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6. Construction of Facilities;Approvals. DJC,at its sole cost and expense, shall construct the aircraft <br /> hangars on a build-to-suit basis within the Kilo Development Area. Prior to commencing <br /> construction on any facility,DJC shall: <br /> a. Submit to Airport Management information related to proposed use and purchaser of the <br /> facility. <br /> b. Submit plans, together with the architect or engineer's estimated cost of construction of <br /> facilities and related construction schedule to Airport Management and the City. <br /> c. Submit metes and bounds survey of proposed lease boundary. <br /> d. Submit form 7460-1, Notice of Proposed Construction of Alteration, to FAA and submit <br /> same to City. <br /> e. For each hanger constructed, DJC shall provide a Performance bond to the City in the <br /> amount of 125%of the price of said hangar. The bond must be accepted by the City prior <br /> to the start of construction and shall be in a form approved by the City, of which approval <br /> shall not be unreasonably withheld. <br /> f. Receive written approval for the proposed development from City and obtain all permits <br /> required by the City. <br /> g. Begin construction of the facility within ninety(90) days of approval of both ground lease <br /> and permits or the expiration of the Feasibility Period,whichever is later. <br /> 7. City Obligations. During the Feasibility Period, City shall provide DJC with copies of all San <br /> Marcos Regional Airport hangar waitlists and any other documentation reasonably required by DJC <br /> for evaluating potential construction of built-to-suit hangars. DJC shall be allowed to contact any <br /> party listed on the San Marcos Regional Airport hangar waitlists for possible interest in a built-to- <br /> suit hangar.Any documentation provided to DJC for this purpose shall be considered confidential <br /> and DJC shall protect said documentation with the same care and manner as its own confidential <br /> material. <br /> 8. As-Built Survey and Plans:Following completion of construction of facility,DJC shall prepare as- <br /> built survey and plans,at its sole cost and expense, and deliver a copy of the same to City. <br /> 9. Insurance.DJC will obtain a commercial general liability insurance policy with combined limits of <br /> liability for bodily injury or property damage as follows: $1,000,000.00. <br /> 10. Default. Failure by DJC to make any payment of Development Fee when due where such failure <br /> continues for a period of ten (10) days after written notice by City shall constitute an event of <br /> default. Additionally, failure for DJC to observe or perform any of the conditions or provisions of <br /> this MOU,including but not limited to bankruptcy and/or failure to perform,and where such failure <br /> continues for a period of thirty (30) days after written notice by City shall constitute an event of <br /> default. Failure of DJC to conduct construction activities for a period of one hundred and twenty <br /> (120) consecutive days and is not remedied within ten(10) days after written notice by City shall <br /> constitute an event of default. <br />