HomeMy WebLinkAboutOrdinance 8984DALLAS-FORT WORTH REGIONAL AIRPORT BOARD
P O Drawer DFW Administrative Offices
Dallas-Fort Worth Airport, Texas 75261 East Airfield Drive
Telephone (214) 574-6720 DaIlas-Fort Worth Airport
OFFERING MEMORANDUM
CITIES OF DALLAS AND FORT WORTH, TEXAS
$8,000,000
DALLAS-FORT WORTH REGIONAL AIRPORT
American Special Facilities Revenue Bonds, Series 1983A
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";f`~ The purpose of this Offering Memorandum (including the cover page and Appendices hereto) of
the Dallas-Fort Worth Regional Airport Board (the "Board") is to furnish information with respect to
$8,000,000 principal amount of Dallas-Fort Worth Regional Airport American Special Facilities
Revenue Bonds, Series 1983A (the "Series 1983A Bonds"), to be issued jointly by the Cities of Dallas
and Fort Worth, Texas (the "Cities" )
The Series 1983A Bonds are being issued by the Cities as "Special Facility Bonds" under the
authority reserved to the Cities in Section 8.7 of the 1968 Regional Airport Concurrent Bond Ordinance
adopted by the City Councils of the Cities on November 11 and 12, 1968, as supplemented and
amended (the "1968 Ordinance"), and pursuant to the authority granted the Cities under and by
virtue of Article 1269j-5, Article 1269-j-5.1, Article 1269j-5.2, Article 46d and other applicable provisions
of Vernon's Texas Civil Statutes, as amended.
The Series 1983A Bonds are being issued under and are authorized by the 1983A Regional
Airport American Special Facilities Bond Ordinance (the "Ordinance") to be adopted by the City
Councils of the Cities, respectively on December 6 and December 7, 1983, to provide funds for
the acquisition, construction and equipping at the Dallas-Fort Worth Regional Airport (the "Airport")
of the Special Facilities hereinafter described (see "Special Facilities") The Special Facilities
will be leased by the Board to American Airlines, Inc. ("American") pursuant to ~an American
Airlines Special Facilities Lease Agreement dated as of December 1, 1983 (the "Lease") The
proposed form of the Ordinance, the Lease and information concerning American are included in this
Offering Memorandum as Appendices A, B, and C, respectively
The proceeds of the Series 1983A Bonds are to be applied to pay the costs of the Special Facilities,
a deposit to the Bond Reserve Fund and Iegal, financing and administrative costs incurred in con-
nection with the issuance and delivery of the Series 1983A Bonds.
DALLAS-FORT WORTH REGIONAL AIRPORT BOARD
~ The Board was established on September 27, 1965, under Article 46d, Vernon's Texas Civil
P` Statutes, as amended, by the City Councils of Dallas and Fort Worth. Pursuant to a Contract and
~' ~ Agreement between the Cities, dated and effective as of April 15, 1968 (the "Contract Between the
~_ Cities" ), the Cities authorized and directed the Board, acting on behalf of the Cities, to proceed
3~ with the development of the Airport as a joint venture.
~'' By the terms of the Contract Between the Cities, the Airport is owned jointly by the Cities and
operated by the Board on behalf of and under the control of the Cities. The Board is authorized to
plan, acquire, establish, develop, construct, operate, lease, regulate and police the Airport and is
charged with the responsibility of exercising on behalf of the Cities the powers of each with respect
thereto.
The Board consists of eleven members, seven from the City of Dallas and four from the City of
Fort Worth, appointed by the respective City Councils of the Cities. Members of the Board serve
without compensation.
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AUTHORITY AND SECURITY FOR THE SERIES 1983A BONDS
The Series 1983A Bonds are "Special Facility Bonds", issued under the authority reserved to the
Cities in Section 8.7 of the 1968 Ordinance and pursuant to the authority granted the Cities under
and by virtue of Article 1269]-5.1, Article 1269j-5.2 and Article 46d and other applicable provisions of
Vemon's Texas Civil Statutes, as amended.
Special Facility Bonds are payable from net rent received under leases of the respective facilities
. financed thereby The Series 1983A Bonds are special obligations of the Cities of Dallas and Fort Worth
and are not a general obligation of the State of Texas or of the Cities of Dallas and Fort Worth.
Net rent payments under Special Facility leases do not constitute security for Airport Joint Revenue
„~ Bonds issued under the Airport Ordinance. Ground rental .payments under Special Facility leases and,
after Special Facility Bonds have been retired, revenues derived by the Board from the leasing, opera-
~~ ` tion or use of such Special Facilities shall be a part of Gross Revenues pledged under :the Airport
Ordinance for the Airport Joint Revenue Bonds.
`~~~' The,Series 1983A Bonds shall be payable solely from and secured by an irrevocable first and
superior lien on and pledge of the Net Rent (except that part received on account of the costs and
charges of any paying agents for the Bonds) payable by American to the Board under the Lease; and
the Special Funds in which Net Rent from time to time shall be on deposit as required in the Ordi-
nance. Net Rent shall be equal to the principal, interest and redemption premiums, if any, and any
reserve requirements with respect to the Bonds, together with certain other costs and charges. Ameri-
can has ~ agreed to pay such Net Rent throughout the period during which the Bonds and any
Completion Bonds, Additional Bonds or Refunding Bonds are outstanding. As indicated, the Series
1983A Bonds are payable solely from such Net Rent payments and are not payable from any other
revenues received by the Board from the operation of the Airport.
The obligations of American to make. the payments of Net Rent under the Lease. shall be absolute
and unconditional and, until such time as the principal, interest and .any redemption premium shall
have been fully paid, American (i) will not suspend or discontinue any payments of Net Rent, and
(ii) will not terminate the Lease or otherwise seek to avoid or reduce the payment of Net Rent for
.any reason.
THE SPECIAL FACILITIES
The Special Facilities to be acquired and- constructed with the proceeds of the Series 1983A Bonds
will be located on property owned by the Airport and include catering facilities and other improve-
ments necessary and desirable and related thereto.
ESTIMATED APPLICATION OF THE SERIES 1983A BOND PROCEEDS
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The proceeds of the Series 1983A Bonds will be applied as follows
~. - Total estimated construction costs of the Special Facilities $6,800,000 4
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Bond Reserve Fund deposit ~ 1,080,000
' Bond issuance expenses, including legal, administrative and financing 120,000
~" Principal amount of Series 1983A Bonds $8,000,000
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.. THE SERIES 1983A BONDS
General Description
The Series 1983A Bonds will be dated December 1, 1983, and will mature on November I, 1988.
Interest on the Series 1983A Bonds will be payable on May 1, 1984 and semi-annually thereafter on
November 1 and May 1 of each year Principal, interest and redemption premium, if any, are payable
to the registered holder by Chemical Bank, New York, New York. The Series 1983A Bonds will be
issued as a single fully registered bond in the denominations of $8,000,000.
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BOND PURCHASE
Chemical Bank, New York, New York, has agreed, subject to certain conditions, to purchase the
Series 1983A Bonds and have agreed to pay therefor a price of $8,000,000.
TAX EXEMPTION
In the opinion of Hutchison Price Boyle & Brooks, Bond Counsel, Dallas, Texas, interest on the
Series 1983A Bonds is exempt from present Federal income taxes under existing statutes, regulations,
rulings and court decisions (except as provided by Section 103(b) of the Internal Revenue Code of
1954, as amended, with respect to any Series 1983A Bond for any period during which such Bond is
held by a person who is a substantial user of the facilities financed from the proceeds of the Series
~. 1983A Bonds, or by a "related person" as defined in such Section 103(b) Said opinion will be given in
xeliance upon certain representations of American regarding the use of proceeds of the Series 1983A
Bonds. ,
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1983A REGIONAL AIRPORT
AMERICAN
SPECIAL FACILITIES
- FOND ORDINANCE
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Authorizing the Issuance of
DALLAS-FORT WORTH REGIONAL AIRPORT
AAZERICAN SPECIAL FACILITIES
REVENUE BONDS,. SERIES 1983A
$8,000,000
Adopted by
The City Councils of
THE CITY OF DALLAS, TEXAS
' and
THE CITY OF FORT WORTH, TEXAS
Effective as of December 1, 1983
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CITY OF DALLAS ORDINANCE
No. ~~06
CITY OF FORT WORTH ORDINANCE
No.
~'` Y
AN ORDINANCE ADOPTED CONCURRENTLY by the City Councils, respectively, of the
Cities of Dallas and Fort Worth, authorizing the issuance of Dallas-Fort Worth Regional Airport
American Special Facilities Revenue Bonds, Series 1983A, in the aggregate principal amount of
$8,000,000, for the purpose of acquiring, constructing, fabricating and installing certain Special
Facilities for the jointly owned Dallas-Fort Worth Regional Airport of the Cities; providing for the
security for and payment of said bonds from the Net Rent received under a certain American
Airlines $pecial Facilities Lease Agreement pertaining to the leasing and operation of said facilities;
providing that the same shall not be payable from taxation; providing the form, terms and con-
ditions ,of such bonds and the manner of their execution; containing covenants and commitments
regarding the payment of said bonds; the acquisition and construction of said facilities, and regarding
transfers of airport properties; providing other details concerning such bonds, said Agreement and said
Airport; providing for the deposit of certain of the proceeds of such bonds into the American
Special Facilities Acquisition and Construction Fund of the Joint Airport Fund under and sub-
ject to the control of the Dallas-Fort Worth Regional Airport Board; authorizing said Board to see
to the delivery of said bonds as herein directed and directing that due observance of the covenants
herein contained be made by the Board to the extent such covenants are performable by it; providing
and describing events of default and the consequences thereof; providing a method of amending this
Ordinance; ordaining other matters incident and relating to the subject and purpose hereof; and
declaring an emergency
WHEREAS, the Cities of Dallas and Fort Worth have heretofore determined that the then existing
commercial aviation and airport facilities of the Cities, specifically Love Field Airport of the City of
Dallas and Greater Southwest International Airport of the City of Fart Worth, were wholly inadequate
to meet the foreseeable commercial aviation needs of the citizens of the Cities and the residents and
citizens of the entire North Central Texas Region; and ,
WHEREAS, the Cities have further found and determined that the most effective, economic and
efficient means of providing needed airport facilities to be the construction and equipment of a cen-
trally located airport for the Cities, and to that end by an agreement entitled and hereinafter defined
as the "Contract and Agreement," the Cities continued, expanded and further defined the powers and
duties of the Dallas-Fort Worth Regional Airport Board (hereinafter defined as the "Board") thereto-
fore created, created the Joint Airport Fund of the Cities; and provided for the construction and opera-
tion of an airport known as the "Dallas-Fort Worth Regional Airport," also known as the Dallas-Fort
Worth Airport (hereinafter called the "Airport"), and
WHEREAS, in the exercise of their lawful authority, the Cities have obtained and will obtain
in the future funds for the purpose of the construction, development and equipment of the Airport in
both its first and subsequent phases; and
WHEREAS, the Airport is the major hub, primarily passenger and commercial cargo, airport for
the metropolitan area of Dallas and Fort Worth and the entire North Central Texas Region and in
that regard contains separately identifiable systems, complexes and facilities, each of which sepa-
rately constitutes but a part of the Airport as a whole, and all of which are and will be functionaIIy
relative and essential to the proper functioning of the others; and
WHEREAS, it has been found. and determined by the Board in accordance with its lawful duties
acting on behalf of the Cities that it is essential, appropriate and necessary to the proper and orderly
functioning of the Airport for its public purposes that adequate, well-planned, and major facilities
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(hereinafter defined as and called the "American Special Facilities") be established, constructed,
fabricated and equipped at the Airport for the public using the Airport, all as a part of the Airport's
essential and necessary systems and facilities; and
WHEREAS, the funds with which to construct and develop the Airport have been and will be
obtained under the authority expressed, reserved and recited in a certain Ordinance adopted jointly
by the Cities, effective as of November 12, 1968, and bearing the short title "1968 Regional Airport
Concurrent Bond Ordinance" (hereinafter called "1968 Concurrent Bond Ordinance"), and
WHEREAS, among other rights reserved therein and subject to its other terms, Section 8.7 of the
196& Concurrent Bond Ordinance reserves to the Cities, when requested by the Board, the right,
power and authority to issue "Special Facility Bonds" for the purpose of paying all costs of construc-
tion of Special Facilities (as therein defined), and
WHEREAS, it has also been determined necessary and appropriate by the Boazd that the
American Special Facilities be financed as Special Facilities, within the meaning of the 1968 Concurrent
~~ Bond Ordinance, through the issuance of the Special Facility Bonds hereinafter described, and the
Board has requested the Cities to issue bonds as such and for such purposes, and, in accordance with
the procedures and provisions described and provided in the Contract and Agreement, the Board has
executed a certain American Airlines Special Facilities Lease Agreement (hereinafter called the
"Facilities Agreement") with American Airlines, Inc. ("American"), as Lessee, the Facilities Agreement
and all of its terms and provisions being hereby adopted by reference and incorporated herein for all
purposes; and
WHEREAS, the Boazd, as permitted by law and by the Contract and Agreement, further con-
siders it appropriate and necessary in the public interest to have the American Special Facilities
operated for and on behalf, but under and subject to its jurisdiction and control and to the jurisdic-
tion and control of the Cities under the Contract and Agreement, by American as set forth in the
Facilities Agreement; and
WHEREAS, the City Councils have each found and determined as to each that the-matters to
which this Ordinance relates are matters of imperative public need and necessity in the protection of
the health, safety and morals of the citizens of each of the Cities and, as such, that this Ordinance is
an emergency measure and shall be effective as to each City respectively upon its adoption by its
City Council; and
WHEREAS, as to each respective City Council, it has been found and determined and it is hereby
found and determined that the meeting at which this Ordinance is adopted is open to the public as
required by law and that notice of the time, place and purpose of said meeting was given and posted
in accordance with the requirements of Article 6252-17, Vernon's Texas Civil Statutes, as amended,
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
DALLAS, TEXAS
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
~~ FORT WORTH, TEXAS
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'~ ARTICLE I
Title, Findings and Ratification
Section 1.1. SHORT TITLE. This Ordinance may be cited by the short title "1983A American
Special Facilities Bond Ordinance."
Section 1.2. FINDINGS All of the declarations and findings contained in, recited or repeated in
the preambles of this Ordinance and in the preambles of the Facilities Agreement are made a part
hereof and shall be fully effective as a part of the ordained subject matter of this Ordinance and are
adopted by the Cities as true and proper determinations and findings of the Cities.
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Section 1.3. RATIFICATION All actions heretofore taken (not inconsistent with the provisions
hereof) by the Cities, by the Board and by the employees and officers of each directed toward the
Airport and the issuance of the bonds herein authorized, expressly including the authorization, execu-
tion and delivery of the Facilities Agreement by the Board are hereby ratified, approved, confirmed,
accepted and adopted.
ARTICLE II
Definitions and Construction '
Section 2.1. DEFINITIONS In and throughout this Ordinance, the following words and expres-
sions shall have the following meanings, respectively, to-wit -
.~ (a) "Additional Bonds" means any Bonds issued for the purposes specified in Section 8.2
`" hereof.
(b) "Airport" means the Dallas-Fort Worth Regional Airport, as aforesaid.
(c} "American Special Facilities" means the facilities and properties defined in the Facilities
Agreement as the "Special Facilities:'
(d) "American Special Facilities Bond Interest and Sinking Fund" means the Fund by that
name created in Section 7.2 and constituting a part of the Joint Airport Fund.
{e) "American Special Facilities Net Rent Clearance Fund" means the fund by that name
created in Section 7.2 of this Ordinance and constituting a part of the Joint Airport Fund.
(f) "American Special Facilities Bond Reserve Fund" means. the fund ,by that name created
in Section 7.2 of this Ordinance and constituting a part of the joint Airport Fund.
(g) "American Special Facilities Acquisition and Construction Fund" means the fund by that
name created in Section 5.2 of this Ordinance and constituting a part of the Joint Airport Fund.
(h) "Board" means the Dallas-Fort Worth Regional Airport Board, as aforesaid.
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(i) "Bonds" means the Series 1983A Bonds, the Completion Bonds, the Additional Bonds and
any Refunding Bonds issued in lieu thereof, all of which are Special Facility Bonds within the
meaning of the 1968 Concurrent Bond Ordinance.
(j) "Cities" means collectively the municipal corporations and political bodies and sub=
divisions of the State of Texas known as the City of Dallas, in the County of Dallas, and the
City of Fort Worth, in the County of Tarrant, and such term shall also be deemed to include
and refer to, in all appropriate respects, any successor political body, authority or subdivision
• if the Airport shall ever be transferred thereto as permitted by Section 9.3 hereof.
(k) "City Council" or "City Councils" means in each instance the governing body as from
time to time constituted of each of the Cities or the plural thereof shall mean and refer to the
~s~~,.. governing bodies of both of the Cities.
L (1) "Completion Bonds" means Bonds issued for the purpose of completing the ,payment
'~ of the Costs of the Initial Special Facilities, or any subsequent Costs of the American Special
Facilities for which Additional Bonds have been issued, as permitted in Section 8.1 hereof.
(m) "Contract and Agreement" means that certain agreement entitled "Contract and Agree-
ment," entered into actually on April 23, 1968, but effective as of April 15, 1968, by and between
' Dallas and Fort Worth, which by its terms continues, expands, and further defines the powers
and duties of the Board, creates the Joint Airport Fund, as herein defined, and provides for the
construction and operation of the Airport.
(n) "Costs of the American Special Facilities" or "Costs of the Initial Special Facilities"
means the items of costs described and enumerated in subsection (i) of Section 1.I of the
Facilities Agreement.
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(o) "Dallas" means the City of DaIIas, Texas.
(p) "Director of Engineering" means that person who shall from time to time be in charge
of the Board's Engineering Department.
(q) "Director of Finance" means the Director of Finance of the Board.
(r) "Executive Director" means the chief administrative and executive officer of the
$oard as described and required by the Contract and Agreement.
(s) "Event of Default" means any of the events stated in Section 10.1 hereof.
(t) "Facilities Agreement" means the agreement with the Lessee described in the preambles
~, hereof.
v (u) "Fort Worth" means the City of Fort Worth, Texas.
(v) "Ground Rent" means the rent payable to the Board under Section 5.1 of the Facilities
Agreement.
(w) "Holder" when used in conjunction with the Bonds means the person in possession and
the apparent owner of the designated item.
(x) "Independent Accountant" means any Certified Public Accountant or firm of Certified
Public Accountants, or both as determined by the Board, duly licensed to practice and practicing
as such under the laws of the State of Texas, appointed and paid by the Board, who is, in
fact, independent and not under the dominion of the Board or the Cities.
(y) "Initial Special Facilities" means the facilities and properties defined and described as
such in the Facilities Agreement.
(z) "Investment Securities" means any of the securities from time to time permitted by the
agreement with the Treasurer to be utilized by him as security for the funds of the Board on
deposit with him (except personal bonds), and additionally includes any time deposits or
certificates of deposit of any State Bank or National Banking Association which are themselves
secured by any of the above and foregoing.
(AA) "Joint Airport Fund" means the master fund by that name created by the Cities for
the purpose of accurately and adequately recording and accounting for the ownership, operations
and properties to the joint venture of the Cities evidenced by the Contract and Agreement, all
as described and provided in Section 17 of the Contract and Agreement.
(BB) "Lessee" means American Airlines, Inc., a Delaware corporation, as aforesaid
being the Lessee under the Facilities Agreement.
(CC) "Net Rent" means the rent payable to the Board under Section 5.2 of the Facilities
Agreement and herein pledged to the payment of the Bonds.
~" (DD) "1968 Concurrent Bond Ordinance" means the .Ordinance described and referred to
by that name in the preambles hereof.
'~ (EE) "Paying Agent/Registrar" with respect to the fonds, means Chemical Bank, New
York, New York.
(FF) "Pledged Revenues" means the revenues specified in Section 7.1 hereof and therein
pledged to the payment of the Bonds.
(GG) "Prime Rate" means the rate of interest publicly announced by Chemical Bank, New
York, New York, from time to time as. .its prime xate, such rate to be adjusted automatically on
and as of the effective date of any change in the Prime Rate.
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(HH) "Refunding Bonds" means any bonds issued for the purposes authorized under Sec-
tion 8.3 hereof.
(II) "Series 1983A Bonds" means the series of Bonds authorized in Article III hereof.
(JJ) "Treasurer" means the duly designated Treasurer for the Board and the Joint Airport `
Fund as described and contemplated in the Contract and Agreement.
Section 22. CONSTRUCTION AND EFFECT OF COVENANTS This. Ordinance, except
where the context hereof by clear implication shall otherwise require, shall be construed and applied
as follows
(a) Definitions include both singular and plural.
°". (b) Pronouns include both singular and plural and cover all genders.
- (c) Any percentage of Bonds, for the purposes of this Ordinance, shall be computed on the
basis of the unpaid principal amount thereof outstanding at the time the computation is made or
is required to be made hereunder
(d) None of the covenants herein shall ever impose, or be construed as imposing, a liability
or obligation on the part of the Cities, or either of them, or the Board, either (i) to pay the
principal of or interest on any .Bonds out of any funds derived by taxation; or (ii) to pay the
Bonds out of the "Gross Revenues" of the Airport, as defined in the 1968 Concurrent Bond
Ordinance.
(e) All covenants contained herein which require the performance of an affirmative,
common or joint act with respect to the Airport, the American Special Facilities or the Bonds
shall be performed, on behalf of the Cities acting jointly, by the Board, and from and after the
effective date of this Ordinance, the Board shall be obligated to undertake and perform each
and every such covenant and this Ordinance shall constitute a directive and order to the Board
to that effect.
(f) All covenants contained herein requiring the Cities to pay the principal of and the
interest on Bonds shall be joint, and not several, obligations, and all such obligations shall be
payable and collectible solely from Pledged Revenues, such revenues being owned in undivided
interests by Dallas (to the extent of 7/ llths thereof) and by Fort Worth (to the extent of
4/ llths thereof ), and each, and every holder of Bonds shall by his acceptance thereof consent
and agree that no claim, demand, suit or judgment for the payment of money, shall ever be
asserted, entered or collected against either City individually, except out of said funds and not
exceeding in the case of Dallas an amount equal to 7/ llths of the total amount asserted or
demanded, and in the case of Fort Worth an amount equal to 4/llths of the total amount
asserted or demanded.
.\ (g) In the event of a transfer of the Airport to another political body or political sub-
division, as permitted by Section 9.3 hereof, the governing board of such political body, when
' y operating the Airport under and subject to the provisions of this Ordinance, shall be obligated
to perform all of the covenants and duties hereof imposed upon the Cities themselves or upon
the Cities acting through the Board, and shall be authorized to exercise the rights reserved
- herein to the Cities or to the Board in such manner as may be appropriate and consistent with
its usual and customary methods of exercising similar rights in other instances so long as the
method or methods utilized do not impair or defeat the substantive purposes of this Ordinance.
(h) Nothing in this Ordinance shall be deemed or construed to prohibit the Cities or the
Board from financing, acquiring, constructing, installing and equipping any special facilities
for the Airport of any type considered by the Board to be necessary or desirable in connection
therewith under the 1968 Concurrent Bond Ordinance through the issuance of special facility
bonds therefor payable from lease agreements with any parties, including the Lessee, and
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expressly including the right to acquire, construct, fabricate and install (original or replace-
ment) other American Special Facilities or facilities of a type similar thereto by any method
additional to the issuance of Completion Bonds or Additional Bonds and in any locations at
the Airport, and either within or without the Leased Lands, as defined in the Facilities Agree-
ment, or any part thereof, through the execution of other agreements with other parties, or
the Lessee.
ARTICLE III
Series 1983A Bonds
Section 3.1. AUTHORIZATION (a) For the purpose of providing funds with which to pay the
Costs of the Initial Special Facilities, as contemplated by the Agreement, it is hereby declared
necessary that the Cities authorize and issue, and the Cities hereby authorize and direct the issu-
ance of "Dallas-Fort Worth Regional Airport American Special Facilities Revenue Bonds, Series 1983A"
(hereinafter defined as the "Series 1983A Bonds" or the "Series 1983A Bond"), in the principal amount
of $8,000,000 payable both as to principal and interest solely out of Pledged Revenues, as described,
defined and pledged herein.
(b) The Series 1983A Bonds are and shall be "Special Facility Bonds," issued under the authority
reserved to the Cities in Section 8.7 of the 1968 Regional Airport Concurrent Bond Ordinance and
pursuant to the authority granted the Cities under and by virtue of Article 1269j-5.1, Article
1269j-5.2, Article 48d, and other applicable provisions of Vernon's Texas Civil Statutes, as amended.
Section 3.2. DATE, DENOMINATION, MATURITIES AND INTEREST RATES The Series
1983A Bonds shall be dated as of the date of execution, delivery and issuance thereof, shall be issued in
the denomination of $8,000,000, in the form of a single typewritten bond registered in the name
of the initial purchaser thereof.
The Series 1983A Bonds shall mature on November 1, T986, and shall bear interest at a rate as
follows for the period from the date of issuance through October 3i, 1984, 58% of the Prime Rate;
for the period from November 1, 1984 through October 31, 1985, 60% of the Prime Rate for the
period from November 1, 1985 until maturity, 62% of the Prime Rate. Interest shall be payable on
May 1, 1984 and semi-annually thereafter on each November 1 and May 1. The interest rate payable
on the Series 1983A Bonds shall never exceed 15% per annum.
Section 3.3. MEDIUM, METHOD AND PLACE OF PAYMENT The principal of and the
interest on the Series 1983A Bonds shall be paid in lawful money of the United States of America in
the manner provided in this Section 3.3.
(a) Interest on the Series 1983A Bonds shall be payable to the registered Owners thereof as shown
on the records of the Paying Agent/ Registrar at the close of business on the 15th day of the month
next preceding such interest payment date (the "Record Date") Such interest shall be paid by check
or draft (dated as of the interest payment date) and mailed by the Paying Agent/Registrar to the
person entitled to such payment, .first class, postage prepaid, at the address of such person as it appears
in the bond register kept by the Paying Agent/ Registrar, or shall be payable by such other customary
banking arrangements acceptable to the Paying Agent/Registrar and the person to whom interest is to
be paid, provided, however, that such person shall bear all risk and expense of such alternative method
of payment.
(b) The principal of the Series 1983A Bond shall be paid to the person in whose name the
respective Series 1983A Bond is registered on the maturity or redemption date thereof upon presenta-
tion and surrender of the matured or redeemed Bond at the principal corporate trust office of the
Paying Agent/Registrar
Section 3.4. PRIOR REDEMPTION (a) The Series 1983A Bonds may be redeemed, at the option
of the Cities, on any date, from any moneys (other than the moneys on deposit in the American
Special Facilities Bond Interest and Sinking Fund as provided in subsection (c), below) for a
redemption price equal to the principal amount of said bonds thus optionally redeemed plus
accrued interest to the date fixed for redemption and without premium.
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(b) If the interest on the Series 1983A Bonds shall be finally determined, upon the basis of a
ruling of the Internal Revenue Service of the United States of America or a determination by a court
of competent jurisdiction, to be includable for Federal income tax purposes in the income of all reci-
pients thereof, then the Series 1983A Bonds shall be redeemed as a whole at any time not later than
120 days after any such determination, at a price equal to the principal amount thereof, plus accrued
interest to the date of redemption.
(c) The Series 1983A Bonds shall be subject to prior redemption at a price equal to the principal
amount thereof plus accrued interest to the date of redemption, at the option of the holder thereof,
on November 1, 1984, and November 1, 1985, by notice given to the Board and to American at least
ninety (90) days prior to the date of such redemption.
.r (d) The Paying Agent/Registrar shall give notice of any redemption by sending notice by first
`~ class mail, postage prepaid, not less than thirty (30) days prior to the -date fixed for redemption,
.-- to the registered Holder of the Series 1983A Bonds to be redeemed in whole or in part at the address
:~ shown on the Bond Register Such notice shall state the redemption date, the redemption price,
the place at which the Bonds are to be surrendered for payment, and, if less- than all the Series
1983A Bonds outstanding are to be redeemed, an identification of the Series 1983A Bonds or portions
thereof to be redeemed. Any notice mailed as provided herein shall be conclusively presumed to
have been duly given, whether or not the Holder receives such notice. This provision shall not apply
to any redemption pursuant to Section 3.4(c) hereof.
Section 3.5. Forrru (a) Generally The Series 1983A Bonds, the Registration Certificate of the
Comptroller of Public Accounts of the State of Texas, which may be omitted from the definitive
printed Bonds, the Certificate of Registration, and the Form of Assignment to be printed on each
Series 1983A Bond shall be substantially in the forms set forth in this Section with such appropriate
insertions, omissions, substitutions, and other variations as are permitted or required by this Resol*i-
tion and may have such letters, numbers, or other marks of identification (including identifying
numbers and letters of the Committee on Uniform Securities identification Procedures) and such
legends and endorsements (including any reproduction of an opinion of counsel) thereon as may,
consistently herewith, be established by the Board or determined by the officers executing such
Bonds as evidenced by their execution thereof: Any portion of the text of any Bonds may be set
forth on the reverse side thereof, with an appropriate reference thereto on the face of the Bonds.
The definitive Series 1983A Bonds shall be printed, lithographed, typewritten, engraved, or produced
by any combination of these methods, or produced in any other similar manner, all as determined
by the officers executing such Bonds as evidenced by their execution thereof, but the Initial Bond
submitted to the Attorney General of Texas may be typewritten or photocopied or otherwise
reproduced.
(b) Form of Series I983A Bonds. The form of the Series 1983A Bonds, including the form of
Registration Certificate of the Comptroller of Public Accounts of the State of Texas to be printed
and endorsed on the Bond shall be, respectively, substantially as follows, to wit
(FORM OF SERIES 1983A BONDS)
Registered UNITED STATES OF AMERICA Registered
No. STATE OF TEXAS $
COUNTIES OF DALLAS AND TARRANT
DALLAS-FORT WORTH REGIONAL AIRPORT
AMERICAN SPECIAL FACILITIES REVENUE BOND
SERIES 1983A
On the 1st day of November 1986, the Cities of Dallas and Fort Worth (herein collectively called
the "Cities"), municipal corporations duly incorporated under the laws of the State of Texas, for value
T
received, hereby jointly promise to pay to Chemical Bank, New York, .New York, or registered assigns,
solely from the revenues and funds described herein, the total principal sum of
EIGHT MILLION DOLLARS
and to pay interest thereon from the date of execution, delivering and issuance hereof to the maturity
or earlier redemption of this bond at the rate of 58% of the Prime Rate (as defined herein) from the
date of issuance through October 31, 1984, at the rate of 60% of the Prime Rate from November 1,
1984 through October 31, 1985; and at the rate of 62% of the Prime Rate from November 1, 1985 until
the maturity hereof, payable May 1, 1984, and semi-annually thereafter on each November and May' 1.
The principal of this Bond shall be payable without exchange or collection charges to the owner hereof
in lawful money of the United States of America upon presentation and surrender of this bond at the
~ principal corporate trust office of the Paying Agent/Registrar executing the registration certificate
~,,; appearing hereon. Interest on this bond is payable by check, dated as of the interest payment date,
mailed by the Paying Agent/ Registrar, to the registered owner at the address shown on the bond reg-
` ister kept by the Paying Agent/ Registrar For the purpose of ,paying the interest on this bond the
registered owner shall be the person in whose name this bond is registered at the close of business
on the "Record Date," which shall be the 15th day of the month next preceding each interest
payment date. The interest rate payable on this bond shall never exceed 15% per annum.
The term "Prime Rate" means the rate of interest publicly announced by Chemical Bank, New
York, New York, from time to time as its prime rate, such rate to be adjusted automatically on and
as of the effective date of any change in the Prime Rate.
The bonds of this Series may be redeemed, at the. option of the Cities, prior to its stated maturity
in whole or in part at any time, from any moneys (other than the moneys on deposit in the Interest and
Sinking Fund thereof) for a redemption price equal to the principal amount of said bonds thus
optionally redeemed plus accrued interest to the date fined for redemption and without premium.
In addition, the Series 1983A Bonds shall be redeemed as a whole at any time not later than 120
days after interest on the Series 1983A Bonds shall be finally determined, upon the basis of a ruling of
the Internal Revenue Service or a determination by a court of competent jurisdiction, to be includable
for Federal income tax purposes in the income of all recipients thereof, at a redemption price equal
to the principal amount thereof and accrued interest to the date of redemption and without premium.
The series 1983A Bonds shall be subject to prior redemption at a price equal to the principal
amount thereof plus accrued interest to the date of redemption, at the option of the holder thereof,
on November 1, 1984, and November 1, 1985, by notice given to the Board and to American at least
ninety (90) days prior to the date of such redemption.
When bonds shall be redeemed pursuant to the foregoing, a written notice of such redemption
shall be given in the manner specified in the Ordinance of the Cities authorizing this series of bonds.
By the date fixed for any such redemption, .due provision shall be made with the Paying Agent/
Registrar for the payment of the principal amount of the bonds to be so redeemed, plus accrued
interest thereon to the date fixed for redemption. If the written notice of redemption is published,
and if due provision for payment is made, all as provided above, the bonds, which are to be so
redeemed, thereby automatically shall be redeemed prior to maturity, and they shall not bear inter-
est after the date fixed for redemption, and shall not be regarded as being outstanding for any
purpose except for the purpose of receiving the funds so provided for such payment.
This bond is one of a duly authorized issue of fully registered bonds, dated December 1, 1983,
of $8,000,000, issued by the Cities for the purpose of providing funds for the purpose of acquir-
ing, constructing, fabricating and installing certain Special Facilities for the jointly owned Dailas-
Fort Worth Regional Airport of the Cities. For the purpose of providing for the issuance of this
series of bonds and securing the payment thereof, the Cities have jointly .adopted a certain
ordinance known by the short title as the "1983A American Special Facilities Bond Ordinance," and
8
therein have jointly pledged their respective interests in certain moneys therein defined as "Pledged
Revenues," which term includes certain net rents to be derived by the Dallas-Fort Worth Regional
Airport Board (the "Board") under and pursuant to the terms of a certain American Special Facilities
Lease Agreement, dated as of December 1, 1983, between the Board and American Airlines, Inc. Said
pledged Revenues, including said net rent, will be on deposit from time to time in various funds
created and' confirmed in and pursuant to the 1983A American Special Facilities Bond Ordinance,
and are unconditionally and irrevocably committed and pledged to the purposes specified for said
- funds including. the .payment of this series of bonds, and other bonds, if any, which may be issued
under said Ordinance. Reference is made to the 1983A American Special Facilities Bond Ordinance
and to said American Airlines Special Facilities Lease Agreement for a further description of Pledged
Revenues and said net rent, the. nature and extent of the security thereof, a statement of the rights,
~ duties and obligations of each of the Cities, the rights and remedies of bondholders in the event of
defaults thereunder, and further rights of the holders of this series of bonds, to all the provisions of
..-- which the holder hereof by the acceptance of this bond assents and agrees.
~ As provided in the 1983A American Special Facilities Bond Ordinance, the obligations of the
Cities to pay money hereon out of Pledged Revenues are joint, and not several, and no claim, demand,
suit or judgment shall ever be asserted, entered or collected against or from one City with the other
and no individual liability shall ever exceed in the case of Dallas 7/ lths of the total amounts thereof,
and in the case of Fort Worth 4/ llths of the total amount thereof, and such sums shall be payable and
collectible solely from the funds in which Pledged Revenues shall from time to time be on deposit.
The holder hereof shall never have the right to demand payment of this obligation out of any
funds raised or to be raised by taxation.
As provided in the Ordinance and subject to certain limitations therein set forth, this bond is
transferable upon surrender for transfer at the principal corporate trust office of the Paying Agent/
Registrar, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory
to the Paying Agent/ Registrar duly executed by the registered owner hereof or his attorney duly
authorized in writing. Thereupon one or more new fully registered Bonds of the same stated maturity;
of authorized denominations, bearing the same rate of interest, and for the same aggregate principal
amount will be issued to the designated transferee or transferees.
Neither the Cities nor the Paying Agent/ Registrar shall be required (1) to issue, transfer or
exchange any of the .Bonds during a period beginning at the opening of business 30 days before the
day of the first mailing of a notice of redemption of Bonds hereunder and ending at the close of busi-
ness on the date of such mailing, or (2) to transfer or exchange any of the Bonds so selected for
redemption in whole or in part when such redemption is scheduled to occur within 30 calendar days,
except in the case of an exchange by the holder of the unredeemed balance of a Bond called in part
for redemption.
The Cities, the Paying Agent/Registrar, and any agent of either of them may treat the person
in whose name this bond is registered as the owner hereof for the purpose of receiving payment as
herein provided (except interest shall be paid to the person in whose name this bond is registered on
the Record Date as set forth elsewhere herein and in the Ordinance authorizing the Bonds) and
for all other purposes, whether or not. this bond be overdue. Neither the Cities, the Paying Agent/
Registrar nor any such.agent shall be affected by notice to the contrary
It is hereby certified and recited that all acts and things required by the Constitution and laws
of the State of Texas to be done, to exist, and to be performed precedent to and in the issuance of
this bond and the series of which it is one, the adoption of the 1983A American Special Facilities Bond
Ordinance and the execution and delivery of said American Airlines Special Facilities Lease Agreement
have been done, do exist and have been performed as so required.
9
I1V WITNESS WHEREOF, the City Council of the City of Dallas, Texas, has caused the seal
of that City to be impressed, printed or lithographed hereon and this bond to be signed by the manual
or facsimile signature of its Mayor and countersigned by the manual or facsimile signatures of its City
Auditor and its City Secretary; and the City of Fort Worth, Texas, has caused the. seal of that City to be
placed hereon and this bond to be signed by the manual or facsimile signature of its Mayor, counter-
signed by the manual or facsimile signature of its City Secretary, and approved as to form by its City
Attorney
/s/
Mayor, City of Dallas, Texas
i
COUNTERSIGNED
/s/
City Auditor, City of Dallas, Texas
/s/
City Secretary, City of Dallas, Texas
COUNTERSIGNED
/s/~
City Secretary, City of Fort Worth, Texas
APPROVED AS TO FORM
/s/
City Attorney, City of Fort Worth, Texas
/s/
Mayor, City of Fort Worth, Texas
[FORM OF COMPTROLLER'S REGISTRATION CERTIFICATE]
OFFICE OF THE COMPTROLLER §
OF PUBLIC ACCOUNTS § .REGISTER NO.
` OF THE STATE OF TEXAS §
I hereby certify that there is on file and of record in my office a certificate of the Attorney
General of the State of Texas to the effect that this bond has been examined by him as required
by law, that he finds that it has been issued in conformity with the Constitution and laws of the
State of Texas, and that it is a valid and binding obligation of the Cities of Dallas and Fort Worth,
payable from the revenues pledged to its payment by and in the Ordinance authorizing same, and
that this bond has this day been registered by me.
Witness my hand and seal of office at Austin, Texas, December , 1983.
Comptroller o f Public Accounts
of the State of Texas
[SEAL]
10
[FORM OF CERTIFICATE OF PAYING AGENT/REGISTRAR]
as Paying Agent/ Registrar
The records of the Paying Agent/Registrar show that the Initial Bond of this series was approved
by the Attorney General of the State of Texas and registered by the Comptroller of Public Accounts
of the State of Texas under Comptroller's Registration No. ,and that this is one of the
Bonds referred to in the Ordinance described within.
DATED BY
Authorized Signer
[FORM OF ASSIGNMENT]
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers unto (print or
typewrite name, address and ZIP code of transferee)
(Social Security or other identifying number: ) the ~~
bond .and all rights thereunder, and hereby irrevocably constitutes and appoints
attorney to transfer the within bond on the books kept for registration thereof,
with.full power of substitution in the premises.
DATED
Signature Guaranteed By
Authorized Signatory
NOTICE The signature on this assignment
must correspond with the name of the regis-
tered owner as it appears on the face of the
within bond in every particular and must be
guaranteed by an officer of a federal or state
bank or a member of the National Association
of Securities Dealers.
' The Initial Bond shall be in the form set forth above in this Section, except that:
{i) in the first paragraph the words "executing the registration certificate appearing hereon"
shall be deleted and an additional sentence shall be added to the paragraph as follows "The
initial Paying Agent/ Registrar is Chemical' Bank, New York, New York."
(ii) The Initial Bond shall be numbered T-1.
~? Section 3.8. CONTROL, EXECUTION AND INITIAL REGISTRATION OF BONDS (a) The
Executive Director of the Board is hereby authorized to have control of the Series 1983A Bonds and all
necessary records and proceedings pertaining thereto pending investigation, examination and approval
by the Attorney General of the State of Texas, registration by the Comptroller of Public Accounts of
the State of Texas and their registration with and initial exchange or transfer by the Paying Agent/
Registraz
(b) Initially a single bond (the "Initial Bond") representing the entire principal amount of the
Series 1983A Bonds registered in the name of the initial ,purchaser, or purchaser's designee, of the
11
Series 1983A Bonds, shall be executed and submitted to the Attorney General of Texas for his approval.
Thereupon, the Comptroller of Public Accounts of the State of Texas; or a deputy designated in
writing to act on behalf of the Comptroller, shall execute the Comptroller's Registration Certificate.
The Initial Bond shall thereafter be delivered, as provided in the written delivery instructions, to
the initial purchaser of the Bonds on the closing date. Upon written request of the initial purchaser,
satisfactory in form and substance to the Cities and the Paying Agent/Registrar; the Initial $ond
may thereafter be exchanged for one or more typewritten or printed Bonds of equal principal amount.
Until so exchanged, the Initial Bond (and any other typewritten Bond or Bonds) registered and deliv-
ered hereunder shall be entitled to the same rights, remedies and security as definitive printed Bonds.
(c} No Series 1983A Bond shall be valid or obligatory for any purpose or be entitled to any security
or benefit of this Ordinance unless and until there appears thereon either (i) the Comptroller's Reg-
; istration Certificate substantially in the form provided herein, manually executed by the Comptroller
of Public Accounts of the State of Texas, or by his duly authorized agent, or (ii) the Certificate of
the Paying Agent/Registrar substantially in the form provided herein duly registered by manual
execution by the Paying Agent/Registrar
Section 3.7 OWNERSHIP The Cities, the Paying Agent/Registrar and any other person may
treat the person in whose name any Series 1983A Bond is registered as the absolute holder thereof for
the purpose of making and receiving payment of the principal thereof and the interest thereon, and for
all other purposes, whether or not such Series 1983A Bond is overdue, and neither the Board nor the
Paying Agent/Registrar shall be bound by any notice or knowledge to the contrary All payments
made to the person deemed to be the Holder of any Series 1983A Bond in accordance with this Sea
tion 3.7 shall be valid and effectual and shall discharge the liability of the Cities and the Paying
Agent/Registrar upon such Series 1983A Bond to the extent of the sums paid.
Section 3.8. REGISTRATION, TRANSFER AND EXCHANGE. (a) So Long as any Series 1983A
Bonds remain outstanding, the Cities shall cause the Paying Agent/Registrar to keep at its principal
corporate trust office a register (sometimes herein referred to as. the "Bond Register") in which, subject
to such reasonable regulations as it may prescribe, the Paying Agent/Registrar shall provide for the
registration and transfer of Series 1983A Bonds in accordance with the terms of this Ordinance.
(b) Except for transfers occurring by operation of law, each Series 1983A Bond may be transferred
only upon the presentation and surrender thereof at the principal corporate trust office of the Paying
Agent/Registrar with such endorsement or other evidence of transfer acceptable to the Paying
Agent/Registrar No transfer of any Series 1983A Bond shall be effective un#il entered on the registra-
tion books kept by the Paying Agent/Registrar Anew Series 1983A Bond or Series 1983A Bonds will
be required. to be delivered by the Paying Agent/Registrar to the last assignee in exchange for such
transferred and assigned Series 1983A Bonds within seventy-two (72) hours after receipt of the Series
1983A Bonds to be transferred in proper form and with proper instructions directing such transfer
(c) All Series 1983A Bonds may be exchanged upon presentation and surrender thereof at the
principal corporate trust office of the Paying Agent/Registrar for a Bond or Bonds of the same series,
maturity and interest rate and in any authorized denomination, in an aggregate principal amount
equal to the unpaid principal amount of the Bond presented for exchange. All Bonds delivered in
exchange for other Bonds shall be dated so that neither gain nor loss in interest shall result from such
exchange. The Paying Agent/ Registrar shall be and is hereby authorized to register and deliver
` exchange Bonds in accordance with the provisions of this Section 3.8. Each exchange Bond deliv-
ered in accordance with this Section 3.8 shall constitute am original additional contractual obliga-
tion of the Cities and shall be entitled to the benefits and security of this Ordinance to the same
extent as the Bond or Bonds in lieu of which such exchange Bond is delivered.
(d} No service charge shall be made to the holder for the initial registration or any subsequent
transfer of Series 1983A Bonds. However, the Paying Agent/ Registrar may require the owner of any
Bond to pay a sum sufficient to cover any tax or other governmental charge that may be imposed
12
in connection with the registration, transfer, exchange or discharge from registration of such Series
1983A Bond.
(e) Neither the Board nor the Paying Agent/Registrar shall be required (i) to issue, transfer
or exchange any Bond during a period beginning at the opening of business 30 days before the day
of the first mailing of a notice of redemption of Bonds hereunder and ending at the close of business
on the day of such mailing or (ii) to transfer or exchange any Bond so selected for redemption in
whole or in part where such redemption is scheduled to occur within 30 calendar days. Such limita-
tion on transfers shall not be applicable to an exchange by the holder of the unredeemed balance of
a Bond called in part for redemption.
Section 3.9. CANCELLATION All Bonds paid or redeemed in accordance with this Ordinance,
and all Bonds in lieu of which exchange Bonds or replacement Bonds aze regist~red~ and delivered in
accordance with Section 3.8 of this Ordinance, shall be cancelled and destroyed upon the making of
" proper records regazding such payment or redemption.. The Paying Agent/Registrar shall periodically
furnish the Board with certificates of destruction of such Bonds. ,
- Section 3.10. TEMPORARY BONDS (a) Following the delivery and registration of the Initial
Bonds and pending the preparation of definitive Series 1983A Bonds, the Cities may execute and, upon
the Cities' request, the Paying Agent/ Registraz shall register and deliver, one or more temporary
Series 1983A Bonds which are printed, lithographed, typewritten, mimeographed or otherwise pro-
duced, in any denomination, substantially of the tenor of the definitive Bonds in lieu of which they are
delivered and with such appropriate insertions, omissions, substitutions and other variations as the
officers of the Cities executing such temporary Bonds may determine, as evidenced by their signing of
such temporary Bonds.
(b) Until and unless exchanged for Series 1983A Bonds in definitive form, such-Bonds in temporary
form shall be entitled to the benefit and security of this Ordinance. The Cities shall, without unreason-
able delay, prepaze, execute and deliver to the Paying Agent/Registrar, and thereupon, upon the
presentation and surrender of the Bond or Bonds in temporary form to the Paying Agent/Registrar,
the Paying Agent/Registrar shall register and deliver in exchange therefor a Bond or Bonds of the
same maturity and series, in definitive form, in the authorized denomination, and in the same aggregate
principal amount, as the Bond or Bonds in temporary form surrendered. Such exchange shall be made
without the making of any chazge therefor to any holder of the Bonds.
Section 3.11. REPLACEMENT BONDS (a) Upon presentation and surrender to the Paying
Agent/Registrar of a mutilated Bond, the Paying Agent/Registraz shall register and deliver in ex-
change therefor a replacement bond of like tenor and principal amount, bearing a number not con-
temporaneously outstanding. The Board or the Paying Agent/Registrar may require the holder of
such bond to pay a sum sufficient to cover any tax or other governmental charge that may be imposed
and any other expenses connected therewith.
(b) In the event any Bond is lost, apparently destroyed or wrongfully taken, the Paying Agent/
Registrar,. pursuant to the applicable laws of the State of Texas and in the absence of notice or knowl-
edge that such Bond has been acquired by a bona fide purchaser, shall authenticate and deliver a
replacement Bond of like tenor and principal amount, bearing a number not contemporaneously
outstanding, provided that the holder shall have
(i) furnished to the Paying Agent/Registraz satisfactory evidence of the ownership of and
the circumstances of the loss, destruction or theft of such Bond,
(ii) furnished such security or indemnity as may be required by the Paying Agent/Registrar,
and acceptable to the Board, to save it harmless;
(iii) paid all expenses and charges in connection therewith, including, but not limited to,
printing costs, legal fees; fees of the Paying Agent/ Registrar and any tax or other governmental
charge that may be imposed, and
(iv) met any other reasonable requirements of the Cities and the Paying Agent/Registrar
13
If, after the delivery of such replacement Bond, a bona fide purchaser of the original Bond in lieu
of which such replacement Bond was issued presents for payment such original Bond, the Cities and
the Paying Agent/Registraz shall be entitled to recover such replacement Bond from the person to
whom it was delivered or from any person taking therefrom, except a bona fide purchaser, and shall
be entitled to recover upon the security or indemnity provided therefor to the extent of any loss,
damage, cost or expense incurred by the Cities or the Paying Agent/Registrar in connection therewith.
(c) In the event any such mutilated, lost, apparently destroyed or wrongfully taken Bond has
become or is about to become due and payable, the Paying Agent/Registrar in its discretion may,
in lieu of issuing a replacement Bond, pay such Bond.
(d) Each replacement Bond delivered in accordance with this Section 3.T1 shall constitute an
original contractual obligation of the Cities and shall be entitled to the benefits and security of this
Ordinance to the same extent as the Bond or Bonds in lieu of which such replacement Bond is
r delivered.
«.' Section 3.12. SALE OF SERIES 1983A BONDS The Series 1983A Bonds are hereby sold and
shall be delivered to Chemical Bank, New York, for a price of par
ARTICLE IV
[Article IV is hereby intentionally omitted from this Ordinance.]
ARTICLE V
Disposition of Bond Proceeds, Uses and Withdrawals
Section 5.1. RESERVE FUND It is hereby directed that from the proceeds of the Series 1983A
Bonds, the sum remaining after payment of costs of issuance and funding of the Acquisition and Con-
struction Fund shall be deposited into the American Special Facilities Bond Reserve Fund and used,
applied and devoted to the purposes specified elsewhere herein for money on deposit in said
Fund. Said amount (with the investment earnings thereon) shall be the minimum amount required
to be on deposit therein by reason of the Series 1983A Bonds. Additional deposits may be required
to be made thereto in accordance with ordinances authorizing Completion Bonds, Additional Bonds
or Refunding Bonds. If the amount on deposit in said Fund shall ever exceed $1,200,000, then the
funds in excess of such amount (the "Restricted Funds") shall be invested at a yield which does
not exceed the yield on the Series 1983A Bonds.
Section 5.2. AMERICAN SPECIAL FACILITIES ACQUISITION AND CONSTRUCTION
FUND The sum of $6,800,000 from the proceeds from the sale of the Series 1983A Bonds shall be
deposited promptly upon the receipt thereof in the American Special Facilities Acquisition and
Construction Fund, which is hereby created, and the moneys within said Fund, including earnings
from the investment thereof, shall be used solely for the purpose of paying the Costs of the Initial
Special Facilities.
Section 5.3. DISBURSEMENTS FROM CONSTRUCTION FUND, SURPLUS (a) Before any
moneys shall be withdrawn or any payments shall be made from the American Special Facilities
~ Acquisition and Construction Fund for Costs of the Initial Special Facilities which directly relate
to the physical construction and equipment thereof there shall be filed with and approved by the
Executive Director or his designee
(i) a voucher which may ~rontavn any number of items signed by the Board's Duector of
Engineering and stating in respect of each item to be paid-
(a) the item number of the payment;
(b) the name of the person to whom payment is due;
14
(c) the amount qr amounts to be paid;.
(d) the purpose for which the obligation to be paid was incurred in such detail as shall
be satisfactory to the Director of Finance; and
(ii) a certificate signed by the Board's Director of Engineering and attached to the voucher
certifying -
(a) that the obligations in the stated amounts have been incurred by the Board and that
each item thereof is a proper charge against the American Special Facilities Acquisition and
Construction Fund and has not been paid, ,
(b) that there has not been filed with or served on the Board any notice of lien, right
:: of lien, or attachment upon or claim affecting the right to receive payment of any moneys
payable to any person named in such voucher which has not been released or will not be
' released simultaneously with the payment of such obligations;
(c) that such voucher contains no payment on account of any retained percentage
which the Board at the date of such certificate is entited to retain; and
(d) that insofar as any such obligation was incurred for work, materials, equipment or
supplies such work was actually performed in the furtherance of the Initial Special Facili-
ties or delivered at a site thereof for that purpose or delivered for storage or fabrication at
a place or places approved by the person signing the certificate and under the control of
the Board.
If the Executive Director or his designee shall determine that such voucher and certificate are
in the form and contain the information required by this paragraph, and that such payments are due,
he shall be authorized to make payment thereof in such manner as is customarily employed by the
Board for the payment of other expenses thereof.
(b) Before any moneys shall be withdrawn or any payments shall be made from the American
Special Facilities Acquisition and Construction Fund far Costs of the Initial Special Facilities other
than those contemplated in paragraph (a); above, including expenses of administration and other
items included as a part of the term "Costs of the Initial Special Facilities" as defined in this Ordi-
nance, the Board shall adopt and maintain a current schedule of American Special Facilities Acquisition
and Construction Fund uses. Moneys within the American Special Facilities Acquisition and Construc-
tion Fund may be expended for such purposes at such times as expenditures may be required upon
the execution of a certificate by the Executive Director or his designee to the effect that such
expenditures are itemized in or contemplated by such schedule of American Special Facilities Acquisi-
tion and Construction Fund uses. Otherwise, such expenditures shall not be made unless the expendi-
ture thereof shall be approved by resolution adopted by the Board, which resolution shall recite that
the expenditure is a proper Cost of the Initial Special Facilities.
(c) When the acquisition and construction of the Initial Special Facilities shall have been com-
pleted in accordance with the plans and specifications thereof, and when all .amounts due therefor,
including all proper incidential expenses, shall have been paid, the Board's Director of Engineering
shall file with the Executive Director and the Board a certificate so stating, and thereupon the Board
shall cause the transfer of all moneys remaining in the American Special Facilities Acquisition and
Construction Fund, if any, to the American Special Facilities Bond Interest and Sinking Fund.
15
ARTICLE VI
Facilities Agreement, Collection of Net Rent
Section 6.1. FACILITIES AGREEMENT The Cities covenant and warrant (i) that the Facili-
ties Agreement has been duly and lawfully entered into, executed and delivered by the Cities acting
by and through the Board and represents a valid and subsisting agreement of the Cities, the Board
and the Lessee, enforceable in accordance with its terms; (ii) that this Ordinance has been approved
by the Lessee in conformity with the requirements of the Facilities Agreement; (iii) that during any
period during which Bonds are outstanding under this Ordinance, neither the Cities nor the Board
will consent to or grant any modification of, or amendment or concession to, by supplemental or
amendatory agreement or otherwise, the provisions of paragraphs (a) and (c) of Section 5.2 of the
Facilities Agreement; (iv) that, during any period during which Bonds are outstanding under this
Ordinance, neither the Cities nor the Board will consent to or grant any modification of, or amend-
ment or concession to, by supplemental or amendatory agreement or otherwise, any other provision
of the Facilities Agreement, which modification, amendment or concession would have the effect of
reducing, altering or modifying the obligations and commitments of the Lessee contained in para-
graphs (a) and (c) of Section 5.2 of the Facilities Agreement, or would minimize, reduce or lessen
the rights of the Board in the event of a default in the payment of Net Rent by the Lessee there-
under, or would materially and adversely affect the security herein provided for the payment of
Bonds; and (v) that the Cities and the Board will strictly observe and abide by their commitments
contained in the Facilities Agreement and will strictly enforce the obligations of the Lessee thereunder
Section 6.2. COLLECTION OF NET RENT The Cities, acting by and through the Board, shall
through appropriate statements as advised by the Paying Agent/Registrar to the Lessee, cause the
Net Rent payable thereunder to be coliected by the Paying Agent/Registrar on the dates specified in
Article VII hereof for the credit, deposit or transfer into the various funds created herein for the
purposes described, and the dates on which such collections are required, and the amounts required
by said Article VII hereof, for the purposes of this Ordinance and for the purposes of subsection (a)
of Section 5.2 and all other relevant subsections and Sections of the Facilities Agreement shall be the
due date for the payment and collection of Net Rent and the times and amounts payable thereunder
The Prime Rate shall be confirmed in writing by the Paying Agent/ Registrar promptly following the
payment, and the Lessee shall promptly advise the Board of the making of each payment.
ARTICLE VII
Pledge, Special Funds, Flow of Funds
Section 71. PLEDGE The Bonds shall be and are hereby declared to be payable solely from
and secured by an irrevocable first and superior lien on and pledge of (a) the Net Rent (except that
part received on account of the costs and charges of any paying agent or paying agents or any trustee
or trustees for the Bonds) and the special funds herein created in which Net Rent from time to
time shall be on deposit as herein required, (b) any amounts on deposit in the Special Funds herein
created and credited against the Net Rent payable by Lessee under paragraph (b) of Section 5.2
of the Facilities Agreement; and (c) in the event of a default in the payment of Net Rent by the
Lessee under the Facilities Agreement, then the gross receipts, less expenses of collection, derived
by the Board from the exercise of any remedy on default specified or permitted by Section 7.2 of
the Facilities Agreement. All of the items of money described above are herein collectively called
and defined as the "Pledged Revenues."
Section 7.2. SPECIAL FUNDS In addition to the American Special Facilities Acquisition- and
Construction Fund and the other funds heretofore and hereafter established as a part of the Joint
Airport Fund pursuant to the Contract and Agreement, the 1968 Concurrent Bond Ordinance and
other ordinances authorizing bonds relating to the Airport, the Cities hereby establish within the
16
Joint Airport Fund and direct that the same be maintained by or on behalf of the Board the following
special funds, to wit:
(a) American Special Facilities Bond Interest and Sinking Fund,
(b) American Special Facilities Bond Reserve Fund.
Section 7.3. FLOW OF FUNDS (a) That portion of Pledged Revenues credited against the Net
Rent payable by Lessee under subsection (b) of Section 5.2 of the Facilities Agreement shall at all
times remain in or be transferred to the appropriate funds created in and as directed by this Ordi-
nance. Net Rent shall be collected by or on behalf of the Board and shall be paid by the Lessee in the
amounts and on the dates required by Section 6.2 hereof and, as collected, shall be deposited into the
American Special Facilities Interest and Sinking Fund.
(b) On the first day of each month hereafter, after making any transfers required by subsection
(a ), next .above, the Board shall be authorized and required to pay from Pledged Revenues any fee
or fees of the Paying Agent or Paying Agents for the Bonds or any other fees or charges authorized
or permitted which may be or will become due during the month.
(c) During any period which Bonds are outstanding and so long as the American Special Facili-
ties Bond Reserve Fund contains the minimum amount required to be on deposit therein, no further
payments shall be required to be made thereto. If, at the close of business on September 30th of any
year, the Reserve Fund shall be deficient and shall contain less than the minimum amount then
required to be on deposit therein, as established by this Ordinance and any ordinance authorizing
other Bonds, then any surplus amounts in the American Special Facilities Bond Interest and Sinking
Fund shall be deposited to the credit of said Reserve Fund to the extent necessary to restore the
deficiency After such deposit, if a deficiency remains, then an amount equal to such remaining
deficiency shall be deposited in twelve (i2) equal monthly installments during the next succeeding
twelve (12) month period.
Section 7 4. USES OF FUNDS.. Moneys on deposit to the credit of the American Special Facilities
Bond Interest and Sinlang Fund and the American Special Facilities Bond Reserve Fund shall be used
for the purposes and uses specified in this Section 7 4, as follows• ,~
(a) AMERICAN SPECIAL FACILITIES BOND INTEREST AND SINKING FUND
Moneys on deposit in the American Special Facilities Bond Interest and Sinking Fund each year
shall be used solely and exclusively for the purposes of paying the interest on and principal
of the Bonds as such interest comes due and the principal (or sinking fund payments) become
due. Additionally, such amounts as shall be required for the purpose, shall be used for the
purpose of mandatorily redeeming Series 1983A Bonds as prescribed in Section 3.4 hereof.
(b) AMERICAN SPECIAL FACILITIES BOND RESERVE FUND For so long as any
of the Bonds shall be outstanding, the American Special Facilities Bond Reserve Fund shall be
held as a reserve for the payment of principal and interest or sinking fund payments on the
Bonds when and if Pledged Revenues on deposit in the American Special Facilities Bond
Interest and Sinking Fund shall not be sufficient for such purposes. If such deficiencies occur,
the Director of Finance shall transfer money on deposit in the American Special Facilities Bond
~'4 Reserve Fund to the American Special Facilities Bond Interest and Sinking Fund for the uses
specified for that Fund, and the deficiency thus occurring in the American Special Facilities
Bond Reserve Fund shall be restored at the times required by paragraph (c) of Section 7.3 hereof.
On each interest payment date, any Restricted Funds in the Bond Reserve Fund shall be paid to
American.
Section 7.5. SECURITY AND INVESTMENT OF FUNDS (a) For so long as moneys relating
to the American Special Facilities and the Bonds on deposit in the Joint Airport Fund shall be held
by the Treasurer, the same shall be secured in the manner provided by the agreement from time to
17
time in effect between the Board and the Treasurer In the event the Cities. shall elect to place the
moneys in said Fund, or any part thereof, elsewhere, the same shall be secured at all times in the
manner provided by law for other public funds, and, except for current requirements, shall be con-
tinually invested in appropriate Investment Securities. Earnings on the American Special Facilities
Acquisition and Construction Fund shall be retained therein as aforesaid. Earnings on the American
Special Facilities Bond Interest and Sinking Fund shall be retained therein and shall be applied in
the reduction of the Net Rent required to be collected under the Facilities Agreement. Earnings on
the American Special Facilities Bond Reserve Fund shall be retained therein except as otherwise
provided in Section 7 4(b)
(b) The Cities covenant that throughout the term of the Series 1983A Bonds they will diligently
comply with the requirements of Section 103(c) of the Internal Revenue Code of 1954, as amended,
A`- so that the Series 1983A Bonds will not at any time become arbitrage bonds.
(c) If it shall become necessary to remove or withhold any funds (in addition to escrowed
interest) established herein from the custody of the Treasurer in order to comply with the require-
ments of subsection (b), next above, or for any other reason, then, upon written order of the
Director of Finance, said funds shall be placed in trust with a state bank (s) or national banking
association(s) selected by the Board and shall be held for the benefit of the holders of the Bonds,
and pending use for the purposes provided herein shall be invested from time to time in reinvestment
securities as may he directed in accordance with procedures established by the Board. To the extent
that this subsection is inconsistent with the provisions of the Contract and Agreement or the Facilities
Agreement; then the Contract and Agreement and Facilities Agreement are hereby amended to
accommodate the requirements of this Section.
ARTICLE VIII
Completion Bonds, Additional Bonds and Refunding Bonds
Section 8.1. COMPLETION BONDS (a) The Cities reserve the right to issue Completion Bonds
payable from Pledged Revenues for the purpose of completing (i) the payment of the Costs of the
Initial Special Facilities; and (ii) the payment of the Costs of the Special Facilities in connection
with arty project for which Additional Bonds have been issued.
(b) Completion Bonds shall be on a parity with and shall have the same rights and privileges
hereunder as the Series 1983A Bonds and any Additional Bonds issued hereunder Completion Bonds
may be issued upon and subject to the following covenants and conditions, to wit:
(i) In any issue or issues of Completion Bonds the Cities shall include within the principal
amount of each issue the amount necessary to cause the American Special Facilities Bond Re-
serve Fund to have on deposit therein an amount at least equal to the average annual principal
and interest requirements on the Series 1983A Bonds then outstanding and any Completion Bonds
previously issued and then proposed to be issued.
(ii) The Executive Director of the Board shall execute a certificate stating in effect that
the Lessee is not in default under the Facilities Agreement and that the Cities' right to issue
~~ Completion Bonds with the effect as to the payment of increased Net Rent thereunder has not
been altered, rescinded, amended or changed by the Lessee, the Board or the Cities.
(iii) The issuance of any Completion Bonds shall be approved by the Lessee in the manner
required by the Facilities Agreement, as evidenced by a written instrument executed by the
Executive Director of the Board and the Lessee under which the Net Rent under the Facilities
Agreement will be increased in an amount sufficient to pay all principal of and interest on the
Bonds to be outstanding as the same mature and become due or are required to be mandatorily
redeemed.
18
(iv) Completion Bonds shall be made to mature on the same day and month, and bear
interest payable on the same days and months, as the Series 1983A Bonds.
Section 8.2. ADDITIONAL BONDS In addition to said right reserved to issue Completion
Bonds, as provided in Section 8.1, the Cities reserve the right to issue Additional Bonds payable from
Pledged Revenues for the purpose specified in the Facilities Agreement. Additional Bonds shall be
on a parity and of equal dignity with and shall have the same rights and privileges hereunder as
the Series 1983A Bonds and any Completion Bonds. Additional Bonds may be issued upon and subject
to the following covenants and conditions, to wit•
(a) The Cities shall not then be in default in any covenant, obligation or undertaking con-
tained in this Ordinance or in any other ordinance hereafter adopted relating to any Bonds there-
tofore issued as shown by a certificate of the Executive Director of the Board. Said certificate
shall specifically certify that ail payments into various Funds herein created and established have
been made in full and that said Funds .are current and that there are no deficiencies in the
amounts then required to be on deposit therein.
(b) The Cities shall increase the amounts then required to be on deposit in the American
Special Facilities Bond Reserve Fund by providing in the ordinance authorizing the issuance of
such Additional Bonds that such amount shall either be included within the principal amount of
the Additional Bonds being issued or shall be accumulated in approximately equal monthly
installments over a period not exceeding sixty (60) months from the date of the Additional
Bonds.
(c) The issuance of any Additional Bonds shall be approved by the Lessee in the manner
required by the Facilities Agreement, as evidenced by a written instrument executed by the
Executive Director of the Board and the Lessee under which the Net Rent under the Facilities
Agreement will be increased in an amount sufficient to pay all principal of and interest on the
Bonds to be outstanding as the same mature and become due or are required to be mandatorily
redeemed.
(d) Additional Bonds shall mature on the same day and month and bear interest payable
on the same days and months as the Series 1983A Bonds.
Section 8.3. REFUNDING BONDS. In addition to the Bonds authorized in Sections 8.1 and 8.2,
the Cities shall have the right in accordance with any applicable law to issue Refunding Bonds in
any manner authorized by law to refund any part or all of any outstanding. Bonds at any time
the Cities consider appropriate, provided that no Refunding Bonds shall be issued which will have a
lien on Pledged Revenues prior and superior to any Bonds which will remain outstanding after the
refunding.
Section 8.4. NO FURTHER ENCUMBRANCES OF PLEDGED REVENUES Except through
the issuance of Completion Bonds, Additional Bonds or Refunding Bonds, the Cities will not in any
~, manner pledge or further encumber the Pledged Revenues herein committed to the payment of
Bonds. However, this covenant shall not in any manner reduce, limit or otherwise alter the rights
reserved by the Cities in Section 2.2(h) hereof.
ARTICLE IX
Miscellaneous Covenants
Section 9.1. COMPLETION OF THE INITIAL SPECIAL FACILITIES. The Cities, to every
extent they lawfully may do so, covenant and agree to proceed without delay to commence and
complete the Initial Special Facilities and all functionally related parts of the Airport at the earliest
practicable date.
19
Section 9.2. PAYMENT OF BONDS. Subject to the provisions of Section 2.2(d) and Section 7.1
hereof, the Cities agree promptly to pay the principal of and interest on the Bonds.
Section 9.3. TRANSFERS OF AIRPORT AND FACILITIES So long as any Bonds are out-
standing and unpaid, the Cities shall not sell, transfer or dispose of the American Special Facilities,
except for the leasing thereof for operations as a part of the Airport; and for the disposal of surplus
or obsolete property of or as a part of the Airport in the course of exercising the right specifically
reserved under Section 9.6 of the 1968 Concurrent Bond Ordinance, which includes the provisions
of Section 9.6(B) all of which are incorporated by reference herein and shall be deemed to be a part
hereof, wherein the Cities retain, reserve, and shall have the right and privilege of transferring,
selling, leasing or disposing of the entire properties and facilities constituting the Airport to another
political body or political subdivision of the State of Texas, which shall be authorized by law to
own and operate airports, subject to the conditions contained therein, all of which are incorporated
by reference herein and shall be deemed to be a part Hereof.
Section 9.4: RULES AND REGULATIONS The Board shall establish and enforce reasonable
rules and regulations for the use and occupancy, management, control, operation, care, repair and
maintenance of the Airport, including the American Special Facilities, and the Lessee, subject to the
Facilities Agreement, shall abide by and obey all applicable rules and regulations including those
governing passage over, across and through the Airport. The Board will comply with all valid acts,
regulations, orders and directives of any executive, administrative or judicial body applicable to the
Airport, unless the same shall be contested in good faith, all to the end that it will remain operative
at all times.
Section 9.5. BOOKS, AUDITS, INSPECTION (a) So long as any Bonds remain outstanding,
proper books and records and accounts will be kept by the Board showing complete and correct
entries of all transactions relating to Net. Rent, the American Special Facilities and the Facilities
Agreement.
(b) The Board shall, after the close of each fiscal year, cause an audit of such books and accounts
to be made by an Independent Accountant, and each such audit shall include the following
(i) a complete schedule showing the beginning and ending balance in each of the Funds
created and established hereby, ,
(ii) all deposits to the credit of and all withdrawals from each Fund created and established
hereby;
(iii) a list of the insurance policies applicable to the American Special Facilities in force at
the end of the Board's fiscal year
(c) All expenses incurred in the making of the audits and reports required by this Section shall
be regarded and paid by the Lessee as an expense of operation of the American Special Facilities
except during construction when it shall be treated as a Cost of the American Special Facilities. The
Board shall furnish promptly (and in any event within sixty (60) days from the time the audit and
report is filed with the Cities) a copy of each of such audits and reports upon request to any Holder
of the Bonds.
~ Section 9:6. MAINTENANCE OF FACILITIES -INSPECTION The Board covenants that it
` will cause the Lessee to maintain the American Special Facilities at all times in good order and condi-
tion, except for normal wear and tear and to make all necessary and appropriate repairs thereto,
subject to the provisions of the Facilities Agreement.
Section 9.7 INSURANCE. The Board covenants that it will insure or cause to be insured the
American Special Facilities at all times until all Bonds secured hereby, and the interests thereon, shall
have been paid or provision for such payment shall have been made, all in accordance with the
provisions of the Facilities Agreement. The proceeds of all such insurance shall be applied as pro-
vided in the Facilities Agreement.
20
Section 9.8. RATES IN CERTAIN INSTANCES In the event of a default in the payment of
Net Rent by the Lessee under the Facilities Agreement and the Board operates the American Special
Facilities and the gross receipts, less expenses of collection, therefrom are required. to be devoted to
the payment of the Bonds, as contemplated by clause (c) of Section 7.1 hereof, the Board hereby
covenants and agrees to impose and collect with respect to the American Special Facilities such rates,
rentals, fees and charges as shall be sufficient to pay and retire the Bonds and all interest thereon
when and as due and payable and to maintain the amounts required to be on deposit in the special
Funds herein created and at the times herein required.
ARTICLE X
Events and Remedies of Default
~~
Section 10.1. DESCRIPTION Each of the following occurrences or events for the purposes of
this Ordinance shall be and is hereby declared to be an "Event of Default," to wit•
(a) The failure to make payment of the principal of any of the Bonds when the same shall
become due and payable;
(b) The failure to pay any installment of interest when the same shall become due and
payable and such failure shall continue for a period of thirty (3U) days after the due date thereof;
(c) Default in any covenant, undertaking or commitment contained in the Contract and
Agreement, the failure tv perform which materially affects the rights of the holders of the Bonds,
including but not limited to their prospect or ability to be repaid in accordance with the terms
and provisions of this Ordinance, and. the continuation thereof for a period of sixty (60) days
after notice of such default by any Holder of any Bonds;
(d) The Cities or the Board shall fail, refuse or neglect to enforce the payment by the
Lessee of Net Rent under the Facilities Agreement, or otherwise fail, refuse or neglect to
enforce any other provisions of the Facilities Agreement in a manner which materially affects
the rights of the Holders of the Bonds, including but not limited to their prospect or ability to
be repaid in accordance with the terms and provisions of this Ordinance, and the continuation
thereof for a period of sixty (60) days after notice of such default by any Holder of any Bonds;
(e) An order or decree shall be entered by a Court of competent jurisdiction with the
consent or acquiescence of the Cities appointing a receiver or receivers for the Airport. or the
American Special Facilities or for or of the rentals, rates, revenues, fees or charges derived
therefrom, or if any order or decree having been entered without the consent or acquiescence
of the Cities shall not be vacated, discharged or stayed on appeal within ninety (90) days
after entry;
(f) The Cities shall default in the due and punctual performance of any other of the
covenants, conditions, agreements and provisions contained in the Bonds or in this Ordinance on
their part to be performed, and if such default shall continue for thirty (30) days after written
notice specifying such default and requiring the same to be remedied shall have been given to
the. Cities, or to the Board by the Holder
Section 10.2 REMEDIES FOR DEFAULT Upon the happening and continuance of any of the
Events of Default as provided in Section 10.1 hereof, then and in every case any Bondholder,
including but not limited to a trustee or trustees therefore, may proceed against the Cities and the
Board, for the purpose of protecting and enforcing the rights of the Holders of Bonds under this
Ordinance, by mandamus or other suit, action or special proceeding in equity or at law, in any
court of competent jurisdiction, for any relief permitted by law, including the specific performance
of any covenant or agreement contained herein, or thereby to enjoin any act or thing which may be
unlawful or in violation of any right of the Bondholders hereunder or any combination of such
21
remedies. It is provided, however, that all such proceedings at law or in equity shall be instituted,
strictly subject to the provisions of Article II hereof and to Section 7.1 hereof, and shall be had and
maintained for the equal benefit of all Holders of the Bonds. Each right or privilege of any Bond-
holders (or trustee thereof) shall be in addition to and cumulative of any other right or privilege
and the exercise of any right or privilege by or on behalf of any Holders shall not be deemed a
waiver of any other right or privilege thereof.
ARTICLE XI
Amendments to Ordinance
Section 11.1 LIMITATIONS (a) This Ordinance may be amended by concurrent ordinances
adopted by the City Council with the written consent of the Lessee and the Holder of the Bonds
outstanding hereunder at the time of the adoption of such amendatory ordinance (not including any
Bonds then held or owned by the Cities), provided, however, that no such ordinance shall have
the effect of permitting-
(i) an extension of the maturity of any Bonds;
(ii) a reduction in the principal amount of any Bonds, the rate of interest thereon, or any
redemption premium payable thereon,
(iii) the creation of a lien upon or a pledge of revenues ranking prior to the lien or pledge
created hereby;
(iv) a reduction of the principal amount of Bonds required for consent to such amendatory
ordinance;
(v) the establishment of priorities among Bonds; or
(vi) the modification of or otherwise affecting the rights of the Holders of less than all of
the Bonds then outstanding.
(b) NOTICE OF AMENDMENT Whenever the Cities shall propose to amend this Ordinance,
the Cities shall cause notice of the proposed amendment to be given to the Holder in the same
manner provided in Section 3.4(d) hereof.
(c) TIME FOR AMENDMENT The Cities may adopt such amendatory ordinance and the
same shall become effective if within one (1) year from the date of the publication of said notice
there is filed with the Board written consent to the adoption thereof executed by the Holder of the
Bonds then outstanding.
(d) BINDING CONSENT if the Holder of the Bonds outstanding have consented to the
adoption of such ordinance, no Holder of any Bond, whether or not such Holder shall have consented
to or shall have revoked any consent, shall have any right or interest to object to the adoption of
such amendatory ordinance, or to enjoin or restrain the Cities from taking any action pursuant to
the provisions thereof.
(e) PROOF OF INSTRUMENTS The fact and date of the execution of any instrument under
the provisions of this Section may be proved by the certificate of any officer in any jurisdiction, who
by the laws thereof is authorized to take acknowledgments of deeds within such jurisdiction, that the
person signing such instrument acknowledged before him the execution thereof, or such facts may be
proved by an affidavit of a witness to such execution sworn to before such officer
Section 11.2. CORRECTIONS Subject to the provisions of Section ll.i(a) the Cities may, pur-
suant to a concurrent ordinance adopted by their respective City Councils, by supplemental ordinance
correct any ambiguity or typographical error, or correct or supplement any inconsistent or defective
provision contained in this Ordinance or in any ordinance supplemental hereto upon a determination
22
that such ambiguity, error, inconsistency or defect exists, provided, however, that in no event shall
any such supplemental ordinance diminish, dilute, reduce or repeal any covenants, conditions, pledges
or liens created or imposed by this Ordinance or the security for the Bonds authorized hereby
ARTICLE XII
Defeasance, Severability and Repeal
Section i2.1. DEFEASANCE When all of the outstanding Bonds have been duly paid, the pledge
and lien and all obligations hereunder shall thereby be discharged and said Bonds shall no longer be
deemed to be outstanding within the meaning of this Ordinance. There shall be deemed to be such
due payment when there has been placed in escrow or in trust with a trust bank located within or
without the State of Texas an amount sufficient (including the known minimum yield available for
such purpose from Federal Securities in which such amount wholly or in part may be initially invested)
to meet all requirements of the outstanding Bonds, as the same become due at the final maturities
thereof or upon any redemption date as of which the Cities shall have exercised or shall have
obligated itself to exercise its prior redemption option by a call of Bonds for payment. The Federal
Securities shall become due prior to the respective times on which the proceeds thereof shall be
needed, in accordance with a schedule established and agreed upon between the Cities and such
bank at the time of the creation of the escrow or trust, or the Federal Securities shall be subject to
redemption at the option of the Holders of Bonds to assure such availability as so needed to meet
such schedule. "Federal Securities" for purposes of this section shall mean direct obligations of or
obligations guaranteed by the United States of America.
Section 12.2. ORDINANCE IRREPEALABLE. After any of the Bonds shall be issued, this Ordi-
nance shall constitute a contract between the Cities and the Holder or Holders of the Bonds from
time to time outstanding, and this Ordinance shall be and remain irrepealable until the Bonds and the
interest thereon shall be fully paid, cancelled, refunded or discharged or provisions for the payment
thereof shall be made as provided in Section 12.1 hereof.
Section 12.3. SEVERABILITY If any Section, paragraph, clause or provisions of this Ordinance
shall for any reason be held to be invalid or unenforceable, the invalidity or unenforceability of such
Section; paragraph, clause or provisions shall not affect any of the remaining provisions of this
Ordinance, or any of the provisions of the Facilities Agreement. ,
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23
4
Section 12.4. REPEALER. All orders, resolutions and ordinances, or parts thereof, inconsistent
herewith are hereby repealed to the extent of such inconsistency
ADOPTED AND CORRECTLY ENROLLED DECEMBER 7, 1983.
Mayor, City of Dallas, Texas
[SEAL]
ATTEST
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City Secretary, City of Dallas, Texas
APPROVED AS TO FORM
City Attorney, City o f alias, T
ADOPTED DECEMBER 6, 1983.
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Mayor, City of Fort Worth, Texas
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ATTEST
Cit Secretor , Cit f Worth, Texas
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APPROVED AS TO FORM AND LEGALITY
City Attorney, City o f Fort Worth, Texas
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THE STATE OF TEXAS
COUNTY OF' DALLAS
CITY OF DALLAS
I, Robert S. Sloan, City Secretary of the City of Dallas, Texas, do hereby certify:
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WITNESS MY HAND and seal of the City of Dallas, Texas, this December 7 , 1983.
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City Secretary, City of Dallas, Texas , ~ ~"w, ~''
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THE STATE OF TEXAS ~'+' .f^~ ~.~ R~ y
COUNTY OF TARRANT ~"~`~~~~~~~~ ~'`~
I, Ruth Alexander, City Secretary of the City of Fort Worth, Texas, do hereby certify
1. That the above and foregoing is a true and correct copy of Ordinance No. ~j f duly pre-
sented and passed by the City Council of the City of Fort Worth, Texas, at a meeting of the Council
held on December 6, 1983, which ordinance is duly of record in the office of the City Secretary
2. That said meeting was open to the public, and public notice of the time, place and purpose ~.
of said meeting was given, all as required by Article 6252-17, Vernon's Texas Civil Statutes, as
amended. ,:
WITNESS MY HAND and the Official Seal of the City of Fort Worth, Texas, on this December ~ ,
1983.
City Secretary, City o f ForE Worth, Texas
1. That the above and foregoing is a true and correct copy of Ordinance No.!&063, duly pre-
sented and passed by the City Council of the City of Dallas, Texas, at a meeting of the council held
on December 7, 1983, which ordinance is duly of record in the office of the City Secretary
2. That said meeting was open to the public, and public notice of the time, place and purpose
of said meeting was given, all as required by Article 6252-17, Vernon's Texas Civil Statutes, as
amended.
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Airport Boazd Agreement
Number
AMERICAN AIRLINES
SPECIAL FACILITIES
LEASE AGREEMENT
By and Between
THE DALLAS-FORT WORTH REGIONAL AIRPORT BOARD
and
AMERICAN AIRLINES, INC.
(including provisions for net rent and ground rent)
y
Dated as o f December 1, 1983
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS AND TERMS
Page
Section 1.1. Definitions 2
ARTICLE II
REPRESENTATIONS
Section 2.1. Representations by the Board 4
Section 2.2. Representations by Lessee 4
ARTICLE III
FINANCING AND CONSTRUCTION OF THE INITIAL SPECIAL FAC~.ITZEs
Section 3.1. Series 1983A Bonds 5
Section 3.2. Plans and Specifications, Approvals, Construction,
Changes, Contracts 5
Section 3.3. Inspection 8
Section 3.4. Responsibility During Construction 8
Section 3.5. Insufficiency in Funds 7
ARTICLE IV
TERM, POSSESSION, QUIET ENJOYMENT, USE
Section 4.1. Effective Date, Term 7
Section 4.2. Quiet Enjoyment, Use 7
Section 4:3. Ingress and Egress 8
ARTICLE V
GROUND RENTAL, NET RENT AND OTHER RENTAL PROVISIONS
Section 5.1. Ground Rent 8
Section 5.2. Net Rent 10
Section 5.3. Other Rentals 11
Section 5.4. 1968 Concurrent Bond Ordinance; Other Costs 12
Section 5.5. Place of Payments, Use of Funds, Delinquencies 12
- ARTICLE VI
OPERATION AND MAINTENANCE INSURANCE, CONDEMNATION, INDEMNTIY
Section 6.1. Care, Maintenance and Repairs of Leased Premises 12
=
Section 6.2. Services to Airport Users, Discrimination 13
Section 6.3. Governmental Requirements, Board Regulations 13
Section 6.4. Prohibited Acts 14
Section 6.5. Insurance Relating to Airport, Other Than Special
Facilities 14
Section 6.6. Insurance Relating to Special Facilities 14
Section 6.7 Damage, Destruction, Disposition of Insurance Proceeds 16
Section 6.8. Miscellaneous Insurance Covenants 17
Section 6.9. Condemnation i7
i
Section 8.10. Indemnification
Section 6.11. Miscellaneous Operation Provisions
Section 6.12. Conduct of Airport Operations
Section 7.1.
Section 7.2.
Section 7.3.
Section 7 4.
Section 7.5.
ARTICLE VII
EVENTS OF DEFAULT AND- REMEDIES
Events of Default Defined
Remedies on Default
No Remedy Exclusive
Agreement to Pay Attorneys' Fees and Expenses
No Additional Waiver Implied by One Waiver
ARTICLE VIII
TERMINATION BY LESSEE
Section 8.1. While Bonds Outstanding
Section 8.2. Termination at Other Times
ARTICLE IX
ASSIGNMENTS, SUBLETTING
Section 9.1. Assignments by Airport Board and Cities
Section 9.2. Assignments and Subleases by Lessee
ARTICLE X
1VIISCELLANEOUS
Section 10.1. Lessee to Maintain its Corporate Existence
Section 10.2. Contracts and Warranties
Section 10.3. Board's Right of Entry
Section 10.4. Services to Lessee
Section 10'.5. Additional Bonds
Section 10.6. Completion Bonds
Section 10.7 Refunding Bonds
Section 10.8. Formal Approvals by Lessee
Section 10.9. Remedies Against Contractors and Subcontractors
and Sureties
Section 10.10. Personal Liability of Officials
Section 10.11. Force Majeure
Section 10.12. Construction of Lease
Section 10.13. Severability Clause
Section 10.14. Brokerage
Section 10.15. Notices
Section 10.16.. Consent Not Unreasonably Withheld
Section 10.17 Laws Governing
Section 10.18. Recordation
EXHIBITS
Exhibit 1 Dallas/Fort Worth Regional Airport Configuration
Exhibit 2 Construction Application
Exhibit 3 Leased Land Drawing
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11
AMERICAN AIRLINES
SPECIAL FACILITIES LEASE AGREEMENT
THE STATE OF TEXAS
COUNTY OF TARRANT
This American Airlines Special Facilities Lease Agreement (hereinafter called this or the
"Agreement"), made and entered into as of the first day of December, 1983 by and between the
Dallas/Fort Worth Regional Airport Board (hereinafter called the ",Boazd"), being the duly and
lawfully constituted and operating Board of Directors of the Dallas/Fort Worth Regional Airport
(hereinafter called the "Airport"), belonging to the Cities of Dallas and Fort Worth, Texas (herein-
after called the "Cities"); and having an office at 32Q0 East Airfield Drive, Dallas/Fort Worth Airport,
Texas 75261, and American Airlines, Inc. (hereinafter called "Lessee"), having an office at the Dallas/
Fort Worth Regional Airport, P O Box 619616, Dallas/Fort Worth Airport, Texas 75261-9616, a Cor-
poration of the State of Delaware.
WHEREAS, in the exercise of its lawful authority, and the lawful authority of the Cities, the
' Board has obtained, and will obtain in the future, funds for the purpose of the construction, develop=
meet and equipment of the Airport in both its first and subsequent phases, the location and general
configuration of the .Airport being shown, without reference to a particular phase, on Exhibit 1,
attached hereto and made a part hereof;
WHEREAS, the Airport is the major hub, primarily passenger and commercial cargo, airport
for the metropolitan area of Dallas and Fort Worth and the entire North Texas Region, and in that
regard contains many separately identifiable systems, complexes and facilities, each of which separately
constitutes but a part of the Airport as a whole, and ali of which are, and will be, functionally related
and essential to the proper functioning of the others;
WHEREAS, it has been found and determined by the Board, in accordance with its lawful duties,
acting on behalf of the Cities, that it is essential, appropriate and necessary to the proper and orderly
functioning of the Airport for its public purposes and for the public in its travel that adequate
facilities of the types herein described be established, constructed and equipped at the .Airport, all
as a part of the Airport's essential and necessary systems and facilities, all of which are and will be
functionally related and subordinate to the Airport;
WHEREAS, the Initial Special Facilities as defined herein are being leased to Lessee as
provided herein;
WHEREAS, the funds with which to construct and develop the Airport have been and will be
obtained under the authority expressed, reserved and recited in a certain ordinance adopted jointly
by the Cities, effective as of November 12, 1968, and bearing the short title "1968 Regional Airport
Concurrent Bond Ordinance" (hereinafter called the "1968 Concurrent Bond Ordinance"),
WHEREAS, among other rights reserved therein and subject to its other terms, Section 8.7 of
the 1968 Concurrent Bond Ordinance reserved to the Cities, when requested by the Board, the right,
power and authority to issue "Special Facility Bonds" for the purpose. of paying the "Costs of the
Special Facilities" (as hereinafter defined),
WHEREAS, it has been determined necessary and appropriate by the Boazd that the Initial
Special Facilities be financed as "Special Facilities," within the meaning of the 1968 Concurrent Bond
Ordinance, through the issuance of the Special Facility Bonds hereinafter described, and the Board
intends to and will request the Cities to issue such bonds for such purpose;
WHEREAS, the Board as permitted by law and by the Contract and Agreement of the Cities,
dated April 15, 1968, which provided for the Boazd's creation, further considers it appropriate and
necessary in the public interest to have the Initial Special Facilities operated on its behalf by others,
and to have the same operated by Lessee, but under and subject to its continuing jurisdiction, super-
vision and control and to the continuing jurisdiction, supervision, and control of the Board and Cities
under said Contract and Agreement, all as herein provided,
WHEREAS, the 1968 Concurrent Bond Ordinance requires, as a prerequisite to the issuance
of Special Facility Bonds, the making of certain agreements, therein called a "Net Rent Lease" and a
"Ground Lease," which may be incorporated into the same instrument, and this Agreement is re-
sponsive to and is in accordance with that requirement; and
WHEREAS, the Lessee in order to encourage and facilitate the sale of the Special Facility Bonds
herein authorized hereby binds itself under the terms and provisions of this Agreement to pay to the
Board the rentals and payments required herein in response to said requirements,
NOW, THEREFORE, the Board, for the term herein specified, and for and in consideration of
the rents herein reserved, and of the covenants and agreements herein contained on the part of the
.Lessee to be kept, observed and performed, and other valuable consideration as described herein has
demised and leased, and does by these presents demise and lease to Lessee, and the Lessee has
agreed to;take and does hereby take from the Board, the Special Facilities and the land (hereinafter
defined and referred to as the "Leased Land"), the Special Facilities and the Leased Land being
hereinafter defined and referred to collectively as the "Leased Premises"; all upon and subject to the
following express terms, provisions, covenants and conditions, to-wit:
ARTICLE I
DEFINITIONS AND TERMS
Section 1.1 Definitions In and throughout this Agreement, the following words shall have the
following meanings, respectively, unless the context shall clearly appear otherwise, to-wit:
(a) "Additional Bonds" means any bonds issued in accordance with the Special Facilities
Bond Ordinance for the purposes specified in Section 10.5 hereof;
(b) "Airport" means the Dallas-Fort Worth Airport, as aforesaid, also known as the Dailas-
Fort Worth Regional Airport;
(c) "Board" means the Dallas-Fort Worth Regional Airport Board, as aforesaid,
(d) "Bonds" means the Series I983A Bonds, the Completion Bonds, the Additional Bonds and
any Refunding Bonds issued in lieu thereof, all of which are "Special Facility Bonds" within the
meaning of the 1968 Concurrent Bond Ordinance,
(e) "Cities" means the Cities of Dallas, Texas and Fort Worth, Texas as aforesaid,
(f) "Completion Bonds" means any bonds issued in accordance with the Special Facilities
Bond Ordinance for the purposes specified in Section 10.6 hereof,
(g) "Completion Date" means the date upon which the Initial Special Facilities are 'con-
stru~ted, substantially completed and ready for occupancy, as established by a certificate of the
Board's Director of Planning and Engineering, specifying such date. The Completion Date as to
the Initial Special Facilities shall not occur and the same shall not be deemed substantially
completed until such Initial Special Facilities have been accepted in writing by the Lessee and
the Board from the contractor(s),
(h) "Construction Application" means Exhibit 2 attached hereto and made a part hereof,
(i) "Costs of the Special Facilities" or "Cost of the Initial Special Facilities" means all of
the applicable items relating to such facilities, as provided in paragraph "O" of Section 2.1 of the
1968 Concurrent Bond Ordinance, and including without limitation, the following
2
(i) all amounts paid by the Board in discharge of its obligations under Article III,
including without limitation, all amounts paid under all construction, engineering, architec-
tural, insurance or other related contracts; "
(ii) all amounts authorized by the Lessee and paid by the Board for changes to the
complete plans and specifications for the .Special Facilities,
(iii) all amounts necessary to provide for work performed, .material purchased or
expenditures incurred, pertaining to or in connection with Special Facilities which are
approved by Lessee including, without limitation, the charges of any architects or engineers
for plans, specifications, drawings and supervision for the Special Facilities, the charges of
any surveyors or engineers employed to make plans, or conduct tests or analyses with respect
to the Leased Land,
(iv) the cost of any performance and payment bonds procured in connection with the
acquisition and construction of the Special Facilities;
(v) legal, accounting and Bond consultant fees and expenses and all costs and expenses
¢- incident to the authorization, preparation, printing, engraving, issuance, delivery and sale
of the Bonds, the preparation, execution, delivery and recording of this Agreement, the
Special Facilities Bond Ordinance, any preliminary and the final official statement pertaining
to the Bonds, any purchase agreement pursuant to which the fonds will be sold and a1T
other agreements and documents involved and contemplated hereby, the costs and fees,
including legal fees, incident to the qualification of the Bonds for offer and sale under secu-
rities laws and the preparation bf any memorandum as to the eligibility of the Bonds for
offer and sale and for investment under state laws;
(vi) interest accruing on the Bonds during any period of construction, the period of
construction to be stated in the Special Facilities Bond Ordinance and any ordinance authoriz-
ing the issuance of Completion Bonds or Additional Bonds; and
(vii) such other and additional fees, costs, expenses and expenditures of whatever
nature incidental or pertaining to the acquisition, construction, fabrication, equipping and
installation of the Special Facilities, including funding of reserves, fiscal agent fees and
expenses, paying agents' fees, roadways, irrigation, sprinkling and on-site and off-site utility
extensions to the Special Facilities, as well as, reasonably necessary roadway graphics and
on-site and adjacent off-site grading;
(j) "Gross Revenues" means all revenues and income of any kind derived directly or indirectly
from the Special Facilities or from the use thereof, including rental or other payments from sub-
lessees and concessionaires (but not the gross receipts of such sublessees and concessionaires
except as provided for in this paragraph (j) and Section 5.3) on account of sales made and for
services rendered at or from the Special Facilities; provided, however, that Gross Revenues shall
not include (i) any taxes imposed by law which are separately stated to and paid by a customer
and directly payable to the taxing authority, or (ii) any taxes imposed by law upon receipts
from sales or rental of equipment or other facilities, and food, beverages, merchandise or other
goods or services, even though such taxes are not separately stated to a customer, where such
taxes are required to be measured by the amount of such receipts and are reported to and paid
over to the taxing authority, however, copies of all tax report forms supporting tax exclusions
under this proviso shall be furnished to the Board with Lessee's monthly statement of avenues
and rentals; or (iii) any revenues or income derived from subleasing the Special Facilities to
affiliates of AMR Corp. Also to be excluded from Gross Revenues shall be charges to employees for
meals, cash discounts on purchases, cash discounts on sales, credits or refunds to customers, custo-
msry rebates and allowances, credit card fees, interest on money loaned or in bank accounts of
Lessee, income from investments and sales of property other than that purchased in the regular
course of business for the purpose of resale. Sales or subrents previously reported in Gross Reve-
3
Hues shall be deducted from current Gross Revenues when charged off as uncollectible in
accordance with reasonable and commonly accepted accounting practice;
(k) "Initial Special Facilities" means all of the following, to-wit the properties, structures,
~, facilities and equipment for the operation, maintenance, upkeep and repair of certain catering
and inflight kitchen facilities to be acquired, constructed, fabricated and installed on or as a part
of the Leased Land described on Exhibit 3 attached hereto;
(1) "Leased Land" means the tract of land described and shown on Exhibit 3, attached hereto
and incorporated herein for all purposes, and plus other Land at the Airport which in the future
is expressly made subject to and leased under this Agreement by the parties hereto;
(m) "Leased Premises" means the Special Facilities and the Leased Land,
(n) "Lessee" means American Airlines, Inc.,
(o) "Refunding Bonds" means any bonds issued in accordance with the provisions of the
Special Facilities Bond Ordinance for the purposes specified in Section 10.7 hereof;
(p) "Series 1983A Bonds" means the series of Bonds to be issued pursuant to this Lease for
the purpose of providing funds with which to pay the Costs of the Initial Special Facilities, such
Bonds to be entitled "Dallas-Fort Worth Regional Airport American Special Facilities Revenue
Bonds, Series 1983A",
(q) "Special Facilities" means and shall include the Initial Special Facilities, any and all
extensions, additions or improvements thereto and/or any other projects at the Airport, the obli-
gations to finance which ale to be payable from net rentals derived from the Lessee under this
Agreement;
(r) "Special Facilities Bond Ordinance" means the ordinance to be adopted by the Cities for
the purpose of authorizing the issuance, sale and delivery of the Series 1983A Bonds;
(s) "Starting Date" shall mean the day that Lessee took possession of the leased land which
is agreed to be August 1, 1982.
ARTICLE II
REPRESENTATIONS
Section 2.i. Representations by the Board. The Board makes the following representations as the
basis for the undertakings on its part herein contained
(a) The Board is the duly and lawfully created, existing and organized Board of Directors
of the Airport, having the power to enter into the transaction contemplated by this Agreement
and to carry out its obligations hereunder; and by proper action the Board has been duly
authorized to execute and deliver this Agreement;
(b) The Cities have good title to the Leased Land and, by concurrent action, have duly
authorized the Board to execute and deliver this Agreement; and
(c) The Board has full right and authority in and to the Leased Land and will construct and
equip thereon the Special Facilities within the limitations set forth in this Agreement.
Section 2.2. Representations by Lessee. The Lessee makes the following representations as the
basis for its undertakings herein contained.
(a) It is a corporation duly incorporated under the laws of the State recited aforesaid; is in
good standing under its Certificate of Incorporation or Charter and the laws of said State; is duly
authorized to do business in the State of Texas; has the power to enter into this Agreement without
violating the terms of any other agreement to which it or any of its subsidiaries may be a party;
and by proper corporate action has been duly authorized to execute and deliver this Agreement;
4
(b) It, generally, will occupy and possess the Leased Premises itself or through assignees,
sublessees, subsidiaries or concessionaires, in accordance with provisions of Section 9.2 hereof, on
behalf of the Cities and the Board for the public purposes of the Airport and for which the same
are being acquired or constructed and are to be operated hereunder, upon and subject to the
control and jurisdiction of the Board and the Cities in .accordance with the terms hereof; and
(c) It will occupy and possess the Initial Special Facilities itself or through assignees, sub-
lessees, subsidiaries or concessionaires, in accordance with provisions of Section 9.2 hereof, solely
for the purpose of operating a catering and infight kitchen facility, the same to be so operated on
.behalf of the Cities and the Board.
ARTICLE III
FINANCING AND CONSTRUCTION OF THE INITIAL SPEQAL FA~*•*~~
Section 3.1. Series I983A Bonds.
(a) The Costs of the Initial Special Facilities shall be paid with the proceeds from the sale
of the Series 1983 Bonds and, in the event such proceeds are not sufficient to complete the payment
of the Costs of the Initial Special Facilities., the proceeds of Completion Bonds, if it is determined
by the Cities that such Completion Bonds should be issued, and/or moneys provided by Lessee in
accordance with the provisions of Section 3.5 shall be applied to make up any insufficiency in
such proceeds.
(b) The Board agrees to diligently undertake the preparation of the Special Facilities Bond
Ordinance for the submission of the same to the Cities for concurrent adoption and to provide
therein for the issuance of Series 1983A Bonds in an approximate amount of Eight Million Dollars,
($8,000,000.00.), the actual amount of Series 1983A Bonds to be determined by the Board and
specified in the Special Facilities Bond Ordinance. It is provided, however, that the Special
Facilities Bond Ordinance shall not be adopted, nor shall the Series 1983A Bonds be sold, until the
Lessee has approved said Ordinance, as provided in Section 10.8 hereof, after the receipt of which
approval the same shall be conclusively binding upon the Lessee. Subject to the receipt of the
proceeds from the sale of the Series 1983A Bonds and the continuing adequacy and availability
of said proceeds (and proceeds of Completion Bonds, if it is determined by the Cities that such
Completion Bonds should be issued, and/or moneys provided by Lessee pursuant to Section 3.5)
for the purpose, the Board will cause the Initial Special Facilities to be acquired, constructed,
fabricated, installed and equipped on the Leased Land in accordance with plans and specifications
therefor prepared and approved in the manner provided in this Article III.
Section 3.2. Plans and Sped fecations, Approvals, Construction, Changes, Contracts.
(a) The Initial Special Facilities shall be acquired, constructed, installed, fabricated and
equipped in accordance with complete plans and specifications approved by the Board and the
Lessee. Preliminary plans, elevations, specifications and renderings descriptive of the proposed
construction shall be prepared by the Lessee for approval by the Board. The preliminary sub-
mission by Lessee shall employ essentials of aesthetics, convenience, function and design, and
shall be compatible in such respects with those of similar facilities at the .Airport; provided. that no
greater aesthetics treatment shall be required of Lessee than is required of other tenants who may
construct, install, fabricate or equip similar facilities at the Airport.
Upon approval of the preliminary plans and specifications, Lessee shall prepare final plans
and specifications of the Initial Special Facilities. A Construction Application and final plans and
specifications shall be submitted by-Lessee to the Board for approval, and construction shall be
substantially in accordance with such plans and specifications as may be approved by the
Board and with such changes as may be reasonably requested by Lessee and approved by
5
the Board; provided, that no such plans and specifications shall be approved and no such changes
shall be made which may alter the nature of the Initial Special`Facilities as facilities described
in Section 103(b)(4) of the Internal Revenue Code of 1954, as amended (the "Code") and,
provided, further, that approval of such final plans and specifications shall .not be required prior
to the issuance and sale of the Series 1983A Bonds.
(b) Upon completion of such plans and specifications and approval of the same, bids will
be taken for the construction, acquisition, and/or fabrication of the Initial Special Facilities
based on said plans and specifications. Following the receipt of bids from. responsible bidders, the
Board and Lessee will consider and approve such bids and contracts will then be awarded in the
name of the Board, as owner, to acquire, install, construct, fabricate and equip the Initial Special
Facilities. Lessee may, with the Board's prior approval, enter into contracts for the design work
and for the preparation of the preliminary and final plans and specifications described in sub-
section (a ), next above, and it may, with the Board's prior approval, enter into contracts for the
acquisition and construction of the Initial Special Facilities, prior to the time that proceeds from
the sale of the Series 1983A Bonds are available, provided that the Board has adopted an Induce-
ment Resolution, and such contracts contain a provision allowing assignment thereof to the Board
when such proceeds are available.
(c) Whenever approval of either the Board or the Lessee is required in this Section 3.2, such
approval shall be timely and shall not be unreasonably withheld by either the Board or the Lessee.
(d) Contracts relating to the construction, acquisition, equipping, fabrication or installation
(or purchases in connection therewith) of the Initial Special Facilities shall include appropriate
.provisions for expediting the work and for performance and payment bonds, as required by law,
so as to assure completion by specific performance dates and to protect the Special Facilities
against liens, such bonds to name the Board as the beneficiary thereof.
(e) All necessary approvals from governmental agencies shall be obtained prior to acquiring,.
constructing, fabricating, equipping or installing the Initial Special Facilities, and such improve-
ments shall be acquired, constructed, fabricated, equipped or installed in compliance with all
state and local laws, ordinances and regulations applicable thereto. Upon completion of the
Initial Special Facilities, all required occupancy permits and authorizations from appropriate
authorities authorizing the occupancy and possession and use of the Leased Premises for the
purposes contemplated by Lessee shall be obtained by Lessee. All changes alterations, extras
or additions (hereinafter in this subsection (e) called "changes") to or from any contracts or
purchase orders executed or entered into pursuant to the provisions of this Article III shall be
approved in advance by the parties hereto, provided, that no changes shall be made which may
alter the nature of the Initial Special Facilities as facilities described in Section 103 (b) (4) of
the Code. All requests, approvals and agreements required shall be in writing and signed by a
duly designated representative of the party ma~Cing such request, granting such approval or
entering into such agreement. All changes which are not contrary to the general nature and
scope of .the respective Initial Special Facilities may be made after consultation with the Lessee.
Section 3.3. Inspection. The parties hereto and their authorized representatives shall have full
.rights of inspection during the construction, fabrication, equipping or installation of the Initial
'z Special Facilities.
Section 3.4. Responsibility during Cowruction. During construction and until the Completion
Date, the Lessee and its officers, agents, representatives and employees shall have no responsibility
for any claims, loss, damage, actions, causes of action, expense and/or liability resulting from, brought
for, or on account of any personal injury or property damage received or sustained. by any person,
persons or property growing out of, occurring, or attributable to the negligence of the Board or its
agents or employees or its contractors or their agents and employees. The Board shall require all
contractors' indemnities to extend both to the Board, as owner, and to the Lessee, as lessee.
6
Section 3.5. Insufficiency in Funds. In the event the proceeds from the sale of Series 1983 Bonds
are insufficient to pay the Costs of the Initial Special Facilities in full, then the Lessee shall either
(a) pay the amount of the insufficiency; (b) amend the .plans and specifications relating to the Initial
Special Facilities so that the proceeds of the Series 1983A Bonds will be sufficient to complete the
Initial Special Facilities, or (c) request the issuance of Completion Bonds for that purpose, in which
event the Board shall request the Cities to issue Completion Bonds for that purpose. However, no
representation is made or assurance given or implied by the Board that the Cities will consent to
the request of the Board,. and the Cities are not required to issue any such Completion Bonds. In the
event the Cities are unwilling for any reason to issue Completion Bonds the Lessee shall pay the
amount of any such deficiency or amend the plans and specifications to produce the effect aforesaid.
In the event of the issuance of such Completion Bonds, then the Net Rent payable under Section 5.2
hereof shall thereupon be automatically increased in accordance with the ordinance authorizing
~~ such Completion Bonds. It is provided, however, that such ordinance shall not be adopted until the
Lessee has approved such ordinance, after the receipt of which approval the same shall be binding
on Lessee. Such Completion Bonds shall be on a parity as to lien on "Pledged Revenues" (as defined
in the Special Facilities Bond Ordinance) with Series 1983A Bonds, and shall be issued as Special
Facilities Bonds subject to and in accordance with the terms, conditions and provisions of the 1968
Concurrent Bond Ordinance and the Special Facilities Bond Ordinance.
ARTICLE IV
TERM, POSSESSION, QUIET ENJOYMENT, USE
Section 4.1. Effective Date, Term. This Agreement shall be effective upon the execution and
delivery hereof by the Board and by the Lessee, and the rights of use and occupancy granted herein
commenced on the Starting Date and, subject to the other provisions hereof, shall expire December
31, 2009 but not later than the maximum period permitted by law in effect on the date of the final
execution hereof.
Section 4.2: Quiet Enjoyment, Use. Upon and subject to the other terms and provisions hereof
and unless a default shall have occurred hereunder, the Lessee shall be suffered and permitted to
have the exclusive right to occupy and use and shall have peaceful possession and quiet enjoyment
of the Leased Premises in accordance with the following, to-wit:
(a) Commencing on the Starting Date of the Initial Special Facilities, the Lessee shall be
suffered and permitted to have the exclusive right to occupy and use and shall have peaceful
possession and quiet enjoyment of the Initial Special Facilities (including the Leased Land), but
solely for the following respective purposes and uses, to-wit the Initial Special Facilities and
appurtenant land shall be used and are leased hereunder for all primary and incidental purposes
(including the training of personnel) related to the operation, repair, upkeep and maintenance
of the catering and inflight facilities and the same may be used incidentally for any other lawful,
reasonable and appropriate activity which is not in violation of or prohibited by the Board's
reasonable rules and regulations or which may result in such facilities being or becoming facilities
other than those described in Section 103(b)(4) of the Code.
(b) It is expressly provided that, as to the Initial Special Facilities, there shall be allowed
by the Board, without further charge by the Board, its agents, or successors, automotive vehicle
parking for the Lessee's officers, employees, contractors, agents, suppliers of materials, furnishers
of services, shippers and business guests in designated areas as shown on Lessee's drawings of
the Initial Special Facilities to be constructed. Without intending to limit the meaning of the
phrase "business guests," such phrase shall include all persons coming upon the Leased Premises
for the purpose of purchasing, acquiring or using any accommodations, services, goods, wares,
merchandise, supplies or equipment available from the Lessee or any of Lessee's sublessees,
or concessionaries.
7
(c) It is further provided that the Board reserves the following additional rights
(i) to designate areas not to exceed twenty (20) feet in width along the periphery of
the Leased Land to the extent set forth on the Lessee's drawings of the Initial Special
Facilities for use and to be maintained as landscaped area, and
(ii) to itself, or permit its contractors, engineers and architects to enter upon the Leased
Premises whenever necessary and possible without undue interference with Lessee's use of
the Leased Premises for the purpose of constructing, installing and/or maintaining under
the surface of the ground any portion of the Board's other systems which pass through the
.Leased Premises.
Section 4.3. Ingress and Egress.
(a) As to all Special Facilities hereunder, the Lessee and its officers, employees, invitees,
guests, and suppliers of materials and furnishers of service, shall have the right of ingress and egress
to and from and between the Leased Land and any public street or roadway outside the Airport
by means of the roadways leading, to and from the Airport and the Leased Land, and such other
points as may be designated by the Executive Director of the Board, all of the same to be used in
common with others having rights of passage within the Airport, all without any further or additional
fees or charges except the normal Airport control charge, if any, made at exit booths at the Airport, and
those included in the schedule of charges and the rentals, fees and payments described in Article V
The use of such roadways shall be subject to reasonable rules and regulations of the Board now in
effect or which may hereafter be promulgated for the safe and efficient operation of the Airport.
(b) The Board may, at any time, temporarily or permanently close or consent to or request the
closing of any such. roadway and any other area at the Airport presently or hereafter used as such.
So long as a reasonably equivalent means of ingress and egress, as provided above, remains available
to Lessee, Lessee hereby releases and discharges the Board, its successors and assigns, of and from
any and all claims, demands or causes of action Lessee may have against the Board by reason of
the exercise of any of the powers reserved to the Board under this subsection.
ARTICLE V
GROUND RENTAL, NET RENT AND OTHER RENTAL PROVISIONS
Section 5.1. Ground Rent.
(a) For the purpose of determining the rental payable under this Section 5.1, and where used
elsewhere in this Agreement, the following definitions and terms, in addition to other definitions con-
tained in this Agreement, shall apply and have the following meanings, to-wit
(i) "Airport Services" means the general administration and operation of the Airport by
the Board, including, but not limited to the following functions by the Board at the Airport,
to-wit: Airport police, crash, rescue and fire protection and traffic control, the acquisition of land
beyond the initial boundaries of the Airport for use as a part of the Airport; clearing, grading and
draining, the costs of which are not charged or chargeable in specific terms to users under other
_ agreements, roadway systems, perimeter fencing and utilities systems, the furnishing of com-
munication systems, facilities and tunnels, landscaping, the construction, equipment .and mainte-
nance of facilities on non-revenue producing land and the maintenance of such land itself, facilities
and areas or subdivisions of the Airport necessary in the operation and maintenance thereof,
including the Board's administration, maintenance, police, crash, rescue, fire and operations space
and facilities.
(ii) "Airport Services Costs" means and shall include the total of (A) the costs, expenses
and liabilities of the Board in providing Airport Services, including the Board's operations and
maintenance costs and liabilities, however arising, properly charged or chargeable on an accrual
basis of accounting to Airport Services, plus (B) 1.25 times any debt service requirements on any
revenue bonds of the Airport (other than Special Facility Bonds.) allocable or chargeable to
Airport Services, which allocation or charge shall be in the proportion that the Contract Costs
(as hereinbelow defined) for the construction or development of Airport Services bears to the
Contract Costs for the construction or development of those portions of the Airport which are
not financed with private capital or Special Facility Bonds, and plus (C) all other costs, expenses
or liabilities of the Board, however arising (except debt service on revenue bonds not allocable
or chargeable to Airport Services), not specifically charged or chargeable in specific terms to the
users under other agreements relating to the use of the Airport or any part thereof or of its
lands; provided, however, that the Board shall at all times during the term of this Agreement
maintain reasonably obtainable liability insurance in the amounts necessary to protect it from
the normal insurable liabilities which may be incurred in the operation of an airport of the size
of the Airport (except to the extent that such insurance is carried by others or that the Board has
governmental immunity from such liabilities ), the premiums for such insurance to be included
in "Airport Services Costs:'
(iii) "Contract Costs" means and shall include the Board's costs for the acquisition of land as
provided in Section 5.1(i) hereof; for labor and payments to contractors, suppliers and materialmen
in connection with preparing, constructing and otherwise acquiring, replacing, extending and
improving the Airport, and the costs, not covered by insurance, of restoring property damaged or
destroyed in connection with construction.
(iv) "Ground Rent" means the Preliminary Ground Rent computed in accordance with
paragraph (i) of subsection (b), next below, as adjusted to the Actual Ground Rent computed in
.accordance with paragraph (ii) of subsection (b), next below, such amounts being payable for
the use and occupancy of the Leased Premises and shall be in addition to the payments of Net
Rent and other costs under Section 52 and 5.3 hereof.
(v) "Total Developed Acreage on the Airport" means all land within the Airport boundaries
(as the same may be changed from time to time) which is revenue producing, including but not
limited to all land under lease or permit, land actually developed for a specific use and all land
specifically designated as part of the Runway and Taxiway Complex.
(b) The Lessee hereby agrees to pay to the Board from the Starting Date and throughout the
term of this Agreement a Preliminary Ground Rent, as adjusted to the Actual Ground Rent, for the
use and occupancy of the Leased Premises, the specific amounts thereof to be determined in accord-
ance with the following provisions and principles and to be paid at the following times and in the
following amounts, to-wit:
(i) Preliminary Ground Rent -The Lessee shall pay a Preliminary Ground Rent during the
remainder of the first fiscal year (October 1-September 30) of the lease calculated on the basis
of a rate of $8,076 per acre per annum for land comprising the Leased Land, such Preliminary
Ground Rent to be paid in equal monthly payments during the remainder of the first fiscal year,
the first payment to be paid on the Starting Date and thereafter on the first day of each month
during the remainder of the first fiscal year For historical reference of the parties hereto, said
rate was determined in accordance with the following formula, to-wit:
A =Airport Services Costs projected on the date of this Agreement to be in-
curred or due and owing by the Board during the first year of the lease.
A - C B =Total Developed Acreage on the Airport projected for the Starting Date.
B C =Rate per acre per annum applied to land comprising the applicable tract
or tracts of Leased Land under this Agreement in computing Preliminary
Ground Rent for the first fiscal year
9
(ii) Actual Ground for Preceding year - At the close of the fiscal year (each September 30),
the Board shall compute and ascertain the amount of Actual Ground rent payable by the
Lessee for the respective year, then closed. Such computation shall be made and determined in
accordance with the following formula, to-wit
A =actual Airport Services Costs incurred during the period just closed
B =the average number of the Total Developed Acreage on the Airport during
the year just closed
AXC=D
B C =the average number of acres of land comprising the Leased Land during
the year just closed
D =Actual Ground Rent payable for the year just closed
Upon making such computations, the Board shall notify the Lessee of the result thereof If the
resulting Actual Ground Rent shall be greater than the Preliminary Ground Rent paid during the
year to which the adjustment relates, then the Preliminary Ground Rent for such year was deficient,
then the Lessee shall remit to the Board an amount equal to such difference within five (5) days
from the receipt of notice thereof. If such computations reflect that the resulting Actual Ground
Rent is less than the amount of the Preliminary Ground Rent actually paid by the Lessee during the
year to which the adjustment relates, then the amount of the overpayment shall be credited against
the Ground Rent payment(s) next due under paragraph (ii), until such credit has been exhausted.
(c) All estimates and projections required in the making of the computations and determinations
contemplated by subsection (b), next above, shall be made by the Board and shall be reasonable and
made in the light of the latest data available to or reasonably obtainable by the Board.
(d) If the Starting Date commences on a date other than the first day of a month or this
Agreement expires or is terminated on a date other than the last day of a month, the Ground Rent
payable for the part of the month during which rent is due shall be computed by prorating the
monthly Ground Rent payment on a daily basis, and Ground Rent shall be paid only for the portion
of the month for which due.
Section 5.2. Net Rent.
(a) The Lessee hereby agrees to pay to the Board, in addition to the Ground Rental specified in
Section 5.i hereof and in addition to the other rentals and payments specified in Section 5.3 hereof,
an additional rental (hereafter called the "Net Rent") throughout the period during which the Series
1983A Bonds and any Completion Bonds, Additional Bonds, or Refunding Bonds are outstanding,
in an amount equal to the principal, interest, any redemption premiums, and any special reserve
requirements contained in the Special Facilities Bond Ordinance, or in any ordinance authorizing
any such other Bonds together with an amount equal to the reasonable cost and charges of any
paying agent or paying agents and any audit fee thereunder, the Net Rent to be payable at the times
' (such times to include those in connection with the stated maturity of and interest payment dates on
the Bonds, the mandatory redemption thereof and any acceleration of the Bonds pursuant to the
Special Facilities Bond Ordinance) and in the amounts specified and provided in the Special Facilities
Bond Ordinance.
(b) The Net Rent payable under the provisions of this Section 5.2 shall be reduced by the total
of any amounts at any time on deposit in any interest and sinking fund created by the Special Facilities
Bond Ordinance or any such other ordinance referred to in subsection (a), next above, in excess of
the amount then needed for the purpose of paying previously accrued interest, matured Bonds,
redemption premiums, if any, and any auditing or other fees or expenses in respect of the pay-
ment of any such interest, principal or redemption premiums thereof, whether such excess amounts
become available by reason of (i) previous overpayments of Net Rent, (ii) surplus funds from Bond
i0
proceeds, including earnings from the investment of such proceeds deposited to the credit of such
interest and sinking fund upon the completion of the Special Facilities { as will be required in any
such ordinance ), (iii) earnings made on the investment of any amounts from time to time on deposit
in any such interest and sinking fund, (iv) any net reductions or savings in the Costs of the Special
Facilities, the effect of which is to provide funds to such interest and sinking fund with which the
Board can make payments of the interest on and principal of the Bonds, or (v) any other circum-
stances which result in funds being properly deposited in such interest and sinking fund, provided,
however, that such reduction in Net Rent payments shall be made only to the extent that funds are
not necessary to restore any deficiency then existing in any reserve fund created by the Special Facili-
ties Bond Ordinance referred tb in subsection (a), next above, it being understood that excess
amounts in the interest and sinking fund shall first be applied to restore any such deficiency and then,
if any amount remains, to the reduction of the Net Rent payments. The reductions in the Net Rent
payments contemplated by this subsection (b) shall be made by applying such excess amounts as
a credit(s) against the next Net Rent payment(s) due after funds have actually become available
from the foregoing permissible sources to the interest and sinking fund, until such excess amounts
are exhausted. Such reductions shall be reflected in the appropriate billings under subsection (a)
of this section 5.2.
(c) It is understood and acknowledged by the Lessee that the Series 1983A Bonds and any Com-
pletion Bonds, Additional Bonds and Refunding Bonds will be sold to the purchasers thereof in
reliance upon the commitment of Lessee to make the payments of Net Rent provided in subsection
(a), above. Accordingly, the obligations of the Lessee to make the payments of Net Rent thus required
shall be absolute and unconditional and' until such time as the principal, interest and any redemption
premiums thereon shall have been fully paid or provision for suck payment having been made in
accordance with the provisions of the Special Facilities Bond Ordinance, the Lessee (i) will not sus-
pend or discontinue any payments of Net Rent provided herein, and (ii) will not seek to terminate
in any manner or through any process or procedure to avoid or reduce the payment of Net Rent for
any reason, including, without limiting the generality of the foregoing, failure of the Board to com-
plete the acquisition, construction, fabrication, equipping or installation of the Initial Special Facilities
or any portions thereof, or any acts or circumstances that may constitute failure of consideration,
destruction or damage to such facilities, frustration of purpose, any changes in the tax or other laws
of the United States of America or of the State of Texas, or any political subdivision of either, or any
failure of the Board to perform or observe any agreement, whether express or implied, or any duty,
liability or obligation arising out of or connected with this Agreement. It is provided, however, that
nothing contained in this subsection shall be construed to release the Board from the performance
of any of the agreements on its part herein contained, and in the event the Board should fail to per-
form any such agreement, the Lessee may institute such actions against the Board as it may deem
necessary to compel the performance thereof or to restrain or enjoin forbidden acts, and/or to obtain
damages or other appropriate relief, so long as such shall not result in a reduction of the payment of
Net Rent hereunder
Section 5.3. Other Rentals.
(a) Commencing as of the Starting Date, in addition to the rentals paid pursuant to Sec. 5.1
and 5:2, the Lessee shall pay the Airport Board five percent {5%) of the Gross Revenues from the
Initial Special Facilities. Lessee or any wholly-owned subsidiary of AMR -Corp. shall not be
required to pay to -the Airport Board a percentage rental on Gross Revenues arising out of or resulting
from the service (or sales) provided to any wholly owned subsidiaries of AMR Corp.
(b) On or before the twentieth (20th) day of each month beginning with the second month in
which rentals accrue under subparagraph {a), above, Lessee shall furnish the Board a sworn state-
ment for the previous month, specifying its Gross Revenues due under the terms of said para-
graph (a), along with payment of the total rental due under said paragraph (a) from the previous
month.
11
Section 5.4. 1968 Concurrent Bond Ordinance, Other Costs. This Agreement is expressly subject
at all times to the terms, provisions, conditions and requirements of the 1968 Concurrent Bond Ordi-
nance, and as contemplated and required thereby; the Net Rent payable under Section 5.2, above
together with the Ground Rental and Other Rentals set forth in Sections 5.1 and 5.3 respectively, is
intended to be and shall be a net return to the Board, and accordingly, in addition to the payment of
rentals and payments in Sections 5.1, 5.2 and 5,3; the Lessee hereby agrees to pay all operation and
maintenance expenses applicable to the Special Facilities, including, without limitation, any insurance
premiums applicable thereto, and any all ad valorem or other property taxes lawfully levied or
assessed against the leasehold interest of the Lessee in respect to such properties, and the expenses
of upkeep thereof of every kind of character, including the repair or restoration or replacement thereof.
Section 5.5. Place of Payments, Use of Funds, Delinquencies.
~ (a) All payments in Sections 5.1 and 5.3 shall be made on the dates specified in this Article at
the principal office of the Board. Moneys received by the Board as Ground Rental and Other Rentals
shall be and become a part of the "Gross Income" of the Airport as defined in, and shall be utilized
- by the Board in accordance with, the provisions of the 1968 Concurrent Bond Ordinance. Moneys
received by the Board as Net Rent shall be utilized by the Board in accordance with the require-
ments of the Special Facilities Bond Ordinance and as may be thereby directed.
(b) The Board, at its option, in addition to any remedy available to it hereunder in the event of
a default because of nonpayment of rent, may impose a delinquency charge, payable upon demand,
against the Lessee, in accordance with the following formula.
A =Annual rate of interest, which rate shall be four percentage points
above the rediscount rate charged member banks of the Federal
Reserve Barik in Dallas, Texas, in effect on the first business day of
A X B X C each January, April, July and October
D = E B =Amount of the bill due to the Board.
C =Number of days the payment of the bill is late.
D =Number of days in the calendar year
E =Liquidated damages for late payment.
ARTICLE VI
OPERATION AND MAINTENANCE INSURANCE, CONDEMNATION, INDEMNITY
Section 6.1. Care, Maintenance and Repairs of Leased Premises.
(a) The Lessee shall at all times keep in a clean and orderly condition and appearance, the
Leased Premises and all of the Lessee's and the Board's fixtures, equipment and personal property
which are located in or upon any part thereof.
(b) The Lessee shall paint, repair, replace or rebuild all or any part of the Leased Premises
interior _or e.Yterior, structural or non-structural, which may be damaged or destroyed. The Lessee
shall have the right to apply available insurance proceeds to such purposes as contemplated by Sec-
tion 6:6 and Section 6.7 hereof.
(c) Additionally, the Lessee shall-
(i) take good care of the Leased Premises; shall maintain the same at all times in good
condition, shall make all repairs and replacements inside and outside, ordinary and extraordinary,
structural or otherwise, which repairs and replacements by the Lessee shall be in quality not
inferior to the original material and workmanship; and shall pay promptly the costs and expenses
of such repairs, replacements and maintenance, as provided in Section 5.4 hereof; and
12
(ii) unless otherwise provided herein, maintain and repair all utility service lines located
upon the Leased Premises to the extent used by the Lessee exclusively, except to the extent that
such maintenance or repair is the obligation of the utility company providing such utility service.
(d) In the event the Lessee fails to maintain, clean, repair, replace, rebuild or paint, or fails
diligently to continue to complete the repair, replacement, rebuilding or painting of all the applicable
portions of the Leased Premises required to be repaired, replaced, rebuilt or painted by the Lessee
under the terms of this Agreement, the Board, at its option, and in addition to any other remedies
which may be available to it, may repair, replace, rebuild,. or paint all or any part thereof and the
reasonable cost thereof shall be payable by the Lessee upon demand. The Board agrees, however,
not to act pursuant to this subsection (d) without first giving Lessee thirty (30) days' written notice
of default and, if the Lessee shall cure the specified default during such period, the Board shall not
exercise any right or remedy If the cure of Lessee's default requires action of a continuing nature,
or shall reasonably require a period of time to complete, commencement of the cure of such default
within the notice period and the continued exercise of due diligence in effecting such cure shall be
sufficient.
(e) The Lessee shall store its garbage, debris and other waste materials in a clean and sanitary
manner in trash receptacles which the Board shall provide at the Leased Premises, adequate to meet
the reasonable needs of Lessee and Lessee's assignees, subsidiaries, concessionaires and sublessees,
the size of which shall be at the discretion of the Board and the location of which shall be at the
mutual agreement of the parties. The Board further agrees to periodically remove such trash from
the receptacles, and for such service the Lessee shall pay at the normal Airport rate per cubic yard of
trash so removed, which rate may be adjusted, depending on the reasonable costs of administration,
capital, labor and materials, by the giving of thirty (30) days written notice to Lessee by the Board.
Nothing in this Lease shall be deemed to preclude the Lessee from incinerating garbage, debris
and other waste materials rather than. storing them in trash receptacles if the Special Facilities include
an incinerator approved by the Board.
Section 6.2. Services to Airport Users, Discrimination. Without limiting the generality of any of
the provisions of this Agreement, Lessee, in its operations at the Airport, and also as a part of the
consideration hereof, shall maintain and operate its facilities and provide its services in compliance
with and pursuant to Title 49, Part 21, Code of Federal Regulations, Nondiscrimination in federally
assisted programs of the Department of Transportation -Effectuation of Title VI of the Civil Rights
Act of 1964, .and as said Regulations may be amended, and shall not on the grounds of race, creed,
color or national origin discriminate or permit discrimination against any person or group of persons
in any manner whatsoever.
Section 6.3, Governmental Requirements, Board Regulations.
(a) The Lessee shall comply with any applicable Federal Aviation Administration regulations,
as the same may be amended from time to time, and any other present or future laws, rules, regula-
tions, orders or directions of the United States of America, or the State of Texas, which from time to
time may be applicable to the Lessee's operations hereunder
(b) The Lessee shall procure, or require its subsidiaries, assignees, sublessees and concessionaires
to procure, from all governmental authorities having jurisdiction of the operations of the Lessee
hereunder, all licenses, franchises, certificates, permits or other authorization which may be necessary
for the conduct of such operations, and it shall comply, and shall require its subsidiaries, assignees,
sublessees and concessionaires to comply, with all laws and lawful ordinances, and governmental
rules, regulations and orders during the term of this Agreement which from time to time may be
applicable to the Lessee's operations hereunder
(c) The Lessee covenants and agrees to observe and obey (and to require its officers and
employees to observe and obey and to exercise its best efforts to require guests and invitees and
13
those doing business with it to observe and obey) the reasonable rules and regulations of the Board
(including amendments and supplements thereto) governing the conduct and operations of the Lessee
and others on the Leased Premises, and such future reasonable rules and regulations as may, from
time to time during the term hereof, be promulgated by the Board for reasons of safety, health,
sanitation and good order; provided that any such rules and regulations shall not be inconsistent with
the provisions of this Agreement or with the rules and regulations of the Federal Aviation Administra-
tion or of any other regulatory authority having jurisdiction. The obligation of the Lessee to exercise
its best efforts to require such observance on the part of its guests, invitees and business visitors
shall apply only while such persons are on the Leased Premises.
(d) The Lessee covenants and agrees that this Agreement is taken subject to the -terms and
provisions of Section 9.16 of the 1968 Concurrent Bond Ordinance.
(e) Subject to Section 5.2 hereof, nothing in this Section 6.3 shall be construed to deny the
Lessee its right to contest the application or validity of any such law, rule, regulation, order or direc-
a tion and nothing in this Section 6.3 or in Section 5.4 shall be construed to deny the Lessee its rights
to contest any proposed or assessed taxes required to be paid pursuant to Section 5 4. During such
contest the Board may not assert any claim against Lessee for breach of this Agreement provided the
contest is promptly commenced and diligently prosecuted.
Section 6.4. Prohibited Acts.
(a) Unless otherwise expressly permitted so to do, the Lessee shall not install, maintain or
operate, or permit the installation, maintenance, or operation, on the Leased Premises of any vending
machine or device designed to dispense or sell food, beverages, tobacco, tobacco products or merchan-
dise of any kind, except in operations areas not available to the public.
(b) The Lessee shall commit no nuisances on the Leased Premises, and shall not do or permit
to be done anything which may result in the creation.. or commission or maintenance of a nuisance
thereon.
(c) "The Lessee shall not take or omit to take any action which might cause a lien or liens to
become attached to the remainder interests. of the Board and the Cities, or upon the leasehold interest
of the Lessee, without the consent of the Board, or suffer or permit a lien or liens for taxes to be
imposed or attached thereto, unless such taxes are not then due and payable or Lessee is contesting in
good faith the tax or claim that is the basis of the lien, in which event Lessee shall dissolve the lien or
stay or prevent its foreclosure by bond or other appropriate legal procedure.
Section 6.5. Insurance Relating to Airport, Other Than Special Facilities. The Board shall carry
insurance relating to the Airport, other than Special Facilities, in accordance with the provisions and
requirements of the 1968 Concurrent Bond Ordinance.
Section 6:6. Insurance Relating to Special Facilities.
(a) During the acquisition, construction, fabrication, equipping and installation period and until
the Completion Date of the Initial Special Facilities and the .respective completion dates of any addi-
tionalfacilities constituting Special Facilities, the Board shall provide, or cause to be provided, builder's
risk insurance as to all items of construction and all other insurance as to other items required and
reasonably obtainable with responsible insurers to insure against risks of loss or damage to such
facilities, so as to protect the interest of the Board, the Lessee, contractors and suppliers therein.
During such period the Board shall also. maintain, or cause the contractors or suppliers to maintain,
liability insurance, which shall comply with the requirements of paragraph (iii), below
,Beginning with the Completion Date of the Initial Special Facilities and the respective com-
pletion dates of any additional facilities constituting Special Facilities, the Lessee shall maintain or
cause to be maintained, with respect to each said item, with responsible insurers the following kinds
14
and the following amounts of insurance, with such variation as shall reasonably be required to conform
to applicable standard or customary Texas insurance provisions, to-wit:
(i) With respect to every structure and the contents and fixtures thereof constituting part of
the Special Facilities, multi-risk insurance on each structure and its fixtures and contents, covering
direct physical loss or damage (including the cost of removal of debris) to such structure and its
fixtures and contents, in such amount and of such character as, under the terms and provisions
thereof, will provide a recovery, in the event of the occurrence of any loss or damage from an
insured cause, equal to the full amount of loss or damage on a replacement cost basis up to the
amount reasonably obtainable as the maximum probable loss or damage (including the cost of
removal of debris) to such structure and its fixtures and contents from any such cause; provided,
however, that Lessee's insurance may contain a co-insurance clause providing for coverage of not
less than ninety percent (90%) of such replacement cost and a deductible not exceeding One
Hundred Thousand Dollars ($100,000) (or such higher deductible as shall be approved by the
Board) respecting any one casualty The risks to be insured against pursuant to this paragraph
are the risks against direct physical damage or loss from fire and so-called extended coverage
perils to the extent such coverage is reasonably obtainable and which is customarily obtained
for similar facilities at other major airports.
(ii) On all other structures to become part of the Special Facilities during the construction or
reconstruction thereof by the Lessee, such Builder's risk insurance as is customarily carried by
others with respect to. similar construction or reconstruction, but the Lessee shall not be required
to maintain any such insurance to the extent that such insurance is carried by contractors for the
benefit of the Lessee and the Board.
(iii) Public and other liability insurance of such character and amount as shall be reasonably
adequate to insure the Board and the Lessee against risks to which the Board and/or the Lessee
may reasonably be or become subject in the operation, construction or reconstruction of the Special
Facilities, as approved or reasonably required by the Board, but the Lessee shall not be required
to maintain any such insurance to the extent, that such insurance is carried for its benefit by a
licensee or other person operating, occupying or using any part of the Special. Facilities or by the
Board or contractors.. Initially such insurance shall provide coverage of not less than Five Hundred
Thousand Dollars ($500,000) for injury to or death of a person or persons in any one occurrence
and not less than One Hundred Thousand Dollars ($100,000) for damage to property in any one
accident, with a deductible for each occurrence or accident in a reasonable amount at Lessee's
option.
(iv) Such worker's compensation or employer's liability insurance as may be customarily
carried or required by law and such other insurance as is customarily carried by others engaged in
the operation and maintenance of facilities similar to the Special Facilities.
(b) All policies evidencing insurance maintained or caused to be maintained by the Lessee with
respect to the Special Facilities shall be issued by the home office of the insurer(s) or by a duly
authorized agent of the insurer(s) and shall name the Board and the Lessee as insureds, as their
interests shall appear, and shall be deposited with the Lessee but subject to inspection and examination
by the Board. Any such insurance may be written in blanket policies issued to Lessee covering other
property and operations so long as the Special Facilities are specifically stated to be covered in such
policies. All proceeds from claims shall be paid directly to the Lessee. The Board shall have the rights
and is hereby authorized in its own name to demand and sue, collect and give a receipt for claims and
moneys hereunder if Lessee fails to do so. The net proceeds of any and all such insurance required by
paragraphs (i) and (ii) of subsection (a), above, .shall be applied as prescribed in Section 6.7, below
15
Section 6.7 Damage, Destruction, Disposition of Insurance Proceeds.
(a) in the event the Special Facilities or a substantial part thereof are damaged or destroyed
by an insured casualty, the following provisions shall be applicable
(i) If at the time of the casualty there are Bonds outstanding and either (A) the insurance
proceeds together with any moneys in any reserve fund are sufficient to pay all of the interest
principal and other obligations accrued and to accrue on .said Bonds until they are fully and
finally paid and the Lessee does not request that the Special Facilities be repaired or rebuilt,
or (B) the proceeds and funds are insufficient and the Lessee agrees to pay any deficiency, and
the Lessee requests that the Special Facilities not be repaired or rebuilt, then the Board will
terminate this Agreement and release the Lessee from all unaccrued obligations hereunder, the
insurance proceeds and the deficiency payments, if any, paid by the Lessee shall be deposited
in the interest and sinking fund for the Bonds and the moneys in said fund and in any reserve
fund shall lie applied to pay the obligations with respect to the outstanding Bonds. If the said
proceeds. and funds are in excess of the amount then necessary to pay the obligations with
respect to the outstanding Bonds, any such excess after payment or provision for the payment
of the Bonds within the meaning of the Special Facilities Bond Ordinance has been made shall
be divided between the Board and the Lessee as their respective interests appear at the time
of such damage or destruction.
(ii) If at the time of the casualty there are Bonds outstanding and the Lessee requests
that the Special Facilities be repaired or rebuilt, such Facilities shall be repaired or rebuilt
acid paid for with the insurance proceeds, and if such proceeds are insufficient for such purposes
the Lessee shall pay .the deficiency If such proceeds are in excess of the amount necessary fox
such purposes, any such excess shall be paid to the Board and deposited by it to the interest
and sinking fund for said Bonds, as a credit to the next due payments of Net Rent, with such
credit to continue until the amount thereof is exhausted. The repair or restoration of the
Special Facilities shall be in accordance with the original plans and specifications, together
with alterations or modifications made or agreed upon prior to the casualty, or in accordance
with new or modified plans and specifications, the alternative to be determined by the Lessee;
provided no such modification or change shall be made which may alter the nature of the Initial
Special Facilities as facilities described in Section 103(b) (4) of the Code.
(iii) If at the time of the casualty, and whether or not it is an insured casualty, there are
no Bonds outstanding or provision has been made for payment of all of the Bonds outstanding
within the meaning of the Special Facilities Bond Ordinance, the Lessee shall have the right to
determine whether or not the Special Facilities should be reconstructed or repaired. If the Lessee
elects not to reconstruct or repair the Special Facilities or the insurance proceeds are insufficient
for such purpose and the Lessee fails to agree to pay the deficiency, the insurance proceeds shall
be divided between the Lessee and the Board as their respective interests appear at the time
of such damage or destruction and this Agreement and all unaccrued obligations hereunder
shall thereupon be terminated. If the Lessee elects to reconstruct or repair the Special Facilities
and if the insurance proceeds are sufficient to reconstruct or repair the Special Facilities or if
the insurance proceeds are insufficient and the Lessee agrees to bear and pay the deficiency, the
insurance proceeds and the amount paid by the Lessee shall be applied to the repair or restora-
tion of the Special Facilities, in accordance with the original plans and specifications, together
with any alterations or modifications made or agreed upon prior to the casualty, or in. accordance
with new or modified plans and specifications, the alternative to be determined ~y the Lessee;
provided no such modification or change shall be made which may alter the nature of the
Initial Special Facilities as facilities described in Section 103(b)(4) of the Code. If such pro-
ceeds are in excess of the amount necessary for such repair or restoration, such excess shall be
paid to and retained by the Lessee.
(b) Before any reconstruction or repair under this Section 6.7, Lessee shall submit a Construc-
tion Application and plans and specifications to the Board for approval and construction shall be
16
substantially in .accordance therewith subject to such changes as may be reasonably requested by
Lessee and approved by the Board, the Board reserves the right specifically to approve the con-
tractor and/or the architect/engineer selected by Lessee for such reconstruction or repair work.
Section 6.8. Miscellaneous Insurance Covenants.
(a) The Lessee shall, no later than the first day of each policy year in each year during the term
hereof, file or cause to be filed with the Board a certificate stating in reasonable detail the insurance
with respect to the Special Facilities.then in effect pursuant to the requirements of Section 6.6 hereof or
otherwise, and with respect to each policy the name of the insurer, the amount, policy number,
expiration date, and hazards covered thereby, and that the premium thereof has been paid, and
whether the Lessee is then maintaining or causing to be maintained insurance conforming in all
respect with the requirements of Section 6.6 hereof.
(b) Any appraisal or adjustment of any loss, claim or damage under any policy of insurance
with respect to the Special Facilities, and any settlement or payment of proceeds under any such
policy which may be agreed upon between the Lessee and any insurer, shall be evidenced by a
certificate of the Lessee filed with the Board, approving such appraisal, adjustment, settlement or
payment as required and satisfactory in the interest of the Board and the Lessee.
(c) Lessee's obligation under Section 6.6 shall not affect its right to carry additional insurance
solely for its own account.
(d) In the event the Lessee fails to maintain or cause to be maintained the full insurance cover-
'" age required by this Agreement, the Board may (but shall be under no obligation to) obtain the
required insurance coverage and pay the premiums for the same; and ail amounts so advanced
therefor by the Board shall become an additional obligation of the Lessee to the Board, which
amounts, together with interest thereon at the rate of IO% per annum from the date of payment
thereof, the Lessee agrees to pay upon demand.
Section 6.9. Condemnation.
(a) In the event that title to or use of the Leased Premises or a substantial part thereof shall
be taken or condemned in any eminent domain, condemnation, compulsory acquisition or like
proceeding or by any competent authority or conveyed under the threat thereof, for any public or
quasi-public use or purpose (hereinafter called "by the power of eminent domain") the following
provisions shall be applicable
' (i) If at the time of the taking there are Bonds outstanding and either (A) the condemna-
tion proceeds together with any moneys in any reserve fund are sufficient to pay all of the
interest, principal and other obligations accrued and to accrue on said Bonds until they aze
fully and finally paid and the Lessee does not request that the Special. Facilities be rebuilt else-
where or land suitable for such purpose is not available elsewhere, or (B) the proceeds and
funds are insufficient and the Lessee agrees to pay any deficiency and the Lessee does not
request that the Special Facilities be rebuilt elsewhere or land suitable for such purpose is not
available elsewhere, the Board will terminate this Agreement and release the Lessee from all
unaccrued obligations hereunder, the condemnation proceeds and deficiency, if any, paid by
Lessee shall be deposited in the interest and sinking fund for the Bonds and moneys in said
fund and in any reserve fund shall be applied to pay the obligations with respect to the out-
standing Bonds. If the said proceeds and funds are in excess of the amount then necessary to
pay the obligations with respect to the outstanding Bonds, any such excess after payment or
provision for the payment of the Bonds within the meaning of the Special Facilities Bond Ordi-
nance has been made shall be divided between the Board and the Lessee as their respective
interests appear at the time of the taking.
17
(ii) If at the time of the taking there are Bonds outstanding and the Lessee requests that
the Special Facilities be rebuilt elsewhere and if land suitable for such purpose is available
elsewhere, such Special Facilities shall be rebuilt elsewhere and paid for with the condemnation
proceeds, and if such proceeds are insufficient for such purposes the Lessee shall pay the
deficiency If such proceeds are in excess of the amount necessary for such purpose, any such
excess shall be paid to the Board and deposited by it to the interest and sinking fund for said
Bonds as a credit to the next due payment(s) of Net Rent, with such credit to continue until
the amount thereof is .exhausted. The rebuilding of such Special Facilities shall be in accordance
with the original plans and specifications, together with alterations or modifications made or
agreed upon prior to the taking, or in accordance with new or modified plans and specifications,
the alternative to be determined by the Lessee; provided that no such modification or change
shall be made which may alter the nature of the Initial Special Facilities as facilities described
in Section 103 (b)(4) of the Code. In the event of rebuilding under this paragraph (ii), the
Ground Rental shall abate as to any of the Leased Land rendered useless by the taking, as of
the time of the taking, and the parties shall appropriately amend the description of the Leased
Land and the new Ground Rental shall become effective as of the date the Lessee is given
beneficial use of the rebuilt Special Facilities.
(iii) If at the time of the taking there are no Bonds outstanding or provision has been made
for payment. of all of the Bonds within the meaning of the Special Facilities Bond Ordinance,
the Lessee shall have the right to determine whether or not the Special Facilities should be rebuilt
provided that land suitable for such purpose is available. If (A) the Lessee elects not to have
the Special Facilities rebuilt elsewhere (in which event the Lessee will advise the Board of such
decision within sixty (80) days after the date of the taking), or (B) the condemnation proceeds
are insufficient for such purpose and the Lessee fails to agree to bear and pay the deficiency or
(C) the land suitable for such purpose is not available elsewhere, this Agreement and all un-
accrued obligations hereunder shall thereupon be terminated and all condemnation proceeds
shall be divided between the Board and the Lessee, as their respective interests appear at the
time of the taking, with Lessee being entitled to the fair market value of its leasehold estate and
any allowance receivable for relocation or removal. If the Lessee elects to have the Special
Facilities rebuilt elsewhere and the condemnation proceeds are sufficient for such purpose or
if the condemnation proceeds are insufficient and the Lessee agrees to bear and pay the defi-
ciency, the condemnation proceeds and any amounts paid by Lessee shall be applied to the
rebuilding of such Facilities elsewhere, provided land suitable for such purpose is available, in
accordance with the original plans and specifications, together with any alterations or modifica-
tions made or agreed upon prior to the taking, or in accordance with new or modified plans and
specifications, the alternative to be determined by the Lessee; provided that no such modification
or changes shall be made which may alter the nature of the Initial Special Facilities as facilities
described in Section 103(b)(4) of the Code. :If such proceeds are in excess of the amount neces-
sary for such purpose, such excess shall be divided between the Board and the Lessee as their
respective interests appear at the time of the taking. In the event of a rebuilding under this para-
graph (iii), the Ground Rental shall abate as to any of the Leased Land rendered useless by the
taking, as of the time of the taking, and the parties shall appropriately amend the description of
the Leased Land the new Ground Rental shall become effective as of the date the Lessee is
given beneficial use of the rebuilt Special Facilities.
(b) In the event that title to or use of less than a substantial part of the Leased Premises is
taken by the power of eminent domain (that is, if the primary use of the Special Facilities is not
substantially impaired by deletion of the part taken) the Lessee shall determine whether any rebuild-
ing is necessary Any condemnation proceeds not used for the purposes of rebuilding shall be applied
until exhausted in reduction of the Net Rent payable hereunder If such proceeds are in excess of the
amount necessary for such purpose, such excess shall be divided between the Board and the Lessee
as their respective interests appear at the time of the taking.
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(c) Before any reconstruction or repair under this Section 6.9, Lessee shall submit a Construction
Application and plans and specifications to the Board for approval and construction shall be sub-
stantially in accordance therewith .subject to such changes as may be reasonably requested by Lessee
and approved by the Board, the Board reserves the right specifically to approve the contractor and/ or
the architect/engineer selected by Lessee for such reconstruction or repair work.
Section 6.10. Indemnification. The Lessee covenants and agrees from and after the Completion
Date as to each of the Special Facilities to indemnify and hold harmless the Board and the Cities,
their directors, councilmen, officers, agents, and employees, from and against any and all claims
for damages or injuries, including death, to persons or property arising out of or incident to
the use and occupancy of the Leased Premises during the term of this Agreement by Lessee, its
agents, servants or employees; provided, however, that the Board shall .give to Lessee prompt written
notice of any such claim or action and Lessee shall have the right to investigate, compromise and
defend the same. This Section shall not apply, however, to the negligent or willful acts or omissions
of the parties indemnified hereunder or any of them.
Section 6.11. Miscellaneous Operation Provisions.
(a) Without the prior written approval of the Board, Lessee shall not erect, maintain or display
signs or advertising at or on the exterior parts of the Leased Premises or in or on the Leased Premises
so as to be visible outside the Leased Premises. Exterior signs affecting public safety and security shall
be in accordance with established Board standards. If the Board has not given approval, as aforesaid,
upon receipt of notice, the Lessee shall remove, obliterate, or paint out any and all advertising, signs,
posters, and similar devices placed by the Lessee on the Leased Premises. In the event of a failure
on the part of the Lessee so to remove, obliterate or paint out each and every sign or piece of adver-
tising and to restore the Leased Premises to their prior condition, the Board may perform the necessary
work and the Lessee shall pay the cost thereof to the Board on demand.
(b) The Lessee shall provide and maintain such obstruction lights as the Board may reasonably
direct, of the type and design approved by the Board, and shall install such .lights in the locations
on the Leased Premises designated by the Board and shall furnish and install the bulbs and furnish
the electricity necessary for the operation thereof, and shall operate the same in accordance with
the directions of the Board. The Board hereby directs that all said obstruction lights shall, until fur-
ther notice be operated daily for a period commencing thirty (30) minutes before sunset and ending
thirty (30) minutes after sunrise (as sunset and sunrise may vary from day to day throughout each
year) and for such other periods as may be directed or requested by the control tower of the Airport.
In addition, Lessee shall also provide and maintain fire protection and safety equipment and all
other equipment of every kind and nature required by any law, rule, order, ordinance or resolution
of any governmental authority having jurisdiction over the Airport.
(c) Except to the extent required for the performance of the obligations or the exercise of rights
of the Lessee hereunder, nothing contained in this Agreement shall grant to the Lessee any rights
whatsoever in the air space above the Leased Premises in excess of a height set forth in the plans and
specifications for the Special Facilities.
(d) All personal property and all property and installations (including trade fixtures) removable
without material damage to the Leased Premises, which are installed by Lessee and paid for with
.. moneys other than the proceeds of Special Facilities Bonds in or on the Leased Premises shall be
deemed to be and remain the property of the Lessee. All such property and installation may at
Lessee's option be removed by Lessee from the Leased Premises at any time during the term of this
Agreement, and, unless otherwise agreed in writing by the parties, shall be removed by Lessee at or
before the expiration or other termination of the term of this Agreement provided that any damage
to the Leased Premises caused by said removal shall be repaired by Lessee so as to rehirn the
premises to the Board in the same or similar condition as when entered by Lessee, reasonable wear
and tear excepted. Any such property remaining on the Leased Premises beyond sixty (60) days
thereafter shall be deemed to be abandoned by Lessee.
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(e) All water, gas, oil and mineral rights in and under the soil are expressly reserved by the
Board.
(f) Title to all permanent improvements, including, but not limited to, buildings, structures and
paved areas, shall immediately vest in the Board and Cities as a part of the Airport.
(g) Lessee shall be permitted to and agrees to use in connection with its business, the Leased
Premises for the purposes of storage, preparation, sale and delivery of food and beverages for con-
sumption on board aircraft; and- consumption in Lessee's and American Airlines employee cafeterias.
Lessee shall also be permitted to and agrees to in connection with its business, use the Leased
Premises for maintenance of Lessee's ground equipment and for administrative and clerical offices.
(h) Lessee shall conduct its operations in an orderly and proper manner and so as not to annoy,
disturb or be offensive to others in the Airport. The Lessee shall take all reasonable measures to
eliminate vibrations tending to damage the improvements and keep the sound level of its operations
as low as reasonably possible.
Y (i) Lessee shall take all reasonable measures in every proper manner to maintain, develop and
increase the business conducted by it hereunder
(j) Lessee shall not erect any structures, make any improvements, or do any other construction
work on the Leased Premises or alter, modify or make additions, improvements, or repairs to or
replacements of any structure now existing or built, or install any fixtures (other than trade fixtures,
removable without injury to the Leased Premises or improvements thereof, and carpeting) without
the prior written approval of the Director of Planning and Engineering of the Airport by a Construc-
tion Application, provided, that no such change shall be made, which may alter the nature of the
Initial Special Facilities as facilities described in Section 103(b)(4) of the Code. In the event any
construction, improvement, alteration, modification, addition, repair or replacement is made without
such approval then upon reasonable notice to do so, Lessee will remove the same or cause the same
to be changed to the satisfaction of the Board. In case of any failure on the part of Lessee to comply
with such notice, the Board may effect the removal or change, and the Lessee shall pay the cost
thereof to the Board on demand.
The provisions of this Section shall not apply to any additions, improvements, repairs or replace-
ments reasonably necessary due to an emergency and provided further that the structural integrity of
any improvement to the Leased Premises is not affected.
(k) Approvals of Construction Applications shall not be unreasonably withheld, and the Director
of Planning and Engineering of the Airport or the Board shall make timely disposition of each Con-
struction Application.
(1) Lessee shall maintain and cause any subsidiaries, assignees, concessionaires and sublessees
operating .under it to maintain full and adequate books of account and other records and shall make
the same available to an authorized representative of the Board reflecting the results of the operations
of the Special Facilities. The books and records shall be kept in all material respects in accordance
with standard accounting practice used regarding such type of facilities. Records and books of account
more than (3) three years old need not be retained unless Lessee shall be otherwise notified in writing
,, by the Board and then only with good cause.
(m) Lessee shall accord to the officers, accountants, employees, agents and attorneys of the Board
the right to enter upon any part. of the Special Facilities at all reasonable times during the term of this
Agreement .for the purpose of examining or making extracts from the books and records of the Special
Facilities, including but not limited to cash registers and recording tapes, but the same shall be done
with as little disturbance as possible and only to the extent necessary to enable the Board to determine
compliance by Lessee with the terms of this Agreement.
20
(n) Lessee shall install and use and cause any subsidiaries, assignees, concessionaires and sub-
lessees operating under it to install and use such cash registers, sales slips, invoicing machines and
other equipment or devices for recording orders taken or services rendered as may be appropriate to
the Lessee's business and necessary or desirable to keep accurate records of revenue.
Section 6.12. Conduct of Airport Qperations.
(a) The Board agrees to operate, maintain and keep in. good repair or cause to be maintained
and kept in good repair, the areas and facilities provided by the Board for the public and Lessee
in accordance with the practices of a reasonably prudent airport operator The Board agrees to use
its best efforts reasonably necessary for the safe, convenient and proper use of the Airport by those
who are authorized to use the same and, in particular, to maintain and operate the Airport in
accordance with- all applicable standards, rules and regulations of the Federal Aviation Administra-
tion and any other regulatory authority having jurisdiction.
(b) The Board shall maintain directional signs in public areas of the airport, including by way
of example, but not by way of limitation, signs indicating the location of the Initial Special Facilities.
(c) The Board shall provide and keep in good repair lighting for the public and employee
vehicular parking facilities and the ramps and all other airfield lighting, and provide such janitorial
and cleaning services as may be necessary to keep the public areas of the Airport in a reasonably
presentable and -useable condition at all times.
ARTICLE VII
EVENTS OF DEFAULT AND REMIDIES
Section 7.1. Events of Default Defcned. The following shall be "events of default as to the Lessee"
under this Agreement and the term "events of default as to the Lessee" shall mean, whenever it is used
in this Agreement; any one or more of the following events
(a) Failure by the Lessee to pay when due or cause to be paid when due the Net Rent
required to be paid under Article V hereof.
(b) Failure by the Lessee to pay within thirty (30) days of the due date the Ground Rental
or Other Rentals required to be paid under Article V hereof.
(c) Failure by the Lessee to observe and perform any covenant, condition or agreement on
its part to be observed or performed other than as referred to in subsection (a) or (b), next
above, for a period of thirty (30) days after written notice, specifying such failure and requesting
that it be remedied, given to the Lessee by the Board (except where fulfillment of its obligation
requires activity over a period of time and the Lessee shall commence to perform whatever may
be required for fulfillment within thirty (30) days after the receipt of notice and diligently
continue such performance without interruption, except for causes beyond its control)
(d) The Leased Premises shall be abandoned, deserted or vacated by the Lessee or any
- lien shall be filed against the Leased Premises or any part thereof in violation of this Agreement
and shall remain unreleased for a period of sixty (60) days from the date of such filing unless
within said period the Lessee is contesting in good faith the validity of such lien and while
such lien is appropriately bondedr
.. ,
(e) The dissolution or liquidation of the Lessee or the filing by the Lessee of a voluntary
petition in bankruptcy, or failure by the Lessee within sixty (60) days to lift any execution,
garnishment or attachment of such consequence as will impair its abaility to carry on its opera-
tion at the Special Facilities, or the adjudication of the Lessee as a bankrupt, or general
assignment by the Lessee for the benefit of its creditors, or the entry by the Lessee into an
agreement of composition with its creditors, or the approval by a court of competent jurisdiction
21
of a petition applicable to the Lessee in any proceeding for its reorganization instituted under
the provisions of the general bankruptcy act, as amended, or under any similar act which may here-
after be enacted. The term "dissolution or liquidation of the Lessee," as used in this subsection,
shall not be construed to include the cessation of the corporate existence of the Lessee resulting
either from a merger or consolidation of the Lessee into or with another corporation or a
dissolution or liquidation of the Lessee following a transfer of all or substantially all of its
assets as an entirety, under the conditions permitting such actions contained in Section 9.2 hereof.
(f) The occurrence of an event of default as to the Lessee between the Board and the
Lessee under any other Special Facilities lease between the Board and the Lessee.
Section 7.2. Remedies on Default. Whenever any event of default as to the Lessee referred to in
-~ Section 7.1 hereof shall have happened and be subsisting,. the Board may take any one or more of the
following remedial steps as against the Lessee:
(a) The Board may re-enter .and take possession of the Leased Premises without tenninat-
ing this Agreement and sublease (or operate as sublessee) the Leased Premises for the account
of the Lessee, holding the Lessee liable for the difference between the rents and other amounts
payable by the Lessee hereunder and the rents and other amounts payable by such sublessee in
such subleasing or, if operated by -the Board, the difference between the net revenues received
from such operations and the rents and other amounts. payable by the Lessee hereunder;
(b) The Board may terminate this Agreement, exclude the Lessee from possession of the
Leased Premises and use its best efforts to lease the same to another party for the account of
the Lessee, holding the Lessee liable for all rents and other amounts due under this Agreement
and not paid by such other party; or
(c) The Board may take whatever other action at law or in equity as may appear necessary
or desirable to collect the rent then due and thereafter to become due, or to enforce performance
and observance of any obligation, agreement or covenant of the Lessee under this Agreement.
Section 7.3. No Remedy Exclusive. No remedy herein conferred upon or reserved to the Boazd
is intended to be exclusive of any other available remedy or remedies, but each and every such
remedy shall be cumulative and shall be in addition to every other remedy given under this tlgree-
ment or hereafter existing -under law or in equity No delay or omission to exercise any right or power
accruing upon any default shall impair any such right or power or shall be construed to be a waiver
thereof, but any such right and power may be exercised from time to time as often as may be
deemed expedient. In order to entitle the Boazd to exercise any remedy reserved to it in this
Article, it shall not be necessary to give any notice, unless such notice is herein expressly required or
is required by law
Section 7 4. Agreement to Pay Attorneys' Fees and Expenses. In the event there should be a
default under any of the provisions of this Agreement and the Board should determine that the
services of an outside, non-staff attorney are required or the Board incurs other expenses for the
collection of rent or the enforcement of performance or observance of any obligation or agreement
on the part of Lessee, the Lessee agrees that it will on demand therefor pay to the Board the reason-
y able, just and necessary fees of such attorneys and other reasonable expenses so intoned, provided
that it shall have been judicially determined that Lessee was in default of its obligations hereunder
to correct which such fees and expenses were incurred.
Section 7.5. No Additional Waiver Implied by One Waiver In the event any covenant contained
in this Agreement should be breached by either party and thereafter waived by the other party, such
waiver shall be limited to the particular breach so waived and shall not be deemed to be a waiver of
any other breach hereunder
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ARTICLE VIII
TERIIZINATION BY LESSEE
Section 8.1. While Bonds Outstanding. As provided in Section 5.2(c) hereof, this Agreement
as to Net Rent is not subject to termination by Lessee while any Series 1983A Bonds, any Completion
Bonds, any Additional Bonds or any Refunding Bonds are outstanding and not fully and finally paid
(or provision for such payment thereof made in accordance with the Special Facilities Bond
Ordinance )
Section 8.2. Termination at Other Times At any tune after all the Series 1983A Bonds, all Com-
pletion Bonds, all Additional Bonds and all Refunding Bonds have been fully and finally paid (or
provision for such payment thereof made in accordance with the Special Facilities Bond Ordinance)
and upon the occurrence of either of the following.
' (a) The Airport shall be closed or its operations curtailed by more than fifty per cent (50%)
of its achieved operating level in terms of daily average departing and arriving flights for the
twelve month period next preceding, then Lessee in its reasonable discretion may cease or
.curtail its operations of the Special Facilities during the period that the Airport operations have
ceased or have been so curtailed, and if such condition shall continue unabated for more than
two (2) years, Lessee shall have the right and option to terminate the Agreement upon thirty
(30) days prior written notice to the Board. During the time while the ,Special Facilities are not
being operated or are on a curtailed basis pursuant to this paragraph, there shall be a fair abate-
ment of the Ground Rental and Other Rentals which are required by in Sections 5.1 and 5.3
hereof; or "'
(b) The Board shall fail to perform any of its obligations under this Agreement within
thirty (30) days after receipt of notice of default hereunder from Lessee (except where ful-
fillment of its obligation requires activity over a period of time and the Board shall commence
to perform whatever may be required for fulfillment within thirty (30) days after the receipt
of notice and diligently continue such performance without interruption, except for causes
beyond its control) Upon the occurrence of such default and after giving the notice thereof and
allowing the time for curing such default as set forth above or at any time thereafter during the
continuance of any such condition, Lessee may, by thirty (30) days' written notice terminate
this Agreement, such termination to be effective upon the date set forth in such notice and to
have the same effect as if the term hereof had expired on that date, subject, as -aforesaid, to the
provisions of Section 8.1 hereof.
No waiver by Lessee of any default on the part of the Board in the performance of any of the
terms, covenants or conditions hereof to be performed, kept or observed by the Board shall be or
be construed to be a waiver by Lessee of any other or subsequent default in the performance of
any of said terms, covenants and conditions.
ARTICLE IX
AssicNME<vzs, SuBLEZ-rnvc
Section 9.1. Assignments by Airport Board and Cities. The Board and the Cities may transfer
or assign this Agreement to any successor in interest to Board and the Cities to whore the Airport
may be sold or assigned, provided, however, that the successor in interest shall execute and deliver
to the Board, with a copy to Lessee, an instrument assuming the lawful obligations of the Board
and the Cities under this Agreement.
Section 9.2. Assignments and Subleases by Lessee.
(a) Except to an affiliate of AMR Corp., Lessee shall not make any assignment of (other than
pursuant to Section 10.1 hereof) or sublet under this Agreement or enter into any concession or other
23
agreement or arrangement whereby the Leased Premises or any part thereof are operated by any
entity other than Lessee, without the written consent of the Board, which consent will not be unreason-
ably withheld, provided, however, in the event of such subleasing, assignment, concession or other
agreement or arrangement, the Lessee shall continue to remain primarily liable for payment of the
Ground Rental, Net Rent and Other Rentals pursuant to Article V hereof, and Lessee shall continue
to be primarily liable. for the performance and observance of the other agreements on its part herein
provided to be performed and observed by it. It is understood that Lessee may choose a separate or
dfferent operator or operators for all or part of the Special Facilities through use of subleases and/or
concession agreements upon written consent of the Board, which consent shall not be unreasonably
withheld.
(b) If Lessee assigns or sublets its interest in this Agreement, except as hereinbefore permitted,
or if the Leased Premises are occupied by anyone other than Lessee except as hereinabove permitted,
the Board may collect rent therefrom and the Board shall apply the net amount collected to the
rents herein reserved, but no such collection shall be deemed a waiver by the Board of the covenants
contained herein or an acceptance by the Board of any such assignee, sublessee, claimant or occu-
pant as a successor lessee, nor a release of Lessee by the Board from the further performance by the
Lessee of the covenants imposed upon Lessee herein.
ARTICLE X
MISCEt.~rrEOUS
Section i0.1. Lessee To Maintain its Corporate Existence. The Lessee shall from the effective
date hereof and throughout the term hereof maintain its corporate existence, will not dissolve or
otherwise dispose of all or substantially all of its assets and will not consolidate with or merge into
another corporation or permit one or more other corporations to consolidate with or merge into it;
provided, that the Lease may, without violating the agreement contained in this Section, consolidate
with or merge into it, or sell .or otherwise transfer to another corporation all or substantially all of
its assets as an entirety and thereafter dissolve, provide the surviving, resulting or transferee corpora-
tion, as the case may be, (i) assumes in writing all of the obligations of the Lessee herein, (ii) shall
have net assets and capital (both paid in and surplus) at least equal to the net assets and capital
of Lessee immediately prior to such consolidation, merger, sale or transfer, and (iii) qualifies to do
business in the State of Texas.
Section 10.2. Contracts and Warranties. All construction, reconstruction or rebuilding pursuant
to this Agreement shall be under contracts entered into under procedures established by the Board.
The Board will cause construction contracts relating to the Special Facilities to contain provisions for
performance and payment bonds and the usual and appropriate warranties for the benefit of all
parties hereto. All construction warranties may be enforced by Lessee in the name of the Board and
to the extent required will be assigned to Lessee by the Board.
Section 10.3. Board's Right o f Entry
(a) The Board, its officers, and employees, shall have the right at all reasonable times to enter
upon the Leased Premises for the purpose of inspecting the same, and for the doing of any act or
thing which the Board may be obligated or have the right to do under this Agreement.
(b) Without limiting the generality of the foregoing, the Board shall have the right, for its own
benefit or for the benefit of the Lessee and the others at the Airport, to maintain existing and future
utilities systems or portion thereof on the Leased Premises under the surface of the ground, including
therein without limitation thereto, systems for the supply of heat, water, gas, fuel and electricity, and
for the furnishing of fire alarm, fire protection, sprinkler, sewage, drainage, telephone and telegraph
service, including all lines, pipes, mains, wires, conduits .and equipment connected with or appur-
tenant thereto, and to make such repairs, replacements or alterations as may, in the. opinion of the
Board, be deemed necessary or advisable and, from time to time, to construct or install under the
24
Leased Premises new systems or parts thereof, including lines, pipes, mains, wires, conduits and
equipment; provided, however, that in exercising such right the Board shall not interfere with the
operation of the Special Facilities or abridge the rights conferred on Lessee by the Agreement; and
provided, further, that in the event the Board or its contractor shall engage in or perform any con-
struction work on the Leased Premises, during the term of this Agreement, the Board shall defend,
indemnify, and hold harmless the Lessee, its officers, agents and employees against the risk of death,
injury or damage to person or property direct or consequential, arising out of or in connection with
the performance of any or all of such construction work, and ~ does hereby assume liability and
responsibility for the risk of claims and demands, just or unjust, by third parties arising or alleged
to arise out of the performance of such construction work, except for damage caused by Lessee
and/or its agents, servants, contractors or subcontractors.
Section 10.4. Services to Lessee.
(a) Except as may otherwise be expressly provided herein, Airport Board shall have no obliga-
tion to furnish or supply for or on behalf of Lessee any services whatsoever Lessee shall have the
a obligation to arrange with and pay the appropriate utility or service companies; or board, or other
supplier, supplying utilities and services in the area for the supply of all other services including
electric power Lessee shall be responsible for the maintenance and good repair of all such service
lines furnished to it by such utility companies and for all water mains and sewers constructed and
installed within Lessee's Premises by Lessee.
{b) No failure to furnish, or no delay or interruption in, any service or services, whether such
service or services shall be supplied by the Board or by others, shall relieve or be construed to relieve
the Lessee of any of its obligations hereunder, or shall be construed to be an eviction by the Board,
or shall constitute grounds diminution or abatement of the Ground Rental, Net Rent or Other Rentals
payable under this Agreement, or grounds for any claim by the Lessee for damages, consequential
or otherwise, except when resulting from the negligence of the Board or from its willful failure to
furnish or; supply such services, if any (except where the Lessee is in default in the payment of
rentals) It is provided, however, that nothing herein shall diminish or abate the requirement herein
that Net Rent shall be paid unconditionally
Section 10.5. Additional Bonds. The Board and the Lessee acknowledge that as the Airport
becomes more fully developed, such circumstances will likely require that the Initial Special Facilities
be extended, improved and expanded in order to provide convenient and necessary services at the
Airport. Accordingly, the Board shall make such acquisitions, additions, extensions, improvements and
modifications (hereinafter for purposes of this Section 10.5 called "changes") to or of such Initial
Special Facilities a5~ shall be requested by the Lessee and approved by the Board, subject to the
availability of funds therefor; provided that no such changes shall be made which may alter the
nature of the Initial Special Facilities as facilities described in Section 103(b)(4) of the Code. In
order to obtain funds for such purposes, the Board, when requested by the Lessee, shall request the
Cities to issue Additional Bonds therefor However, no representation is made or assurance given or
implied by the Board that the Cities will consent to the request of the Board, and the Cities are not
required to issue any such Additional Bonds. Additional Bonds shall not be issued in circumstances
qualifying for the issuance of Completion Bonds pursuant to Section 10.6 hereof. Upon the issuance
of any such Additional Bonds, the same shall be on a parity as to lien on "Pledged Revenues" as
~: such term is defined in the Special Facilities Bond Ordinance with the Series 1983A Bonds and any
Completion Bonds or other Additional Bonds or Refunding Bonds theretofore issued, and the Net
Rent payable hereunder shall automatically be increased in the amounts required by the terms of the
ordinance authorizing such Additional Bonds. It is provided, however, that such ordinance shall not
be adopted until the Lessee has approved such ordinance, after the receipt of which approval the
same shall be binding upon the Lessee. Such Additional Bonds shall be issued as "Special Facility
Bonds", within the meaning of the 1968 Concurrent Bond Ordinance, subject to and in accordance
with the Special Facilities Bond Ordinance and any other ordinances authorizing Additional Bonds,
25
Completion Bonds, or Refunding Bonds. Section 3.2 and 3.3 hereof shall apply to any such additions,
extensions, improvements and modifications financed under this Section 10.5 to the same extent as
those Sections apply to the Initial Special Facilities.
Section 10.6. Completion Bonds: In the event the proceeds derived from the sale of the Series
1983A Bonds or any Additional Bonds shall be insufficient to pay the Costs of the Special Facilities
for the project then being financed, the Lessee shall either pay the amount of the insufficiency or
shall request the issuance of Completion Bonds for that purpose, in which event the Board shall
request the Cities to issue Completion Bonds for the purpose. However, no representation is made
or assurance given or implied bq the $oard that the Cities will consent to the request of the Board,
and the Cities are not required to issue any Completion Bonds. In the event the Cities are unwilling
_ for any reason to issue Completion Bonds, the Lessee shall pay the amount of any such deficiency
Completion fonds may be issued at any time prior to the completion of the Special Facility as to
which such insufficiency exists, upon the execution of a certificate by the Director of Finance or
similar officer of the Board, stating in substance either (i) as to the completion of the Initial Special
Facilities, that the proceeds of the Series 1983A Bonds have been expended or totally appropriated for
the purpose of the Initial Special Facilities and that additional funds are needed in order to com-
plete the payment of the Costs of the Initial Special Facilities or (ii) as to the completion of any
item of extensions or other improvements or acquisitions of Special Facilities with Additional Bonds,
that the proceeds of such Additional Bonds are not adequate to complete the project for which such
Additional Bonds were issued. In the event of the issuance of such Completion Bonds, then the
Net Rent payable hereunder shall thereupon be automatically increased in accordance with the
ordinance authorizing such Completion Bonds. It is provided, however, that such ordinance shall not
be adopted until the Lessee has approved such ordinance, after the receipt of which approval the
same shall be binding upon the Lessee. Such Completion Bonds shall be on a parity as to lien on
"Pledged Revenues" as such. term is defined in the Special Facili-ties Bond Ordinance, with the
Series 1983A Bonds and any Refunding Bonds, Additional Bonds or other Completion Bonds thereto-
fore issued. Such Completion Bonds shall be issued as Special Facility Bonds subject to and in .accord-
ance with the terms, conditions and provisions of the 1968 Concurrent Bond Ordinance, the Special
Facilities Bond Ordinance and any ordinances authorizing Additional Bonds, Completion Bonds or
Refunding Bonds.
Section 10.7 Refunding Bonds. The Board and the Lessee acknowledge that as economic con-
ditions change it may become necessary or desirable to issue Refunding Bonds for the purpose of
refunding or refinancing of any part or all of the Bonds from time to time outstanding. Accordingly,
the Board agrees to reserve the right to issue Refunding Bonds for such purposes in the Special Facil-
ities Bond Ordinance. In the event the Lessee shall, for any Iawful purpose, consider it desirable
• to issue Refunding Bonds, provided (i) such Refunding Bonds are at the time permitted by the
laws of the State of Texas, (ii) such Refunding Bonds can be issued with the interest thereon tax-
exempt under the laws of the United States; (iii) such Refunding Bonds can be issued without vio-
lating any provisions of the 1968 Concurrent Bond Ordinance, the Special Facilities Bond Ordinance,
~, any other ordinance authorizing the issuance of Additional Bonds, Completion Bonds or other Refund-
ing Bonds or violating the rights of the holders of the then outstanding Bonds; and (iv) the issuance
of such Refunding Bonds will not be unreasonably disruptive of pending or planned financing by
the Board for other purposes of the Airport, the Board shall request the Cities to issue Refunding
"' Bonds for that purpose. However, no representation is made or assurances given or implied that the
Cities will consent to the request of the Board, and the Cities are not required to issue any Refunding
Bonds. The Board expressly agrees not to issue any Refunding fonds without the consent and
approval of the Lessee. In the event of the issuance of such Refunding Bonds, the Net Rent payable
hereunder shall thereupon be automatically adjusted in accordance with the ordinance authorizing
such Refunding Bonds, provided that, unless such ordinance shall theretofore have been in effect and
approved by the Lessee, such ordinance shall not be adopted until the Lessee has approved such ordi-
nance, after the receipt of which approval the same shall be binding upon the Lessee. Such Refunding
26
Bonds shall be on a parity as to lien on "Pledged Revenues" (as such term is defined in the Special
Facilities $ond Ordinance) with any Series 1983A Bonds, Completion Bonds, Additional Bonds or
other Refunding Bonds theretofore issued and remaining outstanding after the issuance of such
Refunding Bonds.
Section 10.8. Formal Approvals by Lessee.
(a) With respect to the approvals herein required of the Lessee, Lessee shall from time to time
furnish to the Board a certificate signed by its Secretary or an Assistant Secretary, under the seal of
the corporation, and such certificate shall set forth the officers or representatives of Lessee who are
authorized to grant such approvals and to bind the Lessee thereto; and the Board and all third parties
affected by any such approvals, including the holders of Bonds, may rely upon any writing purporting
to grant such approvals signed by any officer or representative thus certified as being conclusively
binding upon Lessee, and any such writing shall itself constitute conclusive evidence that any and
all corporate actions necessary to .be taken with respect to the matter thus approved by such officers
or that the approval therein given has been authorized by the corporation.
(b) Whenever herein the approval of Lessee is required in connection with the Special Facilities
Bond Ordinance, the same shall be deemed to mean the complete ordinance, except for rate of
interest, award provisions and the terms of sale and any other matters deferred until the date of sale.
Section 10.9. Remedies Against Contractors and Subcontractors and Sureties. In the event of
default of any contractor or subcontractor under any contract made by it in connection with the
construction of the Special Facilities, the Board will promptly proceed, either separately or in con-
junction with others, to exhaust the remedies of the Board against the contractor or subcontractor
so in default and against the surety of each for the performance of such contract. The Board agrees
to advise the Lessee of the steps it intends to take in connection with any such default. Any amounts
recovered by way of damages, refunds, adjustments or otherwise in connection with the foregoing
prior to the Completion Date or the completion of any construction, shall be made a part of the
funds available for the payment of the Costs of the Special Facilities. If any such recoveries are made
after the Completion Date of the, Initial Special Facilities or any separate additional project consti-
tuting Special Facilities, as the case may be, the amounts recovered shall be deposited in the interest
and sinking fund and applied as a credit to the Net Rent obligation of the Lessee hereunder, in
accordance with Section 5.2(b) hereof.
Section. 10.10. Personal Liability of Officials. in carrying out any of the above provisions of this
Agreement, or in exercising any power or authority granted to him hereunder, there shall be no
liability upon any officer of the Lessee, the Cities of Dallas and Fort Worth, the Board, or their
authorized employees, either personally or as an official of the Lessee, the Cities or the Board, it
being understood that in such matters he acts as an agent and representative of the Lessee, the
Cities or the Board. F
Section 10.11. Force Majeure. Neither the Board nor Lessee shall be deemed in violation of this
Agreement if it is prevented from performing any of the obligations hereunder by reason of strikes,
boycotts, labor disputes, embargoes, shortage of material, acts of God, acts of the public enemy,
acts of superior governmental authority, weather conditions, flood, riots, rebellion, sabotage, or any
other circumstances for which it is not responsible or which is not in its control, and the time for
performance shall be automatically extended by the period the party is prevented from performing
V its obligations hereunder; provided, however, that these provisions shall not apply to failures by the
Lessee to pay the rentals and other charges pursuant to Article V hereof, expressly including the
Net Rent payable thereunder
Section 10.12. Construction of Lease In the event of ambiguity in any of the terms of this Lease,
it shall not be construed for or against any party on the basis that such party did not author the same.
Section 10.13. Severability Clause. If any word, phrase, clause, paragraph, section or other part
of this Lease shall ever be held to be invalid or unconstitutional by any court of competent jurisdic-
27
tion, the remainder of this Lease and the application of such word, phrase, clause, sentence, para-
graph, section or other part of this Lease to any other person or circumstance shall not be affected
thereby
Section 10.14. Brokerage. The Lessee and the Board each to the other represents and warrants
that no brokers have been concerned on their behalf in the negotiation of this Agreement and that
there are no such brokers who are or may be entitled to be paid commissions in connection there-
with. The Lessee and' the Board shall indemnify and save harmless each other of and from any claim
for commission or brokerage made by any such brokers when such claims are based in whole in
part upon any acts or omissions of the other
Section 10.15. Notices. Notices provided for in this Agreement shall be sufficient if sent by regis-
tered mail, postage prepaid, addressed, if to the Board - Dallas-Fort Worth Regional Airport Board,
Post Office Drawer DFW, Dallas-Fort Worth Airport, Texas 75261, Attention Executive Director,
or .to such other address and person as it may direct in writing, and if to Lessee - P O Box 619616,
Dallas-Fort Worth Airport, Texas 75261-9616, Attention Vice President -Properties and Facilities or
to such other address and person as Lessee, may direct in writing. Notices shall be deemed completed
when mailed unless otherwise herein required.
Section 10.16. Consent Not Unreasonably Withheld. Wherever it is provided herein that the
consent or approval of Board, the Executive Director of the Board, the Director of Planning and
Engineering of the Board or Lessee is required, such consent or approval shall not be unreasonably
withheld or delayed, unless specifically otherwise provided herein.
Section 10.17 Laws Governing. The laws of the State of Texas shall govern the construction of
this Agreement.
Section 10.18. Recordation. A short form of this Agreement, for purposes of recording, will be
executed by the parties which may be recorded with all recording fees and transfer taxes to be
paid by Board.
IN WITNESS WHEREOF, this Agreement has been entered into and effective as of the date
first above written, and executed in multiple counterparts on the 9~` day of December, 1983, by the
respective officers of the parties hereto, thereunto duly authorized.
ATTEST
DALLAS/FORT WORTH REGIONAL
AIRPORT BOARD
Qit a~
Staff Secretary Executive Director
APPROVED AS TO FORM
.. AMERICAN AIRLINES, INC.
~.
THE STATE OF TEXAS
COUNTY OF DALLAS
BEFORE ME, the undersigned .authority in and for Dallas County, Texas on this day personally
appeared Ernest E. Dean and Barbara Hollis of the Dallas/Fort Worth Regional Airport Board, each
known to me to be the person whose name is subscribed to the foregoing instrument and known to
me to be, respectively, the Executive Director and Staff Secretary of the Dallas/Fort Worth Regional
Airport Board, and each acknowledged to me that he executed the same for the purposes and con-
sideration therein expressed and in the capacity therein stated, and as the act and deed of said Board.
GIVEN UNDER MY HAND and seal of office, this the ~~ day of December, 1983.
(SFAT•~ t-~C~B-~ ,~ ;, ^,~~ ,~~i 'fir
Notary Pubhc,dn'~'a~id for ~.~ ~ ~ ~'
n
Dallas Coun~~,'Texas ~ ,^
'; J t~ ~ ~.
THE STATE OF TEXAS ~.' ~~~ ~~'~ '..-~
COUNTY OF TARRANT ~ ~,,„ ~+~~
BEFORE ME, the undersigned authority in and for Tarrant County, Texas, on this day
personally appeared Richard B. Jamison and C~ ~t ~~l~lgand each known to me to be, respec-
tively, the authorized officers of American Airlines, Inc., a Delaware corporation, and each acknowl-
edged to me that he executed the same for the purposes and consideration therein stated, as the act
and deed of said corporation.
GIVEN UNDER MY HAND and seal of office, this the ~~/~ day of December, 1983.
Notary Pub c in and for
Tarrant County, Texas
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29
ExHIBIT 1
EXHIBIT 2
a~N\aE~,o~ The Dallas/Fort Worth Regional Airport Board Permit No.
30 1111(;,+~
• P. O. Drawer DFW
' Dalias/Fort Worth Airport; Texas 75261
f~~;%~'~="'~~d Attn: Director of Planning and Engineering
~~~a
.,
TENANT CONSTRUCTION OR ALTERATION APPLICATION
A. INFORMATION FROM APPLICANT (to be completed by Applicant)
s
Leaseholder Telephone No
Company Name of Tenant ~ Telephone No
Lease No
Description of Work
Cost Estimate
Architect/Engineer Telephone No
Signature of Architect/Engineer Date
Contractor Telephone No
Contractor Address
Signature of Leaseholder Authorized Represents#ive
Typed Name Telephone No.
Construction Contract Enclosed Insurance Certificates Enclosed
(Projects Over $25,000 00) (All Projects)
Performance & Payment Bonds Enclosed
(Projects Over $25,000 00)
~~- * If any of these areas are not completed:, the Application will not be approved.
:ry. T
B. CONTRACTURAL REQUIREMENTS FULFILLED:
.,
Contract Administrator Date .
Planning/Engineering Manager Date
C. APPLICATION IS APPROVED SUBJECT TO THE FOLLOWING CONDITIONS•
By- Date
Director of Planning and Engineering
__ Applicant must read the terms and conditions priinteii on the reverse her
r~
EXHIBIT 3
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