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Home My WebLink AboutContract 35891-T1 City Secretary Contract Number AGREEMENT TERMINATING LEASE FORT WORTH MEACHAM INTERNATIONAL AIRPORT TERMINAL BUILDING OFFICE LEASE AND RAMP SPACE LICENSE AGREEMENT 4201 NORTH MAIN STREET, SUITE 119 This AGREEMENT TERMINATING LEASE ("Agreement") is made and entered into by and between the CITY OF FORT WORTH ("Lessor"), a home rule municipal corporation organized under the laws of the State of Texas, acting by and through Fernando Costa, its duly authorized Assistant City Manager and Don E. Hansen, an individual (Lessee). RECITALS The following introductory provisions are true and correct and form the basis of this Agreement: A. Lessor previously entered into a Terminal Building Office Lease and Ramp Space License Agreement ("Lease") at Fort Worth Meacham International Airport (the "Airport") known as City Secretary Contract No. 35891 on October 7, 2007 with Don E. Hansen and was amended by City Secretary Contract No. 35891-A1 on June 8, 2010. All defined terms used in this Agreement that are not otherwise defined herein shall have the meaning as set forth in the Lease. B. Lessor and Lessee have decided to cancel and terminate the Lease and it is the intention of Lessor and Lessee to effect the cancellation of the Lease by this instrument. THEREFORE, in consideration of the covenants and agreements contained below, and of the release and surrender by Lessee of the Lease and all of its rights in it and all of its rights in and to Premises, of the release by Lessor of all Lessee's obligations under the Lease, and for other valuable consideration, the receipt and sufficiency of which are acknowledged here, the parties to this Lease agree as follows: AGREEMENT 1. TERMINATION OF THE LEASE. The Lease is hereby terminated effective as of December 17, 2013 ("Effective Date"). Lessor hereby agrees to pay Lessee in the amount of $500,000.00 for the Agreement Terminating Lease OFFICIAL RECORD Fort Worth Meacham International Airport Terminal Building Office Lease and Ramp Space License Agreement CITY SlQRLT Afty FT. WORTH, TX s�Qt a � �3o a3 ni3�3a termination of the Lease, which is intended to compensate Lessee for the leasehold interest. Lessee ,and Lessee's heirs and assigns hereby forever releases, quitclaims, and surrenders to Lessor the Lease and all rights of Lessee in and to the Premises and the Ramp Space. Lessee and Lessee's heirs further RELEASE, ACQUIT, AND FOREVER DISCHARGE Lessor and Lessor's agents, servants, employees and all other persons from any and all claims, demands, or causes of action of any kind whatsoever against Lessor which Lessee may have now, known or unknown, existing, directly or indirectly attributable to the Lease or this Agreement. 2. SURRENDER OF PREMISES. Within 60 days following the Effective Date, the Premises and Ramp Space shall be vacated of all trade fixtures, tools, machinery, equipment, materials and supplies, furniture, and personal property ("Tenant Property"). By entering into this Agreement, Lessee hereby agrees that any Tenant Property remaining after this 60 day period shall become property of the Lessor, and this Agreement constitutes a bill of sale for same to Landlord. 3. OPTION TO REESTABLISH FBO. At a future time as determined by the Lessee and prior to September 30, 2017, Lessee may re-establish an FBO Operation. This option can be exercised by initiating contact with the Lessor. 4. NOTICES TO LESSEE AFTER EFFECTIVE DATE. All notices to Lessee after the Effective Date shall be addressed as follows: Don E. Hansen 7957 Bal Harbor Fort Worth, Texas 76179 Agreement Terminating Lease Fort Worth Meacham International Airport Terminal Building Office Lease and Ramp Space License Agreement Page 2 of 4 IN WITNESS WHEREOF, the parties hereto have executed this Agreement Terminating Lease in multiples on this the_-IY day of )'t v- , 2013. CITY OF FORT WORTH: By-.7� JiQOGN� Fernando Costa Assistant City Manager Date: STATE OF TEXAS § COUNTY OF TARRANT § BEFORE ME, the undersigned authority, a Notary Public in and for the State of Texas, on this day personally appeared Fernando Costa, known to me to be the person whose name is subscribed to this Agreement Terminating Lease, and acknowledged to me that the same was the act of the City of Fort Worth and that he executed the same as the act of the City of Fort Worth for the purposes and consideration therein expressed and in the capacity therein stated. GIVEN UNDER MY HAND AND SEAL OF OFFICE this_ ay 12013. `,1PRY PVp�i EVONIA DANIELS Notary Public,State of Texas aN °. My commission Expires Notary Public in and or the July 10, 2017 State of Texas APPROVED AS TO FORM ATTES AND LEGALITY: 7 By: I C)141 A Ill By: J. Kayser Assistant City Attorney City Secretary F O0000 G$ p * X Agreement Terminating Lease A��OpOppppO�* Fort Worth Meacham International Airport S Terminal Building Office Lease and Ramp Space L c 1filYRECORD Page o 4 CITY SECRETARY FT.WORTH,TX LESSEE: ATTEST: Don E. Hansen By: By: Don t. Hansen Individual Date: STATE OF TEXAS § COUNTY OF § BEFORE ME, the undersigned authority, a Notary Public in and for the State of Texas, on this day personally appeared Don E. Hansen, known to me to be the person whose name is subscribed to this Agreement Terminating Lease, and acknowledged to me that the same was the act of Don E. Hansen, and that s/he executed the same as the act of Don E. Hansen, for the purposes and consideration therein expressed and in the capacity therein stated. GIVEN UNDER MY HAND AND SEAL OF OFFICE this / day 12013. r�. Not Publi and for the State of Texas Jca"MudV OM Agreement Terminating Lease Fort Worth Meacham International Airport Terminal Building Office Lease and Ramp Space License Agreement Page 4 of 4 City of Fort Worth, Texas Mayor and Council Communication DATE: Tuesday, December 17, 2013 REFERENCE NO.: **G-18092 LOG NAME: 55FTW OFFICE LSE TERMINATION SUBJECT: Authorize Execution of a Settlement Agreement with Don E. Hansen for the Termination of an Administration Building Lease and Ramp Space License Agreement at Fort Worth Meacham International Airport for the Purpose of Renovation of the Administration Building, Authorize Payment in the Amount of $500,000.00 to Don E. Hansen in Settlement of All Claims, Authorize Use of Mineral Lease Revenue from City Airports and Adopt Appropriation Ordinances (COUNCIL DISTRICT 2) RECOMMENDATION: It is recommended that the City Council: 1. Declare the necessity to acquire the leasehold interest in Suite 119 in the Administration Building and the associated ramp space near the Administration Building at Fort Worth Meacham International Airport for the demolition, renovation, and expansion of the Administration Building; 2. Authorize the execution of a Settlement Agreement with Don E. Hansen for the termination of City Secretary Contract No. 35891, M&C C-22425, as amended by Amendment No. 1, City Secretary Contract No. 35891-A1, M&C C-24248, for Suite 119 in the Administration Building and associated ramp space at Fort Worth Meacham International Airport; 3. Authorize the payment in the amount of$500,000.00 to Don E. Hansen in settlement of all claims related to the termination of the Administration Building Lease and Ramp Space License Agreement; 4. Adopt the attached supplemental appropriation ordinance increasing estimated receipts and appropriations in the Municipal Airports Fund in the amount of$500,000.00 for payment to Don E. Hansen in settlement of all claims related to the termination of the Administration Building Lease and Ramp Space License Agreement; 5. Authorize the one-time use of revenue derived from mineral leases on City-owned airports in the amount of$500,000.00 to replenish the fund balance in the Municipal Airports Fund to comply with the Financial Management Policy requirement of twenty percent, as allowed under the Financial Management Policy; 6. Adopt the attached appropriation ordinance increasing estimated receipts and appropriations in the Airports Gas Lease Project Fund in the amount of$500,000.00; and 7. Authorize the transfer in the amount of$500,000.00 from the Airports Gas Lease Project Fund to the Municipal Airports Fund. DISCUSSION: The Meacham International Airport Administration Building has not been renovated since being built in 1967, except for small alterations to portions of the facility. The building needs to be renovated to modernize the exterior and interior lease spaces, meet the Americans with Disabilities Act (ADA) requirements, become more energy efficient and update the heating, ventilation and air conditioning Logname: 55FTW OFFICE LSE TERMINATION Page 1 of 3 system. On October 2, 2007, (M&C C-22425) the City Council approved a lease with Don E. Hansen for Suite 119 in the Administration Building and a non-exclusive license for associated ramp space at Fort Worth Meacham International Airport. This suite consists of 2,100 square feet of first floor office space and the ramp space adjacent to the Administration Building consists of approximately 172,889.64 square feet. Pursuant to the Agreement, Mr. Hansen made significant improvements to the Administration Building in exchange for 1'00 percent rent credits for the capital improvements made to the leased premises and the licensed premises. It is necessary for the City to demolish Suite 119 for the renovation of the Administration Building. Mr. Hansen agreed to terminate his Agreement with the City in return for compensation in the amount of $500,000.00. This amount includes the remaining amount of rent credits owed to Mr. Hansen under the Lease Agreement, the value of the leasehold interest remaining on the lease as determined by appraisal, and the future revenue not realized from the Fixed Based Operator(FBO) business for the remaining years of the lease. This amount also includes any damages related to the FBO brand known as Sandpiper Aviation. The Settlement Agreement provides that the suite and the ramp space shall be vacated of all trade fixtures, tools, machinery, equipment, materials and supplies, furniture, and personal property 60 days from the approval date of this Mayor and Council Communication. Mr. Hansen also has the ability to re- establish, if all minimum standard requirements are met, an FBO business in another location on the airport through the end of the term of the original Lease Agreement, which ends in September of 2017. Staff recommends approval of the execution of the Settlement Agreement for the termination of this Agreement, and the payment of compensation to Mr. Hansen. Funding for this payment will come from the Municipal Airports Fund which will cause the fund balance to drop below the required twenty percent. A one-time use of revenue derived from mineral leases on City-owned airports in the amount of $500,000.00 to replenish the fund balance in the Municipal Airports Fund is allowed, as defined by the allowable expenses section of the Financial Management Policy. The property is located in COUNCIL DISTRICT 2, Mapsco 48P and 48T. FISCAL INFORMATION /CERTIFICATION: The Financial Management Services Director certifies that upon approval of the above recommendations and adoption of the attached appropriation ordinances, funds will be available in the current operating budget, as appropriated, of the Municipal Airports Fund. FUND CENTERS: i TO Fund/Account/Cente% FROM Fund/Account/Centers 4) PE40 476240 0551000 $500,000.00 7)P240 538040 551929990100 $500,000.00 4) PE40 539120 0551000 $500,000.00 6) P240 446200 551929990100 $500,000.00 6) P240 538040 551929990100 $500,000.00 7) PE40 476240 0551000 $500,000.00 CERTIFICATIONS: Submitted for City Manager's Office by: Fernando Costa (6122) Originating Department Head: Bill Welsted (5402) Logname: 55FTW OFFICE LSE TERMINATION Page 2 of 3 Additional Information Contact: James Burris (5403) ATTACHMENTS 1. 55FTW OFFICE LSE TERMINATION P240 AOv2.docx (Public) 2. 5517TW OFFICE LSE TERMINATION PE40 SAO.docx (Public) 3. Available funds 11212013.docx (CFW Internal) 4. Lease Exhibit - Term,.pdf (Public) Logname: 55FTW OFFICE LSE TERMINATION Page 3 of 3