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Res 1185 5/18/1971RESOLUTION NO. ///fr WHEREAS , on May 6 , 1969 , the City of Wichita Falls , Texas and Charles E . King entered into a Fixed Base Operator 's Agreement and Aircraft Fuel Servicing Contract , in which the City leased to King certain premises at Municipal Airport ; and, WHEREAS , such agreement provides that King cannot assign the agreement without the written consent of City ; and, WHEREAS , Charles E . King has requested permission from the City to transfer such agreement and lease and all its rights thereunder to King Flight Services , Inc. or for the City to cancel such lease with no penalty and issue a new lease to King Flight Services , Inc. in accordance with an agreement for sale which has been executed by King and Southern Aviation , Inc. , whereby Southern Aviation , Inc . is purchasing all of the shares of King Flight Services , Inc. NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF ALDERMEN OF THE CITY OF WICHITA FALLS , TEXAS, THAT : Consent is hereby granted to the transfer by Charles E . King to King Flight Services , Inc. of the above described contract and lease and all rights thereunder and the City Manager is authorized to execute with Charles E . King a mutual release of all obligations under such contract . p PASSED AND APPROVED THIS the /0 day of May , 1971 . MAY O R ATTEST : death. City Clerk FIXED BASE OPERATOR' S AGREEMENT AND AIRCRAFT FUEL SERVICING CONTRACT THE STATE OF TEXAS § KNOW ALL MEN BY THESE PRESENTS : COUNTY OF WICHITA THIS AGREEMENT, made and entered into this the day of 1971, and made effective as of the day of May, 1971, by and between the City of Wichita Falls, Texas, hereinafter called CITY and Southern Aviation, Inc. , hereinafter called LESSEE. W I T N E S S E T H: WHEREAS, under date of July 20, 1959, the Secretary of the Air Force executed a lease (known as Contract DA-41-443-ENG-5551) to the CITY as Lessee, for Municipal Airport purposes, on a tract of land in Wichita County, Texas, containing 50.73 acres, more or less, together with the Terminal Building located thereon, a copy of which is attached hereto and marked EXHIBIT A; and, WHEREAS, CITY owns certain buildings, structures, and other facilities on said tract of land, and operates thereon a public airport known as Wichita Falls Municipal Airport, said premises hereinafter called Airport; and, WHEREAS, CITY is desirous of leasing to LESSEE certain premises hereinafter more fully described and located on said Air- port, and the right to engage in Aircraft Engine, Airframe, Instru- ment, and Radio Repair, the sale and renting of aircraft, the sale of aircraft parts and accessories, flight instruction (subject to restrictions thereon in the Air Force Lease referred to above) , storage of aircraft, Charter and Air Taxi Service, and the operation of an Aircraft Fuel Servicing Concession; and, WHEREAS, LESSEE desires to lease said property and rights from CITY on and at said Airport. NOW, THEREFORE, for and in consideration of the rent, covenants and agreements herein contained, City does hereby lease, demise, grant and let to LESSEE, and LESSEE does hereby hire, take and lease from CITY the following described premises on the herein- after set out terms and conditions, to wit: ARTICLE I : Leased Areas CITY does hereby grant, demise and lease unto LESSEE the following described premises at said Airport with respect to which Lessee is to have for the term of this lease the exclusive use except lobby space) of said premises described as follows : Administration Building (See Exhibit C attached) : Office Space containing 1, 125 square feet at $2 .00 sq. ft. yearly Lobby Space containing 1, 500 square feet at $0.45 sq. ft. yearly Hangars/Fuel Facilities (See Exhibit B attached) : Hangar No. 1 (170 feet wide by 105 feet deep, less 425 sq. ft. in Northwest corner which is leased to the Government, for a total of 17 ,425 sq. ft. ) Ground Floor: 17 ,425 sq.ft. at $0.35 sq.ft. yearly Upstairs,North Portion: 1,282 sq. ft. at $0. 30 sq.ft. yearly Upstairs,South Portion: 720 sq.ft. at $0. 20 sq.ft. yearly Hangar No. 2 (229 feet wide by 105 feet deep) 24,045 sq. ft. at 0. 31 sq. ft. yearly. Hangar No. 3: (120 feet wide by 125 feet deep) 15, 000 sq. ft. at 0 . 31 sq. ft. yearly. Bulk Fuel Storage Facilities: Including fuel tanks, pumps, motors, valves, lines and loading dock: $500.00 yearly. ARTICLE II : Term The term of this lease shall be for a period of ten (10) years , commencing on the first day of May, 1971, and ending on the 30th day of April, 1981. Beginning sixty (60) days prior to the end of such term, CITY and LESSEE agree to negotiate in good faith concerning the possible renewal of such lease for a ten (10) year 2- term, subject to adjustment of such rates, rentals and fees as the parties deem appropriate. It is understood that Lessee shall have no option to renew, and that City shall have the right not to renew this lease for cause, but that City does hereby contract that a good faith attempt will be made to renegotiate a renewal of this lease, subject to the adjustments above mentioned for another ten year term provided that the Lessee, during the term of this lease,had demonstrated that it has fully carried out the terms of this lease and has theretofore provided quality service to its customers and the public. The provisions of said lease shall be subject to upward adjustment of rates and fees not to exceed two 2%) percent, at three-year intervals during the term of the lease, which upward adjustment shall be made in the discretion of the City acting in good faith. ARTICLE III: Rental. LESSEE agrees to pay CITY far the use of the above described premises, rights and easements herein provided for an annual rental of $22, 156.30, which rental shall be payable in monthly payments of $1,846. 36 per month for each month during the term of the lease hereunder, the first payment to be made on or before the 15th day of May, 1971 and successive payments to be made on or before the 15th 'day of each succeeding month thereafter for which rental is due hereunder. In addition to the above rental payments, LESSEE further covenants and agrees to pay the following fuelfees to CITY on or before the 15th day of each month: a. A fuel flowage fee which applies to all aircraft fuel sold by LESSEE (except such fuel as is actually delivered by LESSEE 3- L to regularly scheduled commercial airlines operating under contract with CITY, to certificated air carrier aircraft and the first two thousand (2 , 000) gallons of fuel per month used in LESSEE' s business aircraft) based on the following schedule: For each gallon sold by or delivered by LESSEE during the previous calendar month: three and one-half (3-1/2) cents per gallon for the first three hundred thousand (300, 000) gallons sold during the lease year; three (3) cents per gallon for the next two hundred thousand (200, 000) gallons sold during the lease year; two and one-half (2-1/2) cents per gallon for all fuel in excess of five hundred thousand (500,000) gallons sold during the lease year, and b. A fuel flowage fee which applies to all aircraft fuel sold by LESSEE to certificated air carrier aircraft which operate without contract with CITY. one-half (1/2) cent per gallon delivered during the first year of this lease; one (1) cent per gallon delivered during the second year of this lease; one and one-half (1-1/2) cent per gallon delivered during the third year of this lease and thereafter for the term of said lease. ARTICLE IV: Records LESSEE agrees that it will instruct all of its aircraft fuel suppliers to promptly furnish a duplicate copy of all invoices and delivery receipts or to render other appropriate monthly account- ing to the CITY. LESSEE further agrees to maintain adequate books 4- of account and records satisfactory to CITY showing, at all times, the number of gallons of aircraft fuel delivered to and sold by LESSEE during any calendar month. Such records shall be open to inspection and audit by the Airport Manager or other duly authorized representative of the CITY. ARTICLE V. Rights and Privileges LESSEE shall have: a. The right and obligation to install, operate, main- tain, repair and store, subject to approval of CITY, equipment necessary for the conduct of LESSEE' s business. b. The right of ingress to and egress from the leased premises, which right shall extend to LESSEE ' s employees, passengers, guests, invitees, patrons and suppliers. c . The right, in common with others so authorized, to use all areas of the Public Ramp so long as such use does not inter- fere with other operations at the Airport, and the right of use, in common with others, of taxiways, roadways, floodlights and other conveniences for the takeoff, flying, landing and taxiing of" Lessee' s aircraft. Except upon further contractual authorization from City, Lessee shall make no charge to any aircraft for using the ramp, provided that it can make a reasonable charge for its services for tiedown or blocking of aircraft, and such revenue shall be the pro- perty of LESSEE. LESSEE further agrees that in return for such privilege it shall sweep, clean and keep ramp areas presentable at all times without charge to the CITY. CITY reserves the right, but shall not be obligated to LESSEE, to maintain and keep in repair the Ramp Area and all publicly operated facilities of the Airport, together with the right to direct and control all activities of LESSEE in these areas . 5- d. The right, so long as it conducts its business in afair, reasonable and workmanlike manner, to peaceably have and enjoy the leased premises, and all the rights and privileges herein granted. e. The right and obligation in and on the leased pre- mises to locate, maintain and operate full aircraft servicing facilities ; to sell aircraft, engines accessories and parts; to provide storage space for aircraft; to provide airframe, engine, instrument, and radio repair shops within 6 months after the date hereof; to operate air taxi and sightseeing service; to operate a charter transportation of passengers; and to operate a Flight School (subject to the restrictions contained in the lease from the Secretary of the Air Force) . f. The right, without obligation, to operate aerial survey, photography and mapping services . The operations of LESSEE shall be subject to all appro- priate laws of the Federal Government, the State of Texas, the Ordinances of the City, the requirements of the Federal Aviation Administration or any other duly authorized governmental agency as they now exist or may subsequently be amended. LESSEE understands this instrument defines fully the scope of privileges extended to it and is not to be construed as a lease authorizing additional privileges. LESSEE may conduct other activities which are reasonably necessary to the proper conduct and operation by LESSEE of the principal business authorized above, however, it is specifically understood that this provision does not authorize the conduct of a separate business of any kind, type or description. 6- ARTICLE VI: Hangar Rentals LESSEE shall have the right to rent hangar spaces on a month to month rental basis throughout the period of this con- tract and to receive all rentals for the same, provided the CITY retains the right to review said rental rates to determine unjust discrimination and/or if rate charges are comparable to rates charged for like facilities at other airports. ARTICLE VII: Operations Within Leased Area LESSEE agrees that except as may be otherwise provided in other contracts entered into between LESSEE and CITY, it will not engage nor permit the engagement by any persons on the premises here leased, in any business other than that which is expressly authorized herein. ARTICLE VIII : Administration Building Lobby It is understood by the parties hereto that certain office space in the Administration Building is leased to others (presently governmental agencies) and that such space is not included in this lease. Such tenants shall have the right of ingress and egress through the Lobby and the right to use the rest rooms in the north- east corner of the building. LESSEE hereby covenants and agrees that it will keep the premises in a neat, clean and sightly condi- tion and provide custodial and window washing services to its leased area, including the Lobby and Rest Rooms. ARTICLE IX: Inspection of Premises LESSEE represents that it has inspected the Airport premises and facilities together with the premises herein leased and that it accepts the conditions of the same and fully assumes all risks incident to the use thereof. CITY shall not be liable 7- to LESSEE for any damages or injuries to the property or person of LESSEE which may result from hidden, latent, or other dangerous conditions on the leased premises or the Airport. ARTICLE X: Inventory At the commencement and termination of this agreement, an inventory and condition survey shall be made by CITY' s Airport Manager and a representative of LESSEE on forms to be furnished by CITY which shall show a complete inventory of the premises and property belonging to, or under control of CITY and to be used by LESSEE and LESSEE agrees to fully account for all such property placed upon or used in connection with this lease. All property belonging to CITY shall be returned to CITY in as good condition as received, reasonable wear and tear excepted. ARTICLE XI : Maintenance LESSEE shall, during the term of this lease, maintain at its own expense all buildings, structures and improvements on the leased premises in good order and repair, and shall make at its own expense such repairs as are necessary. This lease shall be a net lease, and, except as herein specifically provided, the use and occupancy of the demised premises of LESSEE shall be without cost or expense to CITY. It shall be the sole responsibility of LESSEE to keep, maintain, repair, (including repainting exterior and interior surfaces as required) and operate the entirety of those premises and facilities leased hereunder and all improvements and facilities thereon on LESSEE ' S sole cost and expense except that the Administration Building air conditioning system shall be main- tained by CITY. 8- LESSEE shall share equally with CITY the cost of electricity for the Administration Building. LESSEE shall addi- tionally share equally with CITY the cost of natural gas servicetn the Administration Building and LESSEE shall bear sole cost for natural gas service to the Hangar Areas. LESSEE shall not make or permit any additions, improve- ments or alterations to the property which constitute any structural change or changes without prior written consent of CITY. The request for such consent shall be in writing and shall have plans of the proposed changes attached. Any additions or improvements made with consent of the CITY shall be solely at the expense of LESSEE and, unless such consent provides otherwise, title to the addition or improvement shall at all times remain in CITY and such additions and improvements shall be subject to all terms and conditions of this instrument. LESSEE agrees to hold the CITY harmless from mechanic' s and materialman' s liens arising from any additions, improvements, repairs or alterations effected by the LESSEE. ARTICLE XII : Advertising/Signs/Obstruction Lights LESSEE shall not maintain upon the outside of the pre- mises demised or on any improvements thereto any billboards or advertising signs; provided, however, that LESSEE may maintain on the outside of said buildings its name on signs, the size, location and design of which shall be subject to the prior written approval of CITY. LESSEE agrees to maintain and operate proper obstruction lights on top of all buildings herein leased and keep the same lighted from sunset to sunrise. ARTICLE XIII : Exclusive Rights It is understood and agreed that nothing herein contained shall be construed to grant or authorize the granting of an exclu- sive right, except that LESSEE has the exclusive right to use the r. premises herein leased except as otherwise provided in Article VIII. It is further understood between the parties that CITY retains the privilege of entering into other agreements which might authorize the commercial use of Airport facilities upon terms similar to those extended to LESSEE. ARTICLE XIV: Minimum Standards LESSEE agrees to operate the leased premises for the use and benefit of the public; to make available all airport faci- lities and services to the public without unjust discrimination and to refrain from imposing or levying excessive, discriminatory, or otherwise unreasonable charges or fees for any use of the airport or its facilities or forany airport service, provided that LESSEE may make reasonable and non-discriminatory discounts, rebates and other similar types of price reductions to volume purchasers. All services to be rendered by LESSEE hereunder shall be provided to the highest standards. LESSEE agrees to furnish to CITY copies of all contracts entered into by it with other parties concerning the use of the premises herein leased. LESSEE further agrees to comply with the following minimum standards in the conduct of its operation: a. Charter/Air Taxi: LESSEE shall provide not less than one (1) single-engine four-place aircraft and one (1) multi-engine aircraft, both of which must meet the requirements of the air taxi certificate held by the LESSEE, including instrument operations, and shall have in its employ and on duty at least eight hours daily, six days per week, at least one (1) FAA certificated commercial pilot and otherwise appropriately rated to permit the flight activity offered by the LESSEE. 10- b. Rental: LESSEE shall provide, for rental to the public, not less than two (2) certificated and currently airworthy aircraft, at least one of which must be a four-place aircraft, and at least one of which must be equipped for and capable of flight under instrument conditions, at least eight hours daily, six days a week. c . Flight Instruction: LESSEE shall have available for use in flight training not less than two properly certificated air- craft, at least one of which must be a four-place aircraft and at least one of which must be equipped for and capable of use in instrument flight instruction; Lessee must have at least two (2) properly certificated flight instructors employed, one of whom must be employed on a full-time basis; LESSEE shall provide properly certificated ground school instructors to provide required ground school training preparatory to taking written examinations; and LESSEE shall make actual flight instruction available at least eight hours daily, six days a week. d. Aircraft Sales : LESSEE shall have available or on call at least one single-engine demonstrator aircraft eight hours daily, five days a week; LESSEE shall provide necessary and satis- factory arrangements for repair and servicing of aircraft sold or leased by it for duration of guarantee or warranty period, and shall have available for such service at least one person having a current commercial pilot certificate with single-engine land rating. e. Airframe/Powerplant Repair: LESSEE shall provide sufficient equipment, supplies and availability of parts to be located on the premises, required for certification of LESSEE by the Federal Aviation Administration as an approved repair station, 11- shall have in its employ and on duty at least eight hours daily on Monday through Friday and at least four hours on Saturday a minimum of two persons, at least one of whom will be currently certi- ficated by the FAA with airframe, powerplant or inspector rating. f. Radio Repair: LESSEE shall have in his employ and on duty eight hours daily, five days each week and one-half day on Saturday, at least two persons, one of whom is currently rated as a radio repairmen, and to maintain sufficient supplies, equipment and parts on premises to perform maintenance to standard aircraft radio and electronic equipment. g. Aircraft Fuels and Oil Dispensing Service: LESSEE shall provide servicing capabilities for dispensing Aviation Jet Fuel and at least one type of Avgas, shall perform all services in conformance with the National Fire Protection Pamphlet on Aircraft Refueling, and shall have its premises open for service twenty-four hours a day, seven days a week. CITY covenants and agrees that all operators permitted to perform such aeronautical services at the Airport shall be required to conform to standards similar to those enumerated above. ARTICT,F XV: Lessee' s Employees It is understood that all persons employed or otherwise hired by LESSEE in the operation of LESSEE' s business shall be the employees of, or agents of, LESSEE and not of CITY. ARTICLE XVI; Indemnification: LESSEE shall be solely responsible for the conduct of its operators, agents, employees and representatives, and agrees to indemnify, defend, hold and save the CITY, its authorized agents, officers, representatives and employees, harmless from each and 12- every claim and demand of whatever nature, and against any and all penalties, liability and annoyance or loss, resulting from claims or court action of any nature claimed to have arisen directly or indirectly out of acts of LESSEE or its agents, servants, guests, employees or business visitors under this agreement or by reason of any act, omission or conduct of such person. ARTICLE XVII: Insurance LESSEE agrees to maintain during the term of this agree- ment at its own expense, standard form policies of insurance covering the leased premises, fueling operations and contents and which shall cover any and all damages which may result thereto from fire and extended coverage hazards, except on the Administration Building, which shall be insured by CITY. The Fire and extended coverage shall be in an amount equal to 80% of the replacement cost value. In addition thereto, LESSEE shall secure Public Liability and Pro- perty Damage insurance, including Product Liability insurance, in which the City shall be named a joint assured with LESSEE. Such policies of insurance shall protect CITY and LESSEE against any and all liability for death, injury, loss or damage against which LESSEE has elsewhere in this agreement undertaken to save and hold the CITY, and its authorized agents, officers, representatives and employees harmless from and against any and all penalties, liability and annoyance and loss resulting from claims or court action of any nature and arising directly or indirectly out of the acts of LESSEE, its agents, servants, guests, employees, business visitors or others under this agreement or by result of any act or omission of such per- sons. Such policies shall be placed with a company authorized to do 13- business in the State of Texas and shall have not less than the following limits : Comprehensive Public Liability (including Products Liability) for Bodily Injury (each accident) $100, 000 each person/300,000 each accident. . Property Damage $300,000 each accident. Aircraft Liability Bodily Injury (each accident) $100,000 each person/ 300, 000 each accident. Passenger Liability $100, 000 each passenger. Property Damage $300,000 each accident. Student/Renters Liability: $100,000 each accident. Hangar Keeper' s Liability: $100, 000 each accident. Motor Vehicle Liability: Bodily Injury (each accident) $100,000 each person/300,000 each accident. Property Damage (each accident) $300,000 each accident. The amounts of said insurance shall not be deemed a limitation of LESSEE' s agreement to save and hold the CITY harmless and if LESSEE becomes liable for an amount in excess of the insurance LESSEE will save and hold the CITY harmless as the holder thereof. Copies of all such policies of insurance shall be delivered to CITY. ARTICLE XVIII : Taxes, Assessments LESSEE agrees to properly pay all lawful taxes, assess- ments or charges which during the term hereof may become a lien or be levied by the State, County or City or other tax levying body upon any interest of LESSEE or possessory right which LESSEE may have in or to said premises and/or the improvements thereon by reason of its use or occupancy. 14- ARTICLE XIX: Performance Bond Prior to commencement of this lease, LESSEE shall deliver to CITY a contract Performance Bond with a surety satisfactory to the CITY in the amount of Ten Thousand ($10,000) Dollars, conditioned on the full and faithful performance of all the terms, conditions and covenants of this lease. Said bond shall be renewable annually and shall be kept in full force and effect for the complete term of this lease. At LESSEE' s option, in lieu of said performance bond, LESSEE may deposit with CITY securities acceptable and payable to CITY in an amount equal to one year' s rental. The income from such securities shall be payable to LESSEE. ARTICLE XX: City Agent CITY hereby designates its Airport Manager, as well as its City Manager and such official as he may designate, as its official representative, with the full power to represent CITY in all dealings with LESSEE in connection with the premises herein leased. ARTICLE XXI : Compliance with Rules and Regulations LESSEE agrees to comply with all applicable laws, rules, regulations and ordinancss now in effect or hereinafter enacted. LESSEE recognizes that the Airport Manager is the representative of CITY, and agrees to cooperate fully with such official to promote the efficient conduct of Airport operations. ARTICLE XXII: Inspection CITY reserves the right to enter upon the leased pre- mises at any reasonable time for the purpose of making any inspection it may deem expedient to the proper enforcement of any of the covenants or conditions of this agreement. 15- ARTICLE XXIII : Zoning Against Obstructions CITY reserves the right to take any action it considers necessary to protect the aerial approaches of the Airport against obstruction, together with the right to prevent LESSEE from erect- ing, or permitting to be erected, any building or other structure on the Airport which, in the opinion of the CITY would limit the useful- ness of the Airport or constitute a hazard to aircraft. ARTICLE XXIV: Airport Closure During any period when the Airport shall be closed by any lawful authority restricting the use of the Airport in such a manner as to interfere with the use of same by LESSEE for its busi- ness operations , the rent shall abate and the period of such closure shall be added to the term of this lease so as to extend and post- pone the expiration thereof. There shall be no obligation on the CITY to furnish an auxiliary Field in case free use of the Airport is curtailed to the LESSEE. ARTICLE XXV: Right to Improvement CITY reserves the right to further develop or improve the Airport as it sees fit, regardless of the desires or view of LESSEE, and without interference or hindrance. ARTICLE XXVI : Wartime or National Emergency During time of war or national emergency, CITY shall have the right to return the Airport or any part thereof to the United States Government for military or naval use and, if such right is executed, the provisions of this lease, insofar as they are inconsistent with the provisions of such agreement with the Government, shall be terminated. 16- ARTICLE XXVII: Subordination Clause This lease shall be subordinate to the provisions of any existing or future agreement between CITY and the United States relative to the operation or maintenance of the Airport, the execution of which has been or may be required as a condition pre- cedent to the expenditure of Federal Funds for the development of the Airport. LESSEE agrees that it is familiar with Contract 41-443-ENG-5551, which is the lease on the Airport and Terminal Building, executed by the Secretary of the Air Force on July 20, 1959, and the CITY on August 12 , 1959, and which is recorded in Volume 774, page 89, Deed Records of Wichita County, Texas, a copy of which is attached, marked Exhibit A. It is specifically under- stood and agreed by the parties hereto that this lease from CITY to LESSEE is subordinate to and subject to the terms of such con- tract between the Secretary of the Air Force and the CITY. ARTICLE XXVIII; Cessation of Operations LESSEE shall, in case of fire or other casualty, give immediate notice in writing to CITY who shall thereupon cause the damage to be repaired as soon as practicable consistent with con- tractual provisions with casualty insurance policies, provided materials, supplies and labor are reasonably available; if any portion of the premises is rendered unfit for occupancy, the rent shall be apportioned for the period of time required to make the repairs, according to the part of the premises, if any, which remains usable by LESSEE. If the majority of the leased area is destroyed, then within thirty (30) days after the fire or other casualty, either LESSEE or CITY may cancel this lease by notice in writing to the other, effective as of the date of the mailing 17- of the written notice, except that the rent shall be apportioned as of the date of the fire or other casualty. ARTICLE XXIX: Assignment LESSEE shall not assign or transfer this agreement nor any privileges hereunder and shall not assign or sublet or mortgage all or any part of the premises leased hereby, whether voluntarily or involuntarily, without the prior written consent of the CITY. If LESSEE, without securing prior written approval of CITY, attempts to effect such a transfer, assignment, sublease or mortgage, or if a transfer occurs by operation of law, CITY may terminate this agree- ment upon written notice to LESSEE. Although LESSEE is a private corporation, CITY has entered into this lease in reliance on the continuation of the control and management of LESSEE by its present shareholders, whose names and proportionate ownership of shares are shown on Exhibit D, which is attached hereto. If control of Lessee corporation is transferred to other parties by virtue of the sale of stock, without the prior written consent of CITY, this shall be considered an assignment of the lease, and CITY may terminate this agreement upon written notice to LESSEE. ARTICLE XXX: Suspension/Termination LESSEE understands and agrees that all rights, privileges and interests acquired herein, following written notice of sixty (60) days, may be altered or finally terminated upon payment of just compensation to LESSEE, if such suspension or termination is found by CITY, acting in good faith, to be necessary to secure Federal financial aid for the development of the Airport. 18- Should LESSEE fail to pay the rent due hereunder within fifteen (15) days after same shall become due, or permit any insur- ance coverage required under this agreement to lapse, CITY shall have the option, without any legal proceedings or notice, to declare this lease terminated, cancel the same and re-enter and take possession of the premises, and in such event, LESSEE agrees to deliver possession of the same peaceably and relinquish all rights incident thereto. CITY shall have the right, but not the obligation, to terminate this Agreement in its entirety immediately upon the happening of any of the following events: a. Filing of a petition, voluntarily or involuntarily, for adjudication of LESSEE as a bankrupt, b. The making by Lessee of any general assignment for the benefit of creditors, c. The failure by LESSEE to perform, keep and observe any and all of the terms, covenants, and conditions herein contained on the part of the LESSEE to be performed, kept, or observed after the expiration of fifteen (15) days from the date written notice has been given to LESSEE by CITY to correct such default or breach except, however, failure of LESSEE to provide insurance as required herein will give CITY the right to terminate this lease immediately without the necessity of giving LESSEE 15 days written notice) . No waiver by CITY at any time of any of the terms, con- ditions, or covenants of this Agreement shall be deemed or taken as a waiver at any time thereafter of the same, or of any other terms, conditions, or covenants herein contained, nor of the strict and prompt performance thereof by LESSEE. 19- LESSEE may cancel this Agreement and terminate all or any of its obligations hereunder at any time that it is not in default to CITY hereunder, by giving CITY sixty (60) days advance written notice to be served as hereinafter provided, but such right of LESSEE to terminate is allowed only in the event of default by CITY in the performance of any covenant or agreement herein required to be performed by CITY and the failure of CITY to remedy such default for a period of sixty (60) days after receipt of written notice to remedy same. No waiver of default by LESSEE of any of the terms, covenants or conditions hereof to be performed, kept, and observed by CITY shall be construed to be or act as a waiver by LESSEE of any subsequent default of any of the terms, covenants, and conditions herein contained to be performed, kept and observed by CITY. ARTICLE XXXI: Notification Notice to CITY as herein provided shall be sufficient if written notice is served in person or otherwise sent by regis- tered mail to Airport Manager, Wichita Falls Municipal Airport, Route 4, Box 72-E, Wichita Falls, Texas, or to LESSEE if written notice is served in person to its General Manager at the Airport or otherwise sent by registered mail to Southern Aviation, Inc. , Lawton Municipal Airport, Lawton, Oklahoma, or at such other places as parties may designate in writing. ARTICLE XXXII: Headings The article and paragraph headings are inserted only as a matter of convenience and for reference and in no way define, limit or describe the scope or intent of any provisions of this lease. ARTICLE XXXIII: Invalid Provision It is further expressly understood and agreed by and between the parties hereto that in the event any covenant, condition or provision herein contained is held to be invalid by any court of competent jurisdiction, the invalidity of any such covenant, condition or provision shall in no way affect any other covenants, conditions or provisions herein contained; provided however, that the invalidity of any such covenant, condition or pro- vision shall not be construed so as to materially prejudice either CITY or the LESSEE in their respective rights and obligations con- tained in the valid covenants, conditions or provisions in this agreement. ARTICLE XXXIV: It is agreed and understood by the parties that this contract supersedes and constitutes a complete termination of the Fixed Base Operator' s Agreement and Aircraft Fuel Servicing Con- tract entered into on May 6, 1969, except that CITY reserves such rights as it has under such instrument. That certain T-Hangar ground lease dated April 15, 1965, between the City of Wichita Falls as Lessor and Charles E. King as Lessee, as amended by that certain supplemental agreement effective October 1, 1966, has been assigned to LESSEE herein, and LESSEE is hereby recognized as the holder of said T-Hangar Ground Lease, as amended, and said T-Hangar Ground Lease, as amended, is still in full force and effect and CITY shall retain and reserve all its rights and privileges under such T-Hangar Ground Lease as if fully set forth herein. It is understood by both parties hereto that, by instru- ment dated March 30, 1967, Charles E. King and King Flight Services, Inc. executed a conditional assignment to Humble Oil and Refining Company covering all rights and interests of the assignors in certain leases on the Airport property; although the Fixed Base 21- Operator' s Agreement and the Aircraft Fuel Servicing Contract which were mentioned in such conditional assignment have been heretofore superseded, this lease is made subject to the rights, if any, that Humble Oil and Refining Company may now own by virtue of such conditional assignment, and CITY reserves all rights it has arising out of the instruments creating any security interest in Humble Oil and Refining Company. LESSEE is authorized to execute a conditional assignment to Southern Aviation, Inc. of all its rights under this agreement, which will be junior to said conditional assignment held by Humble Oil and Refining Company. A copy of such conditional assignment to Southern Aviation, Inc. must be submitted to CITY for approval. LESSEE covenants and agrees that, no later than January 1, 1972, LESSEE will merge with Southern Aviation, Inc. and Southern Aviation, Inc. shall become the Lessee on this contract. Southern Aviation, Inc. guarantees the performance of all of the obligations and covenants imposed on LESSEE in this agreement. IN WITNESS WHEREOF, the parties have caused this agreement to be executed as of the day and year first above written. CITY OF WICHITA FALLS ATTEST: By Gerald G. Fox, City Manager Wilma J. Thomas, City Clerk KING FLIGHT SERVICES, INC. ATTEST: By President Secretary SOUTHERN AVIATION, INC. ATTEST: By President Secrerary 22-