Res 2016-135/approving a five year Airport Facility Lease Agreement with Ann K. and William H. McIntosh for the hangar located at 1741 Airport Drive

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and the Lessee agrees to perform all preparation, repairs, remediation and other activities necessary to use the Leased Premises for the Lessee's intended purposes. Lessor agrees that Lessee and Airport Manager do not represent or guarantee the safety or security of the property stored within the Premises and has no duty of safety or security of any kind under any eireumstances. 1.03. The Lessee agrees to comply with the SAN MARCOS REGIONAL AIRPORT RULES AND REGULATIONS and the MINIMUM STANDARDS, as they now exist or may be amended during the term of this Lease, and any conflict between this Lease and these procedures, regulations, and standards will be resolved in favor of the procedures, regulations, and standards. 1.04. The Lessor covenants and agrees that during the term of this Lease it will operate and maintain the Airport and its facilities as a public airport consistent with and pursuant to the sponsor's assurances given by the Lessor to the United States Government and/or the State of Texas through the Federal Airport Act; and the Lessee agrees that this Lease and the Lessee's rights and privileges hereunder shall be subordinate to the sponsor's assurances. 1.05. The Lessor agrees that the Lessee, and its agents, contractors, employees, invitees and licensees, shall have the right of ingress and egress to and from the Leased Premises by means of roadways for automobiles and taxiways for aircraft. Such rights shall be consistent with the riles and regulations with respect to the occupancy and use of airport premises as adopted from time to time by the City of San Marcos and by the Federal Aviation Administration or any other state, federal or local authority. ARTICLE 2: RENT AND TERM OF AGREEMENT 2.01. Rental shall accrue commencing upon execution of this Lease. Rent shall be payable at the place designated in Section 2.04x. 2.02. The Primary Tenn of this Lease will connnenee on 06/01/2016 (the "Commencement Date") and will extend for a period of Three (3) year(s). The Primary Term of this Lease shall expire on 05/31/2019 . 2.03. Any extension shall continue under the terns of this Lease, or on such changed terms, conditions, and rental rale as Lessor may give to Lessee in accordance with Section 3.01 of this Lease herein. The Term may not be extended if. (1) the Lease or Lessee's right to possession of the Premises is terminated, (2) Lessee assigns its interest in the Lease or any portion of the Premises, (3) Lessee fails to timely exercise the extension, or (4) Lessee is in default under the Lease at the time Lessee seeks to extend the Term. 2.04. The Lessee agrees to pay to the Lessor a fixed rental in the suns of 55,736.60 per year for the entire Leased Premises during the five (5) year term of the Lease. This five (5) year term will be comprised of one (1) three (3) year primary Lease with two (2) additional one (1) year options. The annual amount for the fixed rental shall be paid in equal monthly installments in the amount Page 2 of 18