HomeMy WebLinkAbout2017-073 Agrmt - Skinner Aviation - Operator Lease
FIXED BASE OPERATOR LEASE AGREEMENT
FOR THE ASHLAND MUNICIPAL AIRPORT
This FIXED BASE OPERATOR LEASE AGREEMENT FOR THE ASHLAND
MUNICIPAL AIRPORT ("Lease"), effective May 15, 2017 ("Effective Date") is between THE
CITY OF ASHLAND, a municipality of the State of Oregon and Skinner Aviation Inc.
(collectively "parties").
RECITALS
A. The City of Ashland ("City") is the owner of the Ashland Municipal Airport ("Airport).
B. Skinner Aviation Inc. ("Lessee") desires to lease a portion of the Airport for the purposes
described below.
C. The Lease was made as a result of a Request for Proposals (RFP) issued by City in 2013
entitled "Request for Proposals for a Fixed Base Operator, Ashland Oregon Municipal
Airport" and any addenda issued by City. Lessee submitted a proposal in response to the
RFP on May 28, 2013,
NOW, THEREFORE, intending to be legally bound by the terms and conditions of this
Lease,. the parties agree as follows.
1. Agreement to Lease. In consideration of the rent to be paid and the covenants to be
performed by Lessee under this Lease, City hereby agrees to lease the Premises, as defined
below, to Lessee, and Lessee agrees to lease the Premises on the terms and conditions set
forth in this Lease.
2. Premises. City, as owner of the Airport, leases to Lessee the real property and improvements
("Premises") listed below and shown on the attached Exhibit "A" for limited aviation use as
described in the most current version of the "Minimum Standards at the Ashland Municipal
Airport" adopted by the Ashland Airport Commission:
(a) FBO site of 63,740 square feet
(b) FBO OfficelTerminal Building: 1762 square feet building
(c) FBO Maintenance Hangar/Building: 6385 square feet building
(d) 8 tiedown sites
(e) 5 parking spaces for rental cars in the common parking lot, along with ingress and egress,
as more particularly shown on the map attached as Exhibit A
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Aircraft fueling facility, including storage tanks, pumping system and card lock
eauipmellt.
(g) Super UNICOM radio
The term "Premises" includes structures located on subject real property and any structures
constructed on the subject real property for use during the term of the Lease. Except for fixtures
affixed to or otherwise incorporated into said structures, the term "Premises" excludes Lessee's
personal property.
3. Term. The initial term of this Lease is for five years, commencing February 1, 2018 and
continuing until expiration on January 31, 2023, unless sooner terminated under the
provisions of this Lease by giving 180 days advance notice.
4. Periodic Review. The parties will review the terms and conditions of the lease prior to start
of each successive term. Any changes recommended through an amendment will be reviewed
by the Airport Commission and a recommendation will be forwarded to staff and City
Council. Review will include exhibits B, C and D.
5. Lease Extensions. This Lease for up to six (6) additional five (5) year terms after the initial
term as follows:
(a) Provided no material breach is existing or continuing in the performance of any of the
provisions of this Lease, at the conclusion of the initial term or any of the first three
potential renewal terms, the Lease shall be deemed to be renewed for a period of five
years from the date of expiration of the preceding term without the execution of any
further instrument unless Lessee notifies City in writing at least 180 days prior to the
expiration of any current term that Lessee declines to extend the Lease.
(b) Provided Lessee submits a written renewal request to the City at least 180 days prior to
the expiration ofthe fourth renewal term and at least I80 days prior to the expiration of
any fifth renewal term, the Lease maybe extended for an additional five (5) year term by
written mutual agreement of the parties.
(c) The term of this Lease with extensions may not be exceed 35 years, except for any short
term extensions required to complete an appropriate public contracting process to
establish a new lease.
(d) Any renewal term shall be on the same terms, covenants and conditions as provided in
this Lease, except for minor modifications mutually agreed upon in writing by the parties.
6. Rent Pa~nents to City. Lessee agrees to pay to City from the Effective Date until
termination of this Lease the following sums and amounts:
(a) Base Rent. Lessee shall pay to City as a base lease fee ("Base Rent"). The base rent shall
be calculated using current facility square footage, including terminal building and
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maintenance hangar and shall be based on the current ground lease rate approved by City
Council. Base Rent shall be paid on February 20, 2018 for the first month of this Lease
and on the 20r~' day of each month thereafter until termination of the Lease. All other
sums which become payable by Lessee under this Lease shall be considered "Additional
Rent. "Rent," as used in this Lease, shall mean Basic Rent together with Additional Rent.
i. Computation. All sums resulting from the computation of adjusted base Rent shall be
rounded up the nearest whole dollar. For all partial months, Base Rent shall be
prorated. Base Rent is to be absolute net to the City, with Lessee being responsible
for certain taxes pursuant to Section 7(1), the costs of those maintenance, repair and
replacement activities for which Lessee is responsible pursuant to Section 7, and
insurance with respect to the Leased Premises pursuant to Section 8.
ii. Adjustment. The Base Rent shall be adjusted annually on July 1 of each year.. The
adjustment will be calculated by determining the difference between the Consumer
Price Index ("CPI") on January 1 of the prior year and January l of the current year
and multiplying said difference by the Base Rent in effect in June of the current year.
Except as otherwise explicitly provided in other sections of this Agreement, the Base
Rent shall not decrease. As used in this section, "CPI" refers to the All Urban
Consumers (CPI-U), US City Average, CPI-All Items Index as published by the
Bureau of Labor Statistics of the United States Department of Labor. If the CPI is no
longer being published., then the applicable index shall be the figure reported in the
US Department of Labor's most recent comparable official index then in use and most
nearly answering the description of the CPI.
(b) Additional Rent.
i. Tiedown Fees. Lessee shall collect and pay to City 75% of all tiedown revenue
generated at the Airport. Lessee shall provide to City a monthly accounting of all
tiedown revenue received. Tiedown rental fee payments based on the monthly
accounting of all tiedown revenue received are due on the 20th day of the month
following the month in which the tiedown revenue is generated.
ii. Freight Handlers Fee. Lessee shall collect and pay to City 75% of all freight handler
revenue generated. Lessee shall provide to City a monthly accounting of all freight
handler revenue received. Freight handler fee payments based on the monthly
accounting of all freight handler revenue received are due on the 20th day of the
month following the month in which the freight handler revenue is generated.
iii. Ground Lease and Hangar Rental Fees. Lessee shall collect and pay to City 75% of
all ground lease and hangar revenue generated. Lessee shall provide to City a
monthly accounting of all ground lease and hangar revenue received. Ground lease
and hangar rental fee payments based on the monthly accounting of gross ground
lease and hangar revenue received are due on the 20th day of the month following the
month in which the ground lease and hangar revenue is generated. Lessee may assess
such charges as may be permitted under the leases for late ground lease and hangar
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rental payments and shall include 75% of such late charges in the monthly ground
lease and hangar rental fee payments to City.
iv. Fuel Flowage Fee. Lessee shall pay to City a set fuel flowage fee per gallon on all
Lessee's retail or wholesale sales of all types of fuel received from a commercial
distributor on the Airport property. As of the Effective Date, the applicable fuel
flowage fee is $.07 per gallon. The amount of this fee shall be reviewed annually and
may be adjusted upward or downward by resolution of the Ashland City Council.
Accumulated monthly fuel flowage fees shall be calculated from Lessee's monthly
fuel sales report; shall be paid monthly; and shall be due on the loth day of the month
following the month in which the fuel was sold or used by Lessee. Lessee may sell
aviation fuel at a wholesale price to other operators PROVIDED HOWEVER, that
Lessee confirms that those operators have an aircraft Fuel Retailers License from the
Oregon Department of Motor Vehicles. Lessee shall pay City the fuel flowage fee on
all wholesale fuel sales to other operators, and Lessee shall report the names of such
wholesale purchasers and the quantity of wholesale purchases to City in its monthly
fuel report.
(c) Records. Lessee shall keep records in its usual and customary manner of all sales and
volumes that serve as the basis for any additional rent that maybe due the City under this
Lease. Such records shall be open for inspection by City, but not more frequently than
once in any six month period, and only upon ten days' written notice to Lessee. Such
inspection shall be performed at a reasonable time at Lessee's office. In no event shall
Lessee be required to keep such records for more than two years.
(d) Late Fees. Rental payments due to City shall become delinquent if not paid in full within
10 days after the due date. A delinquency charge of 1.5% per month shall be added to
payments required by this Lease which have become delinquent. If Lessee's check for
payment of Rent or Additional Rent due under this Lease is returned to City for any
reason, the payment shall be considered not to have been made and shall be delinquent.
In addition to the above delinquency charge, City may charge Lessee a returned check fee
of $25.00 per returned check, which Lessee agrees is a reasonable fee for the additional
administrative time and expense incurred by City in having to deal with the returned
check. The delinquency charge shall continue to accrue until the returned check fee is
paid, the check can be cashed, and City receives all funds due.
(e) Mode of Payment. Without notice, demand, offset, abatement or deduction, Lessee
agrees to pay all Rent and any other amounts due by to the City of Ashland by City-
accepted forms of payment delivered or mailed to the Finance Department, City Hall, 20
East Main Street, Ashland, Oregon 97520.
7. Use of Premises
(a) General Uses. Lessee shall use the Premises exclusively for aircraft rental, aircraft and
aircraft component maintenance, aircraft flight management, flight training, aircraft
charter operations, retail aviation fuel sales, aircraft self fueling, aircraft sales, aircraft
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parts sales, line services, pilot supplies, and other commercial aeronautical activity
including contract helicopter services, fire fighting, aero-medical services, law
enforcement services, traffic reporting services, aerial photography, scenic tours, pipeline
patrols, incidental car rental, food sales for onboard charter aircraft, and related services
allowed to he performed by a fixed based operator in accordance with the Oregon
Department of Aviation ("ODA") minimum standards for Category 4 FBOs and the
"Minimum Standards at Ashland Municipal Airport, Ashland, Oregon" adopted by the
City Council ("Minimum Standards"} as they now exist or as they maybe required to be
changed in the future by the ODA or the Federal Aviation Administration. Any other
changes to these standards shall not apply to Lessee unless such changes are mutually
agreed upon and applied and enforced uniformly among all FBOs at the airport. Nothing
in this Lease shall be construed to grant to Lessee any exclusive right to conduct any
aeronautical activity at the Airport.
(b) Nonexclusive Rights. Subject to the Minimum Standards, Lessee shall have the
nonexclusive right to use, in common with other aeronautical users on the Airport: (a) all
public Airport facilities, improvements, taxiways, roadways and areas at the Airport
(collectively, the "Airport Public Facilities"); and (b) such non-public areas of the
Airport, common utility facilities, and other improvements which are owned or
designated by the City for common benefit or use of Airport tenants or which may be
necessary for Lessee's access to and from the Premises and for performance of Lessee's
business conducted at the Airport. The FAA's exclusive rights prohibition applicable on
the effective date or, if later amended, the most recent official version thereof, is
incorporated into this lease as if fully set forth herein.. No fees or charges may be made
to Lessee for use of the Airport Public Facilities, except such fees or charges as are
imposed by the City uniformly on all similarly situated users of such Airport Public
Facilities.
(c) Fuelin Fg acilitX. Lessee is authorized to operate the aviation fueling facility at the
Airport. Lessee shall at all times have the appropriate aviation fuels, as determined by
City and Lessee, available for sale and shall be solely responsible for the safe operation
of the fueling facility and for procuring fuel for operation of the fuel facility.
(d) UNICOM Radio. Lessee is authorized to operate a UNICOM radio with antenna in
accordance with all manufacturers' prescribed procedures, and FAA regulations.
(e) Maintenance Hangar. The maintenance hangar shall be used to provide maintenance of
aircraft and other airport related uses. Portions of the maintenance hangar maybe sublet
on a month to month basis for other uses provided that the primary use of the hangar is
airport-related and provided that the need for aircraft maintenance does not require the
use of the sublet portions.
Parking Spaces. The five parking spaces shall be used by Lessee for the parking of rental
automobiles to be rented by Lessee to the public. Installation and maintenance of signs
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identifying the spaces shall be at Lessee's cost.
(g) Except for the uses set forth in (a) through of this Section 6 and the activities set forth
in Section 7, no other use shall be permitted without the prior written consent of the City
which consent shall be in the City's sole discretion.
(h) City reserves the right to further develop or improve the Airport.
(i) General Limits on Use.
i. Lessee shall not, without the prior written consent of City, use any device which
would cause unreasonable noise, vibration, fumes, debris, or electronic interference
on or adjacent to the Premises. Lessee agrees to participate with the Airport
Commission in the development and execution of measures to reduce Airport impacts
on neighboring properties. Lessee shall not use or permit anyone else to use the
Premises in a manner which: (a) creates any condition that constitutes a safety hazard
under, or otherwise violates, Federal Aviation Administration ("FAA") regulations;
(b) creates or tends to create a hazard to aviation or aviation related activities or a
nuisance; or (c) interferes in any way with airport operations.
ii. Lessee shall not use any part of the hangars financed with proceeds of any tax-exempt
obligations issued by the City for office space, except for office space that is de
minimis in size and cost and that is directly related to its day-to-day operations at the
airport as required by Section 142(b) (2) of the IRS Code.
iii. Lessee shall not use or permit the use of the Premises as any lodging facility, any
retail facility (including food and beverage facilities) in excess of a size necessary to
serve passengers and employees at the Airport, as any retail facility (other than
parking} for passengers or the general public located outside the terminal, as an office
building for individuals who are not employees of City, or as any industrial park or
manufacturing facility. No part of the Premises financed with any portion of the
proceeds of any tax-exempt obligations issued by City shall be used to provide any
airplane, skybox or other private luxury box, health club facility, a facility primarily
used for gambling, or store the principal business of which is the sale of alcoholic
beverages for consumption off premises as prescribed by Section 147(e) of the IRS
Code.
iv. No smoking is allowed in the Premises at any time within 10 feet of the FBO
Maintenance Hangar/Building.
v. City may, when reasonably necessary, close all or portions of the Airport to perform
construction or maintenance work on the Airport even though such work may cause
temporary suspension of Lessee's activities and temporary suspension of Lessee's
ingress and egress to the Premises. Such temporary suspension shall not suspend or
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otherwise alter Lessee's rent obligations. City shall provide Lessee reasonable notice
in advance of planned construction or maintenance work. As used in this section
6(i)(v), "temporary suspension" means the necessary and substantial cessation of
primary activities of the Lessee on and Lessee's access to premises for a period of [3]
or fewer consecutive days or [6] non-consecutive days within a 60 day period.
i. Lessee's rental payments will be prorated during the entire period of
closure that exceed the term of a temporary suspension.
8. Lessee's Responsibilities.
(a) Primary Fixed Base Operator. Lessee shall conduct the business and provide the services
of a Fixed Base Operator at the Airport, as described in the Minimum Standards as they
now exist or as they may be changed in the future. Lessee shall be the primary Fixed
Base Operator at the Airport. As such, City grants Lessee and Lessee agrees to exercise
the authority, at Lessee's sole discretion, to monitor activities of other lessees and
permittees at the Airport, as well as the public who use the Airport facilities, including
compliance with the Minimum Standards, lease terms, and safety regulations. City will
provide to Lessee copies of all Airport leases, permits, licenses and other agreements or
regulations concerning Airport activities. Lessee shall report to City any suspected
inappropriate activities at the Airport. Control and enforcement of the leases and
permits shall be the responsibility of the City through its Director of Public Works or a
designee.
General FBO management duties:
• Hours of operation. FBO shall keep terminal building open seven (7)~ days a week
during normal business hours. FBO shall make available after hours phone numbers for
general and emergency issues that occur onsite and require FBO attention.
• FBO responsible for monthly safety inspections of complete site including drive by
inspections of all hangars, asphalt and appurtenances.
• FBO responsible for keeping fuel storage facility properly stocked for public use.
• FBO provides onsite representation of the City and Airport for the FAA, NTSB, airport
users and the general public.
• FBO monitors and reports all safety concerns to City and Airport Commission.
• FBO issues all NOTAMS regarding the Ashland Municipal Airport.
• Provides management of City hangars including fee collection, filling vacancies, manage
tie down area appropriately, manages transient, cargo activity onsite and prevention of
security, and environmental violations on site during hours of operation.
• Promotes appropriate development and use of airport.
~FBO can close terminal office on al(recognized City Holidays.
(b) Public Benefit. Lessee agrees to operate the premises for the use and benefit of the public
without unjust discrimination and to make available to the public on fair and reasonable
terms all leased Airport facilities and services adequate to meet demand at reasonable
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prices so as to result in a reasonable profit to Lessee. Lessee shall not exercise or grant
any right or privilege which operates to prevent any person, firm, or corporation
operating aircraft on the Airport from performing any services on its own aircraft with its
own employees (including but not limited to maintenance, repair, and fueling) that it may
choose to perform.
(c) Hangar Reservation Deposit. Lessee shall maintain a hangar Reservation list for persons
desiring to lease a T-hangar when one becomes available. Lessee shall post the list for
public inspection at the FBO office. Lessee shall collect a deposit from each person
whose name is placed on the list. The amount of the deposit and any refund shall be
established by City Council resolution. Lessee may retain 25% from each deposit for the
cost of collecting the fee and maintaining the list. 75% of the reservation deposit shall be
used towards the first month's rent. Lessee shall propose resolution of any disputes as to
priority dates. The Director of Public Works shall make the final determination of
priority date if any such dispute is not resolved through disputants' negotiations with
Lessee.
(d) Cooperation with Airport Tenants. Lessee shall cooperate with other Airport tenants to
provide access to their leasehold properties. Cooperation with other tenants does not
imply agreement or consent to any tenant proposal that would impair Lessee's present or
future business.
(e) Compliance with Laws, Airport Regulations and City Obli atg ions. Lessee's activities on
or use or possession of the Premises shall comply with all applicable laws, ordinances,
codes, rules and regulations of federal, state, county, city and other public governmental
authorities or agencies, including, but not limited to, Environmental Laws (as defined in
Section 12, the Occupational Safety and Health Act, the Americans with Disabilities Act,
and fire, safety, health, sanitary, and electrical and building codes, prevailing wage laws,
zoning and state and local comprehensive plans and criminal laws and regulations
(collectively, "Laws").
i. City Regulations and Obli anions. Lessee is subject to and shall comply with the
provisions of all existing and future regulations adopted by City's Director of Public
Works, the Ashland Airport Commission or the Ashland City Council concerning the
operation of the Airport. Lessee shall comply with any enforcement procedures the
United States or the State of Oregon might demand that City take in order to comply
with City's assurances or obligations under any deed of conveyance from the United
States or grant agreement with the United States or the State of Oregon.
ii. Environmental Compliance. Lessee shall manage and conduct all of its activities on
or relating to the Premises (a) in compliance with federal, state, and local
environmental law; (b) in a manner designed to protect the environment; (c) in
adherence with best management practices applicable to Lessee's use of the Premise;
(d) in cooperation with City's efforts to comply with environmental laws and best
environmental management practices; and (e} incompliance with the environmental
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requirements detailed in Section 12.
iii. FAA Security Regulations. Lessee recognizes its obligations to comply with
applicable Federal Airport Security Regulations. Lessee will reimburse City in full
for any fines or penalties levied against City for security violations as a result of any
negligent or willful actions on the part of Lessee, including any negligent or willful
failures by lessee to prevent security violations by its agents, contractors, suppliers,
guests, customers or employees.
Inspections by Lessee. Lessee shall inspect at least once weekly all lighting at the
Airport, including, but not limited to, runway, VASI, REIL, taxiway and beacon lights.
Any malfunction shall be immediately reported to City and to the appropriate FAA
representative.
(g) Premises Maintenance and Repair. Lessee shall perform the items designated as the
responsibility of the Lessee on the Pr°cmises Maintenance Matrix attached hereto as
Exhibit B {"Premises Maintenance Matrix"). Further, except for maintenance work
expressly listed among City's responsibilities on the Premises Maintenance Matrix and
except as limited in Section 7(g), it shall be Lessee's responsibility, at Lessee's sole cost
and expense, to continually keep and maintain the Premises and all improvements,
systems, and equipment located thereon (whether constructed by Lessee or City) clean
and neat, free of waste material and debris, in good condition and repair and in a fully
operational condition and to make all necessary and appropriate preventive maintenance,
repairs and replacements. One restroom will be kept open to the public at all times, and
Lessee shall be responsible for its cleaning and upkeep. Without limiting the effect of
any other provision of this Lease, it is a material term of this Lease that Lessee's
improvements on the Premises, may, at City's option, become the property of City upon
the expiration or earlier termination of this Lease. Lessee shall, at the expiration of
termination of this Lease, surrender the Premises in as good order and condition as when
received, reasonable wear and tear, damage from the elements, fire, acts of God or other
casualty excepted. Lessee shall be responsible and shall pay for all damage or injury
done to the Premises by Lessee or any person who may be in or on the Premises with the
consent of Lessee.
(h) Other Airport Maintenance and Repair. Lessee shall perform maintenance and repairs
listed as Lessee's responsibilities onthe Other Airport Maintenance Matrix attached
hereto as Exhibit C ("Other Airport Maintenance Matrix"), as well the Lessee's
maintenance responsibilities pursuant to Section 7(g). City, or its designees or agents,
shall perform the maintenance and repair work listed as City's responsibilities on the
Other Airport Maintenance Matrix on the Airport, in addition to the responsibilities
expressly assigned to City in the Section 7(g).
(i) Alterations and Improvements
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i. Except as provided in Section 7(i). Lessee may not make alterations or improvements
without the prior written consent of City, which consent shall not be unreasonably
withheld. Prior to any construction, construction plans must be approved by City in
writing as to the physical and aesthetic design, site location, color, landscape design,
parking, land use, compliance with all federal and state laws and regulations
including but not limited to Davis Bacon Act, prevailing wage rate and the Lessee's
financial capability. All alterations or improvements that Lessee may desire to make
to the Premises shall be done by Lessee and at the expense of Lessee. The term
"improvements" means any buildings, structures, or facilities placed or erected on the
Premises. All such work shall be done in a good and workerlike manner in
compliance with all applicable building and zoning laws and ordinances.
ii. Lessee shall not make any improvement that increases the footprint of existing
structures on the Premises or that utilizes additional land at the Airport without first
entering into a ground lease with the City for such additional space. Ground lease
rent for such additional space shall be determined using the applicable Council-
approvedrate structure.
iii. Prior to construction of any improvements, the parties agree to negotiate in good faith
as to ownership of the improvements to be constructed. Improvements mandated by
state or federal regulations will be constructed by City. Unless the parties have
previously agreed in writing to the contrary, the improvements shall become City
property, free and clear of all claims of Lessee or anyone claiming under Lessee or
through Lessee's actions, upon completion of construction and issuance of a
certificate of occupancy. Lessee, or anyone claiming under Lessee, shall indemnify
and defend City against all liability and loss arising from such claims.
(j) Utilities. Lessee shall initiate, contract for, and obtain, in its name, the following utility
services required on the Premises: gas, electricity, telephone (including at least one cell
phone or dedicated land line always immediately available for communicating with the
FAA and for local calls), sanitary sewer, solid waste collection and services, and all other
utilities which may be furnished to the Premises, except that City shall obtain all water
service for the Airport in its own name. Lessee shall promptly pay all charges for the
aforesaid services as they become due, except that City shall pay for water and one-half
of the solid waste collection charges, PROVIDED HOWEVER, that City shall not pay
more than the two can minimum. If Lessee fails to pay the utilities charges for which it is
responsible hereunder, City may elect to pay them and the charges will then be added to
the rental payment next due.
(k) Taxes. Any real or personal property taxes assessed against the Premises or the personal
property thereon leased by Lessee shall be paid by Lessee no later than November 15 of
the year in which the taxes become due and payable. Lessee also covenants and agrees to
pay personal property taxes assessed against the Lessee's personal property located on
the Premises for the duration of this Lease, such payments to be made Lessee shall
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annually submit a copy of the receipt for such taxes to City's Director of Finance.
(1) No Liens. Lessee agrees to pay, when due, all sums for labor, services, materials,
supplies, utilities, furnishings, machinery or equipment which have been provided to the
Premises. Lessee shall not suffer or permit any liens to attach to the interest of Lessee in
all or any part of the Premises by reason of any work, labor, services, or materials done.
for, or supplied to, or claimed to have been done for or supplied to, Lessee or anyone
occupying or holding an interest of Lessee in all or any part of the improvements on the
Premises through or under Lessee. If any lien is filed against the Premises, Lessee shall
cause the lien to be discharged of record within thirty (30) days after the date of filing of
the same, by payment, deposit or bond. In the event that Lessee fails to remove the lien
within thirty (30) days, then, in addition to all other remedies set forth in Section 5(d), the
City shall automatically have the right, but not the obligation, to pay the lien off, after
giving notice of its intent to do so to Lessee, and Lessee shall immediately reimburse City
for any sums so paid to remove any such lien, together with the Delinquency Charge due
thereon, calculated from the date City funds were expended thereon.
(m)Fire Safety. Lessee shall exercise due and reasonable care and caution to prevent and
control fire on the Premises. City shall provide and maintain such fire suppression and
other fire protection equipment as may be required pursuant to applicable governmental
laws, ordinances, statutes and codes for the purpose of protecting the Premises and
restricting the spread of any fire from the Premises.
9. Insurance. Insurance requirements set forth below do not in any way limit the amount or
scope of liability of Lessee under this Lease. The amounts listed indicate the minimum
amounts of insurance coverage City is willing to accept to help insure full performance of all
terms and conditions of this Lease. All insurance of type and scope required of Lessee under
this Lease shall meet or exceed insurance coverages of those currently acquired by members
of the same industry who are similarly situated in size and circumstances as the facilities and
operations in this Agreement. All insurance required by Lessee under this Lease shall
therefore meet the following minimum requirements as presented in Exhibit "D" attached,
and any attachments thereto, all of which herein are incorporated by this reference.
(a) Certificates, Notice of Cancellation. On or before the Effective Date and at all times
thereafter while this Lease is in effect, Lessee shall provide City with current certificates
of insurance including an additional insured endorsement, executed by a duly authorized
representative of each insurer, evidencing the existence of all insurance policies required
under this Section 8, and showing the amount of any applicable deductible(s) and/or
self insured retention(s). City shall receive at least thirty (30) days written notice prior to
cancellation, non-renewal, or material change in any policy. Insurance must be
maintained without any lapse in coverage during the entire time Lease is in effect. City
shall also be given true copies of Lessee's policies of insurance upon request. Failure of
City to request such certificates or other evidence of full compliance with these insurance
requirements, or failure of City to identify any deficiency or noncompliance with
coverage requirements, shall not be construed as a waiver of Lessee's obligation to
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maintain the insurance required by this Lease.
(b) Additional Insured. City shall be named as an additional insured in each required
liability policy and, for purposes of damage to the Premises, as a loss payee, to the extent
of its interest. Such insurance shall not be invalidated by any act, neglect or breach of
contract by Lessee.
(c) Primary Coverage. The required policies shall provide that the coverage is primary, and
will not seek any contribution from any insurance or self insurance carried by City.
(d) Compan~g_s. All policies of insurance must be written by companies having an
A.M. Best rating of "A" or better.
(e) Required Insurance.
i. See Attached Exhibit "D".
ii. Workers' Compensation Insurance. Lessee shall maintain in force Workers'
Compensation insurance for all of Lessee's employees, including coverage for
Employer's Liability. In lieu of such insurance, Lessee may maintain a self insurance
program meeting the requirements of the State of Oregon and a policy of Excess
Workers' Compensation with a limit of at least $1,000,000.00 per accident above the
self insured retention.
(t~ Lessee's Risks. Lessee shall be responsible for obtaining any insurance it deems
necessary to cover its own risks, including without limitation: (a) business interruption,
such as business income, extra expense, or similar coverage; (b) personal property; (c)
aircraft hull coverage; and/or (d) automobile physical damage and/or theft. In no event
shall City be liable for any: (i) business interruption or any other related or consequential
loss sustained by Lessee; (ii} damage to, or loss of, Lessee's property; (iii) damage to, or
loss of, an aircraft; or (iv) damage to, or loss of, an automobile, whether or not such loss
is insured, except to the extent caused by City's own negligence or willful misconduct
(g) Periodic Review. The parties will review the types and limits of insurance coverage at
not less than two year intervals and make changes if necessary. In the event City
determines that such types of coverage and/or limits should be changed, City will give
Lessee a minimum of thirty (30) days notice of such determination and Lessee shall
modify its coverage to the comply with the new insurance requirements of City, to the
extent such types and/or limits of coverage are required by City in an equitable and not
unjustly discriminatory manner considering the types and limits of insurance then
required by City of lessees of similarly situated properties. Lessee shall also provide City
with proof of such compliance by giving the City an updated certificate of insurance
within fifteen (15}days. City also reserves the right to require a change of insurance
Page 12 of 32
carrier if the Lessee's carrier's rating drops below an A rating. Lessee shall be given at
least thirty (30) days notice of any such required changes.
(h} Waiver of Subrogation. Except as limited by this Section, the parties hereto waive any
right of action that they and/or their insurance carriers might have against the other for
loss or damage, to the extent that such loss or damage is covered by any property
insurance policy or policies and to the extent that proceeds (which proceeds are free and
clear of any interest of third parties) are received by party claiming the loss or damages.
This waiver of subrogation shall not extend to any applicable deductibles under such
policy or policies.
l0. Indemnification.
(b) General Indemnity. Except as liability is limited for the City of Ashland under the Oregon
Tort Claims Act, if the negligent or willful acts or omissions of any party hereto cause any
other party to be required to respond to legal processes or proceedings, the responsible party
shall indemnify, defend, save and hold harmless the other party and its officers, employees
and agents from and against any and all claims, actions, liabilities, losses, damages, including
consequential damages, or expenses including attorneys' fees, arising from act or omissions
of the responsible party.
(c) The Airport fuel storage and self serve fuel system and its users are not considered as part of
this lease agreement and therefore the Parties no contractual obligations to indemnify or
otherwise as related to the fuel storage and self serve fuel system activity occurring at the
Airport. This provision, however, does not and is not intended to waive or forgive any
general liability of any party for their negligent or willful acts or omissions as related or not
to any fuel storage and self serve fuel system activity that cause injury or damage to persons
or property of the other or third parties, and in which indemnity may be claimed as a matter
of law.
(d) Survival. The releases and indemnities contained in this Section 9 shall survive termination
of this Lease.
11. Limitation on Cit, Lability. City shall have no liability to Lessee for loss or damage
suffered by Lessee on account of theft or any act of a third party including other tenants.
City shall only be liable for its willful misconduct or gross negligence and then only to the
extent of actual and not consequential damages, and as limited under the Oregon Tort Claims
Act.
12. Damage or Destruction. If a casualty that involves damage or destruction of fifty percent
(50%) or more of the improvements located on the Premises not caused by Lessee ("Major
Casualty"), Lessee shall be entitled to terminate this Lease upon the giving of at least sixty
(60) day's notice to City. In the event of a Casualty that does not qualify as a Major
Casualty, Lessee must promptly repair or replace the damaged improvements. The repaired
or replaced improvements must be at least equal in value to the improvements that were
Page 13 of 32
damaged or destroyed. In the event of a Major Casualty, Lessee must either terminate this
Lease or fully restore or replace the damaged improvements within one (I) year, as provided
above and subject to delays beyond Lessee's reasonable control. During restoration, rent
shall continue to be paid unless the parties otherwise agree in writing. If the Lease is
terminated under this Section, the insurance proceeds arising from the Casualty shall be
allocated as follows: (a) to the cost of obtaining the proceeds (excluding the cost of
maintaining the insurance coverage, such as premiums paid); and (b) to City, to the extent of
City's interest; then, subject to the rights of any City-approved lender, to Lessee. The City's
interest shall be an amount not less than the present value (determined as of the date the
proceeds are distributed to City) of the right to receive the improvements (assuming that the
improvements had not been damaged and had otherwise been maintained, repaired and
upgraded as required by this Lease) at the end of the Term of this Lease. In determining the
present value, a discount interest rate generally accepted in the industry for use in valuing
similarly situated facilities at the Airport at the time of distribution of the proceeds shall be
used. Lessee shall be allowed to terminate this Lease as provided in this section only if
Lessee first removes all liens and encumbrances affecting the Premises (other than those
created by City) and otherwise satisfies all obligations arising upon termination of the Lease.
Incase of destruction or damage there shall be no prorated rent, abatement, or reduction of
rent.
13. Environmental Requirements.
(a) Notification. Lessee shall promptly notify City upon becoming aware of: (a) a violation
or alleged violation of environmental law related to the Premises or to Lessee's
occupation or use of the Premises or any environmental provision of this Lease; and (b)
any Hazardous Substance Release on, under or adjacent to the Premises or threat of or
reasonable suspicion of any of the same.
(b) Environmental Inspection. City shall have the right to conduct reasonable inspections of
the Premises and the operations conducted on Premises at any time and from time to
time, after notice to Lessee, to inspect the Premises; Lessee's operations on and use of the
Premises; and, subject to Oregon Public Records Law ORS 192.410 through 192.505,
Lessee's environmental records. Lessee shall cooperate fully with City during such
inspections and investigations.
(c) Toxic Pollutants. Lessee shall install all facilities necessary for the operation and shall
properly operate and maintain all facilities and systems and related appurtenances of
treatment that are required to keep compliance with the effluent standards or prohibitions
established under Section 307(a) of the Clean Water Act for Toxic Pollutants.
(d) Hazardous Substances. As used is this paragraph, the term "hazardous substances"
means any hazardous or toxic substance, material, or waste, including, but not limited to,
those substances, materials, and wastes listed in the United States Department of
Page 14 of 32
Transportation Hazardous Materials Table (49 C.F.R. S 172.101) or by the United States
Environmental Protection Agency as hazardous substances (40 C.F.R. Part 302) and any
amendments; ORS 466.567, 466.205, 466.640 and 468.790; and regulations of the
Oregon Department of Environmental Quality("DEQ"), petroleum products and their
derivatives, and such other substances, materials and wastes as become regulated or
subject to cleanup authority under any environmental laws. Lessee shall not store or
allow any, hazardous substance or petroleum products to be released on the premise other
than that necessary for the conduct of Lessee's business. In addition, Lessee shall recycle
petroleum products and dispose of hazardous substances in accordance with the DEQ's
rules and regulations. All costs associated with the use of hazardous substances or
petroleum products, including, but not limited to costs of cleanup, removal, remediation,
and compliance with federal, state and local environmental requirements, shall be the sole
responsibility of Lessee. Lessee shall indemnify and hold City harmless from any costs,
fees, penalties or other expense incurred by City in connection with hazardous substances
on the leased Premises. All hazardous substances and petroleum products on the
premises shall be used, handled, cleaned up, removed and remediated in accordance with
federal, state and local requirements.
(e) Hazardous Substance Releases. Except as provided in Section 9(c), Lessee shall be
responsible for any Hazardous Substance Release on the Leased Premises, or from the
premises into the air or into adjacent or nearby waterways (including groundwater) which
results from or occurs in connection with Lessee's occupancy or use of the Premises
under this Lease, or occurs or continues after the term of this Lease, if caused by Lessee.
In no event shall Lessee be responsible for any Hazardous Substance Release not caused
by negligent or willful acts of negligence by Lessee or agents of lessee. In the event of a
violation of Environmental Law, a violation of an environmental provision of this Lease,
a Hazardous Substance Release, or the threat of or reasonable suspicion of the same for
which Lessee is responsible under this Lease, Lessee shall immediately undertake and
diligently pursue all acts necessary or appropriate to correct the violation or investigate,
contain, and stop, the Hazardous Substance Release and remove the Hazardous
Substance. Improvements mandated by state or federal regulations will be constructed by
the City.
Remediation. Lessee shall promptly undertake all actions necessary or appropriate to
ensure that any Hazardous Substance Release is remediated and that any violation of
environmental law or the environmental provisions of this Lease is corrected. Lessee
shall remediate, at Lessee's sole expense, all Hazardous Substances for which Lessee is
responsible under this Lease or under any environmental law, and shall restore the
Premises or other affected property or water to its condition prior to the Hazardous
Substance Release for which Lessee is responsible. Within thirty (30) calendar days
following completion of any investigatory, containment, remediation and/or removal
action required by this Lease, Lessee shall provide City with a written report outlining, in
detail, what has been done and the results thereof.
Page 15 of 32
i. City Approval Right. Except in the case of an emergency or an agency order
requiring immediate action, Lessee shall give City twenty four (24) hours advance
notice before beginning any investigatory, remediation or removal procedures.
Subject to Lessee's obligation to remediate as set forth immediately above, City shall
have the right to exercise reasonable approval or disapproval of the proposed
investigatory, remediation and removal procedures and the company(ies) and/or
individuals conducting such procedures which are required by this Lease or by
environmental law, whether on the Premises or on any affected property or water.
City shall have the right to require Lessee to request oversight from DEQ of any
investigatory, containment, remediation and removal activities and/or require Lessee
to seek a statement from DEQ of "No Further Action" acceptable to City.
ii. City's Right to Perform on Behalf of Lessee. Except in the event of an emergency or
an agency order requiring immediate action, City shall have the right, upon giving
Lessee seven (7) calendar days written notice, to perform its obligations arising under
this Lease and charge Lessee the resulting costs. City may not commence
performance on behalf of Lessee under this Section if, within the seven (7) calendar
day notice period, Lessee promptly begins and diligently pursues to completion the
performance of the obligations set forth in the City's notice.
14. ASS1~nment. Lessee shall have the right to assign the whole or any part of Lessee's rights
and duties under this Lease, subject to the written approval of City, which approval shall not
be unreasonably withheld and last no longer than 60 calendar days. City, in considering
approval, may take into consideration the experience, qualifications and financial ability of
the proposed assignee to perform the obligations required of Lessee, and to operate the
airport for the benefit of the public. For the purposes of this paragraph, the sale, assignment,
transfer, or other disposition of any of the issued and outstanding capital stock of Lessee, or a
change in principal officers or directors of the corporation, if Lessee is a corporation, or of
the interest of any general partner or joint venturer or syndicate member or cotenant, if
Lessee is a partnership or joint venture or syndicate or cotenancy, which shall result in
changing the control of Lessee, shall be construed as an assignment of this Lease. Control,
as used in this paragraph, means 50 percent or more of the voting power of the corporation.
15. Default.
(a) Event of Default. The occurrence of any of the following shall constitute an event of
default ("Event of Default"):
i. Default in Rent. Failure of Lessee to pay any rent or other amount payable to City or
to others as provided in this Lease within ten (l o) days after written notice from City
that such payment is past due. Notwithstanding the foregoing, City need not give
notice for a default in the payment of rent or other amounts payable to City or others
more than twice during any twelve (12) month period, and a failure to make a
payment within ten (l o) days after the second (2nd) notice in any twelve (12) month
Page 16 of 32
period constitutes an Event of Default for which no further notice or opportunity to
cure need be given. No other notice by City that rent or such other amount is past due
shall be required.
11. Default in Other Covenants. Failure of either party to comply with any term,
covenant or condition of this Lease (other than the payment of rent) within thirty (30)
days after written notice by one party describing the nature of the default by the other
party. If the default is of such a nature that it reasonably cannot be completely
remedied within the thirty (30) day period, this provision shall be complied with if
correction of the default begins within the thirty (30) day period and thereafter
proceeds in good faith and with reasonable diligence to effect the cure as soon as
practical. Furthermore, if any Event of Default threatens to cause serious harm to a
party or to other Airport tenants or other persons, then the affected party shall not be
required to serve any notice before proceeding to request immediate injunctive relief.
iii. Bankruptcy/Insolvency. The insolvency of Lessee shall be an immediate Event of
Default for which no notice or opportunity to cure need by given. For the purposes of
this Lease, and to the extent permitted by the United States Bankruptcy Code,
"Insolvency" shall mean: (a) an assignment by Lessee for the benefit of creditors; (b)
the filing by Lessee of a voluntary petition in bankruptcy; (c) Lessee dissolves; (d) the
appointment of a receiver of the properties of Lessee and the receiver is not
discharged within ninety (90) days; (e) the filing of an involuntary petition of
bankruptcy and failure of Lessee to secure a dismissal of the petition within ninety
(90) days after filing; and (f) attachment of, or the levying of execution on, the
leasehold interest and failure of Lessee to secure discharge of the attachment, or
release of the levy of execution, within ninety (90) days.
iv. Abandonment. Failure of Lessee for seventy-two (72 hours or more to use and
occupy the Premises for one or more of the purposes permitted under this Lease
unless such failure is required or excused under other provisions of this Lease. Upon
such abandonment, no notice that an Event of Default has occurred shall be required
from City. The Premises shall not be considered abandoned if Lessee notifies City
that it will be absent for a period of time, in advance, and Lessee pays all Rent and
maintains the Premises in good. repair throughout any such absence.
(b) Remedies on Default.
i. Termination. Either party may, at its option, terminate this Lease 180 days after
written notice to the other party.
ii. Re-Entry. City may re-enter the Premises, or any part thereof, by suitable action or
proceeding at law, or, in the event of abandonment of the Premises by Lessee, by
force, or by other lawful means, without being liable for indictment, prosecution or
damages therefore, and may repossess the Premises and remove any person or
Page 17 of 32
property therefrom, by lawful means, to the end that City may have, hold and enjoy
the Premises.
iii. Relettin~. City, at its option, may relet the whole or any part of the Premises from
time to time, either in the name of City or otherwise, to such tenants, for such terms
ending before, on or after the expiration of this Lease, at such rentals and upon such
conditions (including concessions and free rent periods) as City, reasonably may
determine to be appropriate. To the extent allowed under Oregon law, City shall not
be liable for its reasonable refusal to relet the Premises, or, in the event of any such
reletting, for failure to collect any rent due upon such reletting; and no such failure
shall operate to relieve Lessee of any liability under this Lease or otherwise affect any
such liability. City may make such physical changes to the Premises as City
reasonably considers necessary in connection with any such reletting or proposed
reletting, without relieving Lessee of any liability under this Lease or otherwise
affecting Lessee's liability. City, under its obligations to mitigate its damages, shall
not be required to attempt to relet the Premises to a potential lessee with which City
has been negotiating a lease for other space owned by City or to whom City has
shown other space owned by City and City shall be entitled to use its best efforts to
lease such other City space to such prospective tenant.
iv. Rent Recovery. Whether or not City retakes possession or relets the Premises, City
shall have the right to recover unpaid rents and all damages caused by the default.
Damages shall include, without limitation: all rents lost; all legal expenses and other
related costs reasonably incurred by the City as a result of Lessee's default; all costs
reasonably incurred by City in: (a) restoring the Premises to a good order and
condition, to the extent required of Lessee by this Lease, (b) preparing the Premises
for reletting; and (c) reletting the Premises, including, without limitation, any
brokerage commissions expended as a result of the default.
v. Recovery of Damages. To the extent permitted under Oregon law, a party claiming
default by the other party may sue periodically for damages as they accrue without
barring a later action for further damages. Nothing in this Lease will be deemed to
require a party to await the date on which the Lease expires to bring or maintain any
suit or action respecting this Lease. City may in one action recover accrued damages
plus damages attributable to the remaining term of this Lease equal to the amount by
which the rent reserved in this Lease for the balance of the term of this Lease after the
time of award exceeds rent based on the market rental rate for the same period. If
City has relet all or any part of the Premises for the period which otherwise would
have constituted all or any part of the unexpired portion of the term of this Lease, or
any part, the amount of rent reserved upon such reletting shall be deemed, prima
facie, to be the market rental rate for the part or the whole of the Premises so relet
during the term of the reletting.
(c) Remedies Noncumulative, Nonexclusive. Each right and remedy in this Lease will be
cumulative and will be in addition to every other right or remedy in this Lease or existing
Page 18 of 32
at law or in equity, including, without limitation, suits for injunctive relief and specific
performance. The exercise or beginning of the exercise by one party of any such rights
or remedies will not preclude the simultaneous or later exercise by that party of any other
such rights or remedies. All such rights and remedies are nonexclusive.
(d) Lease Continuation. Even if Lessee has breached this Lease, this Lease shall continue for
so long as City does not terminate Lessee's right to possession, and City may enforce all
of its rights and remedies under this Lease, including the right to recover rent as they
become due under this Lease. Acts of maintenance or preservation or efforts to relet the
Premises or the appointment of a receiver upon initiative of City to protect City's interest
under this Lease shall not constitute a termination of Lessee's rights to possession unless
written notice of termination is given by City to Lessee. Any notice to terminate may be
given before or within the cure period for Default and may be included in a notice of
failure of compliance. No such termination shall prejudice City's right to claims for
damages for such breach or any other rights and remedies of City.
(e) Curin~Defaults. If Lessee shall fail to perform any of Lessee's obligations under this
Lease, City, without waiving rights with respect to such failure, may (but shall not be
obligated to) perform the same for the account of and at the expense of Lessee, without
notice in a case of emergency, and in any other cases, only if such failure continues after
the expiration of thirty (30) calendar days from the date City gives Lessee notice of the
failure. City shall not be liable to Lessee for any claim for damages resulting from such
action by City. Lessee agrees to reimburse City upon demand any amounts City may
spend in complying with the terms of this Lease on behalf of Lessee. City shall have the
same rights and remedies in the event of the nonpayment of amounts due to be
reimbursed under this Section as in the case of Default by Lessee in the payment of any
other rent.
16. Duties on Termination.
(a) Surrender and Removal of Property. Upon expiration or earlier termination of the Lease
for any reason, Lessee shall deliver all keys to City and surrender the Premises and all
improvements in good clean condition, acts of God, ordinary wear, work for which City
is responsible excepted. Except when the parties have previously agreed in writing to the
contrary, all improvements on the Premises, whether constructed by City or by Lessee,
other than Lessee's trade fixtures and equipment, including storage tanks, shall, at City's
option, become City property and shall not be removed unless City directs Lessee to
remove such improvements, in which case Lessee must promptly remove the
improvements at its expense, and then repair any damage to the Premises. Except as
otherwise provided in this Lease, all repair for which Lessee is responsible shall be
completed prior to termination and surrender.
(b) Time for Removal. The time for removal of any property which Lessee is required to
remove from the Premises upon expiration or earlier termination of this Lease shall be as
Page 19 of 32
follows: (a) by the expiration of this Lease; or (b) if this Lease is terminated prior to the
expiration date due to an uncured Event of Default or for any other reason, then all
removal must occur within thirty (30) calendar days of the actual earlier termination date,
and Lessee must continue to pay all rent during that period. If removal is not completed
within the thirty (30) calendar days time period, Section 7(I)(iii) and Section 14(e) shall
apply.
(c) Holdin.~ Over. If Lessee holds over after the expiration or earlier termination of this
Lease with the consent of City, and the parties have not agreed, in writing, to the terms
and provisions of a new lease (or to the extension of this Lease) prior to such expiration
or earlier termination, Lessee shall be deemed amonth-to-month holdover tenant
("Holdover Tenant") or a tenant at sufferance ("Tenant at Sufferance"), at City's sole
discretion, and Lessee shall remain bound by all terms, covenants, and agreements
hereof, except that: (a) the tenancy shall be from month to month; (b) Rent shall adjust as
of the date of expiration or earlier termination of this Lease to one hundred fifty percent
(150%) of the amount otherwise determined under Section 5(a); (c) title to Lessee's
improvements shall vest in City as of the expiration or earlier termination of this Lease;
(d) City shall have the right to adjust any rent payments due by Lessee upon thirty (30)
calendar days written notice to Lessee; and (e) such month-to-month tenancy may be
terminated at any time by thirty (30) calendar days prior written notice from either party
to the other. In the event that Lessee is a Holdover Tenant or a Tenant at Sufferance
beyond June 30 of any lease year, Lessee shall be responsible, if applicable, for payment
of taxes for the entire following tax year without proration. In the event City deems
Lessee a Holdover Tenant or a Tenant at Sufferance, City shall be entitled to evict
Lessee, but may still collect rent due by Lessee as set forth herein.
(d) Accrued Rights. Any termination of this Lease or of rights and benefits hereunder shall
be without prejudice to the obligations, liabilities or rights of any party already accrued
prior to such termination.
17. General Provisions.
(a) Covenants, Conditions and Restrictions. This Lease is subject and subordinate to the
effect of any covenants, conditions, restrictions, easements, mortgages, deeds of trust,
ground leases, rights of way, and any other matters of record now or hereafter reasonably
imposed upon the Premises and to any applicable land use or zoning laws or regulations.
Lessee shall, upon request of City, execute and deliver agreements of subordination in the
form reasonably requested City. Lessee's agreement to subordinate its interest in this
Lease to any ground lease, mortgage, deed of trust or other lien or security interest, is
expressly conditioned upon Lessee's continued right to quiet enjoyment of the Premises
and to the exercise of the other rights granted to Lessee under this Lease, so long as
Lessee is not in default under the terms of this Lease, subject, however, to City's rights of
eminent domain and other rights of City under this Lease and at law and inequity.
Page 20 of 32
(b) Governing Law. This Lease shall be governed and construed according to the laws of the
State of Oregon. Venue shall be in .lackson County, Oregon.
(c) No Benefit to Third Parties. City and Lessee are the only parties to this Lease and as
such are the only parties entitled to enforce its terms. Nothing in this Lease gives or shall
be construed to give or provide any benefit, direct, indirect, or otherwise to third parties
unless third persons are expressly described as intended to be beneficiaries of its terms.
(d) City Consent. Any consent or approval of City required or permitted under this Lease
shall be in writing and maybe given by the City's Director of Public Works. If Lessee
requests City's consent or approval pursuant to any provision of the Lease and City fails
or refuses to give such consent, Lessee shall not be entitled to any damages as a result of
such failure or refusal, whether or not unreasonable. Lessee's sole remedy shall be an
action for specific performance or injunction, and such remedy shall be available only if
City has expressly agreed, in writing, not to act unreasonably in withholding its consent
or may not unreasonably withhold its consent as a matter of law and City has, in fact,
acted unreasonably in either of those instances. In the event this Lease is silent as to the
standard for any consent, approval, determination, or similar discretionary action, the
standard shall be in the sole discretion of City.
(e) No Implied Warranty. In no event shall any consent, approval, acquiescence, or
authorization by City be deemed a warranty, representation, or covenant by City that the
matter approved, consented to, acquiesced in or authorized is appropriate, suitable,
practical, safe or in compliance with any applicable law or this Lease. In no event shall
City be deemed liable therefore. Lessee shall be solely responsible for such matters.
No Warranty ofNon-Interference By Entities Outside City's Control. Lessee
understands and recognizes that actions of parties holding land or living adjacent to the
Airport and of governmental entities not subject to City's influence and control may
have, in the future, adverse impacts upon the number and character of flight and other
operations at the Airport. City makes no warranty or assurance that such adverse impacts
will not occur.
(g) Notices. All notices required or desired to be given under this Lease shall be in writing
and maybe delivered by personal delivery, facsimile or placement in the U.S. mail,
postage prepaid, as certified mail, return receipt requested, addressed to the following
addresses or facsimile numbers:
CITY: LESSEE:
Public Works Director ~k~r ~~.~t ~ t"h,~,
20 E. Main Street
~`3 ~)~r~~ ~NF`~ 1 f~~ ~GM~~lr~C...
Ashland, OR 97520 1~~~~;,~, ~r ~
Tel: (541) 552- Tel: (541)- - 7
Fax: (541) 552- Tel: (541)- ~ ~ ~ l t~~
Page 21 of 32
Any notice delivered by mail shall be deemed to be given three (3) days after mailing as
provided above. Any notice delivered by facsimile shall be deemed to be given when a
confirmation of successful transmission is generated to the transmitting machine. To be
effective against City, such facsimile transmission must be confirmed by telephone notice
to an employee at the City Public Works Department. Any communication or notice by
personal delivery shall be deemed to be given when actually hand delivered. A party
may designate a change of address by written notice to the other party.
(h) Time of the Essence. Time is of the essence in the performance of and adherence to each
and every covenant and condition of this Lease.
(i) Calculation of Time. All periods of time referred to in this Lease shall include Saturdays,
Sundays, and legal holidays. However, if the last day of any period falls on a Saturday,
Sunday, or legal holiday, then the period shall be extended to include the next day which
is not a Saturday, Sunday or legal holiday. "Legal Holiday" shall mean any holiday
observed by the Federal. Government.
Nonwaiver. Waiver of strict performance of any provision of this Lease shall not be
deemed a waiver of or prejudice a party's right to require strict performance of the same
provision in the future or of any other provision.
(k) Survival. Any covenant or condition (including, but not limited to, indemnification
agreements), set forth in this Lease, the full performance of which is not specifically
required prior to the expiration or earlier termination of this Lease, and any covenantor
condition which by their terms are to survive, shall survive the expiration or earlier
termination of this Lease and shall remain fully enforceable thereafter.
(1) Partial Invalidity. If any provision of this Lease is held to be invalid or unenforceable,
the remainder of this Lease, or the application of such provision to persons or
circumstances other than those to which it is held invalid or unenforceable, shall not be
affected thereby, and each provision of this Lease shall be valid and enforceable to the
fullest extent permitted by law.
(m)Headin~s. The article and section headings contained in this Lease are for convenience
in reference and are not intended to define or limit the scope of any provisions of this
Lease.
(n) Exhibits Incorporated by Reference. All Exhibits attached to this Lease are incorporated
by reference in this Lease for all purposes.
(o) Modifications. This Lease may not be modified except by a writing signed by the parties
hereto.
Page 22 of 32
(p) Attorney Fees. If a suit, action, or other proceeding of any nature whatsoever (including
any proceeding under the U.S. Bankruptcy Code), is instituted in connection with any
controversy arising out of this Lease or to interpret or enforce any rights or obligations.
hereunder, the prevailing party shall be entitled to recover attorney, paralegal, accountant,
and other expert fees and all other fees, costs, and expenses actually incurred and
reasonably necessary in connection therewith, as determined by the court at trial or on
any appeal or review, in addition to all other amounts provided by law. Payment of all
such fees shall also apply to any administrative proceeding, trial, and/or any appeal or
petition for review. Whenever this Lease requires either party to defend the other, it is
agreed that such defense shall be by legal counsel acceptable to the other party.
(q) Entire Agreement. It is understood and agreed by Lessee that neither City nor City's
agents or employees have made any representations or promises with respect to this
Lease or the making or entry into this Lease, except as in this Lease expressly set forth,
and that no claim or liability or cause for termination shall be asserted by Lessee against
City for, and City shall not be liable by reason of, the claimed breach of any
representations or promises not expressly stated in this Lease, any other oral agreement
with City being expressly waived by Lessee.
(r) Successors. The rights, liabilities and remedies provided for in this Lease shall extend to
the heirs, legal representatives, successors and, so far as the terms of this Lease permit,
successors and assigns of the parties hereto. The words 'City' and 'Lessee' and their
accompanying verbs or pronouns, wherever used in this Lease, shall apply equally to all
persons, firms, or corporations which maybe or become such parties hereto.
(s) Counterparts. This Lease may be executed in two or more counterparts, each of which
shall be an original, but all of which shall constitute one instrument.
(t) Defined Terms. Capitalized terms shall have the meanings given them in the text of this
Lease.
(u) No Limit on City Powers. Nothing in this Lease shall limit, in any way, the power and
right of City to exercise its governmental rights and powers, including its powers of
eminent domain or, except as otherwise provided the rights of Lessee with respect to such
powers.
(v) Provisions Applicable to Others. All provisions of this Lease governing Lessee's use of
the Premises and Lessee's activities and conduct on, about or from the Premises shall
apply to Lessee's officers, agents, employees, invitees, and contractors.
(w) Recitals. The Recitals above are true and are incorporated into and are a part of this
Lease.
Page 23 of 32
(x) Force Majeure. If the performance by either of the parties of their respective obligations
under this Lease (excluding monetary obligations) is delayed or prevented, in whole or in
part, by any extraordinary act of terrorism, nature, explosion, epidemic, war, civil
disorder, change in laws, or unexpected and unavoidable labor strike or material shortage
that could not have been reasonably anticipated or avoided by the impacted party
(collectively, "Force Majeure"), then that party shall be excused from performance of its
obligations until the Force Majeure event has resolved without liability so long as
performance occurs as soon as reasonably possible, to the extent performance can occur.
(y) Interpretation of A reg ement. This Lease is the result of arms length negotiations between
City and Lessee and shall not be construed against either party.
(z) Status of Parties. Nothing contained. in this Lease shall be deemed or construed as
creating the relationship of principal and agent, partners, joint venturers, or any other
similar such relationship, between the parties hereto.
(aa) Nondiscrimination Assurance. Lessee for itself, its successors in interest and
assigns, as a part of the consideration hereof, does hereby covenant and agree that in the
event facilities are constructed, maintained, or otherwise operated on the Airport for a
purpose for which a U.S. Department of Transportation ("DOT") program or activity is
extended or for another purpose involving the provision of similar services or benefits,
Lessee shall maintain and operate such facilities and services in compliance with all other
requirements imposed pursuant to 49 CFR 21, Nondiscrimination in Federally Assisted
Programs of the Department of Transportation, and as said regulations maybe amended.
Lessee for itself, its successors in interest, and assigns, as a part of the consideration
hereof, does hereby covenant and agree that: (a) no person on the grounds of race, color,
or national origin shall be excluded from participation in, denied the benefits of, or be
otherwise subjected to discrimination in the use of said facilities; (b) that in the
construction of any improvements on, over, or under such land and the furnishing of
services thereon, no person on the grounds of race, color, or national origin shall be
excluded from participation in, denied the benefits of, or otherwise be subjected to
discrimination; (c} that Lessee shall use the Premises incompliance with all other
requirements imposed by or pursuant to 49 CFR 21, Nondiscrimination in Federally
Assisted Programs of the Department of Transportation, and as said regulations maybe
amended. Lessee assures that it will comply with pertinent statutes, Executive Orders
and such rules as are promulgated to assure that no person shall, on the grounds of race,
creed, color, national origin, sex, age, or handicap be excluded from participating in any
activity conducted with or benefiting from federal assistance. This provision obligates
Lessee or its transferee for the period during which federal assistance is extended to the
airport program, except where federal assistance is to provide, or is in the form of
personal property or real property or interest therein or structures or improvements
thereon. In these cases, the provision obligates Lessee or any transferee for the longer of
the following periods: (i) the period during which the property is used by City or any
transferee for a purpose for which federal assistance is extended, or for another purpose
involving the provision of similar services or benefits; or (ii) the period during which
Page 24 of 32
City or any transferee retains ownership or possession of the Airport property. In the
case of contractors, this provision binds the contractors from the bid solicitation period
through the completion of the contract. In addition, Lessee agrees that, whether or not
this Lease is conducted with, or benefits from, federal assistance, it shall in all matters
pertaining to the performance of this Lease conduct its business in a manner which
assures fair, equal and nondiscriminatory treatment of all persons without respect to race,
sex, age, color, creed, sexual preference, marital status, national origin, or the presence of
any sensory, mental or physical handicap. Lessee will maintain open hiring and
employment practices and will welcome applications for employment in all positions
from all qualified individuals. It is the policy of the DOT that disadvantaged business
enterprises, as defined in the Airport and Airway Improvement Act, as amended, and as
implemented by the federal regulations, shall have the maximum opportunity to
participate in the performance of leases as defined in 49 CFR 23.5. Consequently, this
Lease is subject to 49 CFR 23, as applicable. Lessee will, at the timely request of City,
provide any information needed in preparation of necessary reports, forms, documents
and other data relative to equal employment. Lessee hereby assures that it will include
the above clauses in any subleases approved by City and cause sublessees to similarly
include clauses in further subleases.
s
IN WITNESS HEREOF, the parties have subscribed their names hereto effective as of the year
and date first written above.
CITY OF ASHCAN
i By: By:
h Strom rg, Mayor
Robert Skinner, President
Skinner Aviation Inc.
- ~ APPROVED AS TO LEGAL SUFFICIENCY
B ; ~~~:~z~ FOR THE CITY:
y ~n
Mignon Ski er, Vice President
Skinner Aviation Inc.
By:
As land City Attorney
Page 25 of 32
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Page 26 of 32
EXI-IIBIT B
Premises Maintenance Matrix
The following pertains to property within the Premises
City is responsible for items designated in the Premises Maintenance Matrix, and Lessee is
responsible for items it is designated to maintain in the Premises Maintenance Matrix, along with
all repairs or maintenance necessitated by the negligent or intentional acts or omissions of Lessee
or the employees, agents, or contractors of the Lessee.
Lessee and City shall perform their maintenance obligations within a MAINTAINED
reasonable timeframe unless otherwise specified in the "Special Notes" to this BY:
Premises Maintenance Matrix.
Lessee City
1. Interior ofPremises buildin s
l .l Windows, non-oversized doors X
l .2 Car et cleanin two times each year X
1.3 Interior rooms, ceilin s, floors and floor coverings X
.4 Janitorial services for and etleral upkee of restrooms X
2. Electrical S stems
2.1 Electrical anels X
2.2 Power from main electrical panel throughout Premises, including X
conduit and wiring, subpanels, and power outlets, switches and
interior lam s.
2.3 Exterior li htin , includin wiring and li htin fixtures X
3. Fire S stems
3.1 Sprinklers {heads and piping) ~
3.2 Fire suppression equipment and devices, including portable fire X
extinguishers, due to Lessee's use of Premises
4. H~AC
4.l Affixed heating, air conditioning, ventilation systems and X
associated controls, including central system and package units
S. Si na e
5.1 Building identification and directory X
6. Structures
6.1 Exterior: Components to include roof, sidings, gutters, drains, ~
walkways, fascia, exterior doors, painting of exteriors of Premises
buildin
b.2 Interior structural components of interior walls, including ~
Page 27 of 32
overhead cargo doors
6.3 Interior surfaces, including ceilings, walls, and floors and ~
waterproofing and sealing of al(floor penetrations.
6.4 Interior lacks X
6.5 Exterior lacks X
6.6 Asbestos mono ement ~
7. Water Systems and Ground Utilities
7.1 Storm sewers, startn inlets X
7.2 Utility lines from Point of Service to and throughout Premises X
7.3 Utilit fixtures (sinks, toilets, fountains, etc.} ~
7.4 Piping within Premises X
7.5 Natural gas lines, from Point of Service to and throughout X
Premises
7.6 Cold water i e insulation X
7.7 Water heater and refrigerator units X
7.8 Floor enetrations X
8. Radio and Weather Equipment
$.I Radio e ui ment X
8.2 Weather equipment X
9. Above Ground Fuel Storage System and Associated Components X
~ Future modifications in the public use area of the FBO Terminal Building required to meet
Americans with Disabilities standards will be the responsibility of the City
Any modifications done by Lessee Will comply with all regulatory statutes and Lessee shall
obtain all necessary permits in order to perform modifications.
EXHIBIT C
other Airport Maintenance Matrix
The following pertains to non-Premises Airport property, for which Lessee has certain
responsibilities as Primary Fixed Base Operator pursuant to the Restated Agreement.
Page 28 of 32
City is responsible for items designated in the Premises Maintenance Matrix, and Lessee is
responsible for items it is designated to maintain in the Premises Maintenance Matrix, along with
all repairs or maintenance necessitated by the negligent or intentional acts or omissions of Lessee
or the employees, agents, or contractors of the Lessee.
Lessee and City shall perform their maintenance obligations within a MAINTAINED
reasonable timeframe unless otherwise specified in the "Special Notes" to BY:
this tither Air ort Maintenance Matrix.
Lessee Ci
1
1.l
Note-exhibit C to be amended as necessary during any lease negotiations opened by the FBQ or
City.
ENHIBIT D
Insurance Requirements
Page 29 of 32
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Page 31 of 32
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