Subject: SIXTH AMENDMENT TO LEASE AGREEMENT WITH MEXICANA AIRLINES
COUNCIL DISTRICT: City -Wide
Approval of
the sixth amendment to Operating Agreement and Terminal Building Lease with
Compania Mexicana de Aviacion, S. A. de C.V. (Mexicana Airlines) to extend the
term for five years and ten months from February 1, 2002, through November 30,
2007, and to add approximately 201 square feet of operations space, with
projected total annual revenue to the City of $242,000.
Background
Mexicana Airlines began service from San Jose International Airport in February 1990, pursuant to an Operating Agreement and Terminal Building Lease. The City Council approved a first amendment to the agreement to extend the term through January 24, 1997, a second amendment to allow Mexicana to relocate to new leased premises, a third Amendment to lease holdroom space on a preferential basis, a fourth amendment to extend the term through January 31, 2002 and a fifth amendment to permit the issuance of airport commercial paper.
Analysis
This
sixth amendment will extend the term of the Operating Agreement and Terminal
Building Lease for an additional five years and ten months through November 30,
2007, which will make it co-terminus with the airline master lease agreements.
This will also allow Mexicana to occupy approximately 201 square feet of
additional operations space at Terminal C, for a total of 1,382 square feet of
operations space. The additional space will be used for the storage of
supplies, and for the placement of an explosive detection device, which will
allow Mexicana to scan lugguage and boxes.
All other terms and conditions of the Operating Agreement and Terminal
Building Lease will remain the same.
Chapter 25.04 of the Municipal Code requires City Council approval of
this extension of term.
Not applicable.
This lease amendment has been coordinated with Risk Management and the City Attorney’s Office.
Resolution #67380.
Ralph G. Tonseth
Director of Aviation
Airport Department