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HomeMy WebLinkAboutLimited Term Full Service Aiport Lease Agreement SpanaFlight LLC LIMITED-TERM FULL-SERVICE AIRPORT LEASE AGREEMENT BETWEEN THE CITY OF AUBURN AND SPANAFLIGHT, LLC THIS LEASE AGREEMENT (the "Lease"), is entered into this ist-ucyA 5-►- j 8 , 2026 (the "Lease Date") by the City of Auburn, a Washington municipal corporation (the "Landlord" or "City") and SpanaFlight, LLC, a Washington limited liability company (the "Tenant") (UBI# 603 384 103). I. RECITALS 1. The City owns and operates The Auburn Municipal Airport (the "Airport") which has space available for lease. RCW 14.08.120(1)(d) authorizes the City to lease Airport property; and 2. Tenant requires temporary space to conduct its operations during the closure of the runway at its home airport, Thun Field, and Landlord has available space suitable for Tenant's operations. 3. The total value of this Lease does not require approval by the Auburn City Council pursuant to Auburn City Code 3.10.010(d). NOW, THEREFORE, in consideration of their mutual promises set out in this Lease, Spanaflight, LLC and The City of Auburn agree as follows: II. AGREEMENT ARTICLE 1: PREMISES LEASED 1.1. For and in consideration of the rent and performance by Tenant of the terms and conditions and the mutual covenants in this Lease, Landlord agrees to lease to Tenant, and Tenant agrees to lease from Landlord, the office building located at 400 23rd St. NE (the "400 Building") together with three (3) tie-downs (collectively the "Premises"). Tenant shall also have the non-exclusive use of the seven(7) automotive parking stalls located directly to the east of the 400 Building. The Premises is located in the City of Auburn, King County Washington, at the Auburn Municipal Airport (the "Airport"). A depiction of the Premises and automotive parking lot is attached for reference as Exhibit A. 1.2. Tenant acknowledges and agrees that it is relying solely on its inspection and investigation of the Premises, and accepts the property "AS-IS, WHERE IS" in its present condition with no warranties of any kind, expressed or implied, either oral or written, made by Landlord or any employee, agent or representative of Landlord with respect to the physical condition of the Premises. Tenant shall have determined to its satisfaction upon its execution hereof that the Premises can be used for the purposes it intends and which are described in Article 4 below and permitted under this lease. Tenant acknowledges and agrees that neither Landlord nor Landlord's SpanaFlight,LLC/COA Limited-Term Full-Service Lease 400 Building+3 tie-downs Page 1 of 18 employees,agents,representatives or otherwise have made,and does not make any representations or warranties of any kind or character whatsoever, whether expressed or implied, with respect to the habitability, leaseability or suitability for commercial purposes, merchantability, or fitness for a particular purpose of the Premises. The presence or absence of any hazardous substances,wastes or materials as defined by State, Federal or Local Law, all of which warranties Landlord hereby expressly disclaims.Landlord does represent that,to the best of the Landlord's knowledge,without duty of inquiry, there are no hazardous wastes or materials on, in or under the Premises. ARTICLE 2: TERM The "Term" of this Lease shall begin on August 1, 2026 (the "Commencement Date"), and terminate at midnight on November 30,2026(the"Termination Date"). ARTICLE 3: RENT As consideration for this Lease, Tenant shall pay Landlord total Rent in the amount of Seven Thousand Five Hundred Dollars ($7,500.00) for the entire Term. The Rent shall be paid in full prior to the Commencement Date. Unless expressly provided for in this Lease, the Rent is inclusive of leasehold excise tax, security fees, utilities servicing the Premises, and routine maintenance of the Premises. ARTICLE 4: PERMISSIBLE USES Tenant shall use the Premises for commercial aeronautical uses as a Fixed Base Operator(FBO) only. All FBOs are subject to the Airport Rules and Regulations and Minimum Operating Standards (found at https://auburnmunicipalairport.com/documents-and-forms) and Auburn City Code 12.56. FBO services may include some or all of the following: • Aircraft Leasing or Rental Services • Flight Training Services Additional services may be permitted at the discretion of the Landlord and may be subject to additional requirements. Tenant agrees to remain compliant with the most current version of the Auburn City Code,Airport Rules and Regulations and Minimum Operating Standards as they may be updated and amended during the Term of this Lease. SpanaFlight,LLC/COA Limited-Term Full-Service Lease 400 Building+3 tie-downs Page 2 of 18 ARTICLE 5: INTENTIONALLY LEFT BANK ARTICLE 6: MAINTENANCE &JANITORIAL 6.1. Maintenance—Landlord shall be responsible at its sole cost and expense for routine repair and maintenance of the Premises unless such repair or maintenance is caused by the misuse or negligence of the Tenant. In the event damage is caused by the misuse or negligence of the Tenant, Landlord shall perform,or cause to be performed the necessary repairs,and Tenant shall reimburse Landlord for the actual cost of such repairs, plus an administrative fee equal to ten(10%)percent of the repair cost. 6.2. Janitorial — Tenant shall, at its sole cost and expense, provide all janitorial services necessary to keep the Premises clean,neat, sanitary, and presentable at all times. 6.3. Natural Disaster or Act of God—In the event that the Premises is damaged due to a natural disaster or act of God, if the cost of repairing or reconstructing the Premises to the condition and form immediately prior to such damage or destruction does not exceed thirty-three percent(33%) of the then new replacement cost thereof, then Landlord shall effect such repair, restoration, and reconstruction of the Premises so damaged or destroyed to substantially their condition prior to said damage or destruction in a timely manner. All such work shall be carried out in accordance with plans and specifications prepared by a licensed architect or engineer if such an architect or engineer is reasonably required given the scope and nature of the work. In no event shall Rent or any other monies due by Tenant be abated during such period of reconstruction and/or restoration. 6.4. If the cost of repairing, restoring or reconstructing the Premises to the condition and form immediately prior to such damage or destruction exceeds thirty-three percent (33%) of the then new replacement cost thereof, then Landlord, in its sole discretion may elect by written notice to Tenant given within thirty (30) days after the date of the damage to terminate this Lease. If no notice of termination is given then all obligations set forth in this Lease shall continue, including but not limited to Rent obligations of the Tenant. In no event shall Landlord be responsible for damage to Tenant's personal property located on or within the Premises. 6.5. Damage Due to Fire—In the event of damage or destruction due to fire determined not to have been caused by Tenant then Sections 6.3 and 6.4 above shall apply. If however, the cause of the fire, as determined by the local Fire Authority is determined to have been caused by Tenant, one of Tenant's guests, agents, employees, students or otherwise then the cost of said repair, restoration, reconstruction or replacement of the Premises shall be borne by Tenant. Repairs, reconstruction or replacement of the Premises shall be done in a commercially reasonable manner and with the approval of the Landlord and all obligations under this Lease, including Rent shall remain in full force during such period of repair, restoration,reconstruction or replacement. ARTICLE 7: ENVIRONMENTAL PROVISIONS SpanaFlight,LLC/COA Limited-Term Full-Service Lease 400 Building+3 tie-downs Page 3 of 18 7.1. Tenant covenants to defend, indemnify, and hold Landlord harmless from any imposition or attempted imposition by any person upon Landlord of any obligation or cost ("liability") of whatever form, including, without limitation, damages; claims; governmental investigations, proceedings or requirements; attorney fees in investigation, at trial or administrative proceeding, or on appeal;witness or consultant costs;or any other liability to the extent that such liability arises from a violation, or from the failure to satisfy a requirement of any environmental or land use law or regulation, proximately resulting from Tenant's use of the Premises during the term of this Lease, and without regard to when the liability is asserted. 7.2. Tenant has inspected the Premises and accepts it in its present "As-Is" condition. Tenant shall not cause the Premises to be contaminated in any way and in the event of contamination shall immediately report such contamination to Landlord and shall cause any such contamination to be remedied by that method recognized by Washington State Department of Ecology and shall indemnify and hold Landlord harmless from all costs involved in implementing the remedy. 7.3. Any other provision of this Lease to the contrary notwithstanding, Tenant's breach of any covenant contained in this Article 7 shall be an Event of Default empowering Landlord,in addition to exercising any remedy available at law or in equity or otherwise pursuant to this Lease, to terminate this Lease and to evict Tenant from the Premises forthwith, or to terminate Tenant's right to possession only without terminating this Lease. 7.4. Tenant shall notify Landlord within twenty-four (24) hours of any release of a reportable quantity of any hazardous substance(as that term is defined in CERCLA,42 U.S.C. §9601,et. seq. or RCW 70A.305, the Washington Model Toxics Control Act), or of the receipt by Tenant of any notices, orders or communications of any kind from any governmental entity which relate to the existence of or potential for environmental pollution of any kind existing on or resulting from the use of the Premises or any activity conducted thereon. If Tenant fails to comply with any of the requirements of this article, Landlord may undertake, without cost or expense to Landlord, any actions necessary to protect Landlord's interest including steps to comply with such laws. ARTICLE 8: INSURANCE COVERAGE,INDEMNIFICATION /HOLD HARMLESS 8.1. Insurance — In accordance with Chapter 1.3 of the Auburn Municipal Airport's Rules & Regulations, Minimum Standards & Development Standards, as may be amended from time to time, a copy of which can be found at auburnmunicipalairport.com/documents-and-forms, and hereby incorporated by this reference, Tenant shall at all times have in effect the following types of minimum amounts of insurance, only as applicable to the business to be conducted by the Tenant: (I) Commercial General Liability insurance in the amount of$2,000,000 per occurrence and$2,000,000 annual aggregate. Such insurance shall contain contractual liability insurance covering applicable leases, licenses,permits, or agreements. SpanaFlight,LLC/COA Limited-Term Full-Service Lease 400 Building+3 tie-downs Page 4 of 18 (II) Commercial/business automobile liability insurance for all owned, non-owned and hired vehicles assigned to or used in performance of commercial aeronautical activities in the amount of at least$1,000,000 each accident.If any hazardous material,as defined by any local,state,or federal authority,is the subject,or transported,in the performance of this contract, a policy must be endorsed with the Insurance Services Office form CA9948 or equivalent. (III) Special Causes of Loss Property Form covering all improvements and fixtures on the Commercial Airport Operator's premises in an amount no less than the full replacement cost thereof, to the extent of the Commercial Airport Operator's insurable interest in the Premises. (IV) If the Tenant or Subtenant has employers,worker's compensation insurance is required by law and employer's liability insurance in the amount of$1,000,000 per accident, $1,000,000 disease per person, $1,000,000 disease policy limit is required by the Agreement. (V) If applicable, Aircraft liability insurance in the amount of at least $1,000,000 per occurrence single limit Bodily Injury and Property Damage Liability including Passengers. (VI) If applicable, Hangar keeper's liability insurance in the amount of at least $1,000,000 per occurrence, or more as values or Landlord require. (VII) If applicable, Products-completed operations liability insurance in the amount of at least$1,000,000 per occurrence. (VIII) If applicable, Tenant shall maintain Environmental Impairment Liability coverage for any underground or aboveground fuel storage facility, tank, underground or aboveground piping, ancillary equipment, containment system or structure used, controlled, constructed, or maintained by Tenant in the amount of $1,000,000 each incident, $2,000,000 aggregate. The policy shall cover on-site and off-site third-party bodily injury and property damage including expenses for defense, corrective action for storage tank releases and tank clean-up for storage tank releases. 8.2. Notwithstanding the foregoing, Tenant shall not be required to procure insurance inapplicable to its aeronautical business operations, on behalf of the aeronautical business operations of its approved Subtenants who have been approved by the Airport Manager subject to Article 9. Tenant will ensure that any Subtenant maintains all insurance requirements for the duration of the Lease. In addition to the types and amounts of insurance required in Article 8.1 above, Tenant and Subtenant shall at all times maintain such other insurance as the Landlord may reasonably determine to be necessary for Tenant's airport activities. 8.3. All insurance shall be in a form and from an insurance company with Best's financial rating of at least an A- (VII). All policies, whether carried by Tenant or Subtenant, except worker's compensation policy, shall name the City and its elected or appointed officials, officers, representatives,directors, commissioners,agents,and employees as "Additional Insured",and the Tenant and/or Subtenant shall furnish certificates of insurances evidencing the required coverage cited herein prior to engaging in any commercial aeronautical activities. Such certificates shall SpanaFlight,LLC/COA Limited-Term Full-Service Lease 400 Building+3 tie-downs Page 5 of 18 provide for unequivocal thirty (30) day notice of cancellation or material change of any policy limits or conditions. 8.4. The Tenant's(or Subtenants, as applicable) insurance coverage shall be primary insurance as respects Landlord. Any insurance, self-insurance, or insurance pool coverage maintained by Landlord shall be in excess of the Tenant's insurance and shall not contribute with it. 8.5. Indemnification/Hold Harmless. The Tenant shall defend, indemnify, and hold harmless Landlord, its officers, officials, employees and volunteers from and against any and all claims, suits, actions, or liabilities for injury or death of any person, or for loss or damage to property, which arises out of Tenant's use of Premises, or from the conduct of Tenant's business, or from any activity,work or thing done,permitted, or suffered by Tenant in or about the Premises,except only such injury or damage as shall have been occasioned by the sole gross negligence or willful misconduct of Landlord. Solely for the purpose of effectuating Tenant's indemnification obligations under this Lease, and not for the benefit of any third parties (including but not limited to employees of Tenant), Tenant specifically and expressly waives any immunity that may be granted it under applicable federal, state, or local Worker Compensation Acts, Disability Benefit Acts,or other employee benefit acts.Furthermore,the indemnification obligations under this Lease shall not be limited in any way by any limitation on the amount or type of damages,compensation or benefits payable to or for any third party under Worker Compensation Acts, Disability Benefit Acts,or other employee benefit acts.The parties acknowledge that the foregoing provisions of this Article have been specifically and mutually negotiated between the parties. ARTICLE 9: ASSIGNMENT AND SUBLETTING Neither this Lease nor any interest in this Lease therein may be assigned, mortgaged, transferred or encumbered, nor shall all or any part of the Premises be sublet (each of which, a "Transfer") without Landlord's prior written consent,which shall not be unreasonably withheld. If Tenant is a corporation,partnership,limited liability company,or any other entity,any transfer of a controlling ownership or voting interest in such entity or any transfer or attempted transfer of this Lease by merger, consolidation or liquidation shall be deemed a Transfer requiring Landlord's consent. Transfers include, without limitation, one or more sales or transfers, by operation of law or otherwise, or creation of new stock, by which an aggregate of more than fifty percent (50%) of Tenant's stock, or partnership or membership interests, as applicable, shall be vested in a party or parties who are non-stockholders or non-partners or non-members, as applicable, as of the date hereof (provided that the foregoing shall not apply if Tenant's stock is listed on a recognized national stock exchange or is traded over-the-counter). Any assignee or subtenant shall assume all of Tenant's obligations under this Lease and shall be jointly and severally liable with Tenant. Consent of the Landlord to any Transfer shall not operate as a waiver of the necessity for consent to any subsequent Transfer. In connection with each request for consent to a Transfer, Tenant shall pay to Landlord an amount equal to the"Transfer Fee"of the then current City fee schedule. If Landlord consents to any proposed Transfer, Tenant may enter into the same,but only upon the specific terms and conditions set forth in Tenant's Request for Consent; any such Transfer shall be subject to,and in full compliance with,all of the terms and provisions of this Lease;the consent SpanaFlight,LLC/COA Limited-Term Full-Service Lease 400 Building+3 tie-downs Page 6 of 18 by Landlord to any Transfer shall not relieve Tenant of any obligation under this Lease; Landlord may require the Tenant and the Transferee to execute a Landlord's consent form; and no Transfer shall be binding on Landlord unless Tenant and the Transferee deliver to Landlord a fully-executed counterpart of the document effecting the Transfer.If Landlord consents to a proposed assignment or sublease then Landlord may require Tenant to pay to Landlord a sum equal to fifty percent (50%) of any Rent and other consideration, profit or gain realized by Tenant from such sublease or assignment, in excess of the rent allocable to the transferred space then being paid by Tenant to Landlord pursuant to the Lease (after deducting the costs of Tenant, if any, in effecting the assignment or sublease, including reasonable alteration costs, commissions and legal fees). ARTICLE 10: UTILITIES 10.1. Utilities — With the exception of internet and communications services, Landlord shall furnish and pay for all standard utility services serving the Premises, including electricity, water, sanitary sewer, heating, and refuse collection, as applicable, the cost of which is included in the Rent. Tenant shall use all utilities in a reasonable and customary manner consistent with the Permitted Use and shall not install or operate any equipment that would unreasonably increase utility consumption without Landlord's prior written consent. 10.2. Internet&Communication Services—Tenant is responsible at its sole cost and expense for establishing and maintaining its own internet and communication services to furnish its Premises. Tenant agrees to ensure that its internet and communication services do not in any way interfere with Landlord's service or the publicly accessible internet broadband service.If Landlord provides notice to Tenant that Tenant's internet communication service is causing interference with Landlords service, the public service, or any other Airport transmittal system, Tenant agrees to take corrective action within 24 hours of notification. If Tenant does not take corrective action within 48 hours of notification, Landlord may take corrective action at Tenant's full cost and expense,including the cost of bringing in any professional(s)deemed necessary by Landlord,plus an additional 10% of the sum total for administrative purposes. Landlord agrees to provide reasonable access to Tenant or Tenants agents to those areas necessary in housing such internet and communications systems. 10.3. Except to the extent caused by the gross negligence or intentional misconduct of Landlord or its agents, employees or contractors, failure by Landlord to any extent to furnish or cause to be furnished the utilities or services described in this Lease, or any cessation or interruption thereof, resulting from any cause, including without limitation, mechanical breakdown, overhaul or repair of equipment, strikes, riots, acts of God, shortages of labor or material, compliance by Landlord with any voluntary or similar governmental or business guidelines,governmental laws,regulations or restrictions, or any other similar causes, shall not render the Landlord liable in any respect for damages to either person or property, for any economic loss or other consequential damages incurred by Tenant as a result thereof,be construed as an eviction of Tenant,result in an abatement of rent, or relieve Tenant from its obligation to perform or observe any covenant or agreement contained in this Lease. SpanaFlight,LLC/COA Limited-Term Full-Service Lease 400 Building+3 tie-downs Page 7 of 18 ARTICLE 11: ESTOPPEL 11.1. Estoppel Certificate—At the request of the Tenant in connection with an assignment of its interest in this Lease, Landlord shall execute and deliver a written statement identifying it as the Landlord under this Lease and certifying: (I) The documents that then comprise this Lease; (II) That this Lease is in full force and effect; (III) The amount of Rent and the date through which it has been paid; (IV) The remaining Term of this Lease; (V) That no amounts are then owed by Tenant to Landlord (or, if amounts are owed, specifying the same); and (VI) Whether to the Landlord's knowledge there are any defaults by Tenant under this Lease, or any facts which but for the passage of time, the giving of notice, or both, would constitute such a default. The assignee of Tenant's interest in this Lease shall be entitled to rely conclusively upon such written statement. ARTICLE 12: NOTICES Any notice, consent, approval or other communication given by either party to the other relating to this Lease shall be in writing, and shall be delivered in person, sent by certified mail, return receipt requested,sent by reputable overnight courier,or sent by other approved forms of electronic communication(with evidence of such transmission received)to such other party at the respective addresses set forth below (or at such other address as may be designated from time to time by written notice given in the manner provided herein). Such notice shall, if hand delivered or personally served, be effective immediately upon receipt. If sent by certified mail, return receipt requested, such notice shall be deemed given on the third business day following deposit in the United States mail, postage prepaid and properly addressed; if delivered by overnight courier, notice shall be deemed effective on the first business day following deposit with such courier; and if delivered by electronic communication,notice shall be deemed effective when sent. SpanaFlight,LLC/COA Limited-Term Full-Service Lease 400 Building+3 tie-downs Page 8 of 18 The notice addresses of the parties are as follows: To the City: Real Estate Division Attn: Josh Arndt/Real Estate Manager 25 West Main St. Auburn, WA 98001 253.931.3000 Jarndt@auburnwa.gov With Copies to: Airport Management Attn: Tim Mensonides/Airport Manager 2143 E Street NE Auburn, WA 98002 253.333.6821 Tmensonides@auburnwa.gov To the Tenant: SpanaFlight, LLC Attn: Doug Miller/Owner 16705 103rd Ave. Ct. E Puyallup, WA 98374 253.973.0419 Doug@spanaflight.com ARTICLE 13: INSPECTION,ACCESS AND POSTED NOTICES Landlord and any of its agents shall at any time upon seventy-two (72) hours advance written notice to Tenant have the right to go upon and inspect the Premises. Provided,however,that in the event the Landlord determines, in its sole and absolute discretion, that an emergency situation exists on or adjacent to the Premises, no advance notice to Tenant is required and Landlord may immediately go upon and inspect the Premises. Landlord shall have the right to serve, or to post and to keep posted on the Premises, or on any part thereof, any notice permitted by law or by this Lease, any other notice or notices that may at any time be required or permitted by law or by this Lease. Landlord shall not be liable in any manner for any inconvenience, disturbance, loss of business, or other damages arising out of Landlords entry on the Premises as provided in this Section except for such damage that is caused directly by, or through the gross negligence of, Landlord, their employees, agents, or representatives. ARTICLE 14: DEFAULT AND REMEDIES 14.1. Events of Default. Tenant will be in default("Default")under this Lease if: SpanaFlight,LLC/COA Limited-Term Full-Service Lease 400 Building+3 tie-downs Page 9 of 18 (I) any amount of Rent or other sums payable by Tenant to Landlord under this Lease remains unpaid for more than thirty(30) days after the date it is due; (II) Tenant files a voluntary petition in bankruptcy or makes a general assignment to the benefit of, or a general arrangement with, creditors; (III) there is an involuntary bankruptcy filed against Tenant that has not been dismissed within sixty(60)days of filing; (IV) Tenant is adjudicated insolvent, or admits, in writing, its inability to pay its obligations in the ordinary course as they come due; (V) a receiver, trustee, or liquidating officer is appointed for Tenant's business; or (VI) if Tenant violates or breaches any of the other covenants, agreements, stipulations, or conditions described in the Agreement; 14.2. Cure of Default. Upon an Event of Default in 14.1, Landlord shall send Tenant written notice of the violation. Upon receipt of such notice, and except for a Notice to Pay all unpaid rent or vacate the Premises,in Section 14.1(a),which shall be due and payable within 3 business days, Tenant shall have thirty(30) days to cure the violation. Any violation that continues beyond this 30-day period shall be grounds for Landlord's termination of this Lease. Tenant shall have no ability to cure a 3rd(or subsequent)distinct Event of Default occurring within a 12-month period. 14.3. Termination after Default. Landlord shall not elect to terminate the Lease as a result of any Default described above without first providing Tenant with written notice of Landlord's intent to terminate the Lease("Termination Notice");provided that any such termination shall be subject to Landlord compliance with the provisions of Article 14.2. Subject to the preceding sentence and the provisions of Article 14.2,Landlord shall have the rights and remedies provided in this Article 14, in addition to any other right or remedy available by law or equity(all notice and cure periods set forth above are in lieu of and not in addition to any notice required pursuant to applicable unlawful detainer/eviction statutes). 14.4. Upon Termination of this Lease, Landlord may reenter the Premises in the manner then provided by law, and remove or put out Tenant or any other persons or subtenants found therein. No such reentry shall be construed as an election on Landlord's part to terminate this Lease unless a written notice of such intention is given to Tenant. 14.5. Upon termination of the Lease as a result of Tenant's Default, the Landlord may elect to re- let the Premises or any part thereof upon such terms and conditions, including rent, term and remodeling or renovation, as Landlord in its sole discretion may deem necessary. Landlord shall also have the right to cause any of Tenant's Subtenants, if any should exist, to direct all future sublease rent payments directly to Landlord until such time as Tenants default has been cured. To the fullest extent permitted by law, the proceeds of any reletting or payments made directly to Landlord by any of Tenant's Subtenants shall be applied: first, to pay Landlord all costs and expenses of such reletting (including without limitation, costs and expenses incurred in retaking SpanaFlight,LLC/COA Limited-Term Full-Service Lease 400 Building+3 tie-downs Page 10 of 18 or repossessing the Premises,removing persons or property therefrom,securing new Tenants, and, if Landlord maintains and operates the Premises, the costs thereof); second, to pay any indebtedness of Tenant to Landlord other than rent; third, to the rent due and unpaid hereunder; and fourth, the remainder, if any, shall be held by Landlord and applied in payment of other or future obligations of Tenant to Landlord as the same may become due and payable, and Tenant shall not be entitled to receive any portion of such revenue. 14.6. If Landlord terminates this Lease as provided in this Article, Landlord shall have the right to reenter the Premises and remove all persons,and to take possession of and remove all equipment and trade fixtures of Tenant in the Premises, in the manner then provided by law. Tenant waives all claims associated with Landlord's exercising this right and shall hold Landlord harmless therefrom. No such reentry shall be considered a forcible entry. If Landlord elects to terminate the Lease, Landlord may also recover from Tenant: (I) Any earned but unpaid rent under this Lease owing to Landlord at the time of termination; (II) The amount of rent Landlord would receive under this Lease for a period of up to the Term expiration. (III) Any other amount necessary to compensate the Landlord for any damages caused by the Tenant's failure to perform its obligations under the Lease or which in the ordinary course of things would be likely to result therefrom; provided that damages associated with loss of Rent payable hereunder shall be limited to amounts measured in 14.6(II) above; and (IV) At Landlord's election, such other amounts in addition to or in lieu of the foregoing that may be permitted from time to time by applicable law; provided that damages associated with loss of rent payable hereunder shall be limited to amounts measured in 14.6(II)above. 14.7. Indemnification. Nothing in this Article 14 shall be deemed to affect Landlord's right to indemnification for liability or liabilities arising prior to termination of this Lease for personal injury or property damage under the indemnification provisions or other provisions of this Lease. 14.8. Time is of the essence for this agreement. ARTICLE 15: RETENTION OF AIRSPACE 15.1. Landlord retains the public and private right of flight for the passage of aircraft in the airspace above the surface of the property hereinbefore described, together with the right to cause in said airspace such noise as may be inherent in the operation of aircraft, now known or as SpanaFlight,LLC/COA Limited-Term Full-Service Lease 400 Building+3 tie-downs Page 11 of 18 hereinafter used, for navigation of or flight in said airspace and for use of said airspace for taking off from, landing on or operating at Auburn Municipal Airport. 15.2. Landlord reserves the right to further develop or improve the landing area of the Auburn Municipal Airport as it sees fit, regardless of the desires or view of the Tenant and without interference or hindrance. 15.3. Landlord reserves the right to maintain and keep in repair the landing area of the Auburn Municipal Airport and all publicly owned facilities of the Airport, together with the right to direct and control all activities of the Tenant in this regard. 15.4. This Lease shall be subordinate to the provisions and requirements of any existing or future agreement between the Auburn Municipal Airport and the United States, relative to the development, operation, and maintenance of the Airport. 15.5. Tenant agrees to comply with the notification and review requirements covered in 14 C.F.R. Part 77 in the event any construction is planned for the Premises, or in the event of any planned modification or alteration of any present or future Improvements or structure situated on the Premises. 15.6. Tenant agrees that it will not erect nor permit the erection of any structure or object, nor permit the growth of any tree on the Premises to exceed the established height contours. In the event the aforesaid covenants are breached, Landlord shall give written notice to the Tenant specifying the breach. If Tenant does not take action to correct the breach within ten(10) days of receipt of said notice,the Landlord reserves the right to enter upon the Premises hereunder and to remove the offending structure or object and cut the offending tree, all of which shall be at the expense of Tenant. 15.7. Tenant, by accepting this Lease, agrees that it will not make use of the Premises in any manner which might interfere with the landing and taking off of aircraft from Auburn Airport or otherwise constitute a hazard. In the event the aforesaid covenant is breached, Landlord reserves the right to enter upon the Premises hereby leased and cause the abatement of such interference at the expense of Tenant. 15.8. It is understood and agreed that nothing herein contained shall be construed to grant or authorize the granting of an exclusive right within the meaning of 49 U.S.C. §40103(e) and/or 49 U.S.C. §41101(c). 15.9). This Lease and all the provisions hereof shall be subject to whatever right the United States Government now has or in the future may have or acquire, affecting the control, operation, regulation, and taking over of the Auburn Airport by the United States during the time of the war or national emergency. 15.10. Landlord reserves the right to take any action it considers necessary to protect the aerial approaches of the Auburn Airport against obstructions, together with the right to prevent Tenant from erecting or permitting to be erected any building or other structure on the Premises which, in SpanaFlight,LLC/COA Limited-Term Full-Service Lease 400 Building+3 tie-downs Page 12 of 18 the opinion of Airport or the Federal Aviation Administration, would limit the usefulness of the Auburn Airport or constitute a hazard to aircraft. 15.11. Tenant, as well as Tenant's assignees and subleases, and the agents, employees, and customers thereof,shall have the rights of access to and use of all areas and facilities of the Auburn Airport which are intended for the common use of all Tenants and occupants of the Auburn Airport, including but not limited to the take-off and landing areas, taxi areas, reasonable access thereto from the Premises, and air control facilities. ARTICLE 16: FEDERAL AVIATION ADMINISTRATION 16.1. Tenant agrees: (I) to prevent any operation on the Premises which would produce electromagnetic radiations of a nature which would cause interference with any existing or future navigational aid or communication aid serving Auburn Municipal Airport,or which would create any interfering or confusing light or in any way restrict visibility at the Airport; and (II) to prevent any use of the Premises, which would interfere with landing or taking off of aircraft at Auburn Municipal Airport, or otherwise, constitute an aviation hazard. 16.2. Landlord reserves the right during the term of this Lease or any renewal and/or extension thereof to install air navigational aids including lighting, in, on, over, under, and across the Premises in the exercise of any of the rights in this Lease. Landlord agrees to give Tenant no less than ninety (90) days'written notice of its intention to install such air navigational aids. ARTICLE 17: NON-DISCRIMINATION 17.1. Tenant for himself, his heirs, personal representatives, successors in interest, and assigns, as a part of the consideration hereof,does hereby covenant and agree that in the event facilities are constructed, maintained, or otherwise operated on the Premises described in this lease agreement for a purpose for which a Department of Transportation ("DOT") program or activity is extended or for another purpose involving the provision of similar services or benefits, the Tenant shall maintain and operate such facilities and services in compliance with all other requirements imposed by 49 C.F.R. Part 21 (implementing Title VI of the Civil Rights Act of 1964) as now enacted or as hereafter amended. 17.2. Tenant for themselves, their personal representatives, successors in interest, and assigns, as a part of the consideration hereof, does hereby covenant and agree that: 1) no person on the grounds of race, color, sex, or national origin shall be excluded from participation in, denied the SpanaFlight,LLC/COA Limited-Term Full-Service Lease 400 Building+3 tie-downs Page 13 of 18 benefits of, or be otherwise subjected to, discrimination in the use of said facilities, 2) that in the construction of any improvements on, over, or under the Premises and the furnishing of services thereon, no person on the grounds of race, color, sex, or national origin shall be excluded from participation in, denied the benefits of, or be otherwise subjected to discrimination, and 3)that the Tenant shall use the Premises in compliance with all other requirements imposed by 49 C.F.R. Part 21 as now enacted or as hereafter amended. 17.3. If the Tenant breaches any of the above non-discrimination covenants,Landlord shall have the right to terminate this Lease agreement and to re-enter and repossess said Premises and the facilities thereon, and hold the same as if said Lease agreement has never been made or issued. This provision does not become effective until the procedures of 49 C.F.R. Part 21 are followed and completed, including expiration of appeal rights. 17.4. Tenant shall furnish its accommodations and/or services on a fair, equal, and not unjustly discriminatory basis to all users thereof and it shall charge fair, reasonable, and not unjustly discriminatory prices for each unit or service, provided that Tenant may be allowed to make reasonable and nondiscriminatory discounts, rebates, or other similar types of price reductions to volume purchasers. 17.5. Noncompliance with Article 17 above shall constitute a material breach thereof and, in the event of such noncompliance, Landlord shall have the right to terminate this Lease and the estate hereby created without liability therefor or, at the election of the Landlord or the United States, either or both said Governments shall have the right to judicially enforce the provisions of said Article 17. 17.6. Tenant agrees that it shall insert Articles 17.1 — 17.5 in any lease, license, or sublease agreement by which said Tenant grants a right or privilege to any person, firm, or corporation to render accommodations and/or services to the public on the Premises herein leased. 17.7. The Tenant assures that during this tenancy it will undertake an Affirmative Action program as required by 14 C.F.R. §§152.401-425 to ensure that no person shall on the grounds of race, creed, color, national origin, or sex, be excluded from participating in any covered employment activities. The Tenant assures that no person shall be excluded on these grounds from participating in or receiving the services or benefits of any program or activity covered by these regulations. The Tenant assures that it will require that its covered suborganizations provide assurances to the Tenant that they similarly will undertake Affirmative Action programs, and that they will require assurances from their suborganizations, as required by these regulations, to the same effort. ARTICLE 18: ATTORNEY'S FEES AND COSTS If by reason of default on the part of either party to this Lease agreement it becomes necessary to employ an attorney to recover any payments due hereunder or to enforce any provision of this Lease, the prevailing party, whether such party be the successful claimant or the party who successfully defended against the claim of the other party, shall be entitled to recover a SpanaFlight,LLC/COA Limited-Term Full-Service Lease 400 Building+3 tie-downs Page 14 of 18 reasonable attorney's fee and to be reimbursed for such costs and expenses as may have been incurred by such prevailing party. ARTICLE 19: MISCELLANEOUS 19.1. Signage—Tenant shall not install, affix, paint, or otherwise attach or display any signs to the exterior of the 400 Building without the prior written consent of the Landlord.Notwithstanding the foregoing, Tenant may display portable A-frame (sandwich board) signs on the Premises, provided such signs do not exceed 24" by 36" in size, obstruct pedestrian or vehicular access, create a safety hazard, or interfere with airport operations, which shall be determined at the sole discretion of the Landlord. Landlord further reserves the right to require the reduction in the number of signs,relocation or removal of some,or all of the signs should it deem any of the above conditions are violated. 19.2. Security - Landlord shall have no obligation to provide security to the Premises. If reasonably required by Landlord, Tenant shall provide adequate lighting to provide for all-night illumination of the Taxi lane apron of all buildings on the Premises, including aprons, aircraft tiedown areas, vehicular parking lots, and pedestrian walkways surrounding the Premises. Tenant may,but need not,employ security persons. If at any time during the term of this Lease,additional security requirements are imposed on the Auburn Municipal Airport by the FAA or any other agency having jurisdiction, and such additional security requirements apply to the Premises, Tenant agrees to comply with said security requirements that affect the Premises, at Tenant's sole expense,upon being notified of such requirements in writing by Landlord. If Landlord is fined by FAA for a security violation caused by negligence of Tenant, or any of Tenant's sub-Tenants, Tenant shall immediately reimburse Landlord upon demand. 19.3. No Brokers-Tenant represents and warrants to Landlord that it has not engaged any broker, finder or other person who would be entitled to any commission or fees in respect of the negotiation, execution or delivery of this Lease and shall indemnify and hold harmless Landlord against any loss, cost, liability or expense incurred by Landlord as a result of any claim asserted by any such broker, finder or other person on the basis of any arrangements or agreements made or alleged to have been made by or on behalf of Tenant. 19.4. Regulatory Compliance - The Tenant agrees, at its sole cost and expense, to conform to, comply with and abide by all lawful rules, codes, ordinances, requirements, orders, directions, laws,regulations and standards of the United States,the State of Washington, and City of Auburn or agency of any of said entities, including rules and regulations of Landlord, including without limitation those relating to environmental matters, and regulations set forth by the Environmental Protection Agency,now in existence or hereafter promulgated, applicable to the Tenant's use and operation of said Premises, including the construction of any improvements thereon, and not to permit said Premises to be used in violation of any of said rules,codes,laws or regulations.Tenant shall pay all costs, expenses, liabilities, losses, damages, fines, penalties, claims, and demands, including reasonable counsel fees, that may in any manner arise out of or be imposed because of the failure of Tenant to comply with the covenants of this section. SpanaFlight,LLC/COA Limited-Term Full-Service Lease 400 Building+3 tie-downs Page 15 of 18 19.5. Liens & Insolvency - Tenant shall keep the Premises free from any liens. In the event Tenant becomes insolvent,voluntarily or involuntarily bankrupt,or if a receiver,assignee or other liquidating officer is appointed for the business of the Tenant, then the Landlord may cancel this Lease at Landlord's option. 19.6. Non Waiver - Waiver by Landlord of any term, covenant or condition contained in this Lease or any breach thereof shall not be deemed to be a waiver of such term,covenant,or condition or of any subsequent breach of the same or any other term, covenant, condition contained in this Lease. 19.7. Force Majeure - Except for the payment of Rent or other sums payable by Tenant to Landlord,time periods for Tenant's or Landlord's performance under any provisions of this Lease shall be extended for periods of time during which Tenant's or Landlord's performance is prevented due to circumstances beyond Tenant's or Landlord's control, including without limitation, strikes, embargoes, shortages of labor or materials, governmental regulations, acts of God,war or other strife. 19.8. Severability - If any term, covenant, or condition of this Lease (or part thereof) or the application thereof to any person or circumstance is, to any extent, invalid or unenforceable, the remainder of this Lease (and/or the remainder of any such term, covenant or condition), or the applicability of such term, covenant or condition to persons or circumstances other than those to which it is held invalid or unenforceable, shall not be affected thereby and each term, covenant or condition (or part thereof) of this Lease shall be valid and be enforced to fullest extent permitted by law. 19.9. Choice of Law, Integration, and Interpretation — This Lease and the rights of the parties hereunder shall be governed by and interpreted in accordance with the laws of the State of Washington and venue for any action hereunder shall be in the Superior Court in and for King County, Washington. This Lease, together with any subsequent amendments or addendums, constitutes the entire agreement of the parties and no other understandings, oral or otherwise, regarding this Lease shall exist or bind any of the parties. All captions, headings or titles in the paragraphs or sections of this Lease are inserted for convenience of reference only and shall not constitute a part of this Lease or act as a limitation of the scope of the particular paragraph or sections to which they apply. Construction of this Lease shall not be affected by any determination as to who is the drafter of this Lease, this Lease having been drafted by mutual agreement of the parties. 19.10. Tenant will be granted two keys to the Premises. If Tenant desires additional keys Tenant may duplicate the provided keys at Tenant's sole expense.Tenant may change the lock to the door providing access into Tenant's Premises at Tenant's sole expense. If Tenant elects to change the lock to Tenant's Premises, Tenant will provide a copy of the new key to Landlord at no charge to Landlord. Tenant shall turn over all keys in its possession at the end of the Term. 19.11. Gate Cards - Tenant shall coordinate with the Airport Manager upon Commencement of the Lease to determine and checkout the appropriate number of gate cards needed for sufficient operations at the Airport. Tenant shall be responsible for the management of the gate cards issued and responsible for the actions of any person that gains access using the cards and shall not make SpanaFlight,LLC/COA Limited-Term Full-Service Lease 400 Building+3 tie-downs Page 16 of 18 the gate cards available to anyone not affiliated with Tenants operations. Tenant shall promptly report any gate cards that have been lost, stolen or not returned to the Airport Office and must obtain replacement cards per the current fee schedule prices. Upon termination or expiration of the Lease without any extensions thereof, Tenant shall immediately and without notice or demand return the gate cards to the Office of the Airport Manager. 19.12. Gate Codes - Gate codes will be provided for personnel gate access onto the Airport. Gate codes are subject to change as determined and in the sole discretion of the Landlord. Tenant shall be notified prior to any changing of the gate codes and it shall be the responsibility of the Tenant to notify their customers and employees of said change. Tenant shall immediately notify the Landlord and the office of the Airport Manager if the codes need to be changed to prevent access from a customer or employee to maintain security. 19.13. Authority- Each party hereto warrants that it has the authority to enter into this Lease and to perform its obligations hereunder and that all necessary corporate action to authorize this transaction has been taken,and the signatories,by executing this Lease,warrant that they have the authority to bind the respective parties. 19.14.Amendment of Lease—This Lease may be altered, changed, or amended, if done in writing and mutually executed by both the Landlord and Tenant. 19.15. Airport Rules and Regulations. Tenant, Tenant's customers, guests, representatives, directors, officers and employees, are subject to and shall at all times abide by the Airport Rules and Regulations as may be amended from time to time. A copy of these rules and regulations are located at auburnmunicipalairport.com/documents-and-forms and are hereby incorporated by this reference. ARTICLE 20: SIGNATURE By signing in the space below, the TENANT ACKNOWLEDGES HAVING READ AND UNDERSTOOD AND AGREES TO THE CONTENTS OF THIS AGREEMENT. TENANT LANDLORD �-- S ANAFLIGHT, LIC CITY OF AUBURN 111 • Miller, g Me bar ancy ' Mayor App ved s to Fo J on Whalen, City of Auburn Attorney SpanaFlight,LLC/COA Limited-Term Full-Service Lease 400 Building+3 tie-downs Page 17 of 18 Exhibit A Premises • h . r ook 400 Btitidin 1 ; *Parking Lot Tie-D o 'n s _.. SpanaFlight,LLC/COA Limited-Term Full-Service Lease 400 Building+3 tie-downs Page 18 of 18