HomeMy WebLinkAboutContract 26951-T1 i
City Secretary Contract No. �Q S�'
TERMINATION OF LEASE AGREEMENT
FORT WORTH SPINKS AIRPORT
UNIMPROVED GROUND LEASE AGREEMENT
AND ASSOCIATED MANDATORY IMPROVEMENTS
This TERMINATION OF LEASE AGREEMENT("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 Harry Phillips, an individual("Lessee").
RECITALS
The following introductory provisions are true and correct and form the basis of this Agreement:
A. Lessor previously entered into an Unimproved Ground Lease and Associated Mandatory
Improvements Agreement("Lease")at Fort Worth Spinks Airport, City Secretary Contract No. 26951, on
July 27, 2001. All defined terms used in this Agreement that are not otherwise defined herein shall have
the same 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 his rights in it and under the Lease, and for other
good and 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.
(a) The Lease is hereby terminated effective as of November 30, 2014 ("Termination Date").
M Lessor and Lessee agree that the Lease is to be cancelled and terminated and the term thereby
M demised brought to an end as of the Termination Date with the same force and effect as if the
`< term of the Lease were, in and by the provisions of the Lease, fixed to expire on the
M
C_-j Termination Date.
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(b) Lessee and Lessee's heirs and assigns hereby forever release, quitclaim and surrender to
cLessor the Lease and all rights of Lessee in and to the Premises and to any and all
o improvements and fixtures on the Premises. Lessee and Lessee's heirs and assigns further
.0 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
Agreement Terminating Lease
Harry Phillips AL RECORD
Fort Worth Spinks Airport �F���
CITY SECRETARY
FT.WORM TX
kind whatsoever against Lessor which Lessee may have now, known or unknown, existing,
directly or indirectly attributable to the Lease or this Agreement.
2. CONSIDERATION.
Lessor hereby agrees to pay Lessee in the amount of$200,000.00 for the termination of the Lease, which
is intended to compensate Lessee for the leasehold interest and all fixtures and improvements to the
Premises.
3. RELEASE AND INDEMNIFICATION.
(a) Lessee, for itself and its successors and assigns, forever releases and discharges Lessor
from any and all claims, demands, or causes of action whatsoever against Lessor, its successors and
assigns, arising after the termination date out of the Lease or its use and occupancy of the Premises under
the Lease, or the termination and surrender of the Lease and surrender of the Premises.
(b) LESSEE AGREES TO DEFEND, INDEMNIFY, AND SAVE LESSOR
HARMLESS FROM AND AGAINST ALL LOSS OR DAMAGE SUSTAINED BY LESSOR(AND
ALL EXPENSES, COSTS, AND ATTORNEY'S FEES OF LESSOR IN ANY ACTION OR
DEFENSE UNDERTAKEN BY LESSOR TO PROTECT ITSELF FROM SUCH LOSS OR
DAMAGE) RESULTING FROM ANY BREACH BY LESSEE OF THE REPRESENTATIONS
AND WARRANTIES MADE IN THIS AGREEMENT, FROM LESSEE'S TERMINATION OF
THE LEASE, FROM ANY LIEN, CHARGE, ENCUMBRANCE, OR CLAIM AGAINST THE
PREMISES, OR FROM ANY CLAIM AGAINST LESSOR FOR WHICH LESSEE IS
RESPONSIBLE.
4. SURRENDER OF PREMISES.
Lessee agrees that Lessor shall have the right to re-enter upon the Premises as of the Termination
Date, as fully as it would or could have done if that were the date provided for the expiration or
termination of the Lease.
5. TENANT PROPERTY.
Within 30 days following the Termination Date, the Premises shall be vacated of all trade
fixtures, tools, machinery, equipment, materials and supplies and personal property of Lessee ("Tenant
Property"). By entering into this Agreement, Lessee hereby agrees that any personal property of Tenant
Property remaining after this 30 day period shall become property of the Lessor, and this Agreement
constitutes a bill of sale for same to Landlord. Tenant Property does not include property owned by the
Sublessees, as hereinafter defined.
6. SUBLEASES.
(a) Lessor has elected to continue the leases with the following sublessees of Lessee on the Premises
("Sublessees"):
Mohammad U. Ali Marvin Doberenz
Lee Clements Michael Kurmes
Dr. Shane Cole Kenneth Morris
Franklin Covington David Sigl
Agreement Terminating Lease
Harry Phillips
Fort Worth Spinks Airport Page 2 of 5
Thomas Cross Marshall Tyson
7. LESSEE WARRANTIES.
Lessee warrants to Lessor:
(1) All subleases(other than with the Sublessees), concessions, and other rights of use and occupancy
of the Premises, insurance policies, and maintenance and service contracts which Lessor has not
elected in writing prior to this Agreement to continue (collectively, the "Lessee Agreements")
have been legally terminated and all charges thereunder paid in full and no cause of action against
Lessee exists as of the date of this Agreement nor will exist after this Agreement in any party to
Lessee Agreement, based on inducing the breach of a contract with respect to same.
(2) All rent or other payments on any sublease or other agreement for use and occupancy which
landlord has elected to continue, have been paid in full or prorated to the Termination Date, the
sublessees' or holders' rights under other agreements are not in default under those agreements,
and that rent or other charges have been paid in advance, except for rent and other charges which
have been approved by Lessor and prorated to the date of this Agreement.
(3) All charges for utility service (gas, water, electricity, etc.) have been paid in full, except those
charges approved by landlord and prorated to the Termination Date.
(4) There are no outstanding contracts for the supply of labor or materials as of the date of this
Agreement, and no work has been done or is being done nor have materials been delivered in,
about, or to Premises which have or have not been fully paid for, for which a mechanic's lien
could be asserted and/or foreclosed under the lien laws of the state in which the Premises are
located.
(5) Neither Lessee nor any of its predecessors in interest under the Lease has done or suffered to be
done anything whereby the Premises or Lessor's title to the Premises are in any manner
encumbered or charged.
(6) All taxes, charges, assessments, levies, or impositions required by the Lease to be paid by Lessee
under the Lease have been paid in full.
(7) The Premises are now and will, on the Termination Date, be clean and in good order, condition,
and repair, reasonable wear and tear excepted.
8. IMPROVEMENTS. Prior to the Effective Date, Lessee shall provide paper and/or electronic
copies of as-built improvements on the Premises.
9. NOTICES TO LESSEE AFTER TERMINATION DATE.
All notices to Lessee after the Termination Date shall be addressed as follows:
Harry Phi ips
9-0 /29-aa( 3i3
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Agreement Terminating Lease
Harry Phillips
Fort Worth Spinks Airport Page 3 of 5
10. APPLICATION OF TEXAS LAW AND VENUE. This Agreement will be construed under, and
in accordance with, the laws of the State of Texas. All obligations of the parties created by this Agreement
are performable in Tarrant County, Texas. Exclusive venue for any action brought to interpret or enforce the
terms of this Lease shall be in Tarrant County,Texas.
11. LEGAL CONSTRUCTION. In case any one or more of the provisions contained in this
Agreement shall for any reason be held by a court of competent jurisdiction to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision
of the Agreement, and this Agreement will be construed as if the invalid, illegal or unenforceable provision
had never been included in the Agreement.
12. WRITTEN AMENDMENTS. No amendment,modification or alteration of the terms of this Lease
Agreement will be binding unless it is in writing, dated subsequent to the date of this Lease Agreement and
duly executed by the parties to this Lease Agreement.
13. FORCE MAJEURE. Neither Lessor nor Lessee will be required to perform any term, condition or
covenant of this Lease Agreement so long as performance is delayed or prevented by force majeure, which
shall mean acts of God, strikes, lockouts, material or labor restrictions by any governmental authority, civil
riots, floods, and any other cause not reasonably within the control of Lessor or Lessee and which by the
exercise of due diligence Lessor or Lessee is unable,wholly or in part,to prevent or overcome.
In witness wilereof, ies hereto have executed this Termination of Lease Agreement in multiples on
this the /71'ctay of�,2014.
CITY OF FORT WORTH:
044-/
By: f �
Fernando Costa
Assistant City Manager
Date: Li*4
APPROVED AS TO FORM ATTEST:
AND L GALIT
By: By
PDea " ry J. Wg
. Guzman a
Assistant City Attorney City Secretary
aS x
LESSEE: ATTEST-
Harry Phillips $°
By: B
Harry/Phillips
Individual
Agreement Terminating Lease
Harry Phillips Pa JQf f ICIAL RECORD
Fort Worth Spinks Airport g
CITY SECRETARY
FT.WORTH, TX
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 Termination of Lease Agreement between City of Fort Worth and Harry Phillips, 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 day of
2014.
p--- ary Public in and for the
EVONIA DANJE
Notary Public.State of Texas
My Commission 4 July 10, 20
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 Harry Phillips, known to me to be the person whose name is subscribed to this
Termination of Lease Agreement between City of Fort Worth and Harry Phillips, and acknowledged to
me that the same was the act of Harry Phillips and that he executed the same as the act of Harry
Phillips for the purposes and consideration therein expressed and in the capacity therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this 2 9 day of
0 c-)-o — , 2014. L lea— A
N tary Public in an r the
:tiPa�Pia., JON Z AVERHOFF State of Texas
NOTARY PUBLIC
State of Texas
Exp.t)<J 24-20 t h
Agreement Terminating Lease
Harry Phillips
Fort Worth Spinks Airport Page 5 of 5
M&C Page 1 of
Official site of the City of Fort Worth,Texas
CITY COUNCIL AGENDA FoRT Wom
COUNCIL ACTION: Approved on 9/9/2014 - Ordinance Nos. 21412-09-2014 & 21413-09-2014
DATE: 9/9/2014 REFERENCE **G-18302 LOG NAME: 55FWS HPHILLIPS LEASE
NO.: TERMINATION
CODE: G TYPE: CONSENT PUBLIC NO
HEARING:
SUBJECT: Authorize Execution of a Lease Termination Agreement with Harry Phillips for the
Termination of a Ground Lease at Fort Worth Spinks Airport, Authorize Payment in the
Amount of$200,000.00 to Harry Phillips to Acquire Aircraft Hangar and Remaining
Leasehold Interest, Authorize Use of Mineral Lease Revenue from City Airports and
Adopt Appropriation Ordinances (COUNCIL DISTRICT 6)
RECOMMENDATION:
It is recommended that the City Council:
1. Authorize the execution of a Lease Termination Agreement with Harry Phillips for the termination
of City Secretary Contract No. 26591 (M&C L-13064) for a Ground Lease at Fort Worth Spinks
Airport;
2. Authorize a payment in the amount of$200,000.00 to Harry Phillips for the acquisition of an
aircraft hangar and remaining leasehold interest;
3. Adopt the attached supplemental appropriation ordinance increasing estimated receipts and
appropriations in the Municipal Airports Fund in the amount of$200,000.00 for payment to Harry
Phillips to acquire the leasehold interest;
4. Authorize the one-time use of revenue derived from mineral leases on City-owned airports in the
amount of$200,000.00 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;
5. Adopt the attached appropriation ordinance increasing estimated receipts and appropriations in
the Airports Gas Lease Project Fund in the amount of$200,000.00; and
6. Authorize the transfer in the amount of$200,000.00 from the Airports Gas Lease Project Fund to
the Municipal Airports Fund.
DISCUSSION:
On July 27, 2001, (M&C L-13064) the City Council approved an unimproved ground lease with Harry
Phillips at Fort Worth Spinks Airport (Spinks Airport). Mr. Phillips constructed a 13,154 square foot
hangar on the site identified as E2. Mr. Phillips approached the City recently stating his desire to
terminate his Lease Agreement and asked if the City would be interested in purchasing the leasehold
interest in the property. Recognizing the good condition and value the hangar possesses, the
Aviation Department had the leasehold interest, including improvements, appraised to determine the
appropriate value and made an offer to Mr. Phillips of$200,000.00 and he has accepted.
The acquisition of this hangar will increase revenue and contribute toward the objective of attaining
self-sustainability for Spinks Airport, which currently has not been met. The Federal Aviation
Administration requires public use airports to try to be as self-sustaining as possible and is
documented through Grant Assurances. In particular, Grant Assurance No. 24 -Airport will maintain
a fee and rental structure for the facilities and services at the airport which will make the airport as
self-sustaining as possible.
Staff recommends approval of the execution of the Lease Termination Agreement for the termination
10/30/2014
M&C Review Page 2 of 2
of this Agreement and the payment of compensation to Mr. Phillips. 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$200,000.00 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 6, Mapsco 119R.
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.
TO Fund/Account/Centers FROM Fund/Account/Centers
3) PE40 476240 0551000 $200.000.00 6) P240 538040 551929990100 $200,000.00
3) PE40 539120 0551000 $200,000.00
5) P240 446200 551929990100 $200.000.00
5) P240 538040 551929990100 $200,000.00
6) PE40 476240 0551000 $200.000.00
Submitted for City Manager's Office by: Fernando Costa (6122)
Originating Department Head: Bill Welsted (5402)
Additional Information Contact: Aaron Barth (5434)
James Burris (5403)
ATTACHMENTS
55FWS HPHILLIPS LEASE TERMINATION P240 AO.docx
55FWS HPHILLIPS LEASE TERMINATION PE40 SAO.docx
HPhillips Hng Map.pdf
10/30/2014