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HomeMy WebLinkAbout2010-03-22 10-107 ORDERCOUNCIL ACTION Item No. 1 (1 1 (1 r7 Date: March 22, 2010 Item/Subject: ORDER, Authorizing the Bangor International Airport to enter into a Lease Agreement with the BAFS, Inc for Airport's In -Flight Catering Facility Responsible Department: Airport Commentary: The proposed lease term for the In -Flight Catering facility is five years with an option to extend for one additional five year term. The rental rate is $27,500.00 Dollars per year. In addition to minimum rental, the Lessee shall pay a percentage of annual Gross Sales as follows: 5.5% of the first $250,000 of annual Gross Sales that exceed $1 million, 6.6% of the next $ 250,000 of Gross Sales that exceed $1.25 million, and 8% of all Gross Sales in excess of $1.5 million. The lease requires a $100,000 investment in the facilities during the first five year term. Rebecca Hupp Department Head Manager's Comments: This has been reviewed by the Airport Committee and is recommended for appro99,4� Interim City Manager Associated Information: Order, Lease Budget Approval: Finance Director Legal Approval: Z -11,111 --Al City Solicitor Introduced for X Passage First Reading Referral Page 1 of 1 Assigned to Councilor - Wheeler CITY OF BANGOR 10 107 March 22, 2010 (TITLE.) ORDER, Authorizing the Bangor International Airport to enter into a lease agreement with the BAFS, Inc for Airport's In -Flight Catering Facility. WHEREAS, The City of Bangor owns and operates the Bangor International Airport; and WHEREAS, BAFS, Inc has experience operating an in-flight catering facility; and WHEREAS, the Bangor International Airport and its customers have a need for this service; and WHEREAS, both parties desire to enter into a lease agreement; and WHEREAS, the terms of this agreement is in the best interest of the Airport; and WHEREAS, the terms of this agreement are advantageious to both parties. NOW, THEREFORE, BE IT ORDERED BY THE CITY COUNCIL OF THE CITY OF BANGOR, That the Bangor International Airport is authorized to enter into a lease agreement with the BAFS, Inc . for Airport's In -Flight Catering Facility, a draft copy of which is attached hereto. The lease shall be in a final form acceptable to the City Solicitor or Assistant City Solicitor. IN CITY COUNCIL March 22, 2010 Passed DEPUTY CITY CLERK (T1TLE,)_Authnrizing the Bangor International Airport to enter into a Lease Agreement with the RAFS. Inc for Airport's In -Flight Ca a ing Facility Assigned to Coune, 10 IN AGREEMENT OF LEASE THIS AGREEMENT OF LEASE, executed in duplicate, this _ day of , 2010, by and between: City of Bangor, a municipal corporation duly Organized and existing under and by virtue of the laws of the State of Maine, and having its principal offices at 73 Harlow Street, Bangor, Maine (hereinafter sometimes referred to as "Lessor") AND BAFS INC., a corporation organized and existing under the laws of the State of Maine, and having a regular place of business at 61 Florida Avenue, Bangor, Maine (hereinafter referred to as "Lessee") WITNESSETH: WHEREAS, the lessor is the owner of an airport commonly known as "Bangor International Airport", formerly known as Dow Air Force Base, and located in the City of Bangor, County of Penobscot, State of Maine (hereinafter sometimes referred to as the "Airport"); and WHEREAS, by an agreement dated January 10, 2000 the parties agreed to lease Buildings 4266, #268 and a parcel of land which abuts and is situated between such buildings for the purposes of operating an airline catering and food service facility; and WHEREAS, the above said five year agreement with the five year extension terminated on December 31, 2009; and WHEREAS, the parties desire to enter into a new lease. NOW, THEREFORE, the parties do mutually agree as follows: ARTICLE I PREMISES The Lessor, for and in consideration of the rents to be paid and the obligations to be performed by Lessee as hereinafter provided, does hereby demise and lease into Lessee, and the Lessee does hereby take and hire, upon and subject to the terms and conditions hereinafter expressed, the following described premises located at Florida Avenue in the City of Bangor, viz.: Buildings #266, and #268 and a parcel of land which abuts and is situated between such buildings located at Florida Avenue: Bangor International Airport, Bangor, Maine, said Buildings to be leased to contain a total of 20,525 square feet. ARTICLE II TERM TO HAVE AND TO HOLD the demised premises unto the Lessee for the term of five (5) years commencing January 1, 2010 and terminating on December 31, 2014. With the option of both parties to extend the above said agreement five (5) years commencing January 1, 2015 and terminating on December 31, 2019. ARTICLE III COMPUTATION OF ANNUAL RENTAL A. The minimum rent to be paid by Lessee to Lessor during the term of this Lease shall be Twenty-seven Thousand Five Hundred ($27,500.00) Dollars per year. Minimum rent shall be paid monthly in advance on the first day of each and every month in the amount of two Thousand Ninety-one Dollars and Sixty -Seven ($2, 291.67) cents. B. Percentage Rent — In addition to minimum rental, the Lessee shall pay to the Lessor each year a percentage of annual Gross Sales (as defined in subparagraph C hereof) except as may be set out pursuant to subparagraph (E) hereof, in accordance with the following schedule: 5.5% of the first $250,000 of annual Gross Sales that exceed $1 million, 6.6% of the next $ 250,000 of Gross Sales that exceed $1.25 million, and 8% of all Gross Sales in excess of $1.5 million. C. Gross Sales as herein used are defined to mean the entire amount of the actual cash received for all food, beverages and related products made on or from the premises for delivery to aircraft at Bangor International Airport, but shall not include, however, any sums collected, charged and/or paid out for any equipment, handling / service charges, liquor handling charges, sales and/or excise taxes imposed by any duly constituted governmental authority and charges for pure services. D. Commencing promptly after the execution and delivery of this Lease, the Lessee shall report to the Lessor within thirty (30) days at the end of each accounting period on the Gross Sales in such accounting period and cumulatively from the commencement of the Lessee's fiscal year. Simultaneously with the submission of such reports for each accounting period, the Lessee shall pay to the Lessor any percentage rent that may be due for such cumulative period less any percentage rent previously paid. Within 120 days after each calendar year, Lessee shall submit to the Lessor a statement of Gross Sales for the year previously terminated certified by its principal financial officer to be accurate and in accordance with standard practices of accounting. Simultaneously with the submission of such annual report, the Lessee shall pay to the Lessor the amount of percentage rent for such year less any payments of percentage rent previously made for such year. The Lessor shall repay to the Lessee, promptly after the submission of the annual report, any overpayments that the Lessee may have made to the Lessor; in the event the Lessor 2 10 1CT shall fail to make such payments, the Lessee may set such payments off against the next ensuing installments of minimum and percentage rent. E. If during the term of this Lease or any extension hereof, the premises or any portion thereof or the Airport itself is closed for a period in excess of five consecutive days by action of any public authority for any reason other than weather, the annual minimum rental herein shall be forgiven by such period in an amount determined by the ratio of the days closed to 365 applied to the annual minimum rent then in effect. Such amount shall be applied to the payment of the next monthly installment (s) of minimum rent due. The term's "year" and "quarter" may, at the option of the Lessee, be adjusted to the accounting periods of the Lessee's fiscal year. F. Lessee shall pay all rentals herein required, without prior demand therefor, in lawful money of the United States, at the address of the Lessor as set forth herein or at such other reasonable places as the Lessor may designate. Late payments shall be subject to an additional interest charge of one and one — half (1.5%) per cent per month to the date of payment. INVESTMENT The Lessee agrees to make investment to the facility or equipment, or fixtures of not less than $100,000 during the initial five year term of the agreement. ARTICLE IV RIGHT OF AUDIT A. If the Lessor objects to any annual statement which the Lessee is required to submit to the Lessor under the terms of this Lease, the Lessor shall give notice within ninety (90) days after receipt of such statement to Lessee of such objection. Unless within ninety (90) days after receipt by Lessee of such notice of objection, Lessee shall satisfy the Lessor with respect to such statement thus complained of, the Lessor shall have the privilege of having an audit made, at its expense, of the account books and records relating to the Gross Sales of the Lessee. The Lessee shall render all reasonable assistance to the auditor selected by the Lessor and shall give him access to all books of account and other records that may be necessary to enable such auditors to verify such reports of Gross Sales. B. The Lessor's objection to any statement submitted by the Lessee shall not in any way impair the Lessee's obligation to pay rent based on the statement submitted. The Lessor's acceptance of such payment shall in no manner constitute a waiver of any right under this Lease or a waiver of the right to receive any percentage rental ultimately determined to be owing to the Lessor by the Lessee. ARTICLE V USE, OCCUPANCY AND ALTERATIONS TO PREMISES. A. Lessee shall have the right to use, occupy and maintain the demised premised herein leased in a reasonably businesslike, careful, clean, and non -hazardous manner for the purposes of operating an inflight dining and services facility which includes, an onboard duty free storage and packing, aircraft servicing products, foreign waste processing, and as a food, 10 1C7 beverage and related products production and storage facility. The Lessee may use the facility for additional commercial food preparation services and for no other purposes whatsoever without the prior written consent of the Lessor. No retail sale of products shall be conducted on the premises. B. Lessee shall not use, occupy or maintain said premises in any manner as to violate any municipal, State, federal laws or regulation, and in particular, regulations of the Federal Aviation Administration relating to the operation of Bangor International Airport as a public airport. C. Lessee shall make a good faith effort to inform its employees and visitors of the rules and regulations of the Bangor International Airport and shall cooperate in every way with the Executive Manager of the Banair Corp. and the Airport Manager to insure that such rules and regulations are obeyed. D. Lessor, through its agents, shall have at all reasonable times the right, upon reasonable notification to the Lessee, to go on and inspect the premises with an authorized representative of the Lessee, and the right of access to utility systems located on premises, for inspection. For purposes of this paragraph, "reasonable notification" shall include any actual notification to date of inspection, "reasonable times" shall mean any time during Lessee's regular business hours, or during normal weekday business hours if Lessee shall cease operations or shall maintain other than normal business hours. Lessor reserves the right to effect emergency repairs to any utility systems located on the demised premises at any time, without prior notice or with such notice as is reasonable given the nature of the emergency concerned, and to have access for this purpose. E. Lessee shall have the right to make alterations and improvements to the premises as it may choose, subject to the prior written approval of the Airport Manager, which shall not be unreasonably withheld, and provided that such alterations, additions and improvements do not weaken the structural integrity of the buildings, nor decrease its functional quality or value, and further provided that any such work shall be done entirely at the Lessee's own expense and will include returning disrupted surfaces to a serviceable and attractive condition. F. Lessee shall have the right to (a) fence, secure, grade and surface the demised premises; (b) install such additional outdoor lighting, including flood lighting, as Lessee deems necessary, provided that such outdoor lighting complies with applicable F.A.A. Regulations, and the right to (c) erect signs on the leased premises, provided that such signs comply with the city's sign ordinance and applicable F.A.A. Regulations. ARTICLE VI HAZARDOUS WASTE Lessee hereby covenants and agrees that it shall not, during the term of this Lease, including any extension or renewal hereof, permanently place, cause to be placed, deposit or discharge any hazardous waste upon the demised premises, or upon any other portion of Lessor's Bangor International Airport, and further expressly agrees that it shall indemnify Lessor from any and all costs, expense or liability, of whatever kind or nature, incurred by the Lessor in detecting, evaluating, removing, treating, disposing of or otherwise responding to any hazardous waste placed or deposited in violation of this Article. 4 10 I Lessee hereby covenants and agrees that it shall not, during the term of this Lease, including any extension or renewal hereof, violate any local, state or Federal regulation, ordinance or statute pertaining to hazardous waste or hazardous material and further expressly agrees that it shall indemnify Lessor from any and all costs, expense or liability, of whatever kind or nature, incurred by the Lessor for any such violation. Such costs shall be deemed to include, without limitation, Lessor's costs of defending any suit filed by any person, entity, agency, or governmental authority; paying any fines imposed in settling any damage claims; complying with any order by a court of competent jurisdiction directing the Lessor to take remedial action with respect to such waste; and of all associated attorney's fees and costs. For the purposes of this Article, the term "hazardous waste" shall be deemed to include every substance now or hereafter designated as a hazardous waste under any provision of State or Federal law. However, it is understood the Lessee does process foreign waste from international arriving aircraft and sea vessels under the guidelines and inspection of the United States Department of Agriculture. Lessee's obligations under this Article shall be deemed to survive the expiration or termination of this lease. ARTICLE VII LIABILITY AND PROPERTY DAMAGE INSURANCE The Lessee during the entire term of this Lease, or any extension thereof, shall maintain, at its sole expense, insurance of the following types with companies authorized to do business in the State of Maine, and for the protection of the City of Bangor, who shall be named as an additional insured against all claims, losses, costs or expenses arising out of injuries to persons whether or not employed by Lessee or damage to property whether resulting from acts, omissions, negligence or otherwise of the resulting from acts, omissions, negligence or otherwise of the Lessee, its directors, officers, employees and agents and arising from Lessee's use of the premises or any part or portion thereof. COMPREHENSIVE PUBLIC LIABILITY Bodily Injury $1,000,000.00 each occurrence Property Damage $1,000,000.00 each occurrence Umbrella $10,000,000.00 Worker's Compensation Insurance Lessor shall not be required to provide insurance coverage and shall have no responsibility for any property owned by the Lessee or third parties which may be located on the demised premises, except negligence or other fault of the Lessor, its employees or agents. 10 IC7 Lessee shall cause to be furnished to the Lessor evidence in the form of certificates of insurance of the existence and continuance in form of the insurance required hereunder. Lessor shall be notified of any changes or discontinuance of coverage. The minimum insurance coverage required under this Article shall be deemed to be automatically adjusted whenever the Maine State Legislature shall increase the Lessor's maximum liability for personal injury or property damage claims brought under the Maine Tort Claims Act. In the event of such an increase, the minimum insurance coverage required shall be no less than the Lessor's maximum liability for such claims under the Maine Tort Claims Act. ARTICLE VIII INDEMNITY Lessee shall protect, defend and hold Lessor, and its inhabitants, officers, employees and agents completely harmless from and against any and all liabilities, losses, suits, claims, judgments, fines or demands arising by reason of injury or death of any person or damage to any property, including all reasonable costs for investigation and defense thereof (including but not limited to attorneys fees, court costs, and expert witness fees), of any nature whatsoever arising out of or incident to this agreement and/or the use or occupancy of the leased premises or the acts or omissions of Lessee's officers, agents, employees, contractors, subcontractors, licensees, or invitees, unless such injury, death, or damage is caused by the negligence of the Lessor. The Lessor shall give to Lessee reasonable notice of any such claims or actions. The Lessee shall also use counsel reasonably acceptable to Lessor in carrying out its obligations hereunder. Lessee's Waiver of Workers' Compensation Immunity — The Lessee hereby expressly agrees that it will defend, indemnify and hold the City of Bangor, its inhabitants, officers, employees and agents completely harmless from any and all claims made or asserted by the Lessee's agents, servants or employees arising out of the Lessee's activities under this Lease. For this purpose, the Lessee hereby expressly waives any and all (except for any negligence or other fault of the Lessor, its employees or agents) immunity it may have under the Maine Workers' compensation Act in regard to such claims made or asserted by the Lessee's agents, servants or employees. The indemnification provided under this paragraph shall extend to and include any and all costs incurred by the City of Bangor to answer, Investigate, defend and settle all such claims, including but not limited to the City of Bangor's costs for attorneys fees, expert and other witness fees, the cost of investigators, and payment in full of any and all judgments rendered in favor of the Lessee's agents, servants or employees against the City of Bangor in regard to claims made or asserted by such agents, servants, or employees. ARTICLE IX RULES, REGULATIONS AND LAWS A. The premises herein leased are located upon the property of the Lessor and commonly known as Bangor International Airport. Therefore, the Lessee hereby agrees to obey and observe, and to cause all personnel employed by the Lessee to obey and observe all municipal ordinances, and State and Federal laws pertaining to the demised premises. In addition, Lessee shall obey and observe all reasonable orders, rules and regulations of the Airport Manager not inconsistent with this Lease or with the aforesaid rules and regulations which are uniform, and apply to all Lessees, invitees and users of the Airport and their employees. 10 107 B. Lessee will not use or permit or suffer the use of the leased property in such a manner as to create electrical interference with radio communication between any installation upon the Airport and aircraft, or as to make it difficult for flyers to distinguish between Airport lights and others, or as to impair visibility in the vicinity of the Airport, or as otherwise to endanger the landing, taking off or maneuvering of aircraft. Further, Lessor retains a right for the passage of aircraft ("aircraft" being defined as any contrivance now known or hereafter invented, used or designed for navigation of or flight in the air) by whomsoever owned and operated, in the airspace above the property above 342.4' MSL to an infinite height together with the vibrations, fumes, dust, fuel particles and all other effects that may be caused by the operation of aircraft landing at, or takeoff from, or operating at or on the Airport and Lessee doeshereby fully waive, remise and release any right or cause of action which they may now have or which they may have in the future against lessor due to such noise, vibrations, fumes, dust, fuel particles, and all other effects that may be caused by the operation of aircraft landing at or takeoff from or operating at or on the Airport. ARTICLE X DAMAGE BY FIRE OR OTHER CASUALTY Lessor is not required to insure the demised premises against loss by fire and the extended coverage usual in such insurance. In the event of destruction or damage of buildings owned by Lessor on the demised premises, or to any part thereof, and as often as the improvements shall be damaged by fire or other Casualty, Lessor shall have the right, but not the obligation to rebuild and repair the building for occupancy. If Lessor elects not to rebuild and repair, it shall so notify Lessee within thirty (30) days or more expeditiously if possible of its decision. In the event the damages are of such extent as to reasonably prevent Lessee from operating within the demised premises, then Lessee shall have the right to terminate this Lease and shall notify Lessor within the aforementioned time period, and Lessee's obligation to pay rent as hereinabove provided shall terminate upon receipt of such notice by the Lessor and surrender of the premises by the Lessee. ARTICLE XI NOISE CLAIMS The Lessee specifically agrees to make no claims in any form for damages or reimbursements to the Lessor or to the United States Government for any reason or cause resulting from noise generated from airport uses. ARTICLE XII TAXES The Lessee agrees to pay, when due, any and all taxes and/or assessments, fees or charges of any kind whatsoever, as may be imposed during the term hereof, or any extension of the term of this Lease, by any governmental authority upon the demised premises, including Lessee's leasehold interest therein, any structures, or improvements thereon, or any personal property located therein. It is expressly agreed that such taxes and assessments shall include all amounts levied as real estate taxes upon the demised premises by the Lessor acting in its governmental 10 1C7 privileges of exemption from taxation on the demised premises, or structures, or improvements thereon, or on any personal property located therein arising due to public ownership of the demised premises by the City of Bangor, or otherwise; provided, however, nothing herein shall in any way prohibit the Lessee form exercising its rights under the law to contest the amounts of such taxes, assessments, charges or fees. Lessee also waives all rights under 36 M.R.S.A. § 556 to retain taxes paid by it out of rentals established under this lease. ARTICLE XIII NONDISCRIMINATION Lessee for itself, its personal representatives, successors in interest and assigns, and as part of the consideration hereof, does hereby covenant and agree that: (1) no person or group of persons on the grounds of race, color, age, sex, handicap, or national origin, or in any other manner prohibited by law, shall be excluded from participation in, denied the benefits of, or be otherwise subjected to discrimination in the Lessee's use or Occupancy of said demised premises; (2) in the construction of all improvements, buildings, structures, on, over, or under such land and the furnishing of services thereon, no person or group of persons on the grounds of race, color, age, sex, handicap, or national origin or in any other manner prohibited by law, shall be excluded from participation in, denied the benefits of, or be otherwise subjected to unlawful discrimination in the Lessee's use or occupancy of the demised premises; and (3) Lessee shall use the premises in complicate with all other requirements imposed by or pursuant to Title 49, code of Federal Regulations, Department of Transportation, Subtitle A, office of the Secretary, part 21, Nondiscrimination in Federally -Assisted Programs of the Department of Transportation — Effectuation of Title VI or the Civil Rights Act of 1964, and as said regulations may be amended. In the event Lessor shall have the right, after failure of Lessee to rectify such breach within thirty (30) days after receipt of notice from Lessor, to terminate this Lease. Provided, however, that Lessor shall not have the right to terminate this Lease under this Article with respect to any complaint of discrimination which is pending final resolution or adjudication before any agency or court of the State of Maine or the United States. ARTICLE XIV COVENANTS OF QUIET ENJOYMENT The Lessee, subject to the terms and provisions of this Lease on payment of the rent, and observing, keeping and performing all the terms and provisions of the lease on its part to be observed, kept and performed, shall lawfully, peaceably and quietly have, hold, occupy and enjoy the demised premises during the term hereof without hindrance or rejection by the Lessor or any other persons. ARTICLE XV LIENS The Lessor and the Lessee agree that each will promptly discharge (either by payment or by filing of the necessary bond or otherwise) any mechanics' materialman's or other liens against the demised premises, which liens may arise out of any payment due for labor, services, materials, supplies or equipment which may have been furnished to or for the Lessee or the Lessor, respectively. 10 I ARTICLE XVI MAINTENANCE AND REPAIRS; ASBESTOS ADJUSTMENT (A) Lessee shall, at its sole expense and cost, throughout the term hereof or any extension, keep and maintain the demised premises including building fixtures, equipment, doors, windows, passageways, interior and exterior paint surfaces, grounds, and landscaping in good order and repair, and in tenantable condition, damage by accidental fire and casualty and reasonable wear and tear, as provided for in this Agreement excepted. (B) The phrase "reasonable wear and tear" used in paragraph A of this Article as an exception to the obligations of the Lessee shall not be construed to relieve Lessee of the responsibility for providing repairs of a routine and regular nature which may from time to time be necessary, nor to provide maintenance to the demised premises of a nature and degree ordinarily sufficient to prevent damage, breakdown, failures, malfunctions or disrepair; nor shall any exception or special provision of this Agreement be construed to mean that Lessor would be required to carry out maintenance and repairs to the premises. Lessor shall, at its sole expense be responsible for maintenance and repairs to the premises. Lessor shall, at its sole expense and cost, throughout the term hereof or any extension, be responsible for the repair and removal of any asbestos in the demised premises. Lessor assumes all liability with regard to said asbestos, excepting any claim arising from Lessee's negligence. ARTICLE XVII UTILITIES Lessee shall pay the cost of all utilities furnished and consumed on the demised premises, including electricity, gas, heat, water and sewer user fees. Lessee accepts all utility fixtures as they now exist. All new utility fixtures shall be installed and maintained by the Lessee. Lessee is responsible for all snow and rubbish removal. ARTICLE XVIII REMOVAL OF PROPERTY A. Ownership of permanent improvements to the demised premises, which may from time to time be made by Lessee that are affixed to the property and are an integral part of the operating systems of the structures as opposed to removable personal property, shall automatically vest in the Lessor as a consideration of the lease and rental schedule. B. Any removable personal property that may be financed, erected or installed by Lessee from time to time during the term of this Lease shall remain the property of the Lessee, and, upon termination or expiration of this Lease, lessee shall have the right to remove the same from the demised premises within ninety (90) days of said termination. Any such property not so removed within ninety (90) days from the date of termination shall become the property of the Lessor to be disposed of in such way, as it may deem fit. In the event Lessee elects to remove said improvements and other personal property, the buildings and land appurtenant thereto shall be returned to as near as possible their conditions as at the commencement of this Lease, damage by accidental fire and casualty and reasonable wear and tear excepted. iC 1C"7 C. In the event Lessee shall fail to remove any non -permanent improvements or other personal property within thirty (30) days from the date of termination or final expiration of this lease, Lessor shall be entitled to recover from the Lessee, Lessor's reasonable costs incurred in removing or disposing of such non -permanent improvements or personal property. In such event, there shall be deducted from Lessor's costs the fair value to the Lessor actually realized from sale, use or other disposition of the particular improvements or personal property concerned. ARTICLE XIX OTHER CATERING SERVICES At any time during the term of this agreement or any extension thereof of this Lease, the lessor shall not enter into a lease or other agreement with third parties concerning or covering the operation of Inflight dining and services at or on the Airport. However, the Lessor may terminate this agreement under the conditions referred to in Article XXI of this agreement. Any airline, scheduled or non — scheduled, which desires to build its own commissary facilities to serve its own airline exclusively shall be free to do so under terms and conditions set by the Lessor. ARTICLE XX UNITED STATES RIGHTS It is understood and agreed that title to the demised premises is in the city of Bangor, provided, however, that the demised premises are a part of Bangor International Airport and this Lease is specifically made subject to nay rights the United States of America or any agency thereof may have under any regulation, law, deed or other existing agreement in or to the leased premises and may exercise in regard to said premises and should the United States of America or any agency thereof exercise any such right or rights in or to said premises, the exercise of such rights shall not be considered to result in a breach by the Lessor of any covenant or agreement hereunder. In the event that the United States of America or any agency thereof exercise any such right or rights in or to said premises, and the exercise of such right or rights makes impractical in the Lessee's sole discretion Lessee's intended use of said premises, then Lessee shall have the right, at its option, to terminate this Agreement without further obligation to the Lessor except for such obligations as shall have been incurred and accrued prior to the exercise of said option. ARTICLE XXI TERMINATION It is covenanted and agreed that: A. By Lessee: (1) If the Lessee shall neglect or fail to pay the rent or other charges payable hereunder and such default shall continue for a period of ten (10) days after written notice thereof by Lessor; or H 10 107 (2) If Lessee shall neglect of fail to perform or observe any of the other covenants, terms, provisions, or conditions on its part to be performed, or observed, and such neglect or failure shall continue for a period of thirty (30) days after written notice thereof by Lessor, or if such covenants, terms, provisions or conditions cannot be performed or observed within said thirty (30) day period, if Lessee fails to diligently prosecute the curing of such neglect of failure; or (3) If the estate hereby created shall be taken on execution or by other process of law; or (4) If any assignment shall be made of the property of the Lessee for the benefit of creditors or (5) If a receiver, guardian, conservator, or trustee in bankruptcy or other similar officer shall be appointed to take charge of all or any substantial part of the Lessee's property by a Court of competent jurisdiction; or lawfully may, immediately or at any time thereafter, and without demand or notice, enter into and upon the said premises or any part thereof, in the name of the whole and repossess the same as of the Lessor's former estate, and expel the Lessee and those claiming through or under it and remove its or their effects (forcibly, if necessary) without prejudice to any remedies which might otherwise be used for arrears of rent or preceding breach of covenant, and upon entry as aforesaid, this Lease shall terminate, and the Lessee covenants and agrees to pay and shall be liable for the days originally fixed herein for the payment thereof, amounts equal the several installments of rents and other charges reserved as they would, under the terms of this Lease, become due if this Lease had not been terminated, or if the Lessor had not entered or reentered as aforesaid. Notwithstanding the foregoing, Lessee's liability shall not exceed the difference, if any, between the rental which would have been due for such month had there been no such termination, and the amount being received by Lessor as rent from occupants of said premises. In order to mitigate Lessee's damages hereunder, Lessor agrees to make every reasonable effort to secure subsequent Lessees, at a rental equal to the prevailing local rate for the demised premises. Upon any termination under this Article, the Lessee shall vacate the premises in accordance with the terms and conditions hereof and with all due speed; and within thirty (30) days after such termination, the Lessee shall pay to the Lessor all sums due from the Lessee to the Lessor hereunder prior to termination. B. By Lessor: This Lease shall be subject to termination by the Lessee in the event of the happening of one or more of the following contingencies: (1) If the Lessee shall default in the performance of any of the conditions and covenants of this Lease to be kept and observed by it and such default shall not be remedied within a period of thirty (30) days after written notification by the Lessee to the Lessor of the existence of such default. (2) If, at any time during the term of this Lease, or any extensions thereof, the business volume, in the sole opinion of the Lessee as reasonably demonstrated to the Lessor by 10 lel the Lessee is not of such volume as to be economically feasible and profitable, upon the giving by the Lessee to the Lessor of written notice of termination contained in said notice. ARTICLE XXII ATTORNEY'S FEE The Lessee shall pay to the Lessor a reasonable attorney's fee in the event the Lessor employs an attorney to collect any rents due hereunder and secures a judgment in connection with collection of said rent, or legal process is levied upon the interest of the Lessee in this Lease or in said premises, or in the event Lessee violates any of the terms, conditions or covenants on the part of notice that it is in violation thereof. In the event Lessor employs its City Solicitor or an assistant solicitor to collect rents or otherwise protect Lessor's interests under this Lease, "reasonable attorneys fees" under this Article shall mean the reasonable value of services provided by Lessor's Solicitor or assistant solicitor at prevailing rates for Lessee a reasonable attorney's fee if Lessee employs an attorney in the event the Lessor violates any of the terms, conditions or covenants on the part of the Lessee herein contained, provided said Lessor fails to promptly correct the violation of any term, condition or covenant after receipt of notice that it is in violation thereof. ARTICLE XXIII ASSIGNMENT, SALE AND SUBLETTING The Lessee shall not at any time assign, sell, convey or transfer this Lease or any interest therein, or sublease or sublet or rent the premises, or any part thereof, without the prior written consent of the Lessor. All provisions of this Lease shall extend to, bind and inure to the benefit of not only the Lessor and Lessee but also their successors and assigns. In no event shall the Lessee named herein be relieved from any obligations under this Lease by virtue of any assignment or subletting. Lessee shall have the right to assign this Lease to any corporation with which it may have become merged, consolidated, or otherwise associated, or to any corporation or holding company having the controlling interest in the Lessee, or to any corporation which may be a subsidiary of the Lessee. In no event, however, shall the Lessee named herein be relieved from any obligations under this Lease by virtue of any such assignment or subletting. ARTICLE XXIV WAIVER Failure on the part of the either party to complain of any action or nonaction on the part of the other party no matter how long the same may continue, shall never be deemed to be a waiver by either party of any of either party's rights hereunder. Further, it is covenanted and agreed that no waiver at any time of any of the provisions hereof by either party, shall be construed as a waiver of any other provisions hereof, and that a waiver at any time of any of the provisions hereof shall not be construed at any subsequent time as a waiver of the same provisions. The approval of Lessor of any action by the Lessee requiring the Lessor's consent or 12 10 loll? approval shall not be deemed to waive or render unnecessary the Lessor's consent or approval to or of any subsequent similar act by the Lessee. ARTICLE XXV NOTICES Notices to the Lessor provided for in this Lease shall be sufficient if sent by registered or certified mail, return receipt requested, postage prepaid, to: City Manager, City of Bangor, City Hall, 73 Harlow Street, Bangor Maine, 04401 with a copy to Airport Director, Bangor International Airport, 287 Godfrey Boulevard, Bangor, Maine_04401; and notices to Lessee, are to be sent by registered or certified mail, return receipt requested, postage prepaid, addressed to: BAFS INC., 61 Florida Avenue, Bangor, Maine, 04401; or to such other respective addresses as the parties may designate to each other in writing from time to time. ARTICLE XXVI INVALIDITY OF PARTICULAR PROVISIONS If any term or provision of this Lease or the application thereof to any person or circumstances to any extent, be invalid or unenforceable, the remainder of this Lease or the application of such terms and provisions to persons or circumstances other than those to which it is held invalid or unenforceable shall not be affected hereby and such term and provision of this Lease shall be valid and be enforceable to the fullest extent permitted by law. ARTICLE XXVII CONSTRUCTION The headings appearing in the Lease are intended for convenience and reference only, and not to be considered in construing this Lease. Nothing contained herein shall be deemed or construed by the parties hereto, nor by any third party, as creating the relationship of principal and agent or of partnership or of joint venture between the parties hereto, it being understood and agreed that neither the method of computation of rent nor any other provision contained herein or any acts of the parties hereto shall be deemed to create any relationship between the parties hereto shall be deemed to create any relationship between the parties here to other than the relationship of landlord and tenant. ARTICLE XXVIII GOVERNING LAW This Lease shall be governed exclusively by the provisions hereof and by the laws of the state of Maine, as the same may from time to time exist. AMENDMENT TO LEASE ARTICLE XXIX 13 10 loll? This Lease contains all the terms and conditions between the parties hereto and no alteration, amendment or addition thereto shall be valid unless in writing and signed by the party against whom enforcement may be sought. ARTICLE XXX EXECUTION OF AGREEMENT A. The Lessor hereby represents and warrants that it has taken all necessary procedural and legal steps as required under all state, local and federal laws and regulations whatsoever for the purpose of authorizing the execution of this Agreement, and this Agreement a valid and binding document on the part of the Lessor and is fully enforceable in all of its terms and conditions by the Lessee. B. Lessee hereby represents and warrants that it has taken all necessary procedural and legal steps as required under all state, local and federal laws and regulations, and all necessary corporate action to authorize the execution of this Agreement by one of its officers and that the execution of this Agreement is a binding and legal document on the part of the Lessee, and is fully enforceable in all of its terms and conditions by the Lessor. IN WITNESS WHEREOF, the parties hereto have set their hands and seals the day and year first written above. WITNESS: 14 CITY OF BANGOR BY: ITS: BAFS INC. BY: ITS: