HomeMy WebLinkAboutMINUTES - 02282006 - C.18 C TO: BOARD OF SUPERVISORS
FROM: MAURICE M. SHIU, PUBLIC WORKS DIRECTOR
DATE: February 28, 2006
SUBJECT: APPROVE and AUTHORIZE the Public Works Director, or designees, to execute a 40-year Lease
with Pacific States Aviation for a Buchanan Field Airport Development Project, Pacheco Area, and
Consent to an assignment of the Long-Terni Lease to the Purchaser of Tenant Pacific States Aviation.
Specific Request(s) or Recommendation(s) & Background & Justification
I. RECOMMENDED ACTION:
APPROVE and AUTHORIZE the Public Works Director, or his designee,to EXECUTE, on behalf of the
County, a 40-year ground lease between the County, as landlord, and Pacific States Aviation, as tenant, in the
amount of$5,365.44 per month with incremental increases, for the lease on approximately 257,541 square feet
of land located at 51 John Glenn Drive, for the period of February 2006 to February 2046 (the"Lease"); and
APPROVE and AUTHORIZE the Public Works Director, or his designee, to EXECUTE Consent to
Assignment of the Lease and documents for the premises located at 51 Jolu1 Glenn Drive to the purchaser of
the assets and business of Pacific States Aviation.
II. FINANCIAL IMPACT:
There is no negative impact on the Gener und. The Airport Enterprise Fund will receive lease rental
Continued on Attachment: X SIGNATU
&,Kf-COMMENDATION OF COUNTY ADMINISTRA-IR
_RECOMMENDATION OF BOARD COMMITTEE
:✓eC('PROVE OTHER
r
SIGNATURE(S): _aet�
ACTION OF BOA Niol7,4& ,y7 406 oepp i APPROVED AS RECOMMENDED_OTHER
VOTE SIF SUPERVISORS
1 UNANIMOUS(ABSENT ) I hereby certify that this is a true and correct copy of an
AYES: NOES: action taken and entered on the minutes of the Board of
ABSENT: ABSTAIN:
Supervisors on the date shown.
l-I:\PSAlease.bos ATTESTED:
Orig.Div: Public Works(Airports Division) JOHN SWEETEN, Clerk of-die Board of Supervisors and
Contact: Beth Lee,Phone(925)646-5722 County Administrator
cc: County Administrator
Auditor-Controller
Community Development
Public Works Director By z Deputy
Public Works Accounting
Federal Aviation Administration
Public Works Real Property
General Services Lease Management
SUBJECT: Authorization to Execute a Lease, Buchanan Field Airport
DATE: February 28, 2006
PAGE: 2
payments and other revenues, including a one-time lease extension payment of $182,220.81, of which a
majority will paid from increased monthly rent and the remaining $38,378 will be paid within thirty days of
lease execution or financed in equal installments,paying a six percent interest rate,over two years.The County
General Fund will continue to receive property, sales and possessory interest tax revenues from the Lease.
III. REASONS FOR RECOMMENDATION/BACKGROUND:
A.Authorization to Execute Lease. The lease between Contra Costa County and Pacific States Aviation(PSA)
supersedes and replaces the original lease between the County and PSA dated February 19, 1963. This new
lease extends the lease term to 2046 and includes a long-term property maintenance and improvement
provision.
The original lease documents provided for the operation of a Fixed Base Operator facility with aviation service
obligations. This new lease will pen-nit those necessary services to continue until 2046 while focusing a
majority of the aviation services and activities towards smaller(i.e.,non corporate)aviation users.This general
aviation focus is consistent with the policies identified within the Buchanan Field Airport Master Plan.
B. Authorization to Assign Lease. The owner of PSA has been in negotiation to sell the company and it is
anticipated that such sale will occur shortly after the Lease is executed. The sale of PSA will result in an
assignment of the Lease and the County must consent to the assignment.This Board action would authorize the
Public Works Director to execute a consent to assignment of the Lease. Such authorization is appropriate on
the basis that the purchaser of PSA is capable of meeting the financial and business requirements to perform
under the Lease.
The lease will provide significant lease revenue to the Airport Enterprise Fund and County General Fund.The
lease is comparable to other executed leases and is consistent with the Airport Master Plan.
IV. CONSEQUENCES OF NEGATIVE ACTION:
The County General Fund and the Airport Enterprise Fund would not realize the additional revenues. The
County-owned land would remain vacant and may negatively impact general aviation aircraft facilities,services
and Airport demand needs.
AMENDED AND RESTATED LEASE RECEIVE®
BETWEEN r tb Z7 2006
CONTRA COSTA COUNTY
AND CLERK 130ARD OF SUPERVISORS
CONTRA COSTA CO.
PACIFIC STATES AVIATION, INC.
TABLE OF CONTENTS
51 JOHN GLENN DRIVE
CONCORD, CALIFORNIA
1. PARTIES..........................................................................................................1
2. PURPOSE........................................................................................................1
3. PREMISES ......................................................................................................1
4. TERM...............................................................................................................2
5. HOLDING OVER...........................................................................................2
6 LEASE EXTENSION PAYMENT................................................................2
7. GROUND RENT.............................................................................................3
8. PERCENTAGE AND OTHER ADDITIONAL RENT.............................10
9. ADDITIONAL PAYMENT PROVISIONS................................................12
10. LESSOR PROCESSING AND TRANSACTION FEES...........................13
11. USE OF PREMISES.....................................................................................14
12. RENTAL OPERATIONS.............................................................................16
13. CONDITION OF PREMISES.....................................................................17
14. SITE IMPROVEMENTS.............................................................................17
15. UTILITY OBLIGATIONS...........................................................................21
16. ALTERATIONS AND ADDITIONS 22
17. MAINTENANCE, REPAIR, AND STORAGE..........................................22
18. LAWFUL CONDUCT..................................................................................24
19. WASTE, QUIET CONDUCT, NUISANCE, POLLUTION .....................24
20. HAZARDOUS MATERIALS......................................................................25
21. STORMWATER DISCHARGE..................................................................27
22. RULES AND REGULATIONS...................................................................27
23. NOISE ORDINANCE...................................................................................28
24. SECURITY....................................................................................................28
25. HOLD HARMLESS AND INDEMNIFICATION.....................................28
26. INSURANCE.................................................................................................29
27. TAXES............................................................................................................31
28. INSPECTION, ACCESS AND NOTICE....................................................32
29. ASSIGNMENT AND ENCUMBRANCES.................................................32
30. SURRENDER OF POSSESSION................................................................33
31. DEFAULT......................................................................................................34
32. LESSOR'S REMEDIES...............................................................................35
33. DESTRUCTION............................................................................................37
34. CONDEMNATION.......................................................................................37
35. CANCELLATION BY LESSOR.................................................................38
36. FINANCING OF LEASEHOLD ESTATE.................................................40
37. NON-DISCRIMINATION...........................................................................42
38. OPERATION OF AIRPORT BY LESSOR...............................................44
39. AIRPORT USE AND DEVELOPMENT....................................................45
40. DEVELOPMENT OF PREMISES..............................................................45
41. INSTRUMENT OF TRANSFER.................................................................46
42. CHOICE OF LAW........................................................................................46
43. NOTICES.......................................................................................................46
44. TIME IS OF THE ESSENCE......................................................................47
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45. BINDING ON SUCCESSORS.....................................................................47
46. INVALID PROVISIONS; SEVERABILITY.............................................47
47. PROVISIONS................................................................................................47
48. ENTIRE AGREEMENT ..............................................................................48
49. CUMULATIVE RIGHTS AND REMEDIES.............................................48
50. NO THIRD-PARTY BENEFICIARIES.....................................................48
51. NO CONTINUING WAIVER......................................................................48
52. COVENANT AGAINST LIENS..................................................................49
53. LEASE AUTHORIZATION........................................................................49
54. LEASE COUNTERPARTS..........................................................................49
55. HEADINGS AND CAPTIONS....................................................................49
56. SIGNATURES...............................................................................................50
EXHIBITS
EXHIBIT A: Property Description
EXHIBIT B: Site Plan
EXHIBIT C: Performance and Service Standards
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AMENDED AND RESTATED LEASE
BETWEEN
CONTRA COSTA COUNTY
AND
PACIFIC STATES AVIATION, INC.
1. PARTIES
A. Effective on February 28, 2006 the COUNTY OF CONTRA COSTA, a political
subdivision of the State of California (hereinafter referred to as "Lessor") and PACIFIC
STATES AVIATION, INC. a California corporation, hereinafter referred to as "Tenant,"
hereby mutually agree and promise as follows:
B. This lease between Lessor and Tenant (the "Lease"), amends and restates the lease
between Lessor and Tenant dated February 19, 1963 and any amendments thereto (the
"Initial Lease"). Effective on the Commencement Date(as defined in Section 4 below),
of this Lease, the Initial Lease shall have no force or effect.
2. PURPOSE
Lessor owns and operates at Buchanan Field, a public airport located at Concord, California,
(hereinafter, the "Airport"), as shown on the Airport Layout Plan, which plan is on file in the
office of the Contra Costa County Director of Airports ("Director of Airports"). Tenant
desires to lease 257,541 square feet of land to operate a Full-Service Fixed Base Operation (as
defined in Section 11 hereof). The purpose of this Lease is to lease to Tenant, said 257,541
square foot parcel of real property at the Airport, shown generally on the Airport site plan
attached hereto as Exhibit `B"pursuant to the tcrms and conditions set forth herein.
3. PREMISES
For and in consideration of the rent, fees, and faithful performance by Tenant of the terms and
conditions and the mutual covenants hereof, Lessor does hereby lease to Tenant, and Tenant
hereby leases from Lessor, subject to all easements and encumbrances of record, that parcel of
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real property described in Exhibit "A" and shown on Exhibit "B", each of which is attached
hereto and made a part hereof, hereinafter referred to as the "Premises."
4. TERM
This Lease is for a term of forty (40) years (the "Term"), commencing on March 1, 2006 (the
"Commencement Date") and expiring on February 28, 2046. The Commencement Date is the
first day of Year 1 of the Lease.
5. HOLDING OVER
In the event Tenant shall remain in possession of the Premises after the expiration of the Term of
this Lease, such holding over shall not be deemed to operate as a renewal or extension of this
Lease, but shall only create a tenancy from month to month, which may be terminated at any
time by Lessor or Tenant upon thirty (30) days written notice. All terms and conditions of this
Lease, as modified, shall govern the month-to-month tenancy.
6. LEASE EXTENSION PAYMENT
As consideration for County's agreement to enter into this amended and restated Lease, "Tenant
will make a one-time lease extension payment of $182,220.81. Tenant agrees to pay the
$182,220.81 in one lump sum on or before March 28, 2006 (the "Extension Payment Date").
Alternatively, Tenant shall advise Lessor no later than the Extension Payment Date of its election
to (a) pay $38,378.00 on or before the Extension Payment Date or (b) amortize such amount,
which shall accrue interest at an annual rate of six percent (6%) by paying two equal annual
installments of $20,340.34 on or before March 28th of the years 2006 and 2007, as Additional
Rent. The balance of Lease extension payments is to be paid by increased Ground Rent during
the first seven (7) years of the Lease as detailed in Section 7 below.
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7. GROUND RENT
A. Tenant shall pay ground rent to Lessor as consideration for the use of the Premises as set
forth below ("Ground Rent") commencing on March 1, 2006. Ground Rent shall be
payable in advance and without demand, set oft, deduction or counter-claim on or before
the first day of each month during the Term of this Lease. Ground Rent for any partial
month shall be prorated at the rate of 1/30th of the applicable monthly Ground Rent per
day. Ground Rent for Year 1 through Year 5 is detailed on the schedule below. Ground
Rent for Year 6 and each year thereafter, shall be increased by the change in the
Consumer Price Index, determined in accordance with subsection 7.8. Consumer Price
Index Adjustment, except in years 11, 21, and 31, during which the Ground Rent shall be
revalued in accordance with Section 7C. Revaluation of Ground Rent. In no event shall
the Ground Rent for any year ever be less than the Ground Rent in effect for the
immediately preceding year. In the event there is a decrease in the Consumer Price Index
("CPI"), Ground Rent for the year in question shall be the same as the Ground Rent for
the preceding year and subsequent years. Ground Rent will be increased annually in the
event there is an increase in CPI. Set forth below is an example of the schedule of
adjustments to Ground Rent.
Year Monthly Ground Rent
1-2 $5,365.44
3-4 $5,901.98
5 $6,438.53
6-10 $6,438.53 increased annually by CPI Adjustment, unless CPI
Adjustment would result in a Ground Rent decrease, in which case
Ground Rent will remain the same as the preceding year's Ground
Rent.
11 Revaluation of Ground Rent per Subsection 7C below.
12-20 Prior year's Ground Rent, increased annually by CPI Adjustment
unless CPI Adjustment would result in a Ground Rent decrease, in
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which case Ground Rent will remain the same as the preceding
year's Ground Rent.
21 Revaluation of Ground Rent per Subsection 7C below.
22-30 Prior year's Ground Rent, increased annually by CPI Adjustment
unless CPI Adjustment would result in a Ground Rent decrease, in
which case Ground Rent will remain the same as the preceding
year's Ground Rent.
31 Revaluation of Ground Rent per Subsection 7C below.
32-40 Prior year's Ground Rent, increased annually by CPI Adjustment
unless CPI Adjustment would result in a Ground Rent decrease, in
which case Ground Rent will remain the same as the preceding
year's Ground Rent.
B. Consumer Price Index Rent Adjustment:
Effective upon the first day of Years 6 through 10, Years 12 through 20, Years 22
through 30, and Years 32 through 40, the Ground Rent shall be adjusted by the change in
CPI for the most recent one year period ending January 31 (the "CPI Adjustment"). CPI,
as used herein, shall mean the Consumer Price Index for all Urban Consumers, All Items,
for the San Francisco-Oakland-San Jose Metropolitan Area (1982-84 = 100), as published
by the Bureau of Labor Statistics of the U.S. Department of Labor, or its successor. At no
time will the Ground Rent be decreased by a CPI Adjustment. In the event there is a
decrease in the CPI, the Ground Rent for the year in question shall be the same as the
Ground Rent for the preceding year. For example, if Year 6 of the Lease commences on,
March 1, 2011, the CPI Index for January 2011 is 210.0, and the CPI Index for January
2010 is 205.0, then the Ground Rent for Year 6 shall be increased from $5,365.44 (Year 6
Ground Rent) to $6,438.53 per month [$5,365.44 x (1+(210.0- 205.0/ 205.0))].
Continuing the example, if the CPI for 2011 is 205.0, the Ground Rent for Year 6 will be
the same as the Ground Rent for Year 5 $6,438.53. Then, if the CPI for January 2012 is
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210.0, the Ground Rent for Year 7 shall be increased by the CPI increase from January
2012 to January 2013 from $6,438.53. to $6,595.57 [$6,438.53 x(1+(210.0- 205.0/
205.0))]. Lessor will notify Tenant of the increase in Ground Rent when Lessor
completes the calculation of the increased Ground Rent. If the notice is after the effective
date of the increase, Tenant will pay any increased Ground Rent retroactively to the
effective date.
C. Revaluation of Ground Rent. Ground Rent shall be revalued by Lessor on the eleventh
anniversary of the Coirunencement Date of this Lease, and thereafter, at the end of each
succeeding ten (10) year period of the Lease Term. Ground Rent shall be revalued on
2016, 2026, and 2036 (the "Revaluation Dates"). Ground Rent shall be revalued based
upon the fair market rental value of the Premises, using the Revaluation Process described
in subsection C.I. below; provided, however, that the revalued Ground Rent shall never
be less than the Ground Rent during the preceding year. In other words, in the event there
is a decrease in the fair market rental value for the year in question, the revalued Ground
Rent shall be the same as the Ground Rent for the preceding year. Prior to each
Revaluation Date, Lessor shall initiate a Ground Rent revaluation process (the
"Revaluation Process") for the determination of Ground Rent for the following period.
(1) Conditions of Revaluation: The revaluation of Ground Rent, including any
appraisals prepared as part of the Revaluation Process, shall be conducted under
the following conditions:
a) All negotiations and actions taken by Lessor and Tenant under this Section
shall be undertaken and conducted by the parties in good faith.
b) If the Revaluation Process is not concluded by the relevant Revaluation
Date, the Ground Rent determined by the Revaluation Process described
herein shall be retroactive to the Revaluation Date to which the Revaluation
Process applies. Tenant shall make any retroactive payments of Ground
Rent no later than thirty (30) days following the completion of the
Revaluation Process.
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c) Except as otherwise provided herein, no waiver by Lessor of any of the
provisions of this Section shall be deemed to have been made by Lessor,
unless made expressly in writing by the Director of Airports and no waiver
by Tenant shall be deemed to have been made unless made expressly in
writing by the duly authorized agent of Tenant.
d) All time periods specified in this Section shall be counted in calendar days.
(2). Revaluation Process:
The Revaluation Process shall consist of the following:
a) The Lessor shall make an initial determination of the amount of the Ground
Rent revaluation ("Lessor Revaluation") and shall notify Tenant in writing
of the amount of the new monthly Ground Rent (".Revaluation Notice").
b) If Tenant disagrees with the Lessor Revaluation, the Tenant may file with
the Lessor a dispute of the amount of the .Lessor Revaluation ("Tenant
Dispute"). The Tenant Dispute must be in writing and delivered to the
Director of Airports no later than twenty-one (21) days after the
Revaluation Notice is mailed to Tenant ("Dispute Period"). In the event
that the Tenant does not file a Tenant Dispute with the Lessor within the
Dispute Period, the Lessor Revaluation shall automatically be deemed to be
accepted by Tenant, Tenant shall be deemed to have waived the right to
contest the amount of the Lessor Revaluation, and the new Ground Rent, as
initially determined by the Lessor shall become effective on the applicable
Revaluation Date, and the Revaluation Process shall be concluded.
c) If Tenant delivers a Tenant Dispute to the Lessor within the Dispute Period,
Lessor and Tenant shall have twenty-one (21) days following Lessor's
receipt of the Tenant Dispute to attempt to establish a new Ground Rent by
negotiation ("Rent Negotiation Period"). The Rent Negotiation Period
may not be extended beyond the initial twenty-one (21) day period except
by mutual written agreement of the Tenant and the Director of Airports.
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d) If Lessor and Tenant are unable to agree upon a new Ground .Rent during
the Rent Negotiation Period, including any agreed upon written extension
thereof, then Lessor and Tenant shall each appoint an appraiser to appraise
the fair market value of the Premises and providing written notice to the
other identifying that party's appraiser. The appointment of the appraiser
shall be made and notice of the appointment shall be given to the other
party not less than twenty-one (21) days atter the end of the Rent
Negotiation Period (including any agreed-upon extension thereof), (the
"Selection Period"). Each appraiser shall be a Member of the Appraisal
Institute (11MAI11), and have current aviation appraisal experience in
appraising property in the geographic real estate market where the Premises
is situated. Each party shall be responsible for paying the fees and costs of
the appraiser it has selected.
In the event that Tenant does not appoint an appraiser and provide Lessor
with written notice of the appointment within the Selection Period: A) the
initial Lessor Revaluation shall automatically be deemed to be accepted by
Tenant; B) the new monthly Ground Rent, as initially determined by the
Lessor Revaluation, shall become effective on the applicable Revaluation
Date; C) Tenant shall be deemed to have waived the right to further contest
the amount of the Lessor Revaluation by arbitration or in any other manner;
and D) the Revaluation Process shall be concluded.
In the event that Lessor does not appoint an appraiser and provide Tenant
with written notice of the appointment within the Selection Period specified
in this Section above: A) the new monthly Ground Rent shall be the Ground
Rent as determined by Tenant's appraiser, or as determined in the preceding
revaluation of Ground Rent, whichever is greater; B) such new monthly
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Ground Rent shall become effective on the applicable Revaluation Date; Q
Lessor shall be deemed to have waived the right to contest the amount of
the new monthly Ground Rent by arbitration or in any other manner; and D)
the Revaluation Process shall be concluded.
e) If Lessor and Tenant each properly appoint an appraiser during the
Selection Period, the issue of the Ground Rent revaluation shall be
submitted to the two appraisers to each make an independent determination
of the fair market value of the Premises. Each appraisal must be completed
and a copy of the appraisal report delivered to the other party no later than
sixty (60) days from the date of each respective appraiser's appointment
unless otherwise extended by the mutual agreement of Lessor and Tenant.
f) Upon completion of both of the above appraisals, Lessor and Tenant shall
make a final attempt to establish a new monthly Ground Rent by
negotiation. In the event that Lessor and Tenant cannot agree on a
revaluation of the monthly Ground Rent, either Lessor or Tenant may
declare an impasse in the negotiations by providing written notice of the
impasse to the other party. The written notice of impasse (referred to
hereinafter as the "Final Proposal") shall include all of the following
information: A) a statement that the declaring party has determined that
negotiations have reached an impasse; B) the declaring party's final
proposed Ground Rent revaluation figure; Q a statement that the recipient
has ten (10) days to either give written acceptance of the amount of the
Ground Rent revaluation specified in the Final Proposal or deliver a
counter-final proposal ("Counter-Final Proposal") to the declaring party;
and D) any other supplementary information as the declaring party deems
appropriate. The party upon whom the Final Proposal is served shall then
have ten (10) days following receipt of the Final Proposal to either accept
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the Final Proposal or to reject the Final Proposal and deliver a Counter-
Final Proposal to the declaring party.
g) If neither the Final Proposal nor the Counter-Final Proposal is accepted, not
later than thirty-five (35) days after delivery of the Final Proposal, the
parties shall jointly select an arbitrator who shall make a binding
determination as to which proposal is the closest to the actual fair market
value of the land underlying the Premises. If the parties cannot agree on an
arbitrator within fifteen (15) days from rejection of the Final Proposal and
the Counter-Final Proposal either party may submit the matter to the
American Arbitration Association, or another professional arbitration firm
as agreed in writing by both parties, for the immediate selection of an
arbitrator.
The arbitrator shall be an MAI and have current aviation appraisal
experience in appraising property in the geographic real estate market
where the Premises is situated. The arbitrator shall conduct the arbitration
under the provisions of the commercial arbitration rules of the American
Arbitration Association. The arbitration shall be conducted in Contra Costa
County, California unless the parties agree in writing to another location.
The arbitrator shall not have the right to combine, average, or otherwise
modify the proposals, but shall select from among them. The arbitrator
shall have no power to modify the provisions of this Lease. The arbitrator's
decision shall be binding on all parties and shall apply retroactively to the
Revaluation Date. The arbitrator's decision shall be subject to challenge
only 1) on the grounds set forth in California Code of Civil Procedure
section 1286.2 or 2) based upon the arbitrator's incorrect application of the
substantive laws of California.
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8. PERCENTAGE AND OTHER ADDITIONAL RENT
In addition to the payment of Ground Rent, Tenant shall pay to Lessor an amount equal to one
percent (1%) of the Gross Sales (as definded below) Irom the operation and management of the
Premises ("Percentage Rent"). Percentage Rent shall be paid no later than the 10th of the
month for the previous month's Gross Sales.
A. Gross Sales. The term "Gross Sales" means the gross revenue (without any deductions,
and subject only to the below exceptions) from any activity conducted on the Premises,
including all sales made and all cash and credit revenue of Tenant including finance
charges to customers, and in the case of sale by credit, whether or not the payment is
actually made, at, in, on or from the Premises; all fees or other consideration paid to
Tenant for services performed, including but not limited to, rental or other payments from
a renter.
B. Exceptions to Gross Sales: The following are the only exceptions from the term "Gross
Sales":
(1) sales, excise and gross receipt taxes which must be accounted for by Tenant to any
governmental agency;
(2) receipts from the wholesale sale of parts and accessories wherein Tenant receives
from the purchaser a valid resale certificate as required by the Board of
Equalization of the State of California, in connection with such sale; provided,
however, this exception shall apply to only those wholesale sales which do not
exceed 50% of the gross sales of parts and accessories;
(3) receipts from the sale of each new and used aircraft. However, Tenant shall pay
Lessor a flat fee of$500.00 per sale of new or used aircraft.
(4) revenue against which Tenant later provides a credit for or returns to suppliers or
manufacturers;
(5) amounts received by Tenant for settlement of any claims for loss or damage to
products purchased by Tenant;
(6) deposits received for and paid to any State recycling fund;
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(7) all Fuel Flowage Fees.
C. Fuel Flowage Fees: Within fourteen (14) days of the beginning each calendar quarter,
Tenant shall pay to Lessor a fuel flowage fee, less taxes, for the preceding quarter of
$0.08 per gallon (the "Fuel Flowage Fee"). The Fuel Flowage Fee shall be reviewed and
may be revised by Lessor every fifth (5th) year. Lessor shall give notice to Tenant in
writing of any revised Fuel Flowage Fee, which shall be effective the month after such
notice is given. It is understood that any Fuel Flowage Fee schedule shall apply uniformly
to all Buchanan Field Fixed Base Operators at the time of the 5-year revision.
D. Records to Be Maintained. Tenant shall record all sales or other transactions, whether
cash or credit, and shall keep full and accurate books of account and records in
accordance with generally accepted accounting principles consistently applied, including
without limitation, a sales journal general ledger, and all bank account statements
showing deposits of Gross Sales revenue. In addition, Tenant shall keep all cash register
receipts with regard to Gross Sales, credits, refunds and other pertinent transactions, as
well as record of any other exclusions or deductions from Gross Sales.
E. Statement of Gross Sales and Percentage Rent Review. Tenant shall Iurnish to Lessor a
written statement of monthly Gross Receipts ("Statements of Gross Receipts"), within
thirty(30) days after the close of each calendar quarter
F. Certified Annual Statement. Within one hundred twenty (120) days following the close
of Tenant's fiscal year, and within one hundred twenty (120) days following the
termination of this Lease, Tenant shall deliver to Lessor an annual statement of Gross
Receipts, certified as being correct by an authorized accounting officer of the Tenant
("Certified Annual Statement").
G. Inspection of Records. Lessor shall have the right to inspect the books and records of
Tenant from which any Statement of Gross Receipts is prepared at any reasonable time
upon request. For this purpose, Tenant shall keep for a period of five (5) years after
submission to Lessor of any such statement, all of Tenant's records, books, accounts and
other data pertaining or necessary to the verification of Gross Receipts as defined herein,
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and shall, upon request, make the same available to Lessor and/or Lessor's auditor,
representative or agent for examination at any time during said five (5) year period.
Failure to keep, maintain and make available, the records, books, accounts and other data
as required by this section shall constitute a default of this Lease.
H. Audits. Lessor, at its sole cost and expense, may engage the services of an independent
certified public accountant to audit and verify the accuracy of Tenant's records, books,
and accounts including the Certified Annual Statement. In the event the audit shows that
an additional amount of Percentage Rent is due and payable to Lessor, Tenant shall make
such payment within seven (7) days to Lessor. If the audit shows that there has been an
overpayment of Percentage Rent, Lessor shall, at the sole option of Lessor, promptly
repay to Tenant the amount of such overpayment or credit same to any future rent due
Lessor by Tenant. If the audit shows a discrepancy that is greater than five percent (5%)
of the Percentage Rent paid to Lessor, Tenant shall pay for the audit.
I. Additional Rent: In addition to Ground Rent, Percentage Rent, and Fuel Flowage Fees
Tenant shall pay, as additional rent all other charges, costs and fees required to be paid
pursuant to the provisions of this Lease (such amounts, "Additional Rent", and together
with Ground Rent, Percentage Rent and Fuel Flowage Fees, "Rent").
9. ADDITIONAL PAYMENT PROVISIONS
A. Late Payments: In the event Tenant fails to pay Lessor any amount due under this Lease
within five (5) days after such amount is due, Tenant shall pay to Lessor a late charge of
One Iundred and No/100 Dollars ($100) per occurrence, plus interest on said unpaid
balance at a rate ten percent (10%) annually (.83% per month), from the date said
payment was due and payable until paid in full. Tenant shall. pay said late charge on or
before the next installment of Ground Rent is due. Lessor and Tenant hereby agree that it
is and will be impracticable and extremely difficult to ascertain and fix Lessor's actual
damages from any late payments and, thus, that Tenant shall pay as liquidated damages to
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Lessor the late charge specified in this Section, which is the result of the parties'
reasonable endeavor to estimate fair average compensation therefor.
B. Form and Place of Pqyment: All Rents and fees, shall be paid in cash or by personal
check, certified check, or money order, payable to the County of Contra Costa, and must
be received on or before the date due at the Director of Airports Office, 550 Sally Ride
Drive, Concord, California 94520, or at such other place as Lessor may designate from
time to time.
C. Returned Checks: If a check written by Tenant is returned for insufficient funds, Lessor
may impose a reasonable service charge in addition to any charges imposed by the bank.
Lessor may require Tenant to pay Rent by certified check or money order if Tenant's
bank or banks have returned one or more personal checks in a twelve (12) month period.
D. Security Deposit: Upon execution of this Lease, Tenant shall pay to Lessor the sum of
$11,096.32 as security ("Security Deposit") for the faithful performance or the terms,
covenants, and conditions of this Lease. Lessor acknowledges that Tenant has previously
paid Lessor $5,000.00 under the Initial Lease and under this Lease Tenant will have a
total Security Deposit of$16,096.32. If Tenant is in default of this Lease, Lessor may in
its sole discretion, use the Security Deposit, or any portion of it, to cure the default or
compensate Lessor for damages sustained by Lessor resulting from Tenant's default.
Upon demand by Lessor, Tenant shall immediately pay to Lessor a sum equal to the
portion of the Security Deposit expended or applied by Lessor as provided in this
subsection so as to maintain the Security Deposit in the sum initially deposited. Upon
final accounting by Lessor, any balance of said deposit shall be refunded to Tenant,
without interest
10. LESSOR PROCESSING AND TRANSACTION FEES
In the event that Tenant, requires or requests Lessor's review, investigation, processing,
recordation, or any other action in connection with any Tenant document, proposal or other
matter (such as review of a proposed assignment, or other transfer, or estoppel certificate or
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financing of a Leasehold Estate, as such tenn is defined in Section 36 hereof), Tenant shall pay
such costs and expenses incurred by Lessor thirty (30) days after demand therefor by Lessor.
In addition to any amounts due from Tenant pursuant to the foregoing paragraph, Tenant shall
pay to Lessor a transaction fee ("Transaction Fee") of $2,500.00 plus all Lessor's costs,
including, but not limited to, staff time at rates determined by the County Auditor, for Lessor's
time spent in connection with Lessor's reviewing a transaction until said transaction is
completed. The Transaction Fee shall be increased by $500.00, every five years after the
Commencement Date of this Lease.
11. USE OF PREMISES
The Premises shall be used for the operation of a "Full-Service Fixed Base Operation" and for
no other purpose. For purposes of this Lease, a "Full-Service Fixed Base Operation" is defined
as a major airport aviation business granted the privilege of providing a wide range of aviation
related sales and services to the general aviation public, as well as the obligation to provide a
number of basic services necessary to support general aviation aircraft users. The minimum level
of services a full-service fixed base operator will be obligated to provide are listed in Subsection
II.A. below; the permitted services a full-service fixed base operator may offer for sale are
listed in subsection I I.B. below.
A. MINIMUM SERVICES REQUIRED: In the conduct of the Full-Service Fixed Base
Operation hereunder, Tenant shall provide, or cause to be provided by others, the following
services for both general aviation aircraft:
1) Tie-down and hangar storage for general aviation aircraft, both itinerant and local.
2) Adequate ramp service for general aviation aircraft users, with a qualified attendant
available on the ramp no less than 7 days a week, 12 hours a day.
3) Sale of aviation gasoline, fuel, oils, and lubricants of the kind customarily sold to
general aviation users.
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4) Maintenance, repair, and servicing of general aviation aircraft, aircraft engines, and
parts.
5) Maintenance of an adequate inventory of the necessary aircraft parts and accessories
to maintain, repair, and service general aviation aircraft.
B. Services conditionally permitted on the Premises:
Tenant may, at its option, and only upon the prior written approval of the Director of
Airports and subject to such conditions as the Director of Airports shall impose, offer
additional services, or cause additional services to be provided by others, of the type
frequently provided by the full-service fixed base operators, including, but not limited to:
(1) Operation of a flight school with certified flight instructors and aircraft.
(2) Aircraft rental business.
(3) Sale of new or used aircraft, including leasing and management.
(4) Operation of specialized commercial flying service (aerial survey, photography, and
mapping services).
(5) Operation of specialized aircraft repair services (paint shop, radio, propellers,
instruments, and accessories).
(6) Sale of any and all fuel.
(7) Hangar rental.
(8) Aircraft cleaning and detailing services.
(9) Sales and services of miscellaneous aviation related equipment and services.
C. Uses permitted on the Premises:
Tenant may, at its option, and only upon the prior written approval of the Director of
Airports and subject to such conditions as the Director of Airports shall impose, offer
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additional services, or cause additional services to be provided by others, of the type
frequently provided by the full-service fixed base operators, including, but not limited to:
(1) Operation of non-scheduled air taxi and charter transportation of passengers.
(2) Rental car operations, including automobile fuel sales and auto insurance.
(3) Food and beverage concession.
(4) Office Rental
D. SERVICE STANDARDS: The facilities hereunder shall be operated in accordance with
the Performance and Service Standards established by Lessor, as set forth in Exhibit "C,"
and made a part hereof by this reference.
E. Limitations:
The provisions of this Section 11 shall not be construed to authorize Tenant to conduct
any business or other activity at the Airport not included in Section l 1 A or B hereof
12. RENTAL OPERATIONS
Tenant may sublease or rent hangar space on the Leased Premises in accordance with reasonable
rules and regulations adopted from time to time by Airport, including but not limited to the
following:
A. All hangar rental agreements shall be subject to the terms and conditions of, and be
subordinate to, this Lease.
Each hangar subleased rental agreement shall be a standard form approved in advance in
writing by the Director of Airports and shall be for a term no greater than the term of this
Lease.
.B. To the extent that Tenant engages in the rental of hangar space, Tenant or its authorized
representative shall be available during normal business hours, either at the Airport or by
telephone/facsimile to discuss rental terms and to conduct business.
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C. On or before January 1.01h of each calendar year Tenant shall deliver to Lessor a copy of
any new, revised, or extended rental agreements entered into by Tenant in the past twelve-
month period, which rental agreements shall contain the name, address, and telephone
number of the renter, the identification and make of all of the renter's hangared aircraft,
and any other information that Lessor from time to time may require.
D. Commencing on March 1, 2006, and annually thereafter, Tenant shall provide the
Director of Airports with an updated "Premises Occupancy and Active Demand List" for
based aircraft and identifying the aircraft type and number.
E. Tenant is responsible for all materials stored in the hangars, whether said materials are
stored by Tenant or by Tenant's agents, employees, or renters. The Director of Airports
shall have the right to determine, in his or her sole discretion, what items may be stored in
the hangar. Tenant shall inspect all hangar space no less than once each year to determine
if materials that violate any applicable codes, or that have not been authorized by the
Director of Airports, are being stored in the hangar space, and shall require the immediate
removal of such materials. Tenant shall terminate the rental agreements of those renters
who have not removed such materials within ten (10) days following Tenant's notice to
remove such materials.
13. CONDITION OF PREMISES
Except as otherwise expressly stated in this Lease, Lessor hereby lets, demises and leases, and
Tenant takes the Premises in an "as is" physical condition with no warranty, express or implied,
on the part of Lessor as to the condition of any existing improvements, the condition of the soil
or the geology of the soil.
14. SITE IMPROVEMENTS
A. In year twenty-nine (29) of this Lease (2035), Lessor and Tenant shall in writing retain a
mutually agreed upon MAI appraiser to perform an inspection and produce a report (the
"Inspection Report") and determine the replacement value (the "Replacement Value")
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of the buildings, ramp, and other facilities (collectively called "Improvements") to
determine what maintenance is needed to maintain the Improvements in a first class
condition through the remaining term of the Lease. 'rhe costs of retaining the agreed upon
MAI appraiser shall be equally divided between Tenant and Lessor. In the event that
Lessor and Tenant cannot mutually agree upon an MAI appraiser by .lune 30, 2035, both
Tenant and Lessor shall select an MAI appraiser to determine the Replacement Value or
the Improvements. Each of the selected MAI appraisers shall deliver their valuations no
later than August 31, 2035 (the "Replacement Value Appraisal Date"). Thereafter,
Lessor and Tenant shall attempt to arrive at a mutually agreed Replacement Value based
on the Replacement Values determined by the selected MAI appraisers. If a Replacement
Value cannot be agreed upon with thirty (30) days of the Replacement Value Appraisal
Date, the parties shall jointly select an arbitrator who shall make a binding determination
as to which determination of Replacement Value is the most accurate. If the parties
cannot agree on an arbitrator within sixty (60) days of the Replacement Value Appraisal
Date, either party may submit the matter to the American Arbitration Association, or
another professional arbitration firm as agreed in writing by both parties, for the
immediate selection of an arbitrator who has current aviation appraisal experience in
appraising property in the geographic real estate market where the Premises are located.
The term "Improvements" shall not include any buildings, ramps or other facilities that
are comprised wholly of new construction that was completed by Tenant after January
2026. In order to maintain the Improvements in such first class condition, Tenant shall
invest a minimum of fifteen percent (15%) of the Replacement Value between years 2036
and 2046, with at least five percent (5%) of the Replacement Value being invested
between years 2041. and 2046. Within six (6) months of receiving said appraisal, the
Tenant shall provide the Director of Airports with a detailed property improvement plan
("Improvement Plan"). The Improvement Plan will contain a timeline and itemize each
improvement to be completed by Tenant with an estimated cost. The Improvement Plan
may include, but is not limited to the following:
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(1) Interior and exterior building improvements including root, doors, windows,
signage, painting, flooring, fixtures (i.e. lights, toilets and sinks), etc.
(2) Replacement of asphalt and cut and repair any concrete features on aircrall ramp
and in the parking lot.
(3) Repair, replace, and upgrade HVAC, fuel tanks and fuel system, plumbing and
electrical system.
All upgrades in the Improvement Plan must comply with current building codes and the
building entrance and at least one bathroom must conform to current Americans with
Disabilities Act ("ADA") standards.
B. Plans and Lessor's Approval: Tenant shall obtain Director of Airports' written approval of
all plans and specifications (together "Plans") for buildings, paving, landscaping, or other
improvements before any improvements may be commenced. All Improvements shall
conform with any and all general requirements of Lessor and shall be constructed or installed
in conformance with the Plans, and all applicable statutes, ordinances, building codes,
Buchanan Field Airport Policy and Standards for Development, and rules and regulations of
Lessor, and such other authorities as may have jurisdiction over the Premises or Tenant's
operations thereon, including, but not limited to, the Contra Costa County Building
Inspection Department, Contra Costa County Public Works Department, the Contra Costa
County Community Development Department, and/or the Federal Aviation Administration.
Tenant shall be solely responsible for obtaining all necessary permits and approvals, and for
paying any and all fees required for said construction. Lessor's approval of Tenant's Plans
shall not constitute a representation or warranty as to such conformity and responsibility shall
remain at all times in Tenant.
C. Performance and Payment Bonds: Not less than ten (10) working days before the
commencement of construction of the Improvements, Tenant shall, at its sole cost and
expense, furnish to Lessor a payment bond from a surety company licensed to transact
business in the State of California, or other type of security satisfactory to the Lessor,
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with Tenant's contractor or contractors as principals, in the penalty sum of one hundred
percent (100%) of the total estimated cost of the construction contract or contracts Por the
Improvements and other necessary appurtenances specified herein, guaranteeing the
payment of all labor, materials, provisions, supplies and equipment used in, upon, for or
about the performance of said construction work or labor done thereon of any kind
whatsoever and protecting the Lessor from any liability, losses, or damages arising
therefrom. Simultaneously, Tenant shall also provide Lessor a surety bond or a surety
company licensed to transact business in the State of California, or other type of security
satisfactory to Lessor, with Tenant's contractor or contractors as principals, in an amount
equal to one hundred percent (100%) of the total estimated amount of the construction
contract or contracts for the Improvements, guaranteeing faithful performance of such
construction contract or contracts. Said bonds or other security shall be in a form
acceptable to Lessor and shall name Lessor as oblige and any bond shall comply with the
requirements of California Civil Code Section 3248.
D. Inspection and Acceptance: Tenant shall be responsible for obtaining any necessary
permits from all Contra Costa County departments having jurisdiction over the Airport,
including but not limited to, the Building Inspection Department, the Community
Development Department and the Public Works Department, and all other agencies
having jurisdiction. over the Airport. All Improvements, including but not limited to
buildings, on the Premises shall be subject to inspection, testing, and acceptance in
accordance with applicable law by the Contra Costa County Public Works Department
and Building Inspection Department. Nothing in this Lease shall be construed as
approval by Lessor or any other governmental entity acting in its or their governmental
capacity of the Improvements or to release Tenant from any govenunental application,
review or requirement.
E. No Warranties: The inspection, testing and acceptance by Tenant under this or any other
section of this Lease, of any plans submitted by or acts performed by Lessor shall not
constitute a warranty by Lessor, and shall not relieve Tenant of its obligation to fulfill the
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provisions of this Lease and of the Plans as approved by Lessor, .nor shall Lessor be
thereby estopped from exercising any of its remedies provided at law or equity or under
this Lease.
F. Engineering: Lessor shall furnish Tenant with control information required for ground
and pavement elevations, specifications for earthwork, pavement, and drainage. Tenant
shall be responsible for all other engineering work and the accuracy thereof Any
material deviations from the approved Plans must have prior written approval by the
Lessor.
G. Utilities: Upon the prior written approval of the Director of Airports, Tenant may install
any utilities on the Premises at its own cost and expense and shall pay any and all
connection, inspection, and service fees in connection therewith.
1-I. Paving and Concrete: Tenant shall upgrade the pavement for the aircraft movement areas
and concrete hangar floors such that they will acconunodate the heaviest aircraft expected
to operate in the area, or fully loaded titel trucks, whichever is of greater weight, with a
minimum expected pavement life of no less than twenty-five (25) years or as
recommended in the Inspection Report in Subsection 14.A. above. All road access shall
be in accordance with Contra Costa County Public Works Department standards.
I. Signs: Tenant may erect signs and advertising media and place the same upon the
improvements in accordance with FAA and Buchanan Field Airport Policy and Standards
for Development, atter obtaining the written approval of the Director of Airports and/or
of any other public agency having jurisdiction.
15. UTILITY OBLIGATIONS
Tenant shall pay on Tenant's own account all utilities used or consumed on the Premises,
including, but not limited to gas, water, electricity, garbage disposal, stone and sanitary sewer
services,janitorial services, and telephone services.
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In the event Lessor, or any utility company, requires that any existing or new overhead
distribution system be installed underground, Tenant shall, at its own cost and expense, provide
all necessary facility changes on the Premises, so as to receive such service.
16. ALTERATIONS AND ADDITIONS
Tenant shall not make any alterations, erect any additional structures, or make any improvements
(including site Improvements pursuant to Section 14 hereot) on the Premises without prior
written consent of the Director of Airports. In the event Tenant makes alterations or constructs
additions that violate the conditions contained in this Lease, at the Director of Airports' sole
discretion, Tenant shall remove those alterations and additions at Tenant's sole cost and expense.
Any such alterations, additions, or improvements made shall remain on and be surrendered with
the Premises on expiration or termination of the Lease, except as otherwise provided in Section
30. Surrender of Possession of this Lease. If Tenant is required to remove any such alterations,
additions, or improvements pursuant to Section 30. Surrender of Possession, Tenant, at its sole
cost and expense, shall restore the Premises to the conditions existing immediately prior to the
alteration, addition, or improvement, or such other condition designated by Lessor in its election.
If Tenant makes any alterations, erects any additional structures, or makes any additional
improvements to the Premises as provided in this Section, Tenant may not commence
construction until Tenant has provided Lessor ten (10) days advance written notice thereof. In
addition a Notice of Lessor Non-Responsibility shall be posted and recorded by Tenant during
construction in accordance with Civil Code Sections 3094 and 3129. A copy of the notice shall
be mailed to Lessor upon filing with the County Recorder.
17. MAINTENANCE, REPAIR, AND STORAGE
A. Tenant shall, at its sole cost and expense throughout the term of this Lease, maintain the
Premises and all improvements thereon, including, but not limited to, structures, signs,
driveways, curbs, walkways, perimeter fences and gates to the airfield, pads, aprons,
taxiways, mechanical equipment, utility lines, drainage and sewage lines, Fuel storage and
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dispensing facilities, environmental control equipment, irrigation systems and
landscaping, in a first-class condition. Tenant shall be responsible .for the gates arid
fences on the Premises. Tenant has the right to determine the location of gates on the
Premises. Any fencing improvements by Tenant along John Glenn Drive must be
approved by the Director of Airports in advance of any installation. All maintenance,
repairs, and replacements shall be of a quality substantially equal to the original material
and workmanship and consistent with approved plans. Lessor shall be the sole judge of
the maintenance standards required.
Tenant shall perform all maintenance and repairs in compliance with, and all maintenance
and repairs necessary to comply with, all applicable statutes, ordinances, resolutions,
regulations, orders, and policies now in existence or adopted from time to time by the
United States, the State of California, the County of Contra Costa and other government
agencies with jurisdiction over the Airport.
B. No materials, supplies, products, equipment or other personal property, except for
assembled aircraft and ramp equipment and vehicles in regular use, shall be stored or
permitted to remain on any portion of the Premises outside of buildings or structures
without the prior written consent of the Director of Airports. Tenant shall store personal
property items, supplies, materials and combustibles inside the buildings in a safe, neat
and sanitary manner.
C. Tenant shall provide or cause to be provided adequate enclosures, screened areas and/or
suitable covered metal receptacles within the Premises for the short-term accumulation
and storage of solid waste, such as rubbish, trash, garbage, sludge, discarded machinery
or parts and any other solid industrial wastes. Such enclosures and/or screened areas shall
be designed in such a way as to prevent odors, fumes, attraction of pests, and dispersal of
wastes due to wind or water runoff, and shall be serviced frequently by qualified waste
removal and disposal services.
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18. LAWFUL CONDUCT
Tenant shall obey and observe, and shall ensure that all persons entering upon the Premises obey
and observe, all the terms and conditions of this Lease and all statutes, ordinances, resolutions,
regulations, orders, and policies now in existence or adopted from time to time by the United
States, (including, but not limited to, the Federal Aviation Administration) the State of
California, the County of Contra Costa, the Central Contra Costa Sanitary District, the San
Francisco Bay Regional Water Quality Control Board, and any other government agencies with
jurisdiction over the Airport (collectively, the "Applicable Laws") including, but not limited to,
Applicable Laws concerning health, safety, fire, accessibility, police, and the environment.
Tenant shall be responsible for paying all fines and penalties levied by any government agency
for any violation of an Applicable Law associated with activities on the Premises.
19. WASTE, QUIET CONDUCT, NUISANCE, POLLUTION
A. Tenant shall not con-unit, or suffer to be committed, any waste upon the .Premises or any
nuisance or other act or thing that may disturb the quiet enjoyment of the use of Buchanan
Field Airport or surrounding property.
B. Tenant shall provide, as necessary, a separate drainage, collection, and/or separation
system to ensure that no untreated liquid waste from any type of operation, including
aircraft cleaning and oil change operations, will enter the Airport storm drainage or
sanitary system.
C. Tenant shall not permit any activity on the Premises that directly or indirectly produces
unlawful amounts or levels of air pollution (e.g., gases, particulate matter, odors, fumes,
smoke, dust), water pollution, noise, glare, heat emissions, electronic or radio interference
with navigational and communication facilities for the operation of the Airport and for its
use by aircraft, trash or refuse accumulation, vibration, prop-wash,jet blast, or any other
activity that is hazardous or dangerous by reason or risk of explosion, fire, or harmful
emissions.
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20. HAZARDOUS MATERIALS
A. Definition of Hazardous Materials: As used in this Lease, the term "Hazardous Materials"
shall mean any hazardous or toxic substance, hazardous or radioactive material, or
hazardous waste, pollutant or contaminant at any concentration that is or becomes
regulated by the United States, the State of California, or any local government authority
having jurisdiction over the Premises. Hazardous Materials include, but are not limited
to, the following: (1) Any "hazardous waste," "extremely hazardous waste," or
"restricted hazardous waste," as defined in Sections 25115, 25117 or 25122.7, or listed
pursuant to Section 25140 of the California Health & Safety Code, Division 20, Chapter
6.5 (Ilazardous Waste Control Law); (2) any "hazardous substance" as that term is
defined in Section 25316 of the California Health & Safety Code, Division 20, Chapter
6.8 (Carpenter-Presley-Tanner IIazardous Substance Account Act); (3) any material or
substance listed as a chemical known to cause cancer or reproductive toxicity pursuant to
Section 6380 of the California Labor Code, Division 5, Part 1, Chapter 2.5 (IIazardous
Substances Information and Training Act); (4) any "hazardous waste" as that term is
defined in the Resource Conservation and Recovery Act, 42 U.S.C. Section 690.1 et seq.
(42 U.S.C. Section 6903); (5) any "hazardous substance" as that term is defined in the
Comprehensive Environmental Response, Compensation, and Liability Act of 1980, 42
U.S.C. Section 9601 et seq. (42 U.S.C. Section 9601); (6) any pollutant, contaminant, or
hazardous, dangerous, or toxic chemical, material, or substance, within the meaning of
any other applicable federal, state, or local statute, ordinance, resolution, regulation,
order, policy, or requirement, including consent decrees and administrative orders
imposing liability or standards of conduct concerning any hazardous, dangerous, or toxic
waste, substance, or material, now or hereafter in effect; (7) any petroleum product; (8)
any radioactive material, including any "source material", "special nuclear material", or
"byproduct material" as defined in 42 U.S.C. Section 2011 et seq.; (9) any asbestos in any
form or condition; and (10) any polychlorinated biphenyls (PCBs) and any substances or
any compounds containing PCBs.
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B. Use of Hazardous Materials: Tenant shall not cause or permit any Hazardous Material, as
defined in this Section, to be generated, brought onto, stored, used, emitted, released,
discharged or disposed of in, on, under, or about the Premises by Tenant or its officers,
employees, agents, contractors, renters, guests or invitees, except for limited quantities of
(1) standard office and janitorial supplies containing chemicals categorized as Hazardous
Materials; (2) motor oils, hydraulic fluids, fuel and other materials commonly used in
aircraft storage and fueling facilities; (3) such other Hazardous Materials as are approved
in advance in writing by Lessor.
C. Notification to the Director of Airports. If, during term of this Lease, Tenant becomes
aware of (a) any actual or threatened release of any Hazardous Materials on, under, or
about the Premises; or (b) any inquiry, investigation, proceeding, or claim by any
government agency or other person regarding the presence of Hazardous Material on,
under, or about the Premises, Tenant shall (1) immediately provide verbal notification to
the Director of Airports and (2) provide written notification of such release or
investigation to the Director of Airports within twenty-four (24) hours after learning of it.
In the event Tenant receives any claims, notices of violation, reports, or other writings
concerning the aforementioned release or investigation, Tenant shall furnish copies of all
such materials to Lessor no later than the business day following Tenant's receipt thereof.
Notification to the Director of Airports under this Section does not relieve Tenant of any
obligation to notify any governmental agency under any Applicable Law.
D. Indemnification: Tenant shall, at Tenant's sole expense and with legal counsel
reasonably acceptable to Lessor, indemnify, protect, defend, and hold harmless Lessor
and Lessor's officers, employees, agents, and contractors from and against any and all
demands, losses, claims, costs, suits, liability and expenses (including without limitation,
attorneys' fees and consultant fees), arising out of or relating to the violation of any law
regulating or the use, handling, generation, emission, release, discharge, storage or
disposal of any Hazardous Materials (such as those laws listed in this Section 20)
("Environmental Laws") by Tenant or Tenant's officers, employees, agents, contractors,
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renters, guests or invitees. This indemnification applies whether or not any government
agency has issued a cleanup order. Losses, claims, costs, suits, liability, and expenses
covered by this indemnification provision include, but are not limited to: (1) Losses
attributable to diminution in the value of the .Premises; (2) loss or restriction of use of
rentable space on the Premises; (3) adverse effect on the marketing of any rental space on
the Premises; and (4) penalties and lines levied by, and remedial or enforcement actions
of any kind issued by any regulatory agency (including but not limited to the costs of any
required testing, remediation, repair, removal, cleanup or detoxification of the Premises
and surrounding properties).
This indemnification clause shall survive any expiration or tennination of this Lease.
21. STORM WATER DISCHARGE
Contra Costa County has applied for and received a National Pollutant Discharge Elimination
Permit ("NPDEP") under the Federal Clean Water Act, which covers Tenant's operations on the
Premises.
Tenant shall ensure that no pollution or IIazardous Materials of any type will be discharged into
the stormwater system at the Airport, and shall comply with the NPDEP in all respects and be
held responsible for any such discharge by Tenant or by any of Tenant's officers, employees,
agents, contractors, renters, guests or invitees during the entire term of this Lease. Any fine or
cost of remedial action required of Lessor, by any agency or agencies having jurisdiction
thereover, as a result of actions on or discharges from the Premises, will be charged to Tenant,
and Tenant shall immediately reimburse Lessor for these costs upon demand. In addition, any
discharge of pollutants or Hazardous Materials, as defined herein, on or from the Premises shall
be considered a default of this Lease and shall be grounds for its termination.
22. RULES AND REGULATIONS
Tenant agrees to observe and obey all policies, rules, and regulations promulgated and enforced
by Lessor and any other governmental entity having jurisdiction over Buchanan Field.
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23. NOISE ORDNANCE
Tenant shall abide by all conditions of County Ordinances 87-8 and 88-82, as amended, or any
other rules or ordinances relating to noise standards at the Airport, as may be approved Erom
time to time by the Contra Costa County Board of Supervisors. Tenant will provide quarterly
noise abatement training to pilots of aircraft based on the Premises.
24. SECURITY
Lessor shall have no obligation to provide security to the Premises. Tenant shall provide,
through the use of buildings, structures, walls, fences, gates, and similar barriers, or a
combination thereof, positive uninterrupted on-site security at all times for the prevention of
unauthorized pedestrian and vehicular access to the aircraft operating area by way of the
Premises. Direct or indirect points of entry to the aircraft operating area to accommodate
authorized individuals and authorized vehicles shall be controlled by Tenant in compliance with
FAA and Airport security requirements. Tenant shall also provide security for on site facilities,
such as vehicular parking lots, aircraft tie down aprons, buildings, hangars, fuel storage areas
and shops. Tenant shall provide adequate lighting to provide for all-night illumination of the
perimeter of all buildings on the Premises, including, aprons, aircraft tie down areas, vehicular
parking lots and pedestrian walkways surrounding the Premises. If at any time during the term
of this Lease additional security requirements are imposed on the Airport by the FAA or any
other agency having jurisdiction over the Airport, Tenant shall comply with said security
requirements on the Premises at Tenant's sole expense. If Airport is Tined by FAA for a security
violation caused by Tenant, Tenant shall immediately reimburse Lessor upon demand.
25. HOLD HARMLESS AND INDEMNIFICATION
Tenant shall defend, hold harmless, and indemnify the indemnitees from the liabilities as defined
in this section;
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A. The indemnitees benefited and protected by this promise are Lessor, its governing body,
elective and appointive boards, commissions, officers, employees, representatives, and
agents;
B. The liabilities protected against are any liability or claim for damage of any kind allegedly
suffered, incurred or threatened because of an Act (as such term is defined below), and
including personal injury, death, property damage, inverse condemnation claims of third
parties or any combination of these, and including the defense of any suits or actions at
law or equity concerning these;
C. An "Act" shall be defined as any act, intentional or negligent, or omission by Tenant, its
agents, representatives, invitees, or contractors in connection with the occupancy and use
of the Premises by Tenant, its shareholders, or any renter or assignee, or the matters
covered by this Lease, or claimed to be attributable to Tenant, its subcontractors, or any
officers, agents, renters, assignees, employees, or one or more of them;
D. Non-conditions: The promise and agreement in this Section are not conditioned or
dependent on whether Tenant or Lessor has prepared, supplied, or approved any plans or
specifications in connection with work performed pursuant to Section 14. Site
Improvements and Section 16. Alterations and Additions hereof, or has insurance or other
indemnification covering any of these platters.
26. INSURANCE
Tenant shall procure and maintain, at its own cost and expense, at all times during the term of
this Lease, the following policies issued by insurance companies authorized to do business in
California, with a financial rating of at least an A-status (unless otherwise stated below) as rated
in the most recent edition of Best's Insurance Reports:
A. Commercial General Liability and Property Damage Insurance: Tenant shall obtain and
maintain, owner, landlord, and tenant Commercial General Liability Insurance with a
financial rating of at least an A- or P status (pooled insurance coverage) covering and .
insuring all parties hereto (including Contra Costa County and its officers, agents, and
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employees as additional insureds under the policy or policies) with a minimum combined
single limit coverage of Three Million and No/100 Dollars ($3,000,000) for all damages
due to bodily injury, sickness or disease, or death to any person and damage to property,
including the loss of use thereof, arising out of each accident or occurrence arising out of
ownership, maintenance, or use of the Premises and all operations necessary or incidental
thereto.
B. Fire Insurance: Tenant shall insure for fire and extended coverage risks all personal
property, improvements, and alterations in, on, or about the Premises. Such insurance
shall be in an amount equal to one hundred percent (100%) of insurable, lull replacement
value of any improvements located thereon, and shall include vandalism and malicious
mischief endorsements. Said fire insurance policies shall contain loss payable
endorsements in favor of the parties as their respective interests may appear hereunder.
Lessor and its officers, agents, and employees shall be named as additional insured's in
such policy or policies.
C. Casualties: In the event of damage to or destruction of any buildings or other
improvements on the Premises ("Insured Improvements") in excess of twenty-live
percent (25%) of the then replacement value of such Insured Improvements, Tenant shall
determine whether to repair or replace the Insured Improvements. If Tenant determines
to repair or replace the Insured Improvements, the proceeds of any insurance policy paid
on account of such damage or destruction shall first be applied to the cost of repairing, or
replacing the Insured Improvements. If Tenant determines not to repair or replace the
Insured Improvements, Tenant may tenninate this Lease upon written notice to Lessor
within thirty (30) days of such damage or destruction. It Tenant terminates this Lease
pursuant to this provision after deducting any proceeds payable to Tenant's Mortgagee, as
defined in Section 36. Financing of Leasehold Estate, the remaining proceeds of any
insurance policy paid on account of such damage or destruction shall be distributed to
Lessor and Tenant pursuant to the following formula: "Lessor's Share" shall be the
product of the remaining proceeds multiplied by a fraction, the numerator of which is the
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number of months since the Commencement Date of this Lease until the date on which
the casualty causing such damage or destruction occurred, and the denominator of which
is Four Hundred Eight (480) months, and Tenant's share shall be the excess of the
remaining proceeds after subtracting Lessor's Share. All Fire and extended coverage
policies insuring the improvements may have a loss payable clause in favor of any
Mortgagee of Tenant, as such Mortgagee's interest may appear.
D. Worker's Compensation: Tenant shall obtain workers' compensation insurance as
required by law, covering all employees of Tenant, and said insurance shall be kept in
force during the entire term of this Lease.
E. Form of Policies: All policies of insurance required by this Section shall be in such
standard form and written by such qualified insurance companies as shall be satisfactory
to Lessor. Evidence of such insurance shall be provided by Tenant by riling with Lessor a
copy of the policy and policies, together with a duly executed certificate of insurance to
the effect that the insurance required by this Lease is extended in favor and consistent
with the terms set forth herein. All of such certificates shall specifically state that "Contra
Costa County, its officers, agents, and employees" are named as additional insureds under
such policy or policies. Said policy or policies or certificates shall contain a provision that
written notice of policy lapses, cancellation or any changes thereto shall be delivered to
Lessor no fewer than thirty (30) days in advance of the effective date thereof.
F. Notice: Tenant shall give Lessor prompt and timely notice of any claim or suit of which
it has knowledge and which could in any way directly, contingently or otherwise affect
either Tenant or Lessor or both, and both Tenant and Lessor shall have the right to
participate in the defense of such claim or suit to the extent of its respective interest.
27. TAXES
Tenant agrees to pay before delinquency all taxes (including, but not limited to, possessory
interest tax), assessments, license fees, and other charges which are levied and assessed upon
Tenant's interest in the Premises, or upon Tenant's personal property installed or located in or on
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the Premises, by Contra Costa County or other legally authorized governmental authority. 'Tenant
may pay any taxes and assessments under protest, without liability, cost or expense to the Lessor,
to contest the amount in good faith.
28. INSPECTION, ACCESS AND NOTICE
Insofar as the same may be necessary for the protection of Lessor's rights, Lessor and its agents
shall at any and all times have the right to go upon and inspect the Premises and any and every
building, structure, or improvement erected or constructed or in the course of being erected or
constructed, repaired, added to, rebuilt or restored thereon. Lessor shall also have the right to
serve or to post and to keep posted on the Premises, or on any part thereof, any notice permitted
by law or this Lease, including but not limited to a notice pursuant to Section 3094 of the Civil
Code. Lessor shall not be liable in any manner for any inconvenience, disturbance, loss of
business, or other damage arising out of Lessor's entry on the Premises as allowed in this
Section. Lessor shall conduct its activities as allowed in this Section in a manner that will cause
the least possible inconvenience, annoyance, or disturbance to Tenant, and shall not materially
interfere with access to or use of the Premises. Tenant shall provide an access gate through the
Premises for emergency vehicles.
29. ASSIGNMENT AND ENCUMBRANCES
Tenant shall not voluntarily assign or encumber its interest in this Lease or in the Premises, or
allow any other person or entity (except Tenant's authorized representatives) to occupy or use all
or any part of the Premises, without first obtaining Lessor's written consent, which will not be
unreasonably withheld. Any encumbrance without Lessor's consent shall be voidable and, at
Lessor's election shall constitute a default. Any consent to an assignment or encumbrance shall
not constitute a further waiver of the provisions of this Section.
If Tenant is a corporation, any (i) dissolution, merger, consolidation, or other reorganization of
Tenant, or (ii) the sale or other transfer of a controlling percentage of the capital stock of Tenant,
or (iii) the sale of fifty percent (50%) of the value of the assets of Tenant, shall be deemed a
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voluntary assignment. The phrase "controlling percentage" means the ownership of, and the
right to vote, stock possessing more than fifty percent (50%) of the total combined voting power
of all classes of Tenant's capital stock issued, outstanding, and entitled to vote for the election of
directors.
If Tenant is in default of monetary obligations to Lessor pursuant to this Lease, Tenant
immediately and irrevocably assigns to Lessor, as security for Tenant's monetary obligations
under this Lease, all rent from any subletting of all or part of the Premises as permitted by this
Lease, or a receiver for Tenant appointed on Lessor's application, may collect such rent and
apply it toward Tenant's obligations under this Lease.
30. SURRENDER OF POSSESSION
Title to all improvements constructed upon the Premises, including all alterations or additions
thereto, shall remain in Tenant until the expiration, cancellation, or other earlier termination of
this Lease. Upon such expiration, cancellation or other earlier termination of this Lease, title to
said improvements shall automatically vest in the Lessor and, except as otherwise provided
herein, said improvements shall remain upon and be surrendered with the Premises as part
thereof.
If Lessor does not desire title to said improvements, Tenant shall, upon written notice by Lessor,
and at Tenant's sole cost and expense, return the Premises to Lessor clear of any or all
improvements, above or below ground level, constructed by Tenant and identified in such notice.
"Tenant shall complete its removal of such improvements at its expense within one hundred
twenty (120) days of the effective date of such notice. If Tenant fails to remove the
improvements, Lessor may remove thein at Tenant's expense, and Tenant shall immediately
reimburse to Lessor, in full, all of Lessor's costs and expenses incurred in removing those
improvements upon written demand by Lessor.
Title to personal property belonging to Tenant shall at all times during the term of this Lease
remain in Tenant, and Tenant shall have the right at any time to remove any or all personal
property of any kind and nature whatsoever that Tenant may have placed or installed upon the
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Premises, provided that upon any such removal, Tenant shall repair, at its sole cost and expense,
any damage resulting therefrom and leave the Premises in a clean and neat condition.
Upon expiration or within thirty (30) days after cancellation or termination of this Lease, J'enant
shall surrender to Lessor the Premises and all improvements including alterations and additions,
in good condition (except for ordinary wear and tear and destruction to the Premises covered by
Section 33. Destruction), except for those improvements, alterations and additions that Tenant
has the obligation to remove under the provisions of this Section and Section 16. Alterations and
Additions. If Tenant fails to remove its personal property Froin the Premises within sixty (60)
days after expiration, cancellation, or termination of this Lease, said property may be removed
by Lessor at Tenant's expense, by use of the Security Deposit, as provided in Section 9.
Additional Payment Provisions. If Lessor's cost to remove Tenant's personal property exceeds
the amount of the Security Deposit, then Tenant shall reimburse Lessor the difference between
Lessor's cost and the amount of the Security Deposit, immediately upon Lessor's written
demand.
If Tenant fails to surrender the Premises to Lessor on expiration or within thirty (30) days after
cancellation or termination of this Lease, Tenant shall defend, indemnify, and hold Lessor
harmless from any and all claims, liability, costs, and damages resulting from `T'enant's failure to
surrender the Premises, including, without limitation, claims made by a succeeding tenant or
renter.
31. DEFAULT
The occurrence of any of the following shall constitute a default (a "Default') by'Tenant:
(1) Failure by Tenant to pay any Rent or other charges when due, if the failure
continues for thirty (30) days after notice has been given to Tenant.
(2) Tenant abandons the Premises through its failure to occupy and operate the
.Premises for ninety (90) days.
(3) Tenant shall become insolvent, file a voluntary petition in bankruptcy or an
involuntary petition in bankruptcy is tiled against Tenant, or Tenant shall lose
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possession of the Premises, or any portion thereof, by virtue of any attachment,
execution, or receivership, and such insolvency, bankruptcy proceedings or loss of
possession is not tenninated in Tenant's favor within sixty (60) days thereafter.
(4) Tenant makes a general assignment for the benefit of creditors.
(5) Failure to comply with any of the provisions of Section 37. Non-Discrimination.
(6) Any act, condition, event, or failure of performance constituting a Default under
any other provision of this Lease.
(7) Notwithstanding the foregoing, failure to perform any other provision of this
Lease, if the failure to perform is not cured within thirty (30) days after written
notice has been given to Tenant. If, in Lessor's reasonable judgment, the Default
cannot reasonably be cured within thirty (30) days, Tenant shall not be in Default
of this lease if Tenant commences to cure the default within the thirty (30) day
period and diligently and in good faith continues to cure the Default. Safety
hazards must be cured immediately.
32. LESSOR'S REMEDIES
Lessor shall have the following remedies upon the occurrence of a Default. These remedies are
not exclusive; they are cumulative and in addition to any remedies now or later allowed by law.
A. Lessor may terminate this Lease and Tenant's right to possession of the Premises at any
time. No act by Lessor other than giving written notice to Tenant shall terminate this
Lease. Acts of maintenance, efforts to re-let the Premises, or the appointment of a
receiver on Lessor's initiative to protect Lessor's interest under this Lease shall not
constitute a termination of Tenant's right to possession. Upon termination of this Lease,
Lessor has the right to recover from Tenant:
(1) All unpaid Rent and fees.accrued until the payment of such amounts, plus interest
accrued thereon at a rate of ten percent (10%) per annum or the maximum rate
permitted by law, whichever is greater (the "Default Interest Rate");
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(2) An amount equal to (a) the unpaid Rent and fees that would have been earned alter
the date of termination of this Lease until Tenant shall have paid any and all
amounts due hereunder, less (b) the amount of the loss of Rent and fees that
Tenant proves could have been reasonably avoided any such amount to accrue
interestat the Default Interest Rate from the date this Lease is tenninated until
Tenant shall have paid any and all amounts due hereunder;
(3) An amount equal to the unpaid Rent and fees for the balance of the Tenn alter
Tenant shall have paid any and all amounts due hereunder, less the amount of the
loss of Rent and fees that Tenant proves could have been reasonably avoided any
such amount to be discounted at the discount rate of the Federal Reserve Bank of
San Francisco at the time such detennination, plus one percent (I%); and
(4) Any other amount, including without limitation, attorneys' fees and court costs,
necessary to compensate Lessor for all detriment proximately caused by Tenant's
Default.
B. Lessor, at any time after the occurence of a Default, can cure the Default at Tenant's cost,
provided Lessor has given Tenant thirty (30) days notice and Tenant has failed to cure such
Default within such thirty (30) days, or, if the Default is of such a nature that it cannot be
cured within such thirty (30) day period and fails to pursue such cure diligently to
completion. If Lessor at any time, by reason of Tenant's Default, pays any sum to cure the
Default or does any act that requires the payment of any sum, the sum paid by Lessor shall be
due from Tenant to Lessor within thirty (30) days from the time the sum is paid, upon notice
given by Lessor to Tenant, and if paid by Tenant at a later date, shall bear interest at the rate
of ten percent (10%) per annum or the maximum rate permitted by law, whichever is greater,
from the date the sum is paid by Lessor until Lessor is completely reimbursed by Tenant.
Such sum, together with interestaccrued thereon, shall be paid by 'Tenant as Additional Rent.
In the event of Default by Tenant in connection with the construction of the Improvements
pursuant to Section 14. Site Improvements, Lessor may exercise its rights as an obligee
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against the surety company on the perforinance bond required by Subsection II.D.
Performance and Payment Bonds and may take such steps as are necessary to cause the cure
of said Default by the principal, the surety company, or others.
33. DESTRUCTION
If any Improvements erected on the Premises are damaged or destroyed as a result of any
uninsurable cause or risk at the time of destruction, in the amount of at least twenty five percent
(25%) of the replacement cost of all Improvements, Tenant shall have the option to either
terminate this Lease or to replace and rebuild the Improvements so they are in substantially the
same condition as they were in immediately before such damage or destruction. Tenant shall
give written notice of its election to Lessor within forty-five (45) days of the date of the loss or
destruction of the Improvements. If Tenant elects to tenninate this Lease, this Lease shall
terminate. If Tenant elects to rebuild, only Ground Rent will be abated in an amount equal to the
Ground Rent due for such month multiplied by the percentage resulting from the replacement
costs of the damage to the Improvements divided by the replacement cost of all Improvements,
for a period not to exceed three (3) months from the date of such written notice, unless otherwise
extended by mutual and written agreement by Lessor and Tenant. If damage is less than twenty-
five percent (25%) of the replacement cost of Improvements, Tenant shall rebuild the
Improvements, and no Ground Rent abatement shall apply.
Tenant shall have one hundred eighty (180) days to commence repair or restoration of the
Improvements, and shall diligently pursue the completion of such Improvements.
34. CONDEMNATION
If any part of the Premises shall be taken as a result of the exercise of the power of eminent
domain or be conveyed to any entity having such power under threat of exercise thereof (both
such actions being hereinafter referred to as "Condemnation") this Lease shall automatically
terminate as to the portion of the Premises subject to Condemnation as of the date physical
possession of such portion is taken by condemnor. The value of any damages to the remainder
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of the Premises sustained by the Tenant and or Lessor as a result of said Condemnation action
shall be determined by a court of law or by negotiation and agreement with the condemnor.
If the remaining part of the Premises will not be reasonably suitable for the use described in
Section 11. Use of Premises, this Lease may be terminated by either Lessor or Tenant, at any
time by written notice within thirty (30) days after the date possession of the condemned portion
is taken by condemnor. If the remaining part of the Premises will be reasonably suitable for the
operation of the business described in Section 11. Use of Premises, this Lease shall continue in
full force and effect as to such remaining part. If this I-lease is not so terminated, as of the date
of such Condemnation, the Ground Rent shall continue to be the rate then in effect per square
foot per year pursuant to Section 7. Ground Rent, but the total number of square Ibet shall be
reduced by the number of square feet of the Premises taken and the Rent shall reflect such
reduction.
In the event that all or any part of the Premises shall be taken by eminent domain or conveyed in
lieu thereof, both parties shall have the right to pursue a condemnation award against the
condemning agency, with the Tenant being entitled to any award for lost business, moving
expenses and the depreciated value of any fixtures or property improvements installed by the
Tenant and the Lessor being entitled to all other amounts awarded, including but not limited to,
all amounts awarded for land value. No claim made by or payment to the Tenant shall diminish
or otherwise adversely affect the Lessor's award. Provided that Lessor is not the condemning
agency, Tenant shall neither have nor make any claim against Lessor for any loss, damage or
other matter arising out of said condemnation.
35. CANCELLATION BY LESSOR
If at any time ten (10) years or more after the Commencement Date of this Lease, Lessor
requires the Premises for purposes other than a Full-Service Fixed Base Operation, Lessor shall
have the right to cancel this Lease and to acquire full title, control and possession of said
Premises and all Improvements thereon by giving one (1) year's written notice to Tenant of the
effective date of such cancellation.
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In the event of such cancellation, Lessor and Tenant shall attempt by negotiation to fix the value
of Tenant's remaining interest in the Premises and the Improvements thereon, considering the
fair market value of the remaining term of the Lease and the then existing fair market value of
the Improvements installed by Tenant on the Premises, and any other factors that might be used
in making such a determination. In the event that diligent and good faith negotiations fail to
establish an agreement on the amount of compensation to be paid to Tenant, either Lessor or
Tenant may give written notice ("Appraisal Notice") to the other, declaring an end to
negotiations and requiring the amount of compensation to be paid to Tenant to be determined by
the appraisal method set forth in this Section 35. The appraisal method shall be as follows: two
qualified and licensed real estate appraisers shall be selected, one by Lessor and one by "Tenant.
Each appraiser shall be a Member of the Appraisal Institute, have the designation of MAI, and
have current aviation appraisal experience in appraising property in the geographic real estate
market where the Premises is situated. Lessor and Tenant shall each appoint one appraiser
within fifteen (15) days of the Appraisal Notice, and the name of the appraiser so appointed shall
be given to the other party. In the event that either Lessor or Tenant defaults in the appointment
of an appraiser within said fifteen (15) days, the appraisers elected by the non-defaulting party
shall name a second appraiser. Upon completion of appointment, said appraisers shall proceed
to determine the then-existing the fair market rental value of Tenant's interest in the Premises
within forty-five (45) days. Such determination of value shall be binding on both Lessor and
Tenant.
In the event said appraisers cannot agree upon fair market value within forty-five (45) days, they
will mutually appoint a third appraiser who shall be a Member of the Appraisal Institute, have
the designation of MAI and have current aviation appraisal experience in appraising property in
the geographic real estate market where the Premises is situated. Said third appraiser shall be
appointed within fifteen (15) days of the expiration of forty-five (45) day appraisal period. If a
third appraiser is not selected within said fifteen (15) day period, a third appraiser shall be
selected by a presiding judge of the Contra Costa County Superior Court. Within thirty (30)
days of selection of the third appraiser, the first two appraisers shall inform both parties in
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writing of their fair market value determination. Upon completion of the appointment, said third
appraiser shall proceed to determine the fair market rental value for in accordance with the
foregoing standard within forty-five (45) days. The determination made by the third appraiser
shall be binding upon Lessor and Tenant. Each party shall bear the expense of the appraiser so
appointed by that party (or the appraiser selected for such party by the other party in the event
one party fails to timely select an appraiser), and one-half the expense of the third appraiser if
appointed. In determining the then existing fair market value of the Tenant's interest in the
Premises, the appraisers shall consider the remaining term of the Lease and any other factors
then currently in use for standard real estate appraisals as fixed by a Member of the Appraisal
Institute. Such determination of value shall be binding on both Lessor and Tenant.
For the purposes of this Section 35., the value of Tenant's interest in the Premises shall include
but is not limited to (a) the fair market value of this Lease, valued without the Improvements on
the Premises and valued as if the Lease were not to be canceled and (b) the fair market value of
Tenant's Improvements were they to remain on the Premises. Consideration shall also be given
to the Lessor's current pro rata interest in the Improvements as described in Section 26. (C)
Casualties. Lessee shall be entitled to payment of the amount fixed by the above appraisal
method as of the date Lessor acquires full title, control and possession of the Premises. Lessee
shall have no right to recover the value of its Improvements in the event that the Lease is
terminated as the result of Lessee's default or for any reason other than as specifled in this
Section 35.
36. FINANCING OF LEASEHOLD ESTATE
Subject to the conditions set forth below, Tenant shall have the right to encumber its leasehold
estate in the Premises ("Leasehold Estate"), and/or the Improvements thereon, with only one
Mortgage (as defined below) at any one time. For example, Tenant tnay subject only the
Leasehold Estate to a Mortgage, or Tenant may obtain one Mortgage covering both the
Leasehold Estate and the Improvements, but Tenant shall not subject the Leasehold Estate and
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the Improvements to separate Mortgages at the same time. Further, Tenant may not then take
out additional Mortgages, such as second loans, on either the Leasehold Estate or the
Improvements, or both together. Tenant shall have the above rights to finance, subject to the
following terms and conditions:
A. The Mortgage and all rights acquired under it shall be subject to all of the covenants,
conditions, and restrictions contained in this Lease and to all rights and interests of
Lessor;
B. Tenant shall give Lessor prior written notice of any Mortgage, and shall accompany the
notice with a true copy of any promissory note, Mortgage, or other financing documents;
C. Lessor shall not exercise its remedies under Section 31. Default, of this Lease unless;
(1) Lessor sends a written notice of Default to both Tenant and Mortgagee setting
forth the nature and extent of the Default, and
(2) Within sixty (60) days alter service of the notice of Default, the Mortgagee fails to
do either of the following:
a. Cure the Default if it can be cured by the payment of money or
b. If Mortgagee does not elect to cure the Default by the payment of money, or
if the Default cannot be cured by the payment of money, the .Mortgagee
commences Foreclosure proceedings and thereafter, in Lessor's sole
opinion, diligently prosecutes the Foreclosure proceedings to conclusion.
D. The Mortgagee shall not be liable to perform Tenant's obligations under this Lease until
the Mortgagee acquires the Leasehold Estate by foreclosure, as described herein or by
transfer in lieu of or under threat of foreclosure. However, after the Mortgagee acquires
the Leasehold Estate, Mortgagee shall be liable to pay any Rent or other payments due by
Tenant, and to cure any Default. After the Mortgagee acquires the Leasehold Estate by
Foreclosure, the Mortgagee shall be liable to perform Tenant's obligations under this
Lease only until the Mortgagee thereafter assigns or transfers the Leasehold Estate. Any
assignment or transfer of the Leasehold Estate by the Mortgagee shall require the written
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consent of Lessor. Any such assignee or transferee shall then be liable to perfonn
Tenant's obligations under this Lease.
E. The time in which the Mortgagee is allowed to cure any Default under this Lease shall be
extended by any period of time during which the Mortgagee is precluded by current law
from Foreclosing due to the bankruptcy of Tenant or any court order prevents the
Mortgagee from so acting.
F. (1) As used in this Section:
(a) "Tenant" shall include all assignees and renters of Tenant;
(b) "Mortgagee" shall include the trustee and beneficiary under a deed of trust;
(c) "Mortgage" shall include a deed of trust, or any other form of real property
security; and
(d) "Foreclosure" shall include any judicial foreclosure or sale under the power
of sale in lieu of a judical foreclosure, or any transfer in lieu or under threat
of foreclosure.
(2) Estoppel Certificates. Upon written request by Tenant, Lessor shall execute,
acknowledge, and deliver to Tenant or to any lender or Mortgagee, a written
statement stating (a) whether the Lease is unmodified and is in full force and
effect, and if modified, whether the modified Lease is in full force and effect, and
stating the nature of the modification, (b) the dates to which all. rents and other
payments due hereunder have been paid, (c) whether Lessor is aware of any Tenant
default in the performance or observance of any term or condition hereof, and
whether any notice has been given to Tenant of any default which has not been
cured (and, if so, specifying the same), (d) such other information as Lessor agrees
to provide.
37. NON-DISCRIMINATION
A. Tenant hereby covenants and agrees that in the event facilities are constructed,
maintained, or otherwise operated on the Premises for a purpose for which a United
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States Department or Transportation ("DOT") program or activity is extended or for
another purpose involving the provision of similar services or benefits, Tenant shall
maintain and operate such facilities and services in compliance with all requirements
imposed pursuant to Title 49, Code of Federal Regulations ("CFR"), Part 21, Non-
discrimination in Federally Assisted Programs of the Department of Transportation, and
as said Regulations may be amended.
B. Tenant hereby covenants and agrees that (1) no person shall be excluded from
participation in, denied the benefits of, or be otherwise subjected to, discrimination in the
use of the Premises on the grounds of race, color, sex, or national origin, (2) that in the
construction of any improvements on, over, or under the Premises and the furnishing of
services thereon, no person shall be excluded from participation in, denied the benefits of,
or be otherwise subjected to discrimination on the grounds of race, color, sex, or national
origin, and (3) that Tenant shall use the Premises in compliance with all other
requirements imposed by or pursuant to Title 49, CFR, Part 21, Non-discrimination in
Federally Assisted Programs of the Department of Transportation, , and as said
Regulations may be amended.
C. In the event of a breach of any of the above non-discrimination covenants, Lessor shall
have the right to terminate this Lease and to re-enter and repossess the Premises and the
facilities thereon, and hold the same as if this Lease had never been made or issued. This
provision does not become effective until the procedures of 49 CFR Part 21 are Followed
and completed, including the expiration of any appeal rights.
D. Tenant shall furnish its accommodations and/or services on a fair, equal, and not unjustly
discriminatory basis to all users thereof and it shall charge fair, reasonable, and not
unjustly discriminatory prices for each unit or service, provided that Tenant may be
allowed to make reasonable and nondiscriminatory discounts, rebates, or other similar
types of price reductions to volume purchasers.
E. Noncompliance with Subsection (D) above shall constitute a material breach thereof and,
in the event of such noncompliance, Lessor shall have the right to terminate this Lease
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without liability therefor or, at the election of Lessor or the United States, either or both
governments shall have the right to judicially enforce the provisions of Subsection (ll).
F. Lessor agrees that it shall insert the above subsections A through E in any lease
agreement by which Lessor grants a right or privilege to any person, firm, or corporation
to render accommodations and/or services to the public on the Premises.
G. Lessor assures that it will undertake an Affirmative Action program as such term is
defined and required by 14 CFR Part 152, Subpart E ("Subpart E") to ensure that no
person shall on the grounds of race, creed, color, national origin, or sex, be excluded from
participating in any employment activities covered by Subpart E. Tenant assures that no
person shall be excluded on these grounds from participating in or receiving the services
or benefits of any program or activity covered by Subpart E. Tenant assures that it will
require that its covered suborganizations provide assurances to Tenant that they similarly
will undertake Affirmative Action programs, and that they will require assurances from
their suborganizations, as required by Subpart E, to undertake the same effort.
38. OPERATION OF AIRPORT BY LESSOR
A. Aviation Hazards: Lessor reserves the right to take any action it considers necessary to
protect the aerial approaches of the Airport against obstructions, together with the right to
prevent Tenant from erecting, or permitting to be erected, any building or other structure
on the Premises which, in the opinion of the Lessor or the Federal Aviation
Administration, would limit the usefulness of the Airport or constitute a hazard to aircraft.
B. Navigational Aids: Lessor reserves the right during the term of this Lease or any renewal
and/or extension hereof to install air navigational aids including lighting, in, on, over,
under, and across the Premises. In the exercise of any of the rights hereof, Lessor agrees
to give Tenant no less than ninety (90) days written notice of its intention to install such
air navigational aids.
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39. AIRPORT USE AND DEVELOPMENT
A. Lessor reserves the right to further develop or improve the landing area of the Airport as
it sees fit, regardless of the desires or view of Tenant and without interference or
hindrance.
B. Lessor reserves the right, but shall not be obligated to Tenant, to maintain and keep in
repair the landing area of the Airport and all publicly-owned facilities at the Airport,
together with the right to direct and control all activities of Tenant in this regard.
C. This Lease shall be subordinate to the provisions and requirements of any existing or
future agreement between Lessor and the United States, including but not limited to the
Federal Aviation Administration, relative to the development, operation, and maintenance
of the Airport.
D. There is hereby reserved to Lessor, its successors and assigns, for the use and benefit of
the public, a right of flight for the passage of aircraft in the airspace above the surface of
the Premises. This public right of flight shall include the right to cause in said airspace
any noise inherent in the operation of any aircraft: used for navigation or flight through
said airspace or landing at, taking off from, or operation at the Airport.
40. DEVELOPMENT OF PREMISES
A. Tenant shall comply with the notification and review requirements covered by 14 CFR
Part 77 of the Federal Aviation Regulations in the event future construction of a building
is planned for the Premises, or in the event of any planned modification or alteration of
any present or future building or structure situated on the Premises.
B. Tenant shall not erect nor permit the erection of any structure or object, or permit the
growth of any tree on the Premises to exceed the established height contours. In the event
the aforesaid covenants are breached, Lessor reserves the right to enter upon the Premises
and to remove the offending structure or object and cut the offending tree, all of which
shall be at Tenant's sole cost and expense.
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C. Tenant shall not make use of or develop the Premises in any manner that might interfere
with the landing and taking off of aircraft from the Airport or otherwise constitute a
hazard. In the event the aforesaid covenant is breached, Lessor reserves the right to enter
upon the Premises and cause the abatement of such interference at the sole cost and
expense of Tenant.
D. Nothing herein shall be construed to grant or authorize the granting of an exclusive right
within the meaning of 49 U.S.C. § 40103.
E. This Lease and all of its provisions shall be subject to whatever right the United States
Government now has or in the future may have or acquire, affecting the control,
operation, regulation, and taking over of the Airport by the United States during a time of
war or national emergency.
41. INSTRUMENT OF TRANSFER
This Lease shall be subordinate and subject to the provisions and requirements of the Instrument
of Transfer by and between the United States and Lessor dated the 9th day of October, 1.947, and
recorded in Book 1137, at page 114 of the Official Records of the County of Contra Costa, State
of California.
42. CHOICE OF LAW
This Lease shall be interpreted and enforced under the laws of the State of California, with
venue in the Superior Court of Contra Costa County, California.
43. NOTICES
Any and all notices to be given under this Lease, or otherwise, may be served by enclosing same
in a sealed envelope addressed to the party intended to receive the same, at its address set forth
herein, and deposited in the United States Post Office as certified mail with postage prepaid.
When so given, such notice shall be effective from the date of the mailing of the same. For the
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purposes thereof, unless otherwise provided in writing by the parties hereto, the address of
Lessor, and the proper party to receive any such notices on its behalf is:
Director of Airports
Contra Costa County Airports
550 Sally Ride Drive
Concord, CA 94520-5550
and the address of Tenant is:
Pacific States Aviation, Inc.
51 John Glenn Drive
Concord, CA 94520
44. TIME IS OF THE ESSENCE
Time is of the essence for each provision of this Lease.
45. BINDING ON SUCCESSORS
The covenants and conditions herein contained shall, subject to the provisions as to assignment,
apply to and bind the heirs, successors, executors, administrators and assigns of all of the parties
hereto.
46. INVALID PROVISIONS; SEVERABILITY
It i.s expressly understood and agreed by and between the parties hereto that in the event any
covenant, condition or provision contained herein is held to be invalid by a court of competent
jurisdiction, such invalidity shall not invalidate any other covenant, condition or provision of this
Lease, provided, however, that the invalidity of any such covenant, condition or provision does
not materially prejudice either Lessor or Tenant in their respective rights and obligations
contained in the valid covenants, conditions and provisions of this Lease.
47. PROVISIONS
All provisions, whether covenants or conditions, on the part of Tenant and/or Lessor shall be
deemed to be both covenants and conditions.
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48. ENTIRE AGREEMENT
This Lease and all exhibits referred to in this Lease constitute the entire agreement between the
parties relating to the rights herein granted and the obligations herein assumed and supersedes all
prior or contemporaneous understandings or agreements of the parties. No alterations,
amendments or variations of this Lease shall be valid unless they are in writing and signed by
Lessor and Tenant.
49. CUMULATIVE RIGHTS AND REMEDIES
The rights and remedies with respect to any of the terms and conditions of this Lease shall be
cumulative and not exclusive and shall be in addition to all other rights and remedies at law or in
equity. Each right or remedy shall be construed to give it the fullest effect allowed in law.
50. NO THIRD-PARTY BENEFICIARIES
Nothing in this Agreement, express or implied, is intended to confer on any person, other than
Lessor and Tenant, and their respective successors-in-interest, any rights or remedies under or by
reason of this Lease.
51. NO CONTINUING WAIVER
The waiver by Lessor of any breach of any of the teens or conditions of this Lease shall not
constitute a continuing waiver or a waiver of any subsequent breach of the same or of any other
terms or conditions of this Lease. The receipt by Lessor of any Rent with knowledge of the
breach of any term or condition of this Lease shall not be deemed to be a waiver by Lessor,
unless such waiver is specifically expressed in writing by the Director of Airports. No payment
by Tenant or receipt by Lessor of a lesser amount than specified in this Lease shall be deemed to
be other than a payment on account of such Rent and shall not be deemed a waiver of notice of
termination and of forfeiture of this Lease.
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52. COVENANT AGAINST LIENS
Neither Tenant nor Lessor shall permit any mechanic's, >materialman's, or other lien against the
Premises, or the property of which the Premises fonns a part, in connection with any labor,
materials, or services furnished or claimed to have been furnished. If any such lien shall be filed
against the Premises, or property of which the Premises fon-ns a part, the party charged with
causing the lien will cause the same to be discharged, provided however, that either party may
contest any such lien, so long as the enforcement thereof is stayed.
53. LEASE AUTHORIZATION
This Lease is made and entered into by Lessor in exercise of authority as recognized in Section
25536 of the Government Code of the State of California.
54. LEASE COUNTERPARTS
This Lease may be executed in one or more counterparts, each of which shall be deemed a
duplicate original, but all of which together shall constitute one and the same instrument.
55. HEADINGS AND CAPTIONS
The section headings and captions of this Lease are, and the arrangement of this instrument is,
for the sole convenience of the parties to this Lease. The section headings, captions, and
arrangement of this instrument do not in any way affect, limit, amplify or modify the terns and
provisions of this Lease. The Lease shall not be construed as if it had been prepared by one of
the parties, but rather as if both parties have prepared it. The parties to this Lease and their
counsel have read and reviewed this Lease and agree that any rule of construction to the effect
that ambiguities are to be resolved against the drafting party shall not apply to the interpretation
of this Lease.
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56. SIGNATURES
LESSOR TENANT
CONTRA COSTA COUNTY Pacific States Aviation, Inc.
a political subdivision of
the State of California
By By
Maurice M. Shiu Presi ent, Pacific States Aviation, Inc.
Public Works Director
By
Secretary, Pacific States Aviation, Inc.
RECOMMENDED FOR APPROVAL:
By
Keith Freitas
Director of Airports
APPROVED AS TO FORM:
Silvano B. Marchesi
County Counsel
By
Eric S. Gelston
Deputy County Counsel
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Bucl )an Field
Addis;ion to Site 112
Fixed Base Operation
EXHIBIT "A"
A portion of the Rancho Monte del Diablo, described as follows :
Beginning at a point on the westerly line of the County
Road Down as John Glenn Drive, said voint bearing South 240
28' 42" west (the bearing south 240 28' 42" west being taken for
the purpose of this description) , 85+.00 feet from Point "A",
as said Point "A" is designated in the Board of Supervisors
Resolution No. 324, recorded September 21, 1961 in Volume 3957
of Official Records, at page 591; thence north X50 31' 18" west,
along the northerly line of the lease from Contra Costa County
to Pacific States Aviation, dated February 19 1963 220.00 feet;
thence, leaving said northerly line North 246 28' 42" east,
90 .00 feet; thence south 650 31' 18 east,east, 220.00 feet to said
westerly line pf John Glenn Drive; thence, along said westerly
line, south 24 28' 42" west, 90.00 feet to the point of beginning.
Containing an area of 19. 800 square feet (0.455 acres,
more or less .
RESERVING THEREFROM to the County of Contra Costa, its
successors or assigns, an easement for utility purposes over,
across, and under a strip of land of the uniform width of 10
feet lying easterly-, measured at right angles, from the westerly
line of the above described property, and a strip of land of
the uniform width of 10 feet lying westerly, measured at right
angles, from the easterly line of the above described property,
extending from the northerly boundary to the southerly boundary
of the above described property.
Buu,ianan Field
Amended Description of
F.B.O. Plot #2
(Pacific States Aviation)
EXHIBIT "B"
A portion of Rancho Monte Del Diablo, described as follows:
Beginning at a point on the westerly line of the Cou$ty
Road mown as John Glenn Drive, said oint bearing south 24
28' 42" west (the bearing south 240 28 42 If west being taken
for -the purpose of this description) along said westerly line,
854.00 feet from Point "A", as said Point "A" is designated in
. the Resolution of the Board of Supervisors, County of Contra
Costa, State of California, entitled "In the Matter of Declaring
the Airport Access Road, a County Road", recorded September 21,
1961, in Volume 3957 of Official Records at page 591; thence from
said point of beginning along said westerly line of John Glenn
Drive south 240 28' 42 west 3F.18 feet to a tangent curve to
the left having a radius of 234.36 feet; thence southwesterly
along said curve through a central angle of 190 58' 36", an are
distance of 81.71 feet, to a point from which the radial line
of said tangent curve bears south 850 29' 54" east; thence along
the northwesterly extension of said radial line north 850 29'
5411 west 2+9.01 feet; thence north 240 28' 42" east 518.31 feet
to a point beaming north 650 31' 18" west, 220.00 feet from the
point of beginning; thence south 650 31' 18" east, 220.00 feet
to the point of beginning.
Containing a total area of 2.425 acres of land, more or
less .
RESERVING THEREFROM to the County of Contra Costa, its
successors or assigns, an easement for -utility purposes over,
across, and under two strips of land of the uniform width of
10 feet lying easterly, measured at right angles from the west-
erly line of the above described property and a strip of land
of the uniform width of 10 feet lying westerly, measured at
right angles from the easterly line of the above described prop-
erty, extending from the northerly boundary to the southern
boundary of the above described property.
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EXHIBIT C:
PERFORMANCE AND SERVICE STANDARDS
The following performance and service standards shall apply throughout the term of
the Lease.
1. AERONAUTICAL SERVICES
A. At a minimum, Tenant shall have its hangar and tiedown storage facilities
open and services available twelve (12) hours daily, seven (7) days a
week; Tenant shall have on duty during operating hours sufficient trained
personnel to meet these minimum standards in an efficient manner.
B. In the event Tenant operates an aircraft rental service, Tenant shall
maintain a sufficient number of properly certificated aircraft to adequately
handle the scope of the operation; provided, however,the number of such
available aircraft shall never be less than two (2), at least one (1) of which
shall be equipped for and capable of flight under instrument conditions.
Tenant shall have on duty during operating hours (a minimum of eight (8)
hours a day, six (6) days a week), sufficient trained personnel to meet
these minimum standards in an efficient manner, but never less than one
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(1) person having the .appropriate FAA certificate equal to that required for
operation of the type of aircraft available for rental and instruction.
C. The minimum standard of line service for general aviation aircraft users
shall be one qualified attendant available on the ramp twelve (12) hours a
day, seven (7) days a week, or as determined from time to time by the
Airport. Tenant shall provide aircraft arrival and departure guidance upon
the Premises.
C. The minimum standard for aircraft repair services (airframes, powerplants,
fueling systems, electrical systems, radios, propellers, avionics,
instruments and accessories) shall be to provide a shop, or a combination
of shops, for the repair of one or more of the following: aircraft airframes,
powerplants, radios, propellers, avionics, instruments, and accessories for
general aviation aircraft. This category shall include the sale of new and/or
used aircraft parts, radios, propellers, avionics, instruments and
accessories. Each such shop will be certificated as required by the FAA for
the type of service it will provide.
In providing one or any combination of the services defined above, Tenant
shall have its Premises open and services available at least forty (40)
hours each week, excluding holidays. Tenant shall have on duty during
operating hours sufficient trained personnel to meet these minimum
standards in an efficient manner, but never less than one (1) person,
certificated by the FAA as being qualified to repair aviation radios,
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instruments or propellers, and one (1) other repairman, not necessarily
rated.
E. Tenant shall provide passenger and flight crew ground transportation
services between the Leased Premises and reasonable destinations on the
Airport as.required by users of the Leased Premises.
F. Tenant shall provide twenty-four (24) hour emergency service to disabled
general aviation aircraft on the Airport, including towing or transporting
disabled aircraft to the Leased Premises at the request of the owner or
operator of the aircraft or the Airport.
G. Tenant shall provide such minor repair service, not requiring a certificated
mechanical rating, and cabin services, to general aviation aircraft and other
non-scheduled aircraft as can be performed efficiently on the ramp or other '
apron parking area within the Leased Premises.
H. Tenant shall procure and maintain tools, jacks, towing equipment, tire
repairing equipment, energizers and starters, heaters, fire extinguishers
and other related or required devices as appropriate and necessary for the
servicing of general aviation aircraft and other non-scheduled aircraft using
the Airport. All equipment shall be maintained and operated in accordance
with local and state industrial and safety codes and stored in an orderly
manner.
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2. FUELING
A. Tenant shall have the Leased Premises open for the sole purpose of
aircraft fueling and oil dispensing services up to twelve (12) hours per day,
seven (7) days a week, or as determined by the Airport.
B. Tenant shall provide, at all times, an adequate supply of at least two (2)
grades of fuel which meet the market demand of the general aviation and
other commercial aviation users of the Airport. Tenant shall provide the
fuel supply from fuel transporting vehicles, which conform to all applicable
federal, state, and local laws and regulations.
C. Tenant shall provide metered filter-equipped mobile dispensers for
dispensing the grades of fuel, with separate dispensing pumps and meters
required for each grade of fuel and meeting all applicable safety
requirements, with reliable metering devices subject to independent
inspection, and with a pumping efficiency capable of filling the largest
aircraft likely to be serviced.
D. Only fuel approved by the FAA for the type of aircraft being fueled may be
used.
E. Tenant shall make all fueling facilities and equipment available for
inspection. Additionally, at least two employees shall maintain current
training in fuel handling and quality control.
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3. TRAINING STANDARDS
Training standards shall be developed by Tenant to meet federal, state, and
local requirements. Said requirements shall be submitted to and subject to
review by the Airport.
4. FAILURE TO MEET STANDARDS
A. In the event that any of the foregoing performance or service standards are
not performed by Tenant within fifteen (15) days after receipt of written
notice, the Airport shall have the right to levy a fine on Tenant of$1,000 per
month for each performance or service standard not met.
B. If, after Tenant's receipt of 30 days' written notice, the foregoing
performance standards are still not met, Tenant shall be considered in
default of the Lease and Airport shall have the right to terminate this Lease
upon written notice of termination, in which event this Lease shall terminate
on the date set forth in the notice.
6
CONSENT TO.ASSIGNMENT OF LEASE
This Consent to Assignment of Lease is executed and delivered as of this—day of ,
2006(the "Agreement'),and is made by and between the County of Contra Costa,a political subdivision
of the State of California(`Lessor'),Gregory E.Holbrook("Assignee'),and Pacific States Aviation,
Inc. ("Assignor').
RECITALS:
WHEREAS,Lessor is the lessor under that certain Amended and Restated Lease,dated ,
2006(the "Lease"),between Lessor and Assignor,relating to certain real property located at 51 John
Glenn Drive, Concord, California and more specifically described therein;
WHEREAS,the shareholders of Assignor desire to sell their majority shares in Assignor to
Gregory E.Holbrook ("Assignee"),who will become the majority shareholder ofAssignor,and under
the terms of the Lease, such a transaction(the "Assignment"),constitutes an assignment of the Lease;
WHEREAS,Section 29 of the Lease requires that Assignor receive Lessor's written consent to
the Assignment of its interest in the Lease; and
NOW THEREFORE,Lessor,Assignee and Assignor agree as follows:
AGREEMENT
In consideration of good and valuable consideration,the receipt and legal sufficiency ofwhich are
hereby acknowledged,Lessor,Assignor and Assignee hereby confirms and agrees as follows:
A. Transaction Fee. Assignor hereby agrees to pay to Lessor the Transaction Fee provided
forpursuant to Section 10 of the Lease,in the amount of Two Thousand Five Hundred
Dollars($2,500.00),and such payment is a conditionprecedentto the effectiveness ofthis
Agreement.
B. Representations and Warranties of Assignor and Assignee.
Each of Assignor and Assignee represent and warrant that:
1. Assignee's intended use of the Premises(as such tennis defined in the Lease),is
the same as the Assignor's historical use ofthe,Premises and is not inconsistent
with the use permitted under the Lease and will not require alteration of the
Premises;
2. Assignee has a good reputation in the business cormnunity in which he has
conducted his businesses and his business reputation and business credit history
is consistent with other business conducted at the Premises;
3. Assignee's intended use oftlie Premises will not increase the hazardous substance
liability to the Premises and will not otherwise adversely affect the Lessor's interest
in the Premises;
4. Assignee is capable of operating a Fixed Based Operator business as
contemplated by the terms of the Lease and has business experience and
management ability that is equal to or greater than that of Assignor;
5. Assignee's financial condition is sufficient to support the obligations ofLessee
under the Lease and any encumbrances secured by the Lease;
6. The Assignment will not result in a reduction in the Rent paid under the Lease;and
7. Assignor and Assignee have the legal right and authority to enter into this
Agreement and each have received all necessary approvals to do so.
C. Consent of Lessor.
1. Lessor is entering into this Agreement and consenting to the Assignment in
reliance on the representations and warranties of Assignor and Assignee set forth
in Section A hereof.
Z. Lessor hereby consents to the Assignment and conveyance ofAssignor's interest
in, to and under the Lease and of the Premises to Assignee.
3. This Agreement does not act to amend the Lease. In the event there is any
confusion or contradictionbetween anyterm of the Lease and this Agreement,the
terms of the Lease shall prevail.
4.. Any dispute involving the interpretation or enforcement of this Agreement shall be
decided under the laws of the State of California,with venue in the Superior Court
of the County of Contra Costa,California. This Agreement maybe executed in
any number of counterparts which,when taken together,shall be deemed to be
one document.
5. The provisions ofthis Agreement shall survive both the execution and delivery of
this Consent.
6. The notice provisions of the Lease shall remain unchanged.
D. Signatures.
LESSOR ASSIGNOR
CONTRA COSTA COUNTY,a political Pacific States Aviation, Inc.
subdivision of the State of California
By: By:
Maurice M. Shiu [Maureen Bell]
Public Works Director President
By:
Secretary
RECOMMENDED FOR APPROVAL:
By
Keith Freitas
Director of Airports ASSIGNEE
By By
David Silva Gregory E. Holbrook
Senior Real Property Agent
APPROVED AS TO FORM:
Silvano B.Marchesi,
County Counsel
By
Eric S. Gelston
Deputy County Counsel