in the Monthly Labor Review ojthe Bureau of Labor Statistics of the United States Department of Labor) for the month immediately prior to the applicable Dates Upon Which Rent Increases Apply, and Base Index shall be the CPI for the month immediately prior to the Commencement Date or the most recent Dates Upon Which Rent Increases Apply, whichever is applicable. In no event, however, shall the Rent for any period be less than the Rent as last so increased under this Lease. In the event that such CPI is no longer published or otherwise available, the adjustment provided for herein shall be by the successor (or the most nearly comparable successor index) thereto, adjusted as appropriate to the applicable dates. I LEASE AGREEMENT Hangar Lease University of Arkansas FT This Lease Agreement entered into this _ day of , 2003, by and between the City of Fayetteville, Arkansas, hereinafter referred to as the "City" and Board of Trustees of the University of Arkansas, acting for and on behalf of the University of Arkansas, Fayetteville, hereinafter referred to as University of Arkansas . WHEREAS, the City owns and operates an Airport known as Fayetteville Municipal Airport - Drake Field, situated in Washington County in the State of Arkansas; and WHEREAS, University of Arkansas desires to lease from the City an aircraft hangar for use by the University of Arkansas, and WHEREAS, the City of Fayetteville, Arkansas has agreed to construct the hangar in the newly constructed executive ramp area of the Fayetteville Municipal Airport, and WHEREAS, the University of Arkansas has agreed to pay a lease amount equal to the cost of construction on a straight-line, amortized basis over a 20 year period at an annual rate of 4.5% interest: NOW, THEREFORE, the Parties hereto agree as follows: 1, DESCRIPTION OF PREMISES. The City does hereby grant, demise and lease unto University of Arkansas Hangar Space Numbers) in aircraft hangar located at Municipal Airport -Drake Field situated in the City of Fayetteville, County of Washington, Arkansas. 2. TERM. The term of this lease is for twenty (20) years beginning on the first day of the next month following the date the Occupancy Permit is granted ( day of 2003), and ending at midnight the end of the previous month in the year 2023 2023). A. Option to Extend. University of Arkansas shall have the option to extend the Lease Term of this Lease for one (1) period of Twenty (20) years if University of Arkansas has satisfied the following conditions (extensions beyond Fifty (40) years must be renegotiated and approved by the City Council): 1). University of Arkansas has complied with and performed all conditions, covenants, and terms of the Agreement without any defaults known to University of Arkansas, or any defaults that are not otherwise in the process of being resolved in the manner provided in this Agreement. 2). Notice of University of Arkansas's request to renew has been made in writing to the City at least One Hundred Twenty (120) days prior to the expiration of the term. 3.) The amount of rental fees shall have been successfully negotiated and agreed to by the parties for the extended lease term. 3. RENTAL FEES. During the term of this lease, University of Arkansas agrees to pay the City a monthly rental fee equal to the cost for the City to construct the hangar amortized at four and one- half percent (4.5%) for 20 years (i.e. S400,000.00 @ 4.5% = $2,530.60 per month). /month).. Rental is due, on or before the I" day of next month following the date of the Occupancy Permit is granted ( 20031. A late charge of S will be imposed on payments not received by the close of business on the tenth day after the due date. All payments shall be delivered or mailed to: City of Fayetteville, 113 West Mountain Street, Fayetteville, Arkansas 72701. 4, UTILITIES AND JANITORIAL SERVICES. University of Arkansas shall be responsible for the payment of the utilities associated with the use of the leased premises including, but not limited to, electric, gas, heating, water/sewer, and trash removal to the leasehold. The City shall not be required to furnish to University of Arkansas any facilities or services of any kind, such as, but not limited to, water/sewer, trash removal, electricity, or gas. Any such facilities or services required by University of Arkansas for their use and purposes shall be their sole and exclusive responsibility. 5, TERMS AND CONDITIONS. University of Arkansas agrees to comply with and abide by all terms and conditions set forth in this Agreement. 6. USE OF THE PREMISES. University of Arkansas agrees that the leased premises shall be used and occupied only as an aircraft hangar and for related lawful purposes. A. Flammable Material. University of Arkansas further agrees not to store any flammable material on the demised premises other than a limited supply of oils and agents necessary for the operation of an aircraft hangar. Fuel in the airplanes is excepted. B. University of Arkansas shall not start or operate aircraft engines within the hangar leased hereby and shall not allow such operations by any other person. 7. USE OF THE AIRPORT. University of Arkansas is granted the use, in common, without charge, with others similarly authorized, 24-hour, 365 day use of the Airport, together with all facilities, equipment, improvements, and services which have been or may hereafter be provided at or in connection with the Airport from time to time including, but not limited to, the landing field and any extensions hereof or additions thereto, roadways, runways, ramps, aprons, taxiways, flood lights, landing lights, beacons, control tower, signals, radio aids, and all other conveniences for flying, landings and takeoffs. 8. MAINTENANCE, REPAIR AND REPLACEMENT. The City shall maintain the leased PREMISES, including the building and all equipment, fixtures and appurtenances furnished by the City under this Lease, in good repair and tentantable condition, except in case of damages arising from the acts of the University of Arkansas' agents or employees. For the purpose of so maintaining said PREMISES and property, the City may at reasonable times, and with the approval of the authorized University of Arkansas representative in charge, enter and inspect the same and make any necessary repairs hereto. 9. FAILURE TO PERFORM. The covenant to pay rent and the covenant to provide any service, utility, maintenance or repair required under this Lease are dependent. If the City shall breach anyof the conditions required to be performed by it under this Lease, University of Arkansas may cure such breach and deduct the cost thereof from rent subsequently becoming due hereunder. If City fails to correct a deficiency within thirty (30) days after written notice from University of Arkansas, or within an appropriate shorter period stated in the notice, in the event of a deficiency constituting a hazard to the health and safety of the University of Arkansas' employees, property, or any other person, University of Arkansas may elect to terminate this Lease. 10. DAMAGE BY FIRE OR OTHER CASUALTY. If the demised PREMISES are partially damaged by fire or other casualty, said PREMISES shall be repaired with due diligence by the City at City's expense. If the damage is so extensive as to render such building untentable, the rent hereunder shall be proportionally paid up to the time ofdamage and shall henceforth cease until such time as the PREMISES shall be fully restored. Ifthe demised PREMISES are completely destroyed, City may reconstruct the hangar at City's own cost and the rent payable hereunder shall be adjusted as set forth above, or the City may, at its option, cancel this Agreement, such cancellation to be effective as of the date the hangar was destroyed and the rent adjusted as set forth above. 11. ALTERATIONS. The University of Arkansas may attach fixtures and install signs in or to the PREMISES with City's approval which shall not be unreasonably withheld. Such fixtures and signs shall remain the property of University of Arkansas and may be removed from the PREMISES within a reasonable time after the termination of this Lease provided the University of Arkansas shall restore the PREMISES to a condition as good as at the beginning of this Lease, ordinary wear and tear excepted. No services or work will be performed for which an additional cost or fee will be charged by City without the prior written authorization of University of Arkansas. 12, TERMINATION. In addition to other remedies provided herein, the University of Arkansas may terminate this Lease by thirty (30) days written notice to City if the University of Arkansas' funds are insufficient for it to continue the operations for which the PREMISES are being used. 3 13. SPECIAL PROVISIONS. A. City shall be responsible that this facility conforms to the Arkansas Fire Prevention Code, as amended, Arkansas State Plumbing Code, the National Electrical Code, and any other state and local laws, codes, authorities, etc., applicable to the leased facility including the Arkansas adopted Americans with Disabilities Act Accessibility Guidelines for Buildings and Facilities (ADAAG). B. City shall maintain and keep in good repair so much of the Airport premises as is not under the exclusive control of individual lessees. C. University of Arkansas shall provide for and supply at its expense all janitor service with respect to the demised PREMISES and shall pay for all utilities serving the demised PREMISES, including, but not limited to heat, light, gas, electricity and water. D. University of Arkansas agrees to observe and obey City's ordinance and regulations with respect to use of the demised PREMISES and Airport; provided, however, such rules and regulations shall be consistent with safety and with rules, regulations and orders of the Federal Aviation Administration with respect to aircraft operations at the Airport. E. City authorizes University of Arkansas to use the PREMISES only for the storage of airplanes and materials and equipment necessarily related to the operation of said airplanes and that no other vehicles, equipment or supplies shall be stored on the PREMISE'S unless expressly agreed to by City; provided, when LESSEE'S airplanc(s) arc on a flight, automobiles utilized by the pilot and passengers may be stored on the PREMISES. University of Arkansas further agrees not to store any flammable materials on the PREMISES or in any way endanger or violate the provisions of LESSOR'S property damage insurance policy or the requirement of same. Such violations shall constitute a material breach of this Agreement. F. University of Arkansas further agrees that it shall only be permitted to engage in minor maintenance on the airplane stored in the building and shall not engage in any major overhaul of the airplane within the leased PREMISES. G. University of Arkansas shall procure and maintain in force during the term of this Agreement, fire and extended coverage insurance on University of Arkansas' aircraft in the amount equivalent to the replacement cost thereof. University of Arkansas shall also be required to insure any contents within the aircraft hangar. li. All claims of damages regarding University of Arkansas' liability for injuries and/or contractual breaches or defaults shall be submitted to the Arkansas Claims Commission for adjudication. I. University of Arkansas shall maintain the demised PREMISES in a clean and orderly fashion at all times. J. University of Arkansas shall not start or operate aircraft engines within the aircraft hangar hereby leased and shall not allow such operation by any other person. K. University of Arkansas shall not be responsible for the payment of any taxes or assessments for the PREMISES. 14. EVENTS OF DEFAULT. The following shall be "Events of Default" under this Agreement, and the terms `Events of Default" or "Default" shall mean, whenever they are used herein, any one or more of the following: A. University of Arkansas shall fail to pay when due and owning any rentals hereunder and such nonpayment shall continue for twenty (20) days after written notice thereof by the Airport; B. University of Arkansas voluntarily shall abandon, desert, or vacate the Leased Premises; C. University of Arkansas shall fail to comply with insurance requirements imposed hereunder; provided such noncompliance shall continue for twenty (20) days after written notice thereof by the Airport; D. University of Arkansas shall fail to observe or perform any other of its material obligations hereunder, and such failure shall continue un-remedied for twenty (20) days after the City shall have given to the University of Arkansas written notice specifying such default. Provided, the Airport may grant University of Arkansas such additional time as may be reasonably required to correct any such default if University of Arkansas has instituted corrective action and diligently is pursuing the same; 14, REMEDIES UPON UNIVERSITY OF ARICINSAS' DEFAULT. Whenever an Event of Default of University of Arkansas shall occur, the City may pursue any available right or remedy at law or equity including: A. Termination. At its exclusive option, the City shall deliver to University of Arkansas written notice of termination with a minimum of 30 days notice, specifying the date upon which the Agreement will terminate. In the event of termination, University of Arkansas's rights to possession of the Leased Premises immediately shall cease. The City may then reenter and take possession of the Leased Premises and University of Arkansas forthwith shall surrender possession of the Leased Premises. Upon termination of this Agreement, University of Arkansas shall be liable for payment of: 1.) All sums accrued through the date of termination. 5 2.) The reasonable cost incurred by the City to restore the Leased Premised or any portion thereof to the condition in which they originally were leased, ordinary wear and tear excepted. 16. EXPIRATION OR TERMINATION. On the expiration or other termination of this Lease, University of Arkansas 's right to use the leased Premises shall cease, and University of Arkansas shall vacate the premises without unreasonable delay. All property installed, erected, or placed by University of Arkansas in, on, or about the leased Premises shall be deemed to remain the property of City. University of Arkansas shall have the right at any time during the term of this Agreement, or any renewal or extension hereof, and for an additional period of thirty (30) days after the expiration or other termination of this Agreement, to remove any or all of University of Arkansas' property, subject, however to University of Arkansas' obligation to repair all damage, if any, resulting from such removal. 17. TERMINATION OF AIRPORT. In the event that the Fayetteville Municipal Airport facility and property are no longer used for aviation purposes, the University of Arkansas may remain in possession of the premises until the end of the lease term with the right to use the premises for any use allowable under Arkansas law; or University of Arkansas may elect to terminate the Lease Agreement with no further charges. 18. NON -WAIVER. Neither the waiver by either party of any breach of the other party of any provision hereof nor any forbearance by either party to seek a remedy for any such breach shall operate as a waiver of any other breach of either party. 19. NOTICES. Any notice or consent required by this Agreement shall be sufficient if sent by fax, Certified Mail, return receipt requested, postage paid, or personally delivered to the following addresses: CITY OF FAYETTEVILLE: Airport Administration Office 4500 S. School Avenue, Suite F Fayetteville, Arkansas 72701 P11: 479-718-7642 FAX: 479-718-7646 UNIVERSITY OF ARKANSAS University of Arkansas 321 Administration Building Fayetteville, Arkansas PH: 479-575-2551 FAX: 479-575-4158 21. This Lease Agreement expresses the entire agreement of the parties and may only be amended in writing signed by all the parties hereto or their duly authorized agents. IN WITNESS WHEREOF, the parties have executed this lease on the day and year first above written. 6 r ATTEST: By: City Clerk ATTEST: By: Title: CITY OF FAYETTEVILLE, ARKANSAS By: Dan Coody, Mayor Board of Trustees of the University of Arkansas acting for and on behalf of the University of Arkansas at Fayetteville: By: Ann Kemp Vice President for Finance & Administration Title Aviation Lease Agreement with UofA City of Fayetteville Staff Review Form 2023-0928 Item ID N/A City Council Meeting Date - Agenda Item Only N/A for Non -Agenda Item Jared Rabren 8/25/2023 AIRPORT SERVICES (760) Submitted By Submitted Date Division / Department Action Recommendation: The Aviation Division requests signature of the Mayor on Amendment No. 1 to extend the lease agreement currently held with the University of Arkansas for a corporate hangar located at 4166 S School Ave, Fayetteville, AR 72701. Budget Impact: Account Number Fund Project Number Project Title Budgeted Item? No Total Amended Budget $ Expenses (Actual+Encum) $ Available Budget Does item have a direct cost? No Item Cost $ Is a Budget Adjustment attached? No Budget Adjustment $ Remaining Budget V20221130 Purchase Order Number: Previous Ordinance or Resolution # Change Order Number: Approval Date: 08/28/2023 Original Contract Number: Comments: CITY OF FAYETTEVILLE ARKANSAS TO: Lioneld Jordan, Mayor THRU: Susan Norton, Chief of Staff Staff/Contract Review Committee FROM: Jared Rabren, Airport Director DATE: August 25, 2023 SUBJECT: U of A Lease Agreement Amendment No. I STAFF MEMO RECOMMENDATION: The Aviation Division requests signature of the Mayor on Amendment No. 1 to extend the lease agreement currently held with the University of Arkansas for a corporate hangar located at 4166 S School Ave, Fayetteville, AR 72701. BACKGROUND: The City of Fayetteville signed a lease agreement in 2003 with the U of A to construct a Corporate Hangar, with an option to extend the agreement after twenty (20) years. DISCUSSION: Airport Administration has determined the University has satisfied the conditions of the agreement and is eligible to extend the term for one (1) period of twenty (20) years BUDGET/STAFF IMPACT: Provides annual revenue to the Airport in the amount of $33,600.00, at the rate of $2,800.00 per month. Attachments: Staff Review Form Staff Memo U of A Amendment No. 1 Mailing Address: 113 W. Mountain Street www.fayetteville-ar.gov Fayetteville, AR 72701 AMENDMENT NO.1 TO LEASE A For A Hangar Located at 4166 S. Si REEMENT 001 Avenue This First Amendment to the Lease Agreement ("Agreement") is made and effective May 6, 2023 ("Effective Date"), by and between Board of Trustees of the University of Arkansas, acting for and on behalf of the University of Arkansas, Fayetteville ("University" or "UA"), and the city of Fayetteville, Arkansas ("City"). Capitalized terms used but not defined in this First Amendment shall have the meanings given to such terms in the Agreement. WHEREAS, on May 6, 2003, the City and the Unive 'ty, entered into a lease agreement for an aircraft hangar located at 4166 South School Avenue in the City of Fayetteville, Arkansas (the "Leased Property"); and WHEREAS, the Lease Agreement provides for a term f twenty (20) years ending on May 6, 2023, and grants to the University an option to extend the I ase for an additional twenty (20) years if certain conditions have been satisfied; and WHEREAS, the conditions in the original Lease Agr meat have been satisfied and the University has provided notice to the City that it wishes to exercise the option to extend the lease of the Leased Property for an additional twenty (20) years. NOW, THEREFORE, BE IT KNOWN TO ALL: That the City and the University, hereby agree: A. That the Lease Agreement dated May 6, 2003 w ich expires on May 6, 2023, shall be extended for an additional twenty (20) years. The new expir r on date of the Lease Agreement shall be May 6, 2043. B. Rent shall be paid by the University to the Ci in the amount of Two Thousand Eight Hundred Dollars (52,800 per month for the #first five () years of the renewal term. Rent shall then be increased by ten percent (10%) every five (5) yee rs following the Effective Date of this Agreement. These rental fee adjustments shall be effective n May 6, 2028, May 6, 2033, and May 6, 2038. C. Any notice or consent to the University requi or this First Amendment shall also be sent Certified Mail, re or personally delivered to: The University of Arkansas Attn: Office of General Counsel 416 Administration Building Fayetteville, AR 72701 D. This amendment does not alter, amend or or duties of the parties not expressly addressed herein. All Page 1 of 2 by the original Lease Agreement i receipt requested, postage paid, any of the rights, obligations, terms and conditions of the i Amendment No. I to Lease 4166 S. School Ave: Hangar Agreement shall remain in full force and effect, and this First A mendment shall be exercised consistent with the Lease Agreement. IN WITNESS WHEREOF, the parties hereto have caused their signatures to be set by their authorized representative effective the date set forth herein above. THE BOARD OF TRUSTEES OF THE UNIVERSITY OF ARKANSAS, acting on behalf of the University of Arkansas, Fayettevil BY- '�) V.Px/�C� — Date: -- Dr. Donald R. Bobbitt, UA System President By: Date: Dr. Charles Robinson, UA Chancellor CITY OF F ETTEVI E, By: N yllonofd Jordan, a or ATTEST; Paxton, City Date: tiA -- Approved m w f— UA-0GC Matt McCoy 08/28/2023 .. A r .4 Date v • G •� 1 Page 2 of 2