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a.approximately 40,206 square feet of land located at 1748 Airport Drive, San Marcos,
<br />Texas, as more particularly described in Exhibit Aattached hereto (sometimes referred to
<br />herein as the “Ground Lease Premises”); and
<br />b.that certain parcel of land containing approximately 137,650 square feet of land, inclusive
<br />of an approximately 57,600 square foot aircraft hangar and related improvements
<br />thereon, located at 1749 Airport Drive, San Marcos, Texas, including, without limitation,
<br />the aircraft hangar and other facilities located thereon, as more particularly described in
<br />Exhibit Battached (sometimes referred to herein as the “Air CarrierComplex”).
<br />1.03
<br />Acceptance. Lessee acknowledges that, subject to Lessor’s obligations under paragraph 1.05
<br />below: (i) Lessor makes no representations or warranty regarding the suitability of the Leased
<br />Premises for Lessee’s intended purposes, or the presence of environmental, geologic, or other site
<br />conditions that may affect Lessee’s use of the Leased Premises; (ii) Lessee accepts full
<br />responsibility for determining the suitability of the Leased Premises for its intended purposes;
<br />(iii) Lessee has inspected and performed all desired tests and investigations of the Leased
<br />Premises for its intended purposes; and (iv) Lessee accepts the Leased Premises in their present
<br />condition.
<br />1.04
<br />Rules and Regulations; Minimum Standards. Lessee agrees to comply with the (i) San Marcos
<br />Regional Airport Rules and Regulations adopted November 2, 2015, pursuant to City Ordinance
<br />Number 2015-46 (the “Rules and Regulations”), a copy of which is attached hereto as Exhibit C,
<br />and (ii) San Marcos Regional Airport Minimum Standards last updated August 18, 2015, as
<br />amended with respect to the fuel flowage fee on June 5, 2018 (the “Minimum Standards”), a
<br />copy of which standards as of August 18, 2015, are attached hereto as Exhibit D. Provided the
<br />same do not impair the material rights ofLessee hereunder or adversely affect Lessee’s ability to
<br />use the Leased Premises for the Authorized Use (as defined below), Lessor has the right to amend
<br />and/or restate the Rules and Regulations and/or the Minimum Standards and Lessee shall comply
<br />with the same.
<br />1.05
<br />Airport Operation. During the Term, Lessor covenants and agrees to operate and maintain the
<br />Airport and appurtenant facilities (including, without limitation, runways, taxiways, landing
<br />areas, entrance roads, driveways and existing parking lots leading to and/or contiguous to the
<br />Leased Premises) as a public airport consistent with, at a minimum, current operations and the
<br />“sponsor” assurances given by Lessor to the United States of America and, as applicable, the
<br />State of Texas. In connection with such sponsor assurances, a list of which is set forth in Exhibit
<br />Eattached hereto, Lessee agrees that this Lease and Lessee’s rights and privileges hereunder shall
<br />be subordinate to such sponsor assurances.
<br />1.06
<br />Ingress and Egress. Lessor agrees that Lessee, its officers, directors, agents, representatives,
<br />contractors, employees, invitees and licensees shall have the right of ingress and egress to and
<br />from the Leased Premises by means of roadways owned by the City for automobiles and taxiways
<br />at the Airportfor aircraft, including access during the construction phase of Airport
<br />improvements, unless otherwise agreed to in writing by both parties. Such rights shall be
<br />consistent with the Rules and Regulations and applicable laws, rules and regulations (“Applicable
<br />Law”) of the City, the Federal Aviation Administration (“FAA”) and other governmental
<br />authorities with jurisdiction over the Airport and this Lease.
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