HomeMy WebLinkAbout10-25-2011 Airport CommissionIOWA CITY AIRPORT COMMISSION
MEETING AGENDA
AIRPORT TERMINAL BUILDING
1801 S. RIVERSIDE DRIVE
IOWA CITY, IOWA
TUESDAY, OCTOBER 25, 2011 -12:30 P.M.
1. Determine Quorum
2. Items for Discussion / Action:
1 min*
a. Airport Commerce Park 2 min
i. Consider a resolution setting public hearing on lease agreement with
Affordable Auto LLC
b. Pavement Rehabilitation Project
3. Adjourn
5 min
*The times listed in the agenda are the anticipated duration of that particular agenda item. The
actual discussion may take more or less time than anticipated
Prepared by: Susan Dulek, A si tarnt City Attorney, 410 E.Wash! n t n St., Iowa City, lA 52246 1 356-6630
RESOLUTION N .
RESOLUTIONSETTING A PUBLIC HEARING FOR NOVEMBER 17, 2011,
REGARDING 1 1 G THE INTENT TO ENTER INTO GROUND LEASE
AGREEMENT WITH AFFORDABLE AUTO, LLC FOR LOT 17 OF THE NORTH
AIRPORT SUBDIVISION.
WHEREAS, Affordable Auto, LLC would like to enter into a lease -for an auto repair and used car
facility at Lot 17 of the North Airport Subdivision, aka Aviation Commerce Park; and
WHEREAS, the attached lease has been approved by the Airport Operations Manager.
NOW, THEREFORE, I E, BE IT RESOLVED BY THE IOW CITY AIRPORT COMMISSION THAT:
. The Iowa City Airport Commission does hereby declare its intent to eater into the above -
referenced lease agreement.
2. A public hearing on said proposed lease agreement should be and is hereby set for November
17, 2011 at 6:00 p.m. in the Terminal Building, Iowa City Airport, 1801 S. riverside Drive, Iowa
City, lora, or if said meeting is cancelled, at the next t meeting of the Airport Commission
thereafter as posted by the City Clerk. The City Clerk is hereby directed to cause Notice of
Public Hearing to be published as provided by laver.
Passed and approved this day of
ATTEST.
SECRETARY
Y
It was moved by
adopted, and upon roll call there were
AYES:
} 2011.
CHAIRPERSON
Approved by
S IG - , ('
and seconded b
NAYS:
City Att me is Office
ABSENT:
Assuline
Crane
Gardinier
Horan
Mascari
the Resolution be
Drafted by: Susan Dulek, Asst. city Attorney, City of Iowa city, 410 E. Washin ton St., Iowa city, IA 52240
AVIATION COMMERCE PARK
GROUND LEASE
LOT 17
This Ground Lease (the "Lease") is rade as of the day of ,
20113 by and between the Iowa city Airport Commission, having a principal business address at
1801 S. Riverside ide Drive, Iowa city, IA 52240 "Landlord" and Affordable Auto, LLD ("Tenant"),
with the exception f Article XIS. The agreement contained within Article XIX of this Ground
Lease is by and between the city of Iowa City, a municipal corporation, and Affordable Auto,
LLC.
RECITALS
A. The city of Iowan city is the owner of fee title to certain premises situated in the
City of Iowa City, State of Iowa, commonly known as Aviation Commerce Park, and legally
described as North Airport Development, Iowa City, Iowa, according to the plat thereof recorded
with the Johnson county, Iowa, Recorder, rder, October 17, 2001 at Plat Book 43, Page 1 (the
"Real Estate"). Land lord has the authority to lease Aviation Commerce Park.
B. Tenant is Affordable Auto, LLC.
C. The parties desire to enter into a ground lease pursuant to which Landlord will
lease an unimproved portion of the Real Estate, legally described as Let 17, Forth Airport
Development, Iowa City, Iowa, according to the plat thereof recorded with the Johnson county,
Iowa, Recorder October 17, 2001, Plat Book 4, Page 182, consisting of 46,628 square feet,
for the purpose of Tenant's constructing improvements (the "Leased Premises").
D. Tenant has indicated a willingness and ability to properly keep, maintain, and
improve said ground in accordance with standards established by Landlord, if granted a lease
of sufficient term on said ground area.
E. Tenant has indicated an interest in purchasing the Leased Premises from the
City of Iowa City, and said option is provided for herein and specifically approved by the city of
Iowa City. Tenant acknowledges that the Landlord has the authority to lease the Leased
Premises, but not to sell the Leased Premises. The City of Iowa City has the authority to sell
the Leased Premises.
In consideration of the foregoing and the mutual covenants hereinafter contained, and
for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by the .parties, Landlord and Tenant hereby agree as follows:
G
ARTICLE I
GRANT
T
1.01. Grant. Landlord hereby leases to Tenant the Leased Premises in accordance
with the terns and conditions hereinafter set forth.
ARTICLE II
r_MiT11
2.01 Condition of Leased Premises. Tenant is taking in possession of- the Leased
Premises in an "as -is" condition as of the execution and delivery of this Lease. Larndlerd shall
have no obligation to perform any improvements, alterations, ,additions, repairs or replacements
thereto.
ARTICLE III
TERM
3.01 Initial Term. The term of this Lease shall commence on the date of the execution
and delivery of this Lease (the 'Lease Commencement Date") and shall continue thereafter for
term of 25 years ending November 3 , 2036 (the "Tern) unless sooner terminated a
provided herein.
3.02 Options to Renew. Tenant shall have the option to renew this Lease upon the
same terms and -conditions, with the exception of the amount of monthly base rents for
successive -year teras following the initial Term. Tenant shall be required to give notice t
Landlord, in writing, not lass than 180 days prior to the expiration of the preceding term of
Tenant's intent to exercise an option for ar renewal terra. The monthly base rent during the
renewal periods is set forth in Section 4.01.
ARTICLE IV
RENT AND UTILITIES
4.01 Monthlyse Rent.
(a) Commencing on Juno 1, 2012 and continuing on the first day of each
succeeding month, Tenant shall pay to Landlord, at the address specified in Section 17.05, or
t such other place as Landlord may from time to time hereinafter designate to Tenant in
writing, monthly rent "Monthly Base Font" of $1,632.
(b) Landlord acknowledges that Tenant has prepaid the pro rate Monthly Base
Rent for November 2011 and for December 2011 through May 2012 in the amount of $10,227.
{c} The Monthly Base Rent shall increase annually beginning February 1, 2013
as provided below.
(d). Definitions. For purposes of this provision, the following definitions shall
apply:
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(1) the term "Consumer Price Index" r 'CPI" shall mean the U.S. Bureau of
Labor Statistics Consumer Price Index for all Urban Consumers -U.S. City Average, seasonally
adju ted. 19 82-84 equals 10 0).
(2) the terra "Current CPI" shall ream the annual average of Consumer Price
Indices for the calendar year immediately preceding the Change Date.
(3) the terra "Base CPI" shall mean the annual average of Consumer Price
Indices for the calendar year immediately preceding the year for whi h the Current CPI i
determined.
(4) the term "Change Date" shall mean February 1 of each year beginning
February 1, 2018.
(e) Adjustment. Effective on the Change Date, the Monthly Base Dent
hereunder shall escalate based on the following formula and illustrated by the following
example -
(1) Formula.
[(Current CPI —Base CPQ) x Rent] +Rent =Escalated Rent
[Base CPI]
(2) Example re 2/1/13. The monthly base rent is $1,632. Assume the
Current CP[ (annual average CPI for 2011) is 225.114 and that the Base CPI (annual average
CPI for 2012) is 228.537. Monthly base rent beginning February 1, 2013 would be $1,656.81.
[(228.537 — 225.114) x $'x,632] + $11,632 = $1,656.81
225.114
(f) No Recomputations. Ne subsequent adjustments or recomputations,
retroactive or otherwise, shall be made to the Consumer Price Index due to any revision that
may Inter be made'to the first published figure of the Consumer Price Index for any month.
(g) No Fent Decrease. In no event shall the Monthly Base lent for a given year
be less than the Monthly Base Rent for the immediately preceding year.
(h) No Waiver. Any delay or failure of Landlord in computing or billing Tenant for
the escalation of Monthly Base Fent as provided herein shall not constitute a waiver of or in any
gray impair the continuing obligation of Tenant to pay such escalation of Monthly Base Fent.
(i) Charge in Index. in the event that the Consumer Price Index ceases to use
1982-84=100 as the basis of calculation, the neer CPI established by the U.S. Bureau of Labor
Statistics Consumer Price Index for all Urban Consumers -U.S. City Average, seasonally
adjusted, with a different base year shall be used.
.02 Net Lease. This Lease in every sense shall be without cost to the Landlord for
payment of the development, maintenance, and improvement of the Leased Premises. it shall
be the sole responsibility of the Tenant to Keep, maintain, repair and operate the entirety of the
Leased Premises. and, all -improvements and facilities placed thereon at Tenant's sole cost and
expense and
4.03 Utility P m' ent . Commencing with the Lease Commencement Date and
continuing throughout the Tern, Tenant shall pay or cause to be paid all -charges,
4
assessments, or taxes for gays, electricity, water, sewer, telephone, and all other utility services
incurred in connection with Tenant's use and occupancy f the Leased Premises.
4.04 Takes. Commencing with the Lease Commencement Tarte and continuing
throughout the Term, Tenant shall pay all property taxes assessed on the Leased Premises
when they become due.
4.05 Rent in Option Years. If the parties cannot agree on the amount Of rent during any
option period, they agree to retain the services, and to split the fee equally, of a cornmericial
real estate broker who actively leases property in the Iowa City area. Said commercial broker
will determine the rent for the five-year option period, which shall not be less than the previous
monthly burse rent.
ARTICLE
USE AND o C PA CY
5.01 Use. Tenant shall use the Leased Premises and Tenant's Improvement
exclusively for an auto repair and used carr facility.
5.02 Construction. Tenant shall obtain a certificate of occupancy for the building on
the Leased Premises for the operation of said facility within one (1) year of the date of the
Lease Commencement Date. Tenant's interest under this Lease shah terminate and all
payments hereunder shall be forfeited if Tenant does not obtain a certificate of occupancy
within one (1) year of the Lease Commencement Date. The failure by Tenant to obtain a
certificate of occupancy within a period of one (1) year from the Lease Commencement Date
shall be considered an event of Default and Landlord shall have available all remedies set forth
herein.
5.03. Licenses. Tenant shall, at Tenant's expense, obtain and maintain during the
Tera of this Lease all licenses or permits necessary for the operation of Tenant's use of the
Leased Premises as defined in Section 5.01 herein and Tenant shall comply with any other
applicable rales and regulations governing the operation of Tenant's use of the Leased
Premises as required by any federal, state, or local government or regulatory authority or
agency.
5.04. Zoning. Tenant shell, of Tenant's expense, obtain any and all necessary zoning
approvals and permits required by local law or ordinance.
5.05. Restrictions.
(a) FAA. Tenant shall for itself, its successors and assigns, prevent
any use of the property which would interf=ere with landing or ting off of aircraft at the
Iowa City Municipal Airport, or otherwise constitute an airport hazard.
(b) FAA. Tenant shall for itself, its successors and assigns, restrict the
height of structures, objects of natural growth, and other obstructions on the property to
height of 688 .feet Above Dean Sea Level(AMSL)or other height ars determined by an
FAA airspace review under Federal Aviation Regulation tion (FAR) Part 77. FAA Form 7460-
1, "Notice of Proposed Construction or Alteration," is to be submitted to the FAA and an
unobjectionable determination received prior to commencement of construction.
(c) FAA. Landlord reserves and excepts to itself, its successors and
assigns, for the use and benefit of the public, a right of flight for the passage of aircraft
in the airspace above the surface of the real property herein described, including the
right to cause in such airspace any noise inherent in the operation of any aircraft used
for navigation or flight through such airspace for landing at or taking off from or
maneuvering in the vicinity of the Iowa City Municipal Airport.
(d) Nuisances. No act constituting a nuisance as defined under the provision
of chapter 657, code of Iowa, the city of Iowa city ordinances, or the common law of Iowa,
shall be permitted.
(e) construction Site Standards. construction and the conduct thereof shall
comply with all governmental requirements as to health and safety and shall meet the
standards set forth herein and as set forth by city ordinance. Such standards shall cover, but
not be limited to, the restrictions contained herein and additional regulations concerning erosion
control, parking for construction workers, office trailers on the lot, material storage, location of
telephones and vending machines, , security design: location and disposal of sewage during
construction, cleaning and policing of the construction site and protection of streets, street right
of ways and property adjoining the building site. Said requirements may vary depending on
size, location and topography of lot. During the course of construction, Tenant, its agents, and
contractors shall keep mud, dirt, debris and building materials off of all city roads and other
lots. No temporary building, job trailers or the like shall be permitted on the lot except those
incident to construction while an approved building is being constructed thereon and shall be
removed within 30 days following the issuance of a permanent certificate of occupancy by the
City of Iowa city. When the construction of a project is once begun, work thereon shall be
prosecuted diligently and continuously until full completion.
(e) Parking. All parking areas and service drives shall be dust free} hard -
surface with a concrete curb and gutter. Parking will not be permitted on the lot except in paged
parking areas designed for parking. Tenant shall enforce all fire lane and any other "no parking"
restrictions on paved areas within its lot as required by the applicable fire safety authorities.
(f) Landscaping. In connection with construction on the lot, the Tenant shall
sod or seed the entire ground surface of the lot except for building and parking sites and
alternatively landscaped areas. The Tenant shall be responsible for sodding or seeding and
maintaining the area between its property line and the street curb and for maintaining all
Landlord installed landscaping thereon.
Landscaping shall be completed by Tenant no later than 30 days after a
certificate of occupancy is issued of the building on the lot, weather permitting. If the Tenant
informs the Landlord in writing within 30 days of issuance of the certificate of occupancy that
weather will not permit the completion of landscaping, the Landlord will provide the Tenant with
an alternate deadline by which to complete the landscaping.
Once installed, the landscaping shall be maintained' ire geed condition and
appearance; regularly watered, mowed, and edged. All re -planting and re -landscaping shall be
governed by the then -current city ordinances.
(h) Signs. All signs shall comply with City ordinances.
(i) Li titin . All lighting shall be directed away from adjacent -properties and
shall be positioned to eliminate glare on streets and highways. No neon lights, intermittent or
flashing lights shall be allowed. Only shaded light sources shall be used to illuminate signs,
facades, buildings} paring and loading areas. All lighting shall be reflected downward.
C:1
(k) Utitlies. All electric, telephone, and other utility lines on or servicing the lot
mut be underground. It is the responsibility of the Tenant or occupant of the lot to make
arrangements with the suppliers of electrical, water, severer and. other utility services for the site.
All electric transformers, terminals, or other utility appurtenances which are required to be
above ground, shall be located where possible at the rear of a building, and if visible from a
street such equipment shall be behind a screening facility meeting the City code..
ARTICLE VI
IMPROVEMENTS; SUR ENDE ; PERSONAL PROPERTY,
ALTERATIONS; LIENS- MAINTENANCE- COMPLIANCE
.01 Improvements and Personal Property.
(a) Title to Tenant's Improvements. Any and all real pro-perty improvements,
t ,
alterations, modifications or additions on or to the Leased Premises rade by Tenant during the
Term ("Improvements") shall be and remain the property of Tenant throughout the Terre.
(b) Surrender. Upon expiration of the Terra or termination of the Lease,
whether by breach, default, expiration of Lease, or otherwise, title to the Tenant's
Improvements shall be and become the sole and absolute property of Landlord, and Tenant
shall thereupon be required to, at Landlord's sole discretion, either: i return and deliver up the
Leased Premises in the same condition as when delivered to Tenant, normal war and tear
excepted or(ii) return and deliver up to Landlord the Leased Premises and Tenant's
Improvements thereon. If Landlord chooses option (H), said Improvements shall be surrendered
to, and become the sole property of Landlord at that time, free and clear of any liens of
mortgages, deeds of trust, liens of mechanics, laborers or rnaterialmen, and all other liens and
encumbrances other than any such liens and encumbrances incurred by Landlord, or such lien
or encumbrance which Landlord agrees in writing may survive the expiration of the Terre or the
termination of the Luse.
(c) Removal of Personal Property. All items of furniture, furnishings,
inventories and other personal property acquired by Tenant for use on the Leased Premises
(the "Personal Property") shall be and remain the property of Tenant regardless of termination
of the Luse or expiration of the Tera. Tenant shall remove from the Leased Premises all
Personal Property at or before the termination or expiration of the Lease. If Tenant fails to
remove such items within such period, then i such items shall be deemed abandoned by
Tenant and shall become the property of Landlord, and(ii) Landlord shall have the right to
remove -and dispose of such items -as Landlord, in .its sole discretion,' sees fit and to charge
Tenant the cost of doing so.
.02 Alterations.
(a) or DiscretionaEy Alterations. Tenant shall make all additions,
improvements, and alterations (hereinafter "Alterations") on the Leased Premises, and on and
to the Tenant's Improvements thereon, required by any governmental authority or which may be
made necessary r by the act or neglect of Tenant, its employees, agents or contractors, or any
persons, firm or corporation, claiming by., through or under Tenant. Except as provided in the
immediately preceding sentence, Tenant shall not made any other Alternations to the Leased
Premises without Landlord's prior written consent, which consent shall -not be unreasonably
withheld or delayed.
(b) Performance Standards. Prior to making any improvements or
Alterations, Tenant shall submit to Landlord for approval the following items:
i. Final plans and specifications,
ii, Certificates of insurance required by Section 8.01 naming
Landlord and the City of lora City as additional insureds and including builder's rid, liability and
worker's compensation insurance and such other insurance customarily obtained during
construction as is reasonably requested by Landlord; and
ii. Completion n assurances in the form of an Irrevocable Letter of
Credit or Payment and Performance Bond in accordance with Section 6.02(c) below, both
drawn to the benefit of Landlord, or as may be required by Landlord. Such completion
assurances must be acceptable to Landlord in both form and substance, and must also be
obtained from companies satisfactory to Landlord.
In addition, Tenant shall, upon Landlord's written request, provide
Landlord with evidence satisfactory to Landlord of Tenant's financial ability to pay for the
Improvements or Alterations. Landlord may also -require that Tenant secure, at Tenant's
expense, evidence satisfactory to assure Landlord's title in the Leased Premises against
mechanic's -liens arising out of any work, alterations or improvements rade to the Leased
Premises by Tenant as provided in Section 6.03 herein below. Tenant shall not commence to
perforin any Improvements ent r Alterations costing in excess of $10,000.00 without obtaining
Landlord's prior written consent: which consent shall not be unreasonably withheld. All
permitted Improvements or Alterations shall be performed with new materials, in a good and
workmanlike manner, strictly in accordance with the final plans and specifications approved by
the Landlord: and in accordance with any and all Legal Requirements as such term is defined in
Section 6.05. upon completion of any such work by or on behalf of Tenant: Tenant shall provide
Landlord with such documents as Landlord may require evidencing payment in full for such
work, such as lien waivers, and "as -built" working drawings. In the event Tenant performs any
work not in compliance with the provision of this Section 6.02(b), Tenant shall, upon written
notice from Landlord, immediately remove such work and restore the Leased Premises to their
condition immediately prior to the performance thereof. If Tenant fails to so remove such work
and restore the 'Leased Premises as aforesaid, Landlord may, at its -option, and in addition to all
other rights or remedies of Landlord under this Lease, at laver or in equity, enter the Leased
Premises and perform said obligation of Tenant and Tenant shall reimburse Landlord for the
cost to the Landlord thereof, immediately upon being billed therefore by Landlord. Such entry by
Landlord shall not be deemed an eviction or disturbance of Tenant's use or possession of the
Leased Premises, nor render Landlord liable in .any manner to Tenant.
(c) Performance Bond. Unless exempt or unless this requirement is waived
by Landlord, Tenant, at its own cost and expense, shall cause to be executed, and delivered to
Landlord a performance bond, as follows:
Prier to the date of commencement of construction, a contract surety
bond in a sum equal to the full amount of the construction contract awarded by Tenant for
construction of the improvements n the Leased Premises.
Said bond shall be drawn in a form and from such company as approved
by Landlord; shall guarantee the faithful performance of necessary construction and completion
of improvements in accordance with approved final plans and detail specifications; and shall
guarantee Landlord against any losses and liability, damages, expenses, claims, and
judgments caused by or resulting from any failure of Tenant, -or Tenant's contractor, to perform
8
completely the work described as herein provided and to pay all bills for labor, supplies,
material and equipment incident thereto.
In lieu of said bond, Tenant may deposit the amount of said bond in
local depository institution selected by Tenant to remain until Tenant's general contractor has
delivered to Landlord a waiver of all claims against the Leased Premises for labor done and
materials furnished and for a period of four months after the Landlord's building inspector
approves final completion of the construction of improvements, provided no mechanic's liens
have been filed against the Leased Premises during that time, at which time such deposit shall
e refunded to Tenant. All earnings from said deposit shall be the property of Tenant.
.03 Liens. Tenant shall not cause or permit any liens to be attached to, placed on or
filed against the Landlord's interest in the Leased Premises or Tenant's Improvements in
connection with any construction, alteration, demolition, repair or restoration work Tenant
performs or causes to be performed on the Leased Premises. If, however, at any time, in
connection with the planning, construction, alteration, demolition, repair or restoration work
Tenant performs or causes to be performed on the Leased Premises, any liens of mechanics,
laborers or material men shall be filed against, attached to or planed on the Leased Premises,
the Tenant's Improvements or any part thereof relating to work described above, Tenant shall,
at its expense, cause the same to be discharged, by payment, bonding or otherwise as
provided by law, within fifteen 1days after Tenant receives notice that the lien was filed,
except for such liens that may have been -incurred by Landlord arising from Landlord's actions.
Nothing herein contained shall in any way prejudice the rights of Tenant to contest in good faith
to final judgment or decree any such lien prior to payment thereof, provided that Tenant shall
(a) furnish and keep in effect a surety bond of a responsible and substantial surety company,
acceptable to Landlord, in an amount nt sufficient to pay 125% of the amount of such contested
lien claim with all interest thereon and nosh and expenses with respect thereto, or b provide
other security reasonably satisfactory to Landlord. Upon final determination of the validity of
such contested lien or. claim, Tenant shall immediately pay the amount finally determined to be
dine thereon including any judgment or decree rendered in connection therewith, with all
property costs and charges and shall cause any such lien to be released of record without cost
to Landlord and during the pendency of any such contest, Tenant shall save and keep Landlord
harmless from any claim or loss by reason thereof. Tenant's failure to comply with the teras of
this Section 6.03 shall be considered a Default under the Lease, and Landlord shall have the
right to any and all remedies against Tenant as set forth in Section 13.02 herein.
6.04 Maintenance. Tenant shall, throughout the Tera, at its sole cost and expense,
maintain the Leased Premises and all buildings and improvements at any time erected thereon,
any unimproved portion of the Leased Premises and all Personal Property installed therein, in
good repair and in a safe, clean, sightly and sanitary condition. In the event that Tenant, in
Landlord's reasonable judgment, fails to comply with its repair and maintenance . obligations
under this Section 6.04, Landlord may, but shall not be obligated to, in addition to its remedies
under- Article XIII, perform all repairs and mainter-ante which in Landlord's reasonable judgment
is required to bring the Leased Premises, Tenant's Improvements and Personal Property into
compliance with the repair and maintenance standards of this Section 6.04.
6.05 Compliance with Legal Requirements. Tenant shall, throughout the Term, at its
sole cost and expense, promptly r compl with all applicable laws, ordinances and regulations of
governmental entities having jurisdiction over the Leased Premises (including, but not limited to
all local zoning use restrictions and requirements), and all policies of insurance applicable to the
Leased Premises (collectively, "Legal Requirements"). ents"). Tenarnt shall not conduct or permit any
person to conduct any unlawful activity on the Leased Premises or any use or activity in
violation of a any Legal Requirements, including but not limited to zoning or ether land use
laws or ordinances, or b any private restrictive covenants applicable to the Real Estate.
Furthermore, Tenant shall not cause or allow any activity which causes air, water, soil or noise
pollution, which would violate any Legal Requirements or which would otherwise constitute a
nuisance or reasonably objectionable intrusion into or interference with the use of any
surrounding property.
6.06 Non -Discrimination. Tenant covenants, in consideration of the right to lease
property at Aviation Commerce Park, that Tenant, its employees, and agents shall not
discriminate inate against any person in employment or public accommodation because of race,
religion, color, creed} gender identity: sex, national origin, sexual orientation, rental or physical
disability, marital status or age. "Employment" shall include but not be limited to hiring,
accepting, registering, classifying, upgrading, or referring to employment. "Public
accommodation shall include but not be limited to providing goods, services, facilities,
privileges and advantages to the public. Tenant shall remain in compliance with all
requirements of 49 C.F.R. Part 21, Non -Discrimination in Federally Assisted Programs of the
Department of Transportation.
ARTICLE Vill
SALE AND RIGHT of FIRST REFUSAL
7.01 sale of Structure and -Right of First refusal. Tenant hereby grants to Landlord
ars irrevocable right of first refusal in the purchase of any structure or improvements, including
purchase by way of assignment of lease, upon the Leased Premises or in the alignment of the
leasehold interest. Upon receipt of any acceptable offer, Tenant shall provide notice of said
offer to Landlord. Landlord shall have the option to purchase the structures or improvement
upon the same teras and conditions contained therein. Landlord shall accept or decline said
offer within thirty days of receipt of the notice. Failure to accept the offer within the thirty
(30)day period shall operate to decline the offer. In the event that Landlord accepts the offer,
the parties shall proceed to closing within sixty days. Tenant shall not sell, grant} bargain,
or convey any structure or improvements upon the Leased Premises without first obtaining the
written approval of the Landlord, which the Landlord may withhold at its sole discretion. Tenant
shall fully disclose to Landlord the identity of any person, persons or corporation interested in
the purchase of the structure or improvements.
ARTICLE V1111
INSU RANCE.,DAMAGE AND DESTRUCTION
8.01 Insurance. Tenant covenants and agrees that it will at its own expense procure
and maintain general liability and casualty insurance in a company or companies authorized to
do business in the State of Iowa, in the following amounts:
TWO. f.��Cover e
..
Comprehensive Gen r l.Lia.bility
1 'Bodily Injury -& -P.r.: perty..Damage
-Automobile bab.ility
(1) Bodily Injury & Rroperty Damage
c. .Excess Liability
Ea h Occu'rren Oe - Am re ' ate
Combined Single Limit
$110003000
$1500010.00 1 ,0003000
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d. Worker's Compensation Insurance as required by Chapter 85, -Code of Iowa.
Tenant's insurance carrier shall be A rated or better by A.I. Best. Tenant shall
name the Landlord and the City of Iowa City, as additional insureds. Tenant shall deliver to the
Landlord, within thirty 30days of execution of this lease agreement, Certificates of Insurance
and copies of said policies, naming the Landlord and the City of Iowa City, Iowa as additional
i0sureds. Tenant: shall provide fifteen 1 days' notice to the Landlord before cancellation of
said insurance.
.02 Subrogation: Subrogation rights are not to be waived unless a special provision
is attached to this lease.
8.03 Damage or- Destruction.
(a) Tenant's Obligation to Restore. If any or all of the Tenant's Improvements
shall be damaged or destroyed by fire or any other casualty, then Tenant shall have the right,
exercisable by giving written notice thereof to Landlord within fifteen 1 days after the
determination thereof, to terminate. this Lease. Damaged means when the cost to repair the
Improvements exceeds the current value of the Improvements as determined -by the Landlord.
(i) If the Lease is not terminated, thea Tenant shall be obligated to
repair and restore Tenant's Improvements, as hereinafter provided. such repair or restoration
shall be commenced within ninety o days after the date the casualty occurs, and shall be
completed within a reasonable period thereafter net to exceed twelve 12 months. If the Tenant
shall fail to commence or complete such repairs and restoration work within the time periods set
forth in the preceding sentence, except for reasons due to strike, shortage of labor or materials,
war, or an act of God: Landlord shall have the right to immediately terminate this Lease. In
performing such restoration, Tenant shall substantially comply with the conditions applicable to
Alterations, including but not limited to, section 6.02. All insurance proceeds collected for such
damage or destruction shall be paid to a depositary approved by Landlord, Tenant, and any
entity having a security interest in the Lease. Such insurance proceeds shall be made available
to be applied toward the cost of such repairs or restoration. If the insurance proceeds shall be
insufficient for said repair or restoration, Tenant shall make up the deficiency out of Tenant's
funds. In all oases, due allowance shall be made for reasonable delay caused by adjustment of
insurance claims, loss, strikes, governmental approval, labor difficulties or any cause beyond
either party's reasonable control.
(if)If the Lease is terminated in accordance with this section
13-02(a), then Tenant shall demolish the Tenant's Improvements and restore the Leased
Premises to its condition prior to the Lease Commencement Date, and the effective date of the
termination shall occur upon completion of such demolition and restoration work, as if such date
were specified as the expiration date of the Terra. In such evert, the insurance pros eds shall
-be applied to pay for the demolition of the Tenant's Improvements and the restoration of the
Leased Premises, as previously provided, and thereafter, Tenant shall receive any remaining
proceeds.
(b) Remedies. if Tenant shall not eater upon the repair or rebuilding, or the
demolition and restoration, as the case may be, of the Tenant's Improvements within the period
specified in Section .03 and prosecute same thereafter with such dispatch as may be
necessary to complete same within said period, thea, in addition to whatever other remedies
Landlord may have either under this Lease, at 'law or in equity} the money received by and thea
remaining in the hands of the Depositary shall be paid to and retained by Landlord as security
for the continued performance and observance by Tenant of the Tenant's covenants and
agreements hereunder, or Landlord may terminate this Lease and then be paid and retain the
11
amount so held as liquidated damages resulting from the failure on the part of Tenant to comply
with the provisions of Section 8.03(a).
(c) ttler ent and Adiu tment of Insurance Proceed . Tenant
shall have the right to settle the amount of the casualty loss with the insurance carriers, but no
final settlement of a loss in excess of Fifty Thousand Dollars ($50,000.00) may be made without
Landlord's prior written consent thereto.
(d) Rent and other charges. Provided the Lease is not terminated a
provided in Section 8-03(a), neither Rent nor other charges shall be reduced or abated following
damage or destruction or during the period of repair, restoration or rebuilding. If the Lease is so
terminated, Dent and other charges shall be paid through the effective date of such termination.
ARTICLE I
CONDEMNATION
.01 condemnation. If the Leased Premises shall be condemned and taken for any
public use, or a portion of the. Leased Premises is so taken so that the remaining portion In
Tenant's reasonable judgment is unsuitable for continued operation of the business(es) located
on the Leased Premises, this Lease shall terminate on the date the right to occupy the Leased
Premises shall vest in the condemner; and Landlord shall refund any portion of Tenant's pre-
paid rent on a pro -rata basis. All damages awarded for taking of leased interest. shall belong to
Tenant.
ARTICLE X
ASSIGNMENT AND SUBLETTING
10.01 Binding Effect. The Lease shall be binding upon and shall inure to the benefit of
the parties hereto and their respective heirs, personal representatives, successors, and
assigns.
10,.02 Assignments. Tenant may not sell, transfer, or assign this Lease (either directly
or indirectly) or any legal or beneficial interest therein, or sublease all or any part of the Leased
Premises without the prior written consent of the Landlord, which consent may be withheld at
Landlord's sole discretion. In exercise of its discretion as to such a proposed sale, transfer or
assignment by Tenant, Landlord, in the agent that a proposed sale, transfer or assignment by
Tenant provides for payment to Tenant an amount of rent greater than the amount of Tenant's
rent obligation herein at the time, Landlord may require that a percentage of the difference
between the rental amounts be paid to Landlord. Tenant shall give Landlord written notice of
any proposed assignment or sublease of the Leased Premises, and such notice shall provide
(a) the name and address of the proposed assignee or sublessee, b the terms of the
proposed assignment or a copy of the proposed sublease, c the most recent financial
stateme nts of the .proposed assignee or sublessee and d such other information as Landlord
may reasonably request. Any assignment or sublease made by Tenant without Landlord's
consent in violation ofthis Section 10.02 shall be voidable at Landlord's option and shall
constitute an Event of Default. Landlord's consent to any one assignment or sublease shall not
be deemed a waiver of this Section 10.02 with respect to any subsequent assignment or
sublease nor consent to any subsequent assignment or sublease. Absent the Landlord's
agreement to the contrary, following assignment, whether with or without the Landlords'
consent, Tenant will remain liable for all Lease obligations.
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ARTICLE X1
MORTGAGES
11.01 Leasehold Mortgage.
(a) General Provisions. Tenant: and any successor or permitted assignee of
Tenant, shall not, at any time during the Term, pledge, mortgag e or encumber the Lease and/or
the Leased Premises demised hereunder, or Tenant's Improvements, without Landlord's prior
written consent, which consent Landlord may, in its sole discretion, withhold. Any such pledge,
mortgage or encumbrance rade by and entered into with Landlord's consent, is herein referred
to as a "Leasehold Mortgage". Any Leasehold Mortgage made by and entered into by Tenant
without Landlord's consent in violation of this Section 11.01 shall be voidable at Landlord's
option, and shall constitute an Event of Default.
(b) Landlord's Forbearance; Foreclosure by Leasehold Mortgagee. Landlord
hereby agrees that for the benefit of a Leasehold Mortgagee holding a Leasehold Mortgage and
the successors and assigns of such Leasehold Mortgagee:
0 When giving notice to Tenant with respect to any default under
the Lease or any exercise of any right to terminate the Lease, Landlord will also give a copy of
such notice to the Leasehold Mortgagee at the address of the Leasehold Mortgagee furnished
to Landlord. to such notice to Tenant shall be deemed to affect any rights of the Leasehold
Mortgagee unless or until such notice is given in said manner to such Leasehold Mortgagee.
(ii) In case Tenant shall default in respect of any of the provisions of
the Leases the Leasehold Mortgagee shall have the right, but not the obligation, to cure such
default, and Landlord shall accept -payment and/or performance by or on behalf of such
Leasehold //Mortgagee ars though, and with the sane effect, as if the same had been done or
performed by Tenant. The Leasehold Mortgagee will have a period of time after the service of
any notice of a default hereunder upon it within which to cure the default specified in such
notice, or cause it to be cured: which is the same period for cure, if any, as is available to
Tenant under the Lease for the specified default, plus an additional period of thirty 30days. In
the event of a default or in the event that Landlord is seeping to terminate the Lease by reason
of a default) which cannot reasonably be cured within said period because of Tenant's
possession of the Leased Premises, 'Landlord shall forebear from exercising its rights to
terminate the Lease as against Leasehold Mortgagee (while reserving all rights against Tenant)
on account of such default provided that the Leasehold Mortgagee: A has cured all defaults
which can reasonably be cured within the period of.firne allotted for cure, E within said period
has notified Landlord of its intent to cure all other defaults in a notice which specifies the
proceedings by which the Leasehold Mortgagee intends to secure possession of the Leased
Premises, c has begun proceedings to secure possession within the said period, and D
thereafter prosecutes such proceedings with reasonable diligence. The notice specified in.
clause B above shall contain an assumption by the .Leasehold //Mortgagee of all of Tenants
restrictions and obligations hereunder.
(iii) No default will be deemed to exist as against any Leasehold
Mortgagee and Landlord shall have no right, and shall take no action, to effect a termination of
the Lease as against any Leasehold Mortgagee until the Leasehold Mortgagee has had the
opportunity to cure such ' default specified in clause H above. If the Leasehold Mortgagee, by
foreclosure or otherwise, acquires Tenant's leasehold estate, the Leasehold Mortgagee shall be
subject to all Lease Restrictions and shall be liable for all Tenant's obligations accruing
thereafter to the same extent as the prior Tenant would have been so liable.
(iv) . Provided that the Leasehold Mortgagee has complied with
Subsection(ii) of this section, any default of Tenant under any provision of the Lease which is
not reasonably susceptible of being cured by a Leasehold Mortgagee during the cure period
specified in Subsection(ii) of this Section shall becured by Leasehold Mortgagee or any other
purchasers or transferees of Tenants interest under this Lease, whether at judicial foreclosure,
trustee's sale or by an assignment of the Lease in lieu of foreclosure within thirty days after
acquisition.
(v) A Leasehold Mortgagee or its designee or nominee may
become the legal owner and holder of the interest of Tenant under the Lease, including without
limitation, the interest of Tenant in all Tenant's Improvements and Personal Property, by
foreclosure or other enforcement proceedings, or by obtaining an assignment of the Lease and
a conveyance of the Tenant's Improvements and Personal Property in lieu of foreclosure or
through settlement of or arising out of any pending or threatened foreclosure proceeding:
without Landlord's consent, but subject arrays to the applicable terms, provisions, obligations,
and restrictions of the Lease. Upoh such acquisition of legal ownership, such Leasehold
Mortgagee or its designee or nominee) shall be liable for all obligations under the Lease
accruing thereafter to the same extent as the Tenant would have been. In such event,
Leasehold Mortgagee or, if said Leasehold Mortgagee has not yet become a successor Tenant
hereto, then its designee or nominee) shall have the right thereafter to assign the Lease and
convey the Tenant's Improvements and Personal Property subject to all other applicable terms,
provisions, obligations, and restrictions of the Lease.
(vi)If Tenant fails to observe or perform any of its obligations under
the Lease, Leasehold Mortgagee may, but shall not be obligated to, observe or perform such
obligations for and on behalf of Tenant, whether or not Tenet shall be in default under the
Lease.
(c) Notices to Leasehold Mortgagees. Any notice or other communication
which Landlord shall desire or is required to give to or serve upon a Leasehold Mortgagee shall
be in writing and shall be seared by registered or certified mail or by commercial courier service
addressed to such holder at the address as shall be designated frac time to time by -such
Leasehold Mortgagee and shall mail a copy of said notice by ordinary mail. Any notice or other
communication which any Leasehold Mortgagee shall desire or is required to give to or serve
upon Landlord shall be deemed to have been given or served if sent by registered or certified
,nail or by commercial courier service addressed to Landlord at Landlord's address as set forth
in the provisions of the Lease providing for notices to Landlord or at such other address as shall
be designated from time to time by Landlord by notice in writing given -to such Leasehold
Mortgagee by registered or certified mail or by commercial courier service. Any notice give
pursuant hereto shall be effective when received or refused.
(d) Non-Meger. No union of the interests of Landlord and Tenant shall result
in a merger of the Lease and the fee interests in the Leased Premises without the prior written
consent of any Leasehold Mortgagee.
ARTICLE X11
EASEMENTS
12.01 Generally. This Lease and the rights granted to Tenant hereunder are expressly
,Wade subject and subordinate to any and all existing easements on the Leased Premises, and
Tenant shall net in any way act to alter, obstruct, disturb or otherwise impair any of said
easements nog- grant additional easements on or affecting the Leased Premises during the term
of this Lease without Landlord's prior written consent.
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ARTICLE X111
DEFAULT
13.01 Events of Default. The following shall constitute "Events of Default".
(a) Monet ar Tenant shall fail to pay Fent at the time required or any other
monetary obligation or payment required under this Lease when due, and such failure shall
co. ntinue for a period of ten (1 0) d ays foIlo ging written notice from Landlord to Tenant; or
(b) Non-performance. erformanoe. Tenant shall fail to observe or perform any of the other
covenants, terms or conditions contained in the Lease, or a warranty made by Tenant shall fail
to be accurate and complete, and such failure shall continue and not be cured for a period of
thirty 3 days after written notice by Landlord to Tenant, provided that if the default is not
reasonably susceptible of being cured within thirty 3 days, an Event of Default shall occur
only if the Tenant fails to promptly commence such cure or fails thereafter to diligently pursue
such efforts to completion; or
(C) - Bankrupta l eeeiver hi . If i Tenant files a petition in bankruptcy or for
reorganization or for an arrangement pursuant to any present or 'future federal or state
bankruptcy lav or under any similar federal or state law, or is adjudicated a bankrupt or
insolvent, or'makes an assignment for the benefit of its creditors, or admits in writing its inability
to pay its debts generally as they become dies or if a petition or answer proposing the
adjudication of Tenant as a bankrupt or a reorganization of Tenant under -array present or future
federal or state bankruptcy law or any similar federal or state lave is filed in any court and such
petition or an�r ser is not discharged or denied within thirty(30)days after the filing thereof; or
(ii)receiver , trustee or liquidator of Tenant of all or substantially all of the assets of Tenant or
of the Leased Premises or any portion thereof is appointed in any proceeding brought by or
against Tenant and is net discharged within thirty 30 days after such appointment or if Tenant
consents to or acquiesces in such appointment.
13.02 Landlord's Rights upon an. Event of Default. Upon the occurrence of ars Event of
Default by Tenant, or at any time thereafter during the continuance of such Event of Default,
Landlord may take any of the following actions and sharp have the following rights against
Tenant -
(a) Termination. Landlord may elect to terminate the Leave by giving no less
than thirty 30 days' prior written notice thereof to Tenant, and upon the passage of time
specified in such notice: this Lease and all rights of Tenant hereunder shall terminate as fully
and completely and with the same effect as if such date were the date herein fixed for r
expiration of the Term and Tenant shall remain liable as provided in Section 13.02.
(b) Eviction. Landlord shall have the immediate right upon Termination of this
Lease to bring an action for forcible entry and detainer.
(c) Tennant to Remain Liable. No termination of this Lease pursuant to
Section 13.0 a , by operation of lav or otherwise, and no repossession of the Leased
Premises or any part thereof pursuant to Section 15.02(b) or otherwise shall relieve Tenant of
its liabilities and obligations hereunder, all of which shall survive such termination, repossession
or reletting.
(d) Damages. In the event of any termination of this Lease or eviction from or
repossession of the Leased Premises or any part thereof by reason of the occurrence of an
Event of Defaul, Tenant shall pay to Landlord the Rent and other sums and charges required to
be paid by Tenant for the period to and including the end of the Tera or expiration of an option
period as provided for by Section 3.02 herein, whichever is later.
(e) RCumulative,Non-Waiver. No right or remedy herein conferred
upon or reserved to Landlord is intended to be exclusive of any other right or remedy, and each
and every right and remedy shall be cumulative and in addition to any other right or remedy
given hereunder or now or hereafter existing at law or in equity or by statute. In addition to the
other remedies provided in this Lease, Landlord shall be entitled, to the extent permitted by
applicable law, to injunctive relief in case of the violation, or attempted or threatened violation,
of any of the covenants, agreements, conditions or provisions of this Lease, or to a decree
compelling performance of this Lease, or to any other remedy allowed to Landlord at law or in
equity.
(f) Landlord's light to Cure. If Tenant fails to pay any utilities charges
described in Article IV, insurance premiums described in Article VIII, the cost of any of the
repairs or maintenance required to be rade by Tenant pursuant to the Lease or any other
charges, costs or expenses required to be paid under the Lease, Landlord shall have the right,
but not the obligation, to make a all such payments, and in addition to its other remedies under
this Article ?VIII, Landlord shall have the 4option of requiring Tenant to repay to Landlord the
amount of such payments (which shall be deemed additional rent hereunder) on demand with
interest after demand at 10% rate per annum. (the "Default Date").
(g) Late charge, Default_ Fate. If Landlord does not receive payment of ars
installment of rent or any ether sura or charge required to be paid by Tenant to Landlord
hereunder within ten 10 days after the carne falls due(regardless of whether Tenant has
received notice of the delinquency, Landlord may impose ar late charge equal to five percent
(5%) of the amount of such delinquent sura and if such sura is not received by Landlord within
thirty 30days of its due date, such sum shall, in addition, bear interest at the default Fate
from the due date until the date paid.
(h) Landlord's Lien. Landlord shall have a lien against Tenant's leasehold
estate, Tenant's Improvements and all property of Tenant located at the Leased Premises, to
secure any obligations of Tenant to Landlord arising pursuant -to the provisions of this Luse.
13.03 No -Implied Waiver. The failure of Landlord to insist upon strict performance of
any of the covenants or conditions of the Lease,' or to exercise any options herein conferred in
any one or more instances shall not be construed as a waiver or relinquishment for the future of
any such covenant, condition, or option, but the same shall be and remain in full force and
effect. The receipt by Landlord of any Rent or any other sum payable hereunder with
knowledge of the breach of any covenants or agreements contained herein shall not be
deemed a waiver of such breach.
ARTICLE X111
ABANDONMENT
14.01 Abandonment: Tenant shall not vacate or abandon the Leased Premises at any
time during the Terra of this Lease. If Tenant shall vac to or abandon the Leased Premises, the
right of possession shall, at the option of Landlord, revert to Landlord and Tenant shall lose all
right to possession of the Leased Premises and Tenant's Improvements; however, Tenant shall
otherwise remain liable on this Lease. Landlord shall then, without further notice, have the
remedies provided for in Article Xlll herein.
ARTICLE ACV
ENVIRONMENTAL ONMENTAL CONDITIONS
15.01 Definitions. As used in this Lease} the phrase "Environmental Condition" shall
mean. a any adverse condition relating to surface water, ground water, drinking grater supply,
land, surface or subsurface, strata or the ambient air, and includes, without limitation, air, land
and water pollutants, noise, vibration, light and odors, orb any condition which may result in a
claim of liability under the Comprehensive Environmental response Compensation and Liability
Act, as amended, or the Resource Conversation and Recovery Act, or any claim of violation of
the'Clean Air Act, the Clean Water Act, the Tokio Substance Control Act, or any claim of liability
or of violation under any federal statute hereafter enacted dealing with the protection of the
environment, or under any rule, regulation, permit or plan under any of the foregoing, or under
any laver, rule or regulation noir or hereafter promulgated by the state in which the Leased
Premises are located, or any political subdivision thereof, relating to such matters(collectively
"Environmental Laws").
15.02 Com liance by Tenant. Tenant shall, at all times during the Terra, comply with all
Environmental Laws applicable to the Leased Premises and shall not, in the use and occupancy
of the Leased Premises, cause or contribute to, or permit or suffer any other party to cause or
contribute to any Environmental Condition.
15.03 Tenant's Indemn . Tenant will protect, indemnify and save harmless the
Landlord, the partners of the Landlord, and all of the fore oin 's respective partners, agents
and employees (collectively "Landlord's Indemnitees"), from and against all liabilities,
obligations, claims, damages: penalties, causes of action, costs and expenses (including,
without limitation, reasonable attorneys' fees and expenses) of whatever kind or nature,
contingent or otherwise, known or . ung no ern, incurred or imposed, based upon any
Environmental Lavers or resulting from any Environmental Condition occurring or contributed to
during the terra of this Lease. In case any action, suit or proceeding is brought against any of
the parties indemnified herein by reason of any occurrence described in this Section 15.03,
Tenant will, at Tenant's- expense, by counsel reasonably approved by Landlord, resist and
defend such action, suit or proceeding, or cause the sane to be resisted and defended.
ARTICLE XVI
TENANT'S INDEMNIFICATION
16-01 Generally. To the extent not expressly prohibited by laver, Tenant agrees to
indemnify, save, protect and hold forever- harmless, Landlord, and all of Landlord's Indemnitees
as defined in section 15.03 hereinabove, from and against all losses, damages, costs, claims
and liabilities, including, without limitation, court costs and reasonable attorney's 'fees and
expenses, which Landlord's Indemnitees, or any of them, may become liable or obligated by
reason .of, resulting from or in connection with: a any injurer to or death of persons and
damage to, or theft, misappropriation or loss of property occurring in or about the Leased
Premises or the Property arising from Tenant's use and occupancy of the Leased Premises
and/or the conduct of its business; b any activity, work or thing done, permitted or suffered by
Tenant in or about the Leased Premises, including all liabilities of every Kind or description
which may arise out of or in connection therewith; and any breach or default on the part of
Tenant in the payment or performance of any covenant, agreement or obligation on the part of
Tenant to be paid or performed pursuant to the terms of this Lease or any other act or omission
of Tenant, its agents or employees. In case of any action or proceeding brought against
Landlord's Indemnitees, .or any of therm, by reason of any such claims, Tenant covenants to
17
defend such action or proceeding by counsel reasonably satisfactory to Landlord and/or any
particular Landlord's indemnitee.
ARTICLE XVII
MISCELLANEOUS PROVISIONS
17-01 Access by Landlord.
(a) Landlord or Landlord's agents, representatives or employees shall have
the right at any time upon at least twenty-four 24 Fours oral notice pt in emergencies, in
which case only such notice, if ars, as may be feasible under the circumstances shall be
required to enter upon the Leased Premises and Tenant's Improvements for the purposes of
inspecting the same, determining whether this Lease is being complied with, curing as
permitted herein) any default by Tenant and showing the Leased Premises to prospective
Leasehold Mortgagees.
(b) Landlord or Landlord's agents, representatives, or errnpl yees shall have
the right whenever necessary and without notice to enter upon the Leased Premises for the
purpose of repairing or maintaining any. of Landlord's property adjacent to or abutting the
Leased Premises.
17.02 Landlord's Right ..... to, Inspect Tenant's Records. Landlord shall, in the event of
Tenant's Default as defined in section 13.01, have the right to inspect and examine Tenant's
organizational and financial books and records, including but not limited tax returns for the
previous tax year, loan applications completed in the previous two gears, audits completed in
the previous two years, within thirty 30) of written request to do so.
17.03 Brokers' Fees. Each party represents and warrants to the other that no real
estate broker or agent has been involved in this transaction, except Jeff Edberg of Sl o man
Commercial F eal Estate services Group. Tenant shall hold Landlord harmless and defend
against the claim of any real estate brier or agent claiming to have acted on behalf of Tenant
and Landlord shall hold Tenant harmless and defend against the claim of any ether real estate
broker or agent claiming to have acted on behalf of Landlord.
17.04 Gender and Dumber. Words of any gender used in the Lease shall be held to
include any other gender, and words in the singular shall be held to include the plural, where
required.
1.7.05 Notices. Notices, statements and other communications to be given under the
terms of the Luse shall be in writing and sent by certified or registered mail} or by commercial
courier: return receipt requested, and addressed as follows:
If to L n for -
ewa City Airport
Commission
% Commission
Chairperson
1801 S. Riverside Dr.
Iowa City, 152240
With copies to:
City Attorney
410 E. Washington St.
Iowa city} IA 52240
If M Ten nt-
Affordable Auto, LLC
% Mohammed
Albasari
13 Ambrose Ct.
Coralville, IA 52241
or at such other address as from time to time designated by the party receiving the notice. All
such notices shall be deemed to have been fully given, made or sent when made by personal
service or deposited in the United States Bail, Registered or certified, postage prepaid.
17.06 Applicable Law. The laves of the State of Iowa shall govern the validity,
performance and enforcement of this Lease.
17.07 Partial Invalidity. If any provision of the Lease shall be invalid or unenforceable it
shall not affect the validity or enforceability of any other provisions of the Lease.
17.08 Heading. Headings as to the contents of particular articles and sections herein
are inserted only for convenience, and are in no gray to be construed as a part of the Lease or
as a limitation on the scope of the particular article or section to which they refer.
17.09 Binding Effect. The covenants, conditions and agreements contained in the
Lease shall bind, apply to and inure to the benefit of the parties hereto and their respective
successors.
17.10 No Partnership. It is expressly understood that Landlord shall not be construed
or held to -be a partner, joint venturer or associate of Tenant in the conduct of Tenant's business
and that the relationship between the parties hereto is and shall at all times remain that of
land l o.rd and tenant.
17.11 Holding over. The Leasej shall terminate without further notice at expiration of
the Terra. Any holding over by Tenant or any party claiming by, through or under Tenant after
expiration shall not constitute a renewal or extension or give Tenant any rights in or to the
Leased Premises. In the event of any holding over, Landlord may exercise any and all remedies
available to it under Article XIII herein or at laver or in equity to recover possession of the Leased
Premises, and for damages.
17.12 Time is of the Essence. Time is of the essence in this Lease.
17.13 Recording. Upon request by either party upon the other, Landlord and Tenant
ill execute for purposes of recordation in the appropriate recording office a memorandum or
short form of the Lease containing the names of the parties, a description of the Leased
Premises, the Terra, and such other previsions as either party may reasonably require. The
cost and expenses of recording the memorandum or short form of the Lease shall be borne by
the party requesting the memorandum be recorded. Each party agrees that -it will net record the
Luse in its entirety.
17.14 Covenants to Run with the Land. All the covenants, agreements, conditions and
undertakings contained in this Lease shall extend and inure .to and be binding upon the
successors and permitted grantees and assigns of the respective parties hereto the same as if
they were in every case named and shall be construed as covenants running with the land and
wherever in this Lease reference is made to either of the parties hereto, it shall be held to
include and apply to, wherever and whenever,applicable, the successors and permitted
grantees and assigns of such party the same as if in each and every case so expressed.
17.16 Entire Agreement; . Merl. The Lease contains all the agreements and
conditions made between the parties hereto with respect to the matters contained herein and
may net be modified orally or in any other manner than by an Agreement in writing signed by all
the parties hereto or their respective successors. All prior written and oral understandings and
agreements shall be deemed to have merged into the Lease and have no further force and
effect.
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17.16 Countr rts. This Lease may be executed in counterparts, each of which shall
be deemed to be ars original and all of which shall, when taken together, constitute but one and
the same instrument.
ARTICLE 1 f11
FAA PROVISIONS
18.91 Commission Control. The Landlord reserves the right, but shall not be obligated
to the Tenant, to maintain and keep in repair the landing area of the Airport and publicly owned
facilities of the Airport, without hindrance from the Tenant. The Landlord reserves the right t
take action it considers necessary to protect the aerial approaches of the Airport against
obstructions. The Tenant shall not act as an agent or represent itself as an agent for the
Landlord in matters between the Federal Aviation Administration and the Landlord
18.92. Landlord Improvements. The Landlord reserves the right to further develop or
improve the landing area and all publicly owned aviation facilities of the Airport as it sees fit,
without interference or hindrance from the Tenant.
18.93 Non-exclusive Fight. It is agreed that nothing herein contained shall be
construed to grant or to authorize the granting of an exclusive right prohibited by Section 398 of
the Federal Aviation Act of 1958, -as amended, and the Landlord reserves the right to grant t
others the privilege and right of conducting any activity of an aeronautical nature.
18.04 Grant Assurances. This Lease shall be subordinate to the provisions of any
outstanding or future agreement between Landlord and the United States government or the
State of Iowa relative to the maintenance, operation, or development of the Iowa City Municipal
Airport. Tenant acknowledges and agrees that the rights granted to Tenant in this Lease will not
be exercised so as to interfere with or adversely affect the use: operation, maintenance or
development of said Airport.
18.95 Right t cf Flight. Tenant acknowledges than the City of Iowa City, Ionia is
authorized by law to own and operate the lova City Municipal Airprot located in Johnson
County, Iowa near the Leased Premises. There is hereby reserved t Landlord, its successors
and assigns, for the use and benefit of the public, a free and unrestricted right of flight for the
passage of aircraft in the airspace above the surface of the Leased Premises herein conveyed,
together with the right to cause in said airspace such noise, vibrations, fumes, dust, and
particles as may be inherent in the operation of aircraft, now known or hereafter used for
navigation of or flight in the air, using said airspace or landing at, taking off from, or operating
n or about the airport. Tenant foregoes and waives any and all claims for damages, of
whatever kind or type, which are reasonably likely to occur in the future as a result of air craft
using the "navigable airspaice", as defined by the Federal Aviation Act of 1958 49 U.S.C.
49192 a 3 }and regulations. promulgated thereunder over and above the Leased Premises,
including but not limited to, damages resulting from raise, vibration, fumes, dust and particles.
Tenant grants to the Landlord, its successors and assigns, a continuing right to keep the air
space above the Airport Imaginary Su aces as described in Federal Aviation Regulations.
Part 77 and depicted on the Airport Layout Plan (ALP) Glean of any and all fences, crops, trees,
poles, building or other obstructions of any Kind or nature whatsoever which now extend, or
which may any any time in the future extend, above said surfaces. Tenant grants the Landlord
the right of ingress to, eggre s from, and passage over the Leased Premises for the purpose of
effecting and maintaining such clearance and of removing any and all obstructions which now
r may hereafter extend above the Airport Imaginary Surfaces as described in Federal Aviation
Regulations Part 77 and depicted in the ALP.
1.0Additional FAA Provisions.
(a) The Tenant for himself, his heirs, personal representatives, successors in
interest, and assigns, as a part of the consideration hereof, does hereby covenant and agree as
a covenant running with the land that in the event- facilities are constructed, maintained, or
otherwise operated on the said property described in this Lease for a purpose for which a
Department of Transportation program or activity is extended or for another purpose involving
the provision of similar services or benefits, Tenant shall maintain and operate such facilities
and services in compliance with all other requirements imposed pursuant to 49 CFR Part 21,
Nondiscrimination in Federally Assisted Programs of the Department of Transportation, and as
said Regulations may be amended.
(b) The Tenant, for himself, his personal representative, successors in
interest, and assigns, as a part of the consideration hereof: does hereby covenant and agree as
a covenant running with the land that: 1 no person on the grounds of race, color, or national
origin shall be excluded from participation in, denied the benefits of, or be otherwise subject to
discrimination in the use of said facilities, 2 that in the construction of any improvements on,
over, or under such land and the furnishing of services thereon, no person on the grounds of
race, color, or national -origin shall be eluded from participation in, denied the benefits of, or
otherwise be subject to discrimination, that the lessee, shall use the premises in compliance
with all other requirements imposed by or pursuant to 49 CFR Part 21, Nondiscrimination in
Federally Assisted Programs of the Department of Transportation, and as said Regulations may
be amended.
(c) Landlord reserves the right further to develop or improve the landing area
and all publicly -owned air navigation facilities of the airport as it sees fit, regardless of the
desires or views of Tenant, and without interferences or hindrance.
(d) Landlord reserves the right to take any action it considers necessary to
protect the serial approaches of the airport against obstructions, together with the right to
prevent Tenant from erecting, or permitting to be erected, any building or other structure on the
airport which in the opinion of Landlord would limit the usefulness of the airport or constitute a
hazard to aircraft.
(e) During time of war or national emergency Landlord shall have the right to
enter into an agreement with the United states Government for military or naval use of part or
all of the landing area, the publicly -owned air navigation facilities and/or other areas or facilities
of the airport. If any such agreement is executed, the provisions of this instrument, insofar as
they are inconsistent with the provisions of the agreement with the Government, shall be
suspended.
(f) It is understood and agreed that the rights granted by this agreement will
not be exercised -ire such a way as to interfere with or adversely affect the use, operation,
maintenance or development of the airport.
(g) The Lease shall become subordinate to provisions of any existing or
future agreement between the Lesser and the Ignited States of America or any agency thereof
relative to the operation, development, or maintenance of the airport, the execution of which
has been or may be required as a condition precedent to the expenditure of federal funds for
the development of the airport.
21
ARTICLE XI
OPTION To PURCHASE
19.01 Grant of option. In consideration of the sure of the rent paid by Tenant to
Landlord, the City of lova City `{the City" hereby grants to Tenant the exclusive right and
option to purchase property (the `option Property") as legally described as follows:
Lot 17, North Airport Development, Iowa City, lova, according to the plat thereof
recorded with the Johnson County, Toga, recorder October 17, 200 1, Plat Book -43,
Page 182.
Tenant shall aerie the option to purchase the option Property on or before
November ber 1, 2036 by tendering a purchase agreement mutually satisfactory to the City and
Tenant. If Tenant fails to do so, this option Agreement shall terminate as of 12:01 a.m. on the
day following the date set forth in the preceding sentence.
The purchase shall close as set forth herein unless extended by agreement of
the parties. The purchase price for the option Property is set forth below, and the terms of the
purchase shall be set forth in a purchase agreement upon the general terms set out below (the
"Purchase Agreement"), or as otherwise agreed by the parties.
19.02 Purchase Price.
(a) Purchase Price in 2011 and 2012. The Purchase Price shall be $230,000
if the option Date is in 2011 or 2012. Beginning in 2013, the Purchase Price shall increase
every calendar year based on the following formula and as illustrated in the following example.
In no event shall the Purchase Price be loss than $230,000.
(b) Payment of the purchase price shall be in full at the time of closing in
cash.
{c} Definitions. For purposes of this Option provision, the following definitions
shall apply:
(1) the term "Consumer Price Index" or "SPI" shall mean the U.S. Bureau, of
Labor Statistics Consumer Price Indices for all Urban Consumers -U.S. City Average, seasonally
adjusted 1198 2-84 equals 100).
(2) the tern "Current CPI" shall mean the annual average of Consumer Price
Indices for the calendar year immediately preceding the option Date.
(3) the term "Base CPF" -shall mean the annual average of Consumer Price
Indices for 2011, which is not available at the Lease Commencement Date. For purposes of
identification, the U.S. Bureau of Labor Statistics Consumer Price Index for all Urban
Consumers -U.S. City Average, seasonally adjusted (1982-84 equals 100), annua I average for
2010 is 218.056.
(4) the term "option Date" shall mean date that Tenant provides the City with
notice it intends to exercise its option.
(d) Formula:
22
[(Current CPI -Base CPI) x $230,0001 + $230,000 =sale price
[Base CPI]
(e) Example for sale with an Option Date in 2014. Assume that the Current CPI
(annual average of CPIs for 2013) is 230.416 and the Base CPI (annual average of CPIs for
20'[ 1) is 225.114. Sale price would be $234.417 calculated as follows:
[(230-416 - 225.114) x $230,040] + $230,004 = $234-,417
[225.114]
(e) Recomputations. . o subsequent adjustments or
recomputations, retroactive or otherwise, shall be made to the Consumer Price Index due to
any revision that may later be made to the first published figure of the Consumer Price Index for
any month.
(f) Change in Index, in the event that the Consumer Price Index ceases to use
1982-84-1 og as the basis of calculation, the new CPI established by the U.S. Bureau of Labor
Statistics Consumer Price Index for all 'Urban Consumers -.S. City Average, seasonally
adjusted with a different base year shall be used.
9.03 Notice of Exercise. Tenant may exercise this option only by giving wriften
notice to the City Attorney, 410 Washington Street, lora City, Io na.
9.04 Failure to Exercise option. if Tenant does not timely eerie this Option,
or perform any terra or condition of this Agreement, the option shall terminate.
19.05 Eerie of Option. As Tenant exercises this Option, the City and Tenant
shall enter into a written Purchase Agreement for the Option Property for closing and
possession after the City provides Tenant with an abstract showing clear title in the City, but in
no event later than one hundred eighty 1 days following notice of exercise of the Option or
such additional time as the parties may agree to in writing.
19.06 Assignment. Tenant shall have no right to assign or convey rights ander this
Option.
19.07 Bind.l.ng Effect. This Option contains the entire agreement between the
Tenant and the City with respect to the transaction contemplated herein, and neither the City
nor Tenant have relied on any representation except those expressed herein. The terms of this
Option shall not be modified or amended except by written instrument by the City and the
Tenant. Both the City and the Tenant have had the opportunity to participate in the drafting of
this Option and any rule of law which construes any ambiguity in the terns of a written
instrument against the drafter shall not be applied to interpretation or enforcement of this
Option.
IOWA CITY AIRPORT COMMISSION (as to Articles I to XVIII)
In
Ilinnetta Gardinier, Chairperson
Date
23
ATTEST:
Steve Crane,. Secretary Date
Approved By:
City Attorney's Office
AFFORDABLE AUTO, LLC
Mohammed Albasri Date
CITY OF IOWA CITY (as to Article XIX only)
Matthew J. Hayek, Mayor Dante
Attest:
Marian K. Karr: City Clerk Dante
Commission's Acknowledgement
STATE OF IOWA
) SS:
JOHNSON COUNTY
On this day of 2011, before me,
, a rotary Public in and for the State of Iowa, personally appeared
Linn ttar G rdini r and Steve Crane, to me personally kn ern, who, being by rye duly sworn, did
say that they are the Chair and Secretary, respectively, of the Iowa City Airport Commission and
that the instrument was signed and sealed on behalf of the Commission and that Minnetta
G rdini r and Steve Crane acknowledged the execution of the instrument to be their voluntary acct
and deed of the Commission, by it voluntarily executed.
Notary Public in, and for said County and State
24
Tenant's Acknowledt
STATE OF IOWA )
)ss:
JOHNSON COUNTY }
This instrument was acknowledged before me on
Mohammed Albri ars manager of Affordable Auto, LLC.
Notary Public in and for the State of Iowa
fit 's Acknowledgment
STATE OF IOWA )
ss:
JOHNSON COUNTY )
2011 by
On this day of _ ... -3 2011, before me,.
Notary Public in and for the State of Iowa, personally
appeared Matthew J. Hayek, Mayor and Marian K. Karr, to rye personally known, and, who,
being by me duly sworn, did say that they are the Mayor and City Clerk, respectively: of the City
of Iowan City, Iowa; that the seal affixed to the foregoing instrument is the corporate seal of the
corporation, and that the instrument was signed and sealed on behalf of the corporation, by
authority of its City Council, and that Matthew J.'Hayek and Marian K. Karr acknowledged the
execution of the instrument to be their voluntary act and deed and the voluntary acct and deed of
the corporation, by it voluntarily executed.
Notary Public in and for the Starts of Iowa
My commission expires:
Nola
IT
pW
IT
l
Engineer's Estimate of Probable Construction Cost
Rehabilitate Pavement (Taxiway)
IDOT Project # 91-10-01OW-100
Iowa City Municipal Airport
Iowa City, Iowa
October 11, 2011
Item No.
Description
Unit
Estimated
Unit Price
Estimated
N
Quantity
Cost
1
Mobilization
LS
1
$ 5,000.00
$ 5,000.00
2
Construction Barricades
LS
1
$ 8,000:00
$ 8,000.00
3
PCC Slab Replacement
SYD
550
$ 100.00
—$55' doom
4
Pavement Marking
SFT
245
$ 3.75
$ 918,75
TOTAL ESTIMATE
$ 68,918.