HomeMy WebLinkAboutContract 48576FORT WORTH
January 6, 2017
Thomas J. Harris
FBO Partners, Ltd.
2221 Alliance Blvd., Suite 100
Fort Worth, Texas 76177
Re: Ground Lease Agreement ("Ground Lease") dated , 2017, by and between
the City of Fort Worth ("Lessor") and FBO Partners, Ltd. ("Lessee") covering Fort
Worth Alliance Airport Lease Sites for Hangar 3 and Hangar 4 (as more particularly
described in the Lease, the "Premises")
Performance Guaranty ("Guaranty") datedjdJ7 2017, executed by Alliance
Aviation Investors, L.P. ("Guarantor") for the benefit of Lessor in connection with the
Lease
Dear Mr. Harris:
This letter confirms, on behalf of Lessor, that (i) the referenced Guaranty executed and delivered
by Guarantor in connection with the Lease fully satisfies the requirements of Lessee under
Section 4.5 of the Lease, and (ii) as of the date of this letter, Guarantor has fully satisfied its
obligations to provide satisfactory evidence of Guarantor's financial net worth to Lessor.
Very truly yours,
Lessor:
CITY OF FORT WORTH
By:
Aaron J. Bovos, Chief Financial Officer
FINANCIAL MANAGEMENT SERVICES DEPARTMENT
THE CITY OF FORT WORTH' 200 TEXAS STREET' FORT WORTH, TEXAS 76102
(817) 392-8500' FAX (817) 392-8966
CITY SECRETARY / j ✓�1„
PERFORMANCE GUARANTY CONTRACT NO.-, lU
1. FOR VALUE RECEIVED, and in consideration for, and as an inducement to, the
City of Fort Worth, Texas, a municipal corporation of Tarrant County, Texas ("Lessor"), to enter
into that certain Fort Worth Alliance Airport Ground Lease Agreement for Lease Sites Hangar 3
and Hangar 4 (the "Lease"), dated on or about the date hereof, by and between Lessor and FBO
Partners, Ltd., a Texas limited partnership ("Lessee"), Alliance Aviation Investors, L.P., a Texas
limited partnership ("Guarantor"), hereby absolutely and unconditionally guarantees the full
performance of Lessee's obligation under the Lease to construct and complete the Mandatory
Improvements (as defined in Section 4.1 of the Lease) (the "Obli ag tion") from the date hereof
through the Termination Date (as defined in Section 25 below) (the "Guaranty Term") and
Guarantor hereby makes itself fully liable for such performance. The Obligation shall be
deemed fully satisfied for all purposes as of the date on which the Mandatory Improvements (as
defined in the Lease) have been completed as evidenced by the issuance of a Certificate of
Occupancy for same.
2. Guarantor covenants and agrees that this Performance Guaranty is absolute,
unconditional and irrevocable and shall remain and continue in full force and effect for and with
respect to the Guaranty Term.
3. Failure of Lessor to insist upon strict performance or observance of any of the
terms, provisions or covenants of the Lease or to exercise any right therein contained shall not be
construed as a waiver or relinquishment for the future of any such term, provision, covenant or
right, but the same shall continue and remain in full force and effect. Receipt by Lessor of any
monetary sum or acceptance of performance of any obligation of Lessee under the Lease with
knowledge of the breach of any provision of the Lease shall not be deemed a waiver of such
breach. Waiver by Lessor of any right of Lessor against Lessee under the Lease shall not
constitute a waiver as against Guarantor or in any other way inure to the benefit of Guarantor
(unless Lessor agrees in writing that the liability of Guarantor under this Performance Guaranty
is thereby affected).
4. Guarantor further agrees to indemnify and hold harmless Lessor from all loss,
damage, cost and expense (including, without limitation, costs of court and reasonable attorney's
fees incurred by Lessor) in the event of any default by Lessee of the Obligation under the Lease.
5. Guarantor further agrees that in any right of action which shall accrue to Lessor
under the Lease (after the expiration of any applicable notice to Lessee and opportunity to cure
period contained in the Lease), Lessor may, at its option, proceed against Lessee alone (without
having made any further demand upon Guarantor or having commenced any action against
Guarantor or having obtained or having attempted to satisfy any judgment against Guarantor) or
proceed against Guarantor and Lessee, jointly or severally, or proceed against Guarantor alone
(without having made any prior demand upon Lessee or having commenced any action against
Lessee or having obtained or having attempted to satisfy any judgment against Lessee). With the
exception only of the defense of prior payment or prior performance by Lessee of the Obligation,
all defenses of the law of guaranty, indemnification and suretyship, including without limitation,
substantive defenses and procedural defenses, are hereby waived and released by Guarantor,
2297007_3
Except as provided in the preceding sentence, under no circumstances shall the liability of
Guarantor under this Performance Guaranty be terminated either with respect to any period of
time when the liability of Lessee for the Obligation under the Lease continues or with respect to
any circumstances as to which the liability of Lessee for the Obligation has not been fully
discharged by payment or performance.
6. All of the covenants, duties and obligations of Guarantor under this Performance
Guaranty shall be performed in Tarrant County, Texas, and Guarantor hereby waives the right to
be sued elsewhere; and all matters relating to this Performance Guaranty and the covenants,
duties and obligations of Guarantor under this Performance Guaranty shall be governed by the
internal laws of the State of Texas (without reference to conflicts of laws principles).
7. Guarantor specifically waives any notice of acceptance of this Performance
Guaranty by Lessor.
8. If the Obligation of Lessee under the Lease is secured, in whole or in part by
collateral of any type, Lessor may, from time to time, at its discretion and with or without
valuable consideration, allow substitution or withdrawal of all or any part of such collateral or
subordinate or waive any of its lien rights with respect to all or any part of such collateral or
release all or any part of such collateral, without notice to or consent of Guarantor and without in
anywise impairing, diminishing or releasing the liability of Guarantor under this Performance
Guaranty. Under no circumstances shall Lessor be required to resort first to any collateral for
any obligation of Lessee as any nature of prerequisite or precondition to invoking or enforcing
the liability of Guarantor under this Performance Guaranty.
9. Guarantor acknowledges and represents to Lessor that Guarantor executed this
Performance Guaranty prior to or contemporaneously with the time that Lessor executed the
Lease, and Guarantor acknowledges and agrees that the execution and delivery of this
Performance Guaranty by Guarantor to Lessor has served as a material inducement to Lessor
itself to execute and deliver the Lease and Guarantor further acknowledges and agrees that, but
for the execution and delivery of this Performance Guaranty by Guarantor, Lessor would not
have executed and delivered the Lease.
10. Guarantor acknowledges and agrees that this Performance Guaranty may
reasonably be expected to benefit, directly or indirectly, Guarantor. Guarantor further
acknowledges and agrees that the making of this Performance Guaranty did not result from any
fraud on Guarantor. Guarantor further warrants and represents (and acknowledges that Lessor
has relied upon such warranty and representation in entering into the Lease) that the execution
and delivery of this Performance Guaranty is not in contravention of any contractual or other
legal limitation (statutory or otherwise) binding on Guarantor.
11. Guarantor agrees that in the event that Lessee shall become insolvent or shall be
adjudicated a bankrupt, or shall file a petition for reorganization, arrangement or other relief
under any present or future provisions of the Federal Bankruptcy Code, or if such a petition be
filed by creditors of Lessee, or if Lessee shall seek a judicial readjustment of the rights of its
creditors under any present or future Federal or State law or if a receiver of all or part of its
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property and assets is appointed by any State or Federal court, no such proceeding or action
taken therein shall modify, diminish or in any way affect the liability of Guarantor under this
Performance Guaranty and the liability of Guarantor with respect to the Obligation under the
Lease shall be of the same scope as if Guarantor itself had executed the Lease as the named
Lessee thereunder and no "rejection" and/or "termination" of the Lease in any of the proceedings
referred to in this paragraph shall be effective to release and/or terminate the continuing liability
of Guarantor to Lessor under this Performance Guaranty with respect to the Obligation under the
Lease.
12. All rights of Guarantor against Lessee arising by way of subrogation on account
of Guarantor's having performed some covenant, duty or obligation of Lessee under the Lease
shall be subject and subordinate to all of the rights of Lessor against Lessee with respect to the
Obligation under the Lease, and Guarantor shall not exercise any such right of Guarantor against
Lessee until all of the covenants, duties and obligations of Lessee under the Lease shall have
been fully performed.
13. Guarantor hereby subordinates any and all indebtedness of Lessee now or
hereafter owing to Guarantor to all indebtedness of Lessee to Lessor and agrees with Lessor that
Guarantor shall not demand or accept any payments from Lessee on any such indebtedness if at
such time Lessee is in default with respect to any of its obligations under the Lease, and
Guarantor shall not claim any offset or other reduction of Guarantor's liability hereunder because
of any such indebtedness and shall not take any action to obtain any of the security described in
and encumbered by any security in favor of Lessor.
14. Guarantor agrees to pay to Lessor all reasonable costs and expenses (including
court costs and reasonable attorney's fees) incurred by Lessor in the enforcement of this
Performance Guaranty.
15. The stated rights of Lessor under this Performance Guaranty shall be understood
as not excluding any other legal or equitable rights of Lessor against Guarantor not expressly set
forth herein, but shall be understood as being cumulative of all such other legal and equitable
rights of Lessor not expressly stated herein.
16. Should any portion of this Performance Guaranty ever be held legally invalid or
unenforceable, the balance of this Performance Guaranty shall not thereby be affected, but shall
remain in full force and effect in accordance with its terms and provisions.
17. All terms and provisions hereof shall inure to the benefit of the assigns and
successors of Lessor and shall be binding upon the successors and assigns of Guarantor.
18. This Performance Guaranty (i) constitutes a continuing obligation of Guarantor,
and the liability and obligations of Guarantor hereunder shall be binding upon Guarantor and its
successors and permitted assigns, (ii) may not be assigned, and (iii) will inure to the benefit of
and be enforceable by Lessor, and its successors, transferees and assigns. The obligations of
Guarantor under this Performance Guaranty may not be assigned without the prior written
consent of Lessor, which consent may be withheld in Lessor's sole and absolute discretion.
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19. All notices or requests provided for or permitted to be given pursuant to this
Performance Guaranty must be in writing and may be given or served (a) by personal delivery or
(b) by confirmed telecopy or facsimile transmittal or (c) by recognized overnight delivery such
as, but not limited to, Federal Express, or (d) by depositing the same in the United States mail,
addressed to the party to be notified, postpaid, and registered or certified with return receipt
requested. Notices given or served pursuant hereto shall be effective upon such mailing (if
mailed as aforesaid) or upon such delivery (if given or served as permitted herein other than by
mail), but the time within which any action by the addressee of such notice must be taken
pursuant to the provisions hereof shall commence to run upon the earlier to occur of the date of
actual receipt of such notice or three (3) days after the mailing thereof in accordance with the
provisions of this Performance Guaranty. All notices shall be addressed as follows:
If to Lessor: City of Fort Worth
Aviation Department
4201 N. Main St., Suite 200
Fort Worth, Texas 76106
If to Lessee: FBO Partners, Ltd.
Attn: Thomas J. Harris
2221 Alliance Blvd., Suite 100
Fort Worth, Texas 76177
With a copy to: Hillwood Development Company, LLC
Attn: President
9800 Hillwood Parkway, Suite 300
Fort Worth, Texas 76177
If to Guarantor: Alliance Aviation Investors, L.P.
Attn: Thomas J. Harris
2221 Alliance Blvd., Suite 100
Fort Worth, Texas 76177
With a copy to: Hillwood Development Company, LLC
Attn: President
9800 Hillwood Parkway, Suite 300
Fort Worth, Texas 76177
By giving to the other party at least thirty (30) days written notice thereof, the parties hereto and
their respective successors and assigns shall have the right from time to time and at any time
during the term of this Performance Guaranty to change their respective addresses and each shall
have the right to specify as its address any other address within the United States of America.
20. No waiver of any of the provisions of this Performance Guaranty shall be deemed
to be or will constitute a waiver of any other provisions hereof(whether or not similar), nor shall
any such waiver constitute a continuing waiver unless otherwise expressly so provided.
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21. The invalidity of any one or more of the words, phrases, sentences, clauses or
subsections contained in this Performance Guaranty shall not affect the enforceability of the
remaining portions of this Performance Guaranty or any part hereof, all of which are inserted
conditionally on their being valid in law, and, in the event that any one or more of the words,
phrases, sentences, clauses, sections or subsections contained in this Performance Guaranty shall
be declared invalid, this Performance Guaranty shall be construed as if such word or words,
phrase or phrases, sentence or sentences, clause or clauses, section or sections or subsection or
subsections had not been inserted.
22. This Performance Guaranty constitutes the entire agreement among the parties
hereto with respect to the subject matter hereof and supersedes all prior agreements and
undertakings among the parties hereto with respect to such subject matter, and may not be
amended, supplemented or discharged except by an instrument in writing signed by Lessor and
Guarantor.
23. WAIVER OF JURY TRIAL. GUARANTOR HEREBY WAIVES TRIAL BY
JURY IN ANY ACTION OR PROCEEDING, ARISING OUT OF OR IN ANY WAY
PERTAINING TO THIS PERFORMANCE GUARANTY. IT IS AGREED AND
UNDERSTOOD THAT THIS WAIVER CONSTITUTES A WAIVER OF TRIAL BY JURY
OF ALL CLAIMS AGAINST ALL PARTIES TO SUCH ACTIONS OR PROCEEDINGS,
INCLUDING CLAIMS AGAINST PARTIES WHO ARE NOT PARTIES TO THIS
PERFORMANCE GUARANTY. THIS WAIVER IS KNOWINGLY, WILLINGLY, AND
VOLUNTARILY MADE BY GUARANTOR, AND GUARANTOR HEREBY REPRESENTS
THAT NO REPRESENTATION OF FACT OR OPINION HAS BEEN MADE BY ANY
INDIVIDUAL TO INDUCE THIS WAIVER OF TRIAL BY JURY OR TO IN ANY WAY
MODIFY OR NULLIFY ITS EFFECT.
24. Limited Recourse. Notwithstanding anything contained in this Performance
Guaranty or the Lease and related documents to the contrary, Lessor shall have no recourse
against Guarantor's interest in ILOAJP Holdings, LLC, and by signing this Performance
Guaranty agrees that it shall not seek to enforce any judgment or pursue any other remedy
against Guarantor's interest in ILOAJP Holdings, LLC.
25. Termination of Performance Guaranty. Notwithstanding anything contained in
this Performance Guaranty or the Lease and related documents to the contrary, this Performance
Guaranty and all of Lessors rights hereunder and related hereto, shall automatically terminate
and be of no further force or effect as of the earlier of the following dates (the "Termination
Date"): (i) the date on which the Mandatory Improvements (as defined in the Lease) have been
completed as evidenced by the issuance of a Certificate of Occupancy for same, (ii) the date
Lessor terminates the Lease, or (iii) the date of occurrence of any Reversion Event (as such term
is defined in that certain Dedication Deed dated on or about the date hereof and pursuant to
which the property covered by the Lease was conveyed by Lessee to Lessor).
[Signature page to follow]
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EXECUTED, on this the day of G , 2017.
Guarantor:
ALLIANCE AVIATION INVESTORS, L.P.,
a Texas limited partnership
By: Hillwood Operating, L.P.,
a Texas limited partnership,
its general partner
By: Hillwood Services GP, LLC,
a Texas limited liability company,
its general partner
By:
Name: M.Thomas Mason
Title: Executive Vice President
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Lessor:
CITY OF FORT WORTH:
By: �.,
Fernando Costa
Assistant City Manager
Date: e.h 7
STATE OF TEXAS §
COUNTY OF TARRANT §
BEFORE ME, the undersigned authority, a Notary Public in and for the State of Texas, on
this day personally appeared Fernando Costa, known to me to be the person whose name is
subscribed to the foregoing instrument, and acknowledged to me that the same was the act of the
City of Fort Worth and that he executed the same as the act of the City of Fort Worth for the
purposes and consideration therein expressed and in the capacity therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this 644, day
2017.
� TRIKINYA L JOHNSON
=c: j",Notary Public,State of Texas
comm.Expires 04-17-2018 Notary Publi in and the State of Texas
Notary ID 1238832-0
am..
APPROVED AS TO FORM ATTEST:
AND LEGALITYz
�
By: � �; � By:
Assistant City Atto ey ry J. Kayser
City Secretary
M&C: C-27971 ��'(Y Opp
Approval Date: October 18,2016
Form 1295 Certificate: 2016-24757
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M&C Review Page 1 of 2
Official site of the City of Fort Worth,Texas
CITY COUNCIL AGENDA FOR »
COUNCIL ACTION: Approved on 10/18/2016
REFERENCE ** 55AFW GRNDLEASE
DATE: 10/18/2016 NO.: C-27971 LOG NAME: LANDDONATION
CODE: C TYPE: CONSENT PUBLIC NO
HEARING:
SUBJECT: Authorize Acceptance of a Land Donation of Approximately 5.468 Acres of Unimproved
Land in the Greenberry Overton Survey Abstract No. 1185 from ADL Development, L.P.,
and Execution of a New Ground Lease Agreement with Mandatory Improvements with
FBO Partners, Ltd, at Fort Worth Alliance Airport (COUNCIL DISTRICT 7)
RECOMMENDATION:
It is recommended that City Council:
1. Authorize acceptance of a land donation of approximately 5.468 acres of unimproved land in the
Greenberry Overton Survey Abstract No. 1185 from ADL Development, L.P.; and
2. Authorize execution of a new Ground Lease Agreement with mandatory improvements with FBO
Partners, Ltd, at Fort Worth Alliance Airport.
DISCUSSION:
Aviation staff received an offer from ADL Development, L.P. (ADL) to donate approximately 5.468
acres (238,186.8 square feet) of unimproved land for the purpose of a separate entity, FBO Partners,
Ltd., entering into a new Ground Lease Agreement. The new Ground Lease Agreement will include
mandatory improvements, based on a mutually agreed upon development schedule to construct, at a
minimum, approximately a 40,000 square feet hangar facility (Hangar A)which will include
approximately 32,150 square feet of hangar space, 6,650 square feet of office space, 1,200 square
feet of shop space and associated parking and an approximately 32,150 square foot hangar only
(Hangar B). The total investment by the tenant for the construction of the two hangars is
approximately $9,100,000.
Fort Worth's Alliance Airport is currently at 120 percent capacity in the community hangars. There is
a waiting list of aircraft and continued frequent inquiries for hangar space. Fort Worth Alliance airport
hosts several special events each year with the potential to attract and continue in this business
component with additional hangar capacity. In addition, the runway extension project will be
complete in late 2017, which could drive additional business demand. Surrounding cities, such as
Westlake, Southlake, Keller, and the need for expanding capacity for overnight hangared business jet
parking, support this demand.
Staff requests that the City Council authorize the execution of Ground Lease Agreement for a term of
40 years. Rent will not be due until 15 years after the Effective Date, in recognition and consideration
of the donation, by ADL, of the ground, which is currently valued at approximately
$1,429,116.45. After the first 15 years, rent will begin to be paid at the ground lease rate amount as
set forth in the Lessor's Schedule of Rates and Charges then in effect (Fiscal Year 2031 Schedule of
Rates and Charges).
Rental rates shall be subject to an increase on October 1 st of each subsequent year, beginning in
2032, which will be based on the upward percentage change in the Consumer Price Index for the
http://apps.cfwnet.org/council_packet/mc_review.asp?ID=22133&councildate=l0/18/2016 1/18/2017
M&C Review Page 2 of 2
Dallas-Fort Worth Metropolitan area. At no time will the adjusted rate exceed the rate that is current
in the Schedule of Rates and Charges. Five-year rate adjustments will be applied to the ground rate
starting on October 1, 2036 and every fifth year thereafter.
A 1295 Form is attached for FBO Partners, Ltd.; a 1295 Form for ADL is not necessary because this
M&C does not approve a contract with ADL.
Fort Worth Alliance Airport is located in COUNCIL DISTRICT 7.
FISCAL INFORMATION/CERTIFICATION:
The Director of Finance certifies that the Aviation Department is responsible for the collection and
deposit of funds due to the City under this agreement, if approved.
TO
Fund Department Account Project Program I Activity Budget I Reference# Amount
ID ID Year (Chartfield 2)
FROM
Fund Department Account Project Program Activity Budget Reference# Amount
ID ID Year Chartfield 2
Submitted for City Manager's Office by: Fernando Costa (6122)
Originating Department Head: Bill Welstead (5402)
Additional Information Contact: Anne Marie-Stowe (5415)
ATTACHMENTS
55AFW GRNDLEASE LANDDONTATION.Pdf
Form 1295_FBO Partners Ltd.pdf
http://apps.cfwnet.org/council_packet/mc_review.asp?ID=22133&councildate=l0/18/2016 1/18/2017
CERTIFICATE OF INTERESTED PARTIES
FORM 1295
1 of 1
Complete Nos.1-4 and 6 if there are interested parties. OFFICE USE ONLY
Complete Nos.1,2,3,5,and 6 if there are no interested parties. CERTIFICATION OF FILING
1 Name of business entity filing form,and tate city,state and country of the business entity's place Certificate Number:
of business. 2016-24757
FBO Partners LTD
Fort Worth,TX United States Date Filed:
2 Name of governmental entity or state agency that is a party to the contract for which the form is 03/10/2016
being filed.
City of Fort Worth Date Acknowledged:
3 Provide the identification number used by the governmental entity or state agency to track or identify the contract,and provide a
description of the goods or services to be provided under the contract.
5.53 Acre Tract
New Ground Lease Agreement at Forth Worth Alliance Airport
4 Nature of interest(check applicable)
Name of Interested Party City,State,Country(place of business)
Controlling intermediary
Millwood Alliance Group, L.P. Fort Worth, TX United States X
5 Check only if there is NO Interested Party. ❑
6 AFFIDAVIT I swear,or affirm,under penalty of perjury,that the above disclosure is true and correct.
*o, CHRISTINA CAREY
My Commission Expires
August 3, 2019 nature of authorized agent of contracting business entity
J
A A O
Sworn to and subscribed before me,by the said - MUNI do this the I l day of
20 ��7 ,to certify which,witness my hand and seal of office,
6kkM, CCtLal Chn5rjRc,- Ccarre(,� ft1ct —
Signature of officer administering oath Printed name of officer adrrnnistering oath Title of officer ad mini sterin oath
Forms provided by Texas Ethics Commission www.ethics.state.tx.us Version 11.0.312