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HomeMy WebLinkAboutPermit Vow, **att PAG -05-004 OPERATING PERMIT AND AGREEMENT between the City of Renton and Aero-Copters, Inc. THIS IS A PERMIT TO OPERATE AN AVIATION RELATED ACTIVITY UPON THE RENTON MUNICIPAL AIRPORT AND AN AGREEMENT between THE CITY OF RENTON, a Washington municipal corporation("Permittor"), and Aero-Copters, Inc., a Washington corporation("Permittee"). IN CONSIDERATION of the covenants and agreements hereinafter set forth, the parties agree as follows: 1. ACKNOWLEDGEMENT OF SUB-LEASE: 1.1. Pursuant to lease agreement LAG 03-002, executed on November 1, 2003, the City of Renton (Permittor) granted a lease of the subject premises to AirO, Inc., as Lessee, for the purpose of operating a Fixed Based Operation, which includes the sale of jet fuel and avgas, aircraft maintenance and repair, aircraft storage and air taxi/charter services.. 1.2. Thereafter, AirO, Inc. (Lessee) sublet the subject premises toAero-Copters, Inc., (Permittee) by sublease agreement, executed on January 1, 2004, for the purpose of operating an air taxi/charter business and an aircraft repair and maintenance facility for the benefit of the public, located at 800 West Perimeter Road, Renton, Washington. 2. GRANT OF OPERATING PERMIT: 2.1. Description of Premises: The premises leased by Aero-Copters, Inc..,the Permittee, is described in the sub-lease as: 2.1.1. Interior Space: Shared use of the lobby, flight planning room, conference room and restrooms. 2.1.2. Hangar Space: Shared use of the hangar building located at 800 West Perimeter Road. These two (2) categories (Paragraph 2.1.1 and 2.1.2 above) of the property, being subleased by AirO, Inc. to Aero-Copters, Inc., shall hereafter be referred to as the "Premises". 3. CONDITIONS: 3.1. Specific Conditions: This grant of an Operating Permit is subject to the following: 3.1.1. Easements, restrictions and reservations of record and as further set forth herein; OPERATING PERMIT ORIGINAL 1 City of Renton to Aero-Copters,Inc. 3.1.2. Such rules and regulations as now exist or may hereafter be promulgated by the Permittor from time to time, including the Airport's Minimum Standards which are incorporated herein by this reference, and Permittor's standards concerning operation of public aviation service activities from the Airport; and 3.1.3. All such non-discriminatory charges and fees for such use as may be established from time to time by Permittor; and 3.1.4. TOGETHER WITH the privilege of Permittee to use the public portion of the Airport, including runway and other public facilities provided thereon, on a non-exclusive basis. 3.2. No Conveyance of Airport: This Operating Permit and Agreement shall in no way be deemed to be a conveyance of the Airport, and shall not be construed as providing any special privilege for any public portion of the Airport except as described herein. The Permittor reserves the right to lease or permit the use of any portion of the Airport for any purpose deemed suitable for the Airport, except that portion that is permitted hereby. 3.3. Nature of Permittor's Interest: It is expressly understood and agreed that Permittor holds and operates the Airport, and the Premises under and subject to a grant and conveyance thereof to Permittor from the United States of America, acting through its Reconstruction Finance Corporation, and subject to all the reservations, restrictions, rights, conditions, and exceptions of the United States therein and thereunder, which grant and conveyance has been filed for record in the office of the Recorder of King County, Washington, and recorded in Volume 2668 of Deeds, Page 386; and further that Permittor holds and operates said airport and premises under and subject to the State Aeronautics Acts of the State of Washington (chapter 165, laws of 1947), and any subsequent amendments thereof or subsequent legislation of said state and all rules and regulations lawfully promulgated under any act or legislation adopted by the State of Washington or by the United States or the Federal Aviation Administration. It is expressly agreed that the Permittee also accepts and will hold and use this lease and the Premises subject thereto and to all contingencies, risks, and eventualities of or arising out of the foregoing, and if this lease or the period thereof or any terms or provisions thereof be or become in conflict with or impaired or defeated by any such legislation, rules, regulations, contingencies or risks, the latter shall control and, if necessary, modify or supersede any provision of this lease affected thereby, all without any liability on the part of or recourse against the Permittor in favor of Permittee, provided that Permittor does not exceed its authority under the foregoing legislation, rules and regulations. 3.4. Future Development/Funding: Nothing contained in this lease shall operate or be construed to prevent or hinder the future development, improvements, or operation of Airport by Permittor, its agents, successors or assigns, or any department or agency of the State of Washington or of the United States, or the consummation of any loan or grant of federal or state funds in aid of the development, improvement, or operation of the Renton Airport. OPERATING PERMIT 2 City of Renton to Aero-Copters,Inc. 4. TERM OF LEASE, SUBLEASE AND OPERATING PERMIT: 4.1. Permit Term: The term of this Operating Permit is one (1) year and may be extended to include any Extended Term as may be in effect between AirO, Inc. and Aero- Copters, Inc.. After the Initial Term, the Extended Term of the sublease is on a year-to-year basis, for a period of ten(10) years, ending on January 1, 2014. Any extension of the Initial Term of this Operating Permit is only renewable upon written notice received by theCity ninety (90) calendar days in advance of the termination date of the Initial or Extended Term of this Operating Permit and Agreement. In no event will the term of the Operating Permit and Agreement be extended beyond November 1, 2018. 5. RENTAL: 5.1. Rent on lease: As rental for the premises described in LAG 03-002 and addenda thereto, Lessee has agreed to pay Permittor a monthly rental in the sum of Four Thousand Six Hundred Ninety-Five Dollars and Ninety-Two Cents ($4,695.92) throughout the twelve (12) month period commencing on November 1, 2003, which does not include leasehold excise tax. 5.2. Rent on sublease: As rental for the premises described in Section 2, above, during the term of this permit, Permittee has agreed to pay AirO, Inc. a monthly rental in the sum of One Thousand Five Hundred Dollars ($1,500) throughout the twelve (12)month period commencing on January 1, 2004. In the event Lessee fails to pay the rent identified in Paragraph 5.1., then Permittee may, whether Permittee subleases all or part of Lessee's Airport leasehold interest as described in LAG 03-002 and addenda thereto, pay said rent,when due. In the event neither the Lessee nor Permittee pay said rent, then the Permittor may terminate this permit with ten(10) days notice. 5.3. Other Charges: Permittee further agrees to pay, in addition to the rental specified and other charges hereinabove defined, all fees and charges now in effect or hereafter levied or established by Permittor, or its successors, or by any other governmental agency or authority, being or becoming levied or charged against the premises, structures, business operations, or activities conducted by or use made by Permittee of, on, and from the leased premises which shall include,but not be limited to, all charges for light, heat, gas,power, garbage, water and other utilities or services rendered to said premises. 5.4. Leasehold Excise Tax: In the event that the State of Washington or any other governmental authority having jurisdiction thereover shall hereafter levy or impose any similar tax or charge on the leasehold estate described herein, and Lessee fails to pay said tax or charge, then Permittee may, whether Permittee subleases all or part of Lessee's Airport leasehold interest as described in LAG 03-002 and addenda thereto, pay said tax or charge, when due. Such tax or charge shall be in addition to the regular monthly rentals. In the event neither the Lessee nor Permittee pay said tax or charge, then the Permittor may terminate this permit with ten (10) days notice. OPERATING PERMIT 3 City of Renton to Aero-Copters,Inc. 6. PAYMENT OF UTILITIES AND RELATED SERVICES. 6.1. Whether Permittee subleases all or part of Lessee's Airport leasehold interest as described in LAG 03-002 and addenda, if Lessee fails to pay such utilities and service charges, then Permittee may pay all light, heat, gas, power, garbage, water, sewer and janitorial service used in or on the Premises when due. In the event neither the Lessee nor the Permittee pay said utility or service charges, then the Permittor may terminate this Permit with ten(10) days notice. 6.2. Permittor shall not be liable for any loss or damage caused by or resulting from any variation, interruption, or failure of said utility services due to any cause whatsoever; and no temporary interruption or failure of such services incident to the making of repairs, alterations or improvements, or due to accident, strike, act of God, or conditions or events not under Permittor's control, shall be deemed a breach of the Permit or as an eviction of Permittee, or relieve Permittee from any of its obligations hereunder. 7. PERMITTEE'S ACCEPTANCE OF PREMISES. By occupying the Premises, Permittee formally accepts the same in AS IS condition, and acknowledges that the Permittor has complied with all the requirements imposed upon it under the terms of this Permit with respect to the condition of the Premises at the commencement of this term. Permittee hereby accepts the premises subject to all applicable zoning, municipal, county and state laws, ordinances and regulations governing and regulating the use of the premises, and accepts this Permit subject thereto and to all matters disclosed thereby and by any exhibits attached hereto. Permittee acknowledges that neither Permittor nor Permittor's agent has made any representation or warranty as to the suitability of the Premises for the conduct of Permittee's business or use. Except as otherwise provided herein, Permittor warrants Permittee's right to peaceably and quietly enjoy the premises without any disturbance from Permittor, or others claiming by or through Permittor. 8. PURPOSE AND USE: 8.1. Use of Premises: The Premises are leased to the Permittee for the following described purpose: 8.1.1. Operation of an Aircraft Charter and Aircraft Taxi Service in accordance with the Airport Rules and Regulations and Minimum Standards for the operation of this type of commercial aeronautic activity at the Renton Municipal Airport. 8.1.2. Operation of an Aircraft Maintenance and Repair facility in accordance with the Airport Rules and Regulations and Minimum Standards for the operation of this type of commercial aeronautic activity at the Renton Municipal Airport. 8.2. Continuous Use: Permittee covenants that the premises shall be continuously used for those purposes during the term of the Permit, shall not be allowed to stand vacant or idle, and shall not be used for any other purpose without Permittor's written consent first having been obtained. Consent of Permittor to other types of activities will not be unreasonably withheld. OPERATING PERMIT 4 City of Renton to Aero-Copters,Inc. 8.3. Non-Aviation Uses Prohibited: Permittee agrees that, except as expressly provided above, the Premises may not be used for uses or activities that are not related, directly or indirectly, to aviation. 8.4. Ste: No advertising matter or signs shall be at any time displayed on the leased premises or structures without the written approval of Permittor, which will not be unreasonably withheld. One sign, of the type and dimensions specified by the Airport Manager, shall be permitted to be displayed on the Rainier and Airport Way entrance fences through the termination date of this permit. 8.5. Conformity with Rules: Permittee further covenants to keep and operate the Premises and all structures, improvements, and activities in conformity with all rules, regulations and laws now or hereafter adopted by Permittor, including the Airport Rules and Regulations and Minimum Standards which are incorporated herein by this reference, the Federal Aviation Administration, the State Aeronautics Commission, or other duly constituted governmental authority, all at Permittee's cost and expense. 8.6. Waste,Nuisance, Illegal Activities: Permittee covenants that he will not permit any waste, damage, or injury to the Premises or improvements thereon, nor allow the maintenance of any nuisance thereon, nor the use thereof for any illegal purposes or activities. 8.7. Increased Insurance Risk: Permittee will not do or permit to be done in or about the premises anything which will be dangerous to life or limb, or which will increase any insurance rates upon the premises or other buildings and improvements. 9. HAZARDOUS WASTE: 9.1. Permittee's Representation and Warranty: In particular, Permittee represents and warrants to the Permittor that Permittee's use of the Premises will not involve the use of any hazardous substance (as defined by R.C.W. Chapter 70.105D, as amended), other than fuels, lubricants and other products which are customary and necessary for use in Permittee's ordinary course of business. 9.2. Standard of Care: Permittee agrees to use a high degree of care to be certain that no such hazardous substance is improperly used, released or disposed on the Premises during the term of this lease by Permittee, its agents or assigns, or is improperly used, released or disposed on the premises by the act of any third party. 9.3. Indemnity: The parties agree that Permittor shall have no responsibility to the Permittee, or any other third party, for remedial action under R.C.W. Chapter 70.105D, or other legislation, in the event of a release of or disposition of any such hazardous substance on, in, or at the Premises, and not caused by Permittor, during the term of this Permit. Permittee agrees to indemnify and hold harmless the Permittor from any obligation or expense, including fees incurred by the Permittor for attorneys, consultants, engineers, damages, including environmental resource damages, etc., that are suffered or incurred due to the release or disposition of any such OPERATING PERMIT 5 City of Renton to Aero-Copters,Inc. hazardous substance upon the Premises not caused by Permittor, during the term of this Permit, including remedial action under RCW 70.105D. 9.4. Dispute Resolution: In the event of any dispute between the parties concerning whether any release of or disposition of any such hazardous substance on, in or at the premises (a) occurred during the term of this lease, or(b)was caused by Permittor, the parties agree to submit the dispute for resolution by arbitration upon demand by either party. Each party shall select one (1) arbitrator. The two (2) selected arbitrators, if unable to agree upon an arbitration award within a period of thirty(30) days after such appointment, shall select a third arbitrator. The third arbitrator shall be an engineer with experience in the identification and remediation of hazardous substances. The arbitrators shall make their decision in writing within sixty(60) days after their appointment, unless the time is extended by the agreement of the parties. The decision of a majority of the arbitrators shall be final and binding upon the parties. Each party shall bear the cost of the arbitrator named by it. The expenses of the third arbitrator shall be borne by the parties equally. 10. MAINTENANCE: 10.1. Maintenance of Premises: The Premises and all of the improvements or structures thereon and authorized by the Permittor for use by the Permittee, shall be used and maintained by Permittee in an operable, neat, orderly, and sanitary manner. Permittor shall not be called upon to make any improvements, alteration, or repair of any kind upon the Premises. Permittee is responsible for the clean-up and proper disposal at reasonable and regular intervals of rubbish, trash, waste and leaves around the Premises, including that blown against fences bordering the Premises, whether as a result of the Permittee's activities or having been deposited upon the Premises from other areas. 10.2. Removal of Snow/Floodwater/Mud: Permittee shall be responsible for removal of snow and/or floodwaters or mud deposited there from the Premises and those areas of the Sublessor utilized by the Permittee, with the disposition thereof to be accomplished in such a manner so as to not interfere with or increase the maintenance activities of Permittor upon the public areas of the Airport. 10.3. Permittor May Perform Maintenance: If Permittee fails to perform Permittee's obligations under this Paragraph, Permittor may at its option(but shall not be required to) enter the Premises, after thirty(30) days'prior written notice to Permittee, and put the same in good order, condition and repair, and the cost thereof together with interest thereon at the rate of twelve (12%) percent per annum shall become due and payable as additional rental to Permittor together with Permittee's next rental installment. 11. ALTERATIONS. 11.1. Protection from Liens: Before commencing any work relating to alterations, additions and improvements affecting the Premises, Permittee shall notify Permittor in writing of the expected date of commencement thereof. Permittor shall then have the right at any time and from time to time to post and maintain on the Premises such notices as Permittor reasonably OPERATING PERMIT 6 City of Renton to Aero-Copters,Inc. V or✓ deems necessary to protect the Premises and Permittor from mechanics' liens, materialmen's liens or any other liens. In any event, Permittee shall pay when due, or bond around, all claims for labor or materials furnished to or for Permittee at or for use in the Premises. Permittee shall not permit any mechanics' or materialmen's liens to be levied against the Premises for any labor or material furnished to Permittee or claimed to have been furnished to Permittee or to Permittee's agents or contractors in connection with work of any character performed or claimed to have been performed on the Premises by or at the direction of Permittee. 11.2. Bond: At any time Permittee either desires to or is required to make any repairs, alterations, additions, improvements or utility installation thereon, or otherwise, Permittor may at its sole option require Permittee, at Permittee's sole cost and expense, to obtain and provide to Permittor a lien and completion bond in an amount equal to one and one-half(1-1/2) times the estimated cost of such improvements, to insure Permittor against liability for mechanics and materialmen's liens and to insure completion of the work. 11.3. Permittor May Make Improvements: Permittee agrees that Permittor, at its option, may at its own expense make repairs, alterations or improvements which Permittor may deem necessary or advisable for the preservation, safety or improvement of the Premises or improvements located thereon, if any. 11.4. Notification of Completion: Upon completion of capital improvements made on the Premises, it is the Permittee's responsibility to promptly notify Permittor of such completion. 12. ASSIGNMENT: 12.1. Assignment/Subletting: The sublease or any part thereof shall not be assigned by Permittee, by operation of law or otherwise, nor shall the premises or any part thereof be sublet without the prior written consent of Permittor, which consent shall not be unreasonably withheld. If Permittee is a corporation, the transfer of a majority of Permittee's stock shall constitute an assignment for purposes of this paragraph. 12.2. No Release of Permittee's Liability: No assignment of this leasehold interest shall release Permittee from the obligation to pay the rent and to perform all other obligations to be performed by Permittee under the terms of its sublease. No assignment shall so release Permittee unless Permittor's consent is obtained pursuant to Paragraph 12.1. In the event that Permittor's consent to assignment is so obtained,Permittee shall be relieved of all liability arising from this permit and arising out of any act, occurrence or omission occurring after Permittor's consent is obtained. The Permittee's assignee must assume and agree to carry out all of the obligations of Permittee under this permit. 13. DEFAULT: 13.1. Definition: It shall be a default of this Permit if the Permittee fails to comply with any of the statutes, ordinances, rules, orders, regulations, and requirements of the federal, state, and/or city governments, any terms of this Permit and/or the underlying lease. 13.2 Action Upon Notice of Default: OPERATING PERMIT 7 City of Renton to Aero-Copters,Inc. 13.2.1 In the event of default as provided above, the Permittor may, if it so elects, at any time thereafter, terminate this permit and the term hereof, on giving to the Permittee thirty(30) days notice (Notice of Default), in writing, of the Permittor's intention to terminate the Permit. 13.2.2. Alternatively, the Permittor may allow the Permittee to cure the default within thirty(30) days or, within that time, provide adequate assurance of future ability to cure the default. Adequate assurance shall include,but not be limited to, a deposit in escrow, a guarantee by a third party acceptable to Permittor, a surety bond, or a letter of credit. The default must be cured within ninety(90) days of the notice of default. 13.3. Termination of Permit: Upon the expiration of either of the notice periods specified in Paragraph 13.2 above, and if the event causing the default is not corrected in a timely manner, this permit and the term hereof, together with any and all other rights and options of Permittee herein specified, shall expire and come to an end on the day fixed in such notice. 13.4. No Waiver of Remedies: In the event of default by Permittee, the Permittor may choose not to pursue a claim against Permittee. Such decision will not operate as a waiver of any other remedies or claims then available to the Permittor or those that may become available. 14. BINDING AGREEMENT: Subject to the restriction upon assignment or subletting as set forth herein, all of the terms, conditions, and provisions of this Permit shall be binding upon the parties, their successors and assigns, and in the case of a Permittee who is a natural person, his or her personal representative and heirs. 15. RIGHT OF INSPECTION. Permittee will allow Permittor, or Permittor's agent, free access to the Premises at all reasonable times for the purpose of inspection, or for making repairs, additions or alterations to the Premises, or any property owned by or under the control of Permittor. 16. SURRENDER OF PREMISES: Permittee shall quit and surrender the premises at the end of the term in a condition as good as the reasonable use thereof would permit, normal wear and tear excepted. Alterations, additions or improvements which may be made by either of the parties hereto on the Premises, except movable office furniture or trade fixtures put in at the expense of Permittee, shall be and remain the property of the Permittor and shall remain on and be surrendered with the Premises as a part thereof at the termination of this lease without hindrance, molestation, or injury. Permittee shall repair at its sole expense any damage to the Premises occasioned by its use thereof, or by the removal of Permittee's trade fixtures, furnishings and equipment which repair shall include the patching and filling of holes and repair of structural damage. 17. INSURANCE: 17.1. Personal Property: It is agreed that Permittor shall not be held liable in any manner for, or on account of, any loss or damage to personal property of the Permittee, Permittee's invitees or other persons, which may be sustained by fire or water or other insured peril, or for the loss of any articles by burglary, theft or any other cause from or upon the Premises. It is OPERATING PERMIT 8 City of Renton to Aero-Copters,Inc. acknowledged that Permittor does not cover any of the personal property of Permittee, Permittee's invitees or other persons upon the Premises through its insurance. Permittee, its invitees and other persons upon the Premises are solely responsible to obtain suitable personal property insurance. 17.2. Liability Insurance. The Permittee agrees to maintain, in force, during the term of this Permit a policy of comprehensive public liability and property damage insurance written by a company authorized to do business in the State of Washington against any liability arising out of the ownership, use, occupancy or maintenance of the Premises and all areas appurtenant thereto. The limits of liability shall be in an amount of not less than $1,000,000.00 for injury to or death of one person in any one accident or occurrence and in an amount of not less than $1,000,000.00 for injury to or death of more than one person in any one accident or occurrence, and of not less than $1,000,000.00 for property damage. The limits of said insurance shall not, however, limit the liability of Permittee hereunder. The insurance policy shall have a Landlord's Protective Liability endorsement attached thereto. 17.3. Insurance Policies: Insurance required hereunder shall be written in companies acceptable to Permittor and rated A-10 or better in "Best's Insurance Guides". Coverages shall be submitted on forms prescribed by Permittor. Prior to possession, the Permittee shall deliver to Permittor copies of policies of such insurance acquired by Permittee, or certificates evidencing the existence and amounts of such insurance, with loss payable clauses satisfactory to Permittor. Permittor shall be named as an additional insured. No such policy shall be cancelable or subject to reduction of coverage or other modification except after forty-five (45) days'prior written notice to Permittor. Permittee shall, not less than forty-five (45) days prior to the expiration of such policies, furnish Permittor with renewals or "binders" therefore. Permittee shall not do or permit to be done anything which shall invalidate the insurance policies referred to above. Permittee shall forthwith, upon Permittor's demand, reimburse Permittor for any additional premiums attributable to any act or omission or operation of Permittee causing such increase in the cost of insurance. If the Permittee shall fail to procure and maintain said insurance the Permittor may,but shall not be required to, procure and maintain the same,but at the expense of Permittee. 18. LIMITATION UPON PERMITTOR'S LIABILITY. Permittor shall not be liable for any damage to property or persons caused by, or arising out of(a) any defect in or the maintenance or use of the Premises, or the improvements, fixtures and appurtenances of which the premises constitute a part; or(b) water coming from the roof,water pipes, flooding of the Cedar River or other body of water, or from any other source whatsoever,whether within or without the Premises; or(c) any act or omission of any Permittee or other occupants of the building, or their agents, servants, employees or invitees thereof. 19. INDEMNITY: Permittee covenants to indemnify and save harmless Permittor against any and all claims arising from the conduct and management of or from any work or thing whatsoever done in or about the Premises or the improvements or equipment thereon during the lease term, or arising from any act or negligence of the Permittee or any of its agents, contractors, patrons, customers, or employees, or arising from any accident, injury, or damage whatsoever, however caused, to any person or persons, or to the property of any person,persons, OPERATING PERMIT 9 City of Renton to Aero-Copters,Inc. corporation or other entity occurring during the lease term on, in, or about the Premises, and from and against all costs, attorney's fees, expenses, and liabilities incurred in or from any such claims or any action or proceeding brought against the Permittor by reason of any such claim, except such claims arising directly or indirectly out of Permittor's sole act or omission. Permittee, on notice from Permittor, shall resist or defend such action or proceeding forthwith. 20. HOLDING OVER: Permittee understands that upon expiration of the term of this permit, Permittee must execute a new permit with the Permittor as a condition to remaining on the premises. Permittee further understands that if, without execution of any extension or renewal of this permit, Permittee should remain in possession of the premises after expiration or termination of the term of this permit, notwithstanding any extension of its sublease with Lessee, then the Lessee shall be in default of its lease, LAG 03-002 and Permittor may evict the Lessee and the Permittee. All the conditions, terms and provisions of this permit shall be applicable during such holding over. 21. NO WAIVER: It is further covenanted and agreed between the parties hereto that no waiver by Permittor of a breach by Permittee of any covenant, agreement, stipulation, or condition of this lease shall be construed to be a waiver of any succeeding breach of the same covenant, agreement, stipulation, or condition, or a breach of any other covenant agreement, stipulation, or condition. 22. NOTICES: All notices under this lease shall be in writing and delivered in person, with receipt therefore, or sent by certified mail, to the following addresses: a) For the City of Renton: b) For the Permittee: Airport Manager Aero-Copters, Inc. 616 West Perimeter Road 800 West Perimeter Road Renton, Washington 98055 Renton, WA 98055 23. DISCRIMINATION PROHIBITED: 23.1. Discrimination Prohibited: Permittee covenants and agrees not to discriminate against any person or class of persons by reason of race, color, creed, sex, national origin, or any other class of person protected by Federal or State law or the Renton City Code, in the use of any of its facilities provided for the public in the Airport. Permittee further agrees to furnish services on a fair, equal and not unjustly discriminatory basis to all users thereof, and to charge on a fair, reasonable and not unjustly discriminatory basis for each unit of service; provided that Permittee may make reasonable and non-discriminatory discounts, rebates, or other similar types of price reductions to volume purchasers. 23.2. Minority Business Enterprise Policy: It is the policy of the Department of Transportation that minority business enterprises as defined in 49 C.F.R. Part 23 shall have the maximum opportunity to participate in the performance of leases as defined in 49 C.F.R. 23.5. Consequently, this lease is subject to 49 C.F.R. Part 23, as applicable. No person shall be excluded from participation in, denied the benefits of or otherwise discriminated against in OPERATING PERMIT 10 City of Renton to Aero-Copters,Inc. connection with the award and performance of any contract, including leases covered by 49 C.F.R. Part 23, on the grounds of race, color, national origin or sex. 23.3. Application to Sub-leases: Subject to the provisions of Paragraph 12 of this Permit, Permittee agrees that it will include the above clause in all assignments of this lease or sub-leases, and cause its assignee(s) and sub-lessee(s) to similarly include the above clause in further assignments or sub-leases. 24. FORCE MAJEURE: In the event that either party hereto shall be delayed or hindered in or prevented from the performance of any act required hereunder by reason of strikes, lockouts, labor troubles, inability to procure materials, failure of power, restrictive governmental laws or regulations, riots, insurrections, war, or other reason of like nature not the fault of the party delayed in performing work or doing acts required under the terms of this Lease, then performance of such act shall be extended for a period equivalent to the period of such delay. The provisions of this paragraph shall not, however, operate to excuse Permittee from the prompt payment of rent, or any other payment required by the terms of this Permit, to be made by Permittee. 25. CAPTIONS: Article and paragraph captions are not a part hereof. 26. ENTIRE AGREEMENT: This Permit contains all agreements of the parties with respect to any matter mentioned herein. No prior agreement or understanding pertaining to any such matter shall be effective. This Permit may be modified in writing only, signed by the parties in interest at the time of the modification. In the event of conflict between the terms of this Permit and the sublease agreement between Permittee and Lessee, the terms of this Permit supersede. 27. CUMULATIVE REMEDIES: No remedy or election hereunder shall be deemed exclusive, but shall, wherever possible, be cumulative with all other remedies at law or in equity. 28. CORPORATE AUTHORITY: If Permittee is a corporation, each individual executing this Lease on behalf of said corporation represents and warrants that he is duly authorized to execute and deliver this Permit on behalf of said corporation in accordance with a duly adopted resolution of the Board of Directors of said corporation and in accordance with the Bylaws of said corporation, and that this Permit is binding upon said corporation in accordance with its terms. 29. TRANSFER OF PREMISES BY PERMITTOR: In the event of any sale, conveyance, transfer or assignment by Permittor of its interest in the Premises, Permittor shall be relieved of all liability arising from this Permit and arising out of any act, occurrence or omission occurring after the consummation of such sale, conveyance, transfer or assignment. OPERATING PERMIT 11 City of Renton to Aero-Copters,Inc. Y PERMITTEE: PERMITTOR: Aero-Copters, Inc. THE CITY OF RENTON a Washington corporation a Washington municipal corporation -�dkao,- By Michael O' eary Kathy eolker-Wheeler its: Owner/President Mayor Date: SIOR7�©S Date: ATTEST: By �i7-�,.c,c Bonnie Walton, City Clerk Date: 746--AOOS— Ap ed as to legal form: City Attorney OPERATING PERMIT 12 City of Renton to Aero-Copters,Inc. s V ` LEASE AGREEMENT AirO, Inc. OFFICE/HANGER LEASE This Lease Agreement(this "Lease") is dated January 1, 2004, by and between Michael O'Leary ("Landlord for AirO), and Aero-Copters, Inc. ("Tenant"). The parties agree as follows: PREMISES. Landlord, in consideration of the lease payments provided in this Lease, leases to Tenant shared office/hanger space in the building and shared ramp space on the west side of Renton Municipal Airport. (the "Premises") located at 800 West Perimeter Road, Renton, King County, Washington 98055. TERM. The lease term will begin on;January 1, 2004, and will terminate on December 31, 2004, and will be automatically renewable in one year increments if mutually agreed upon, up to a total of 10 years. Lessor or Lessee has the right to renegotiate terms in the month of December prior to automatic renewal. LEASE PAYMENTS. Tenant shall pay to Landlord monthly installments of$1500.00, payable in advance on the first day of each month. This payment is for the aircraft owned by Aero-Copters. Aero-Copters will pay $1250.00 a month for additional leased aircraft stored on the premises. Payments shall be made to the Landlord at 800 West Perimeter Road, Renton, WA 98055,which address may be changed from time to time by the Landlord. DESCRIPTION OF SUBLEASED AREAS. Aircraft can be parked anywhere within the hanger general area. Other common areas include: lobby, flight planning room, conference room, restrooms, and the use of the ramp area. POSSESSION. Tenant shall be entitled to possession on the first day of the term of this Lease, and shall yield possession to Landlord on the last day of the term of this Lease, unless otherwise agreed by both parties in writing. At the expiration of the term, Tenant shall remove its goods and effects and peaceable yield up the Premises to Landlord in as good a condition as when delivered to Tenant, ordinary wear and tear excepted. PURPOSE AND USE. Use of Premises: The Premises are leased to the Permittee for the following described purposes: ■ The operation of an Aircraft charter and Aircraft Taxi Service in accordance with the Minimum Standards for the operation of this type of commercial aeronautic activity at the Renton Municipal Airport ■ The operation of Aircraft Maintenance and Repair, in accordance with the minimum Standards for the operation of this type of commercial aeronautic activity at the Renton Municipal Airport. ■ Continuous Use: Permittee covenants that the premises shall be continuously used for those purposes during the term of the Permit, shall not be allowed to stand vacant or idle, and condition of this lease shall be construed to be a waiver of any succeeding breach of the same covenant, agreement, stipulation, or condition, or a breach of any other covenant agreement, stipulation, or condition. PARKING. Tenant shall be entitled to parking privileges associated with the building. LIABILITY INSURANCE. Tenant shall maintain liability insurance on the Premises with personal injury limits of at least $1,000,000.00 for injury to one person, and $1,000,000.00 for any one accident, and a limit of at least$1,000,000.00 for damage to property per terms of the Airport Operating Permit and Agreement with the City of Renton. Tenant shall deliver appropriate evidence to Landlord as proof that adequate insurance is in force issued by companies reasonably satisfactory to Landlord. Landlord shall receive advance written notice from the insurer prior to any termination of such insurance policies. Tenant shall also maintain any other insurance which Landlord may reasonably require for the protection of Landlord's interest in the Premises. Tenant is responsible for maintaining casualty insurance for its own property. MAINTENANCE. Tenant shall have the responsibility to maintain the Premises in good repair at all times during the term of this Lease. UTILITIES AND SERVICES. Landlord will pay water, sewer,power, gas, and garbage. Any other services that the tenant requires will be there sole responsibility. TERMINATION. Notwithstanding any other provision of this Lease, Landlord may terminate this lease upon 90 days' written notice to Tenant. DEFAULTS. Tenant shall be in default of this Lease if Tenant fails to fulfill any lease obligation or term by which Tenant is bound. Subject to any governing provisions of law to the contrary, if Tenant fails to cure any financial obligation within 30 days (or any other obligation within 30 days) after written notice of such default is provided by Landlord to Tenant, Landlord may take possession of the Premises without further notice (to the extend permitted by law), and without prejudicing Landlord's rights to damages. In the alternative, Landlord may elect to cure any default and the cost of such action shall be added to Tenant's financial obligations under this Lease shall be additional rent, whether or not such sums or charges are designated as "additional rent". The rights provided by this paragraph are cumulative in nature and are in addition to any other rights afforded by law. HOLDOVER. If Tenant maintains possession of the Premises for any period after the termination of this Lease ("Holdover Period"), Tenant shall pay to Landlord lease payment(s) during the Holdover Period at a rate equal to the most recent rate preceding the Holdover Period. Such holdover shall constitute a month-to-month extension of this Lease only if terms of payment due. CUMULATIVE RIGHTS. The rights of the parties under this Lease are cumulative, and shall not be construed as exclusive unless otherwise required by law. REMODELING OR STRUCTURAL IMPROVEMENTS. Tenant shall have the obligation to conduct any construction or remodeling(at Tenant's expense)that may be required to use the Premises as specified above. Tenant may also construct such fixtures on the Premises (at Tenant's expense)that appropriately facilitate its use for such purposes. Such construction shall be undertaken and such fixtures maybe erected on with prior written consent to of the Landlord,which shall not be unreasonably withheld. Tenant shall not install awnings or advertisements on any part of the Premises without Landlord's prior written consent. At the end of the lease term, Tenant shall be entitled to remove(or at the request of Landlord shall remove) such fixtures, and shall restore the Premises to substantially the same condition of the Premises at the commencement of this Lease. ACCESS BY LANDLORD TO PREMISES. Subject to Tenant's consent(which shall not be unreasonably withheld), Landlord shall have the right to enter the Premises to make inspections, provide necessary services, or show the unit to prospective tenants or workers. However, Landlord does not assume any liability for the care or supervision of the Premises. As provided by law, in the case of an emergency, Landlord may enter the Premises without Tenant's consent. During the last three months of this Lease, or any extension of this Lease, Landlord shall be allowed to display the usual "To Let" signs and show the Premises to prospective tenants. INDEMNITY REGARDING USE OF PREMISES. To the extent permitted by law, Tenant agrees to indemnify,hold harmless, and defend Landlord from and against any and all losses, claims, liabilities, and expenses, including reasonable attorney fees, if any, misuse of the Premises, except Landlord's act or negligence. DANGEROUS MATERIALS. Tenant shall not keep or have on the Premises any article or thing of a dangerous, flammable, or explosive character that might substantially increase the danger of fire on the Premises, or that might be considered hazardous by a responsible insurance company, unless the prior written consent of Landlord is obtained and proof of adequate insurance protection is provided by Tenant to Landlord. COMPLIANCE WITH REGULATIONS. Tenant shall promptly comply with all laws, ordinances,requirements and regulations of the federal, state, county, municipal and other authorities, and the fire insurance underwriters. However, Tenant shall not by this provision be required to make alterations to the exterior of the building or alterations of the structural nature. ARBITRATION. Any controversy or claim relating to this contract, including the construction or application of this contract,will be settled by binding arbitration under the rules of the American Arbitration Association, and any judgment granted by the arbitrator(s)may be enforced in any court of proper jurisdiction. ASSIGNABILITY/SUBLETTING. Tenant may not assign or sublease any interest in the Premises, nor effect a change in the majority ownership of the Tenant(from the ownership existing at the inception of this lease), nor assign, mortgage or pledge this Lease, without the prior written consent of Landlord, which shall not be unreasonably withheld. DISCRIMINATION. Discrimination Prohibited—Lessee covenants and agrees not to discriminate against any person or class of persons by reason of race, color, creed, sex or national origin in the use of any of its facilities provided for the public on the Airport. Lessee further agrees to furnish services on a fair, equal and not unjustly discriminatory basis to all users thereof, and to charge of a fair, reasonable and not unjustly discriminatory basis to all users thereof,and to charge on a fair,reasonable and not unjustly discriminatory basis for each unit of service: provided that Lessee-may make reasonable and not-discriminatory discounts,rebates, or other similar types of price reductions to volume purchasers. NOTICE. Notices under this Lease shall not be deemed valid unless given or served in writing and forwarded by mail,postage prepaid, addressed as follows: LANDLORD: AirO, c/o Michael O'Leary 800 West Perimeter Road Renton, WA 98055 TENANT: Aero-Copters, Inc. 800 West Perimeter Road Renton, WA 98055 Such addresses may be changed from time to time by either party by providing notice as set fourth above. Notices mailed in accordance with the above provisions shall be deemed received on the third day after posting. GOVERNING LAW. This Lease shall be construed in accordance with the laws of the State of Washington ENTIRE AGREEMENT/AMENDMENT. This Lease Agreement contains the entire agreement of the parties and there are no other promises, conditions, understandings or other agreements,whether oral or written, relating to the subject matter of this Lease. This Lease may be modified or amended in writing, if the writing is signed by the party obligated under the amendment. SEVERABILITY. If any portion of this Lease shall be held to be invalid or unenforceable for any reason, the remaining provisions shall continue to be valid and enforceable. If a court finds that any provisions shall continue to be valid and enforceable. If a court find that nay provision of this Lease is invalid or unenforceable, but that by limiting such provisions, it would become valid and enforceable,then such provision shall be deemed to be written, construed, and enforced as so limited. WAIVER The failure of either party to enforce any provisions of this Lease shall not be construed as a waiver or limitation of that party's right to subsequently enforce and compel strict compliance with every provision of this Lease. BINDING EFFECT. The provisions of this lease shall be binding upon and inure to the benefit of both parties and their respective legal representatives, successors and assigns. LANDLORD: AirO,Inc. Ve Z Date: January 1, 2004 Michael J. O'Leary Owner/President TENANT: Aero-Copters,Inc. By: Date: January 1, 2004 Mic ael J. 0'Le Owner/President