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8664
.. *Mw" RESOLUTION NO. 8664 A RESOLUTION APPROVING AN AGREEMENT BETWEEN PUEBLO, A MUNICIPAL CORPORATION AND ALM AVIATION LABOR MANAGEMENT, INC. AND ALM AVIATION OF COLORADO, LLC RELATING TO A JOB CREATING CAPITAL IMPROVEMENT PROJECT AND AUTHORIZING THE EXPENDITURE OF $255,000 THEREFOR FROM THE 1992 -2001 SALES AND USE TAX CAPITAL IMPROVEMENT PROJECTS FUND WHEREAS, ALM Aviation Labor Management, Inc. and ALM Aviation of Colorado, LLC (collectively the "Company ") has expressed a willingness to locate its business activities at the Pueblo Memorial Airport and has committed to employ seventy (70) full time employees, and WHEREAS, Company through the Pueblo Economic Development Corporation has made application for funds from the 1992 -2001 Sales and Use Capital Improvement Projects Fund, and WHEREAS, the City Council is willing to approve such application for funds upon the terms and conditions set forth herein; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, that: SECTION 1. The City Council does hereby find and determine Company's application for funds meets and complies with the criteria and standards established by Ordinance No. 6381 and will create employment opportunities justifying the expenditure of public funds. SECTION 2. The Agreement dated as of March 22, 1999 between Pueblo, a municipal corporation and Company attached thereto having been approved as to form by the City Attorney, is hereby approved. The President of the City Council is authorized to execute and deliver the Agreement in the name of the City and the City Clerk is authorized and directed to affix the seal of the City thereto and attest same. SECTION 3. Funds in an amount of $255,000 are hereby authorized to be expended and made available to or for the benefit of Company out of the 1992 -2001 Sales and Use Tax Capital Improvement Projects Fund for the sole purpose of reimbursing Company for the cost of the job creating capital improvement project described in the attached Agreement. The funds hereby authorized to be expended shall be released and paid by the Director of Finance to or for the benefit of Company after receipt (i) by City Clerk of the documents required to be filed pursuant to paragraph 3 (c) of the Agreement and (ii) by the Director of Finance of written requests for payment required by paragraph 3 (e) of the Agreement. SECTION 4 This Resolution shall become effective upon final passage. INTRODUCED March 22, 1999 BY: Al Gurule Councilperson APPROVED: . li e OdI� -- President of the Council ATTEST: W � � 0 . TM 1-6 ?jI` �OU pla * &&� ,DOtd 3�22� MARCH 22, 1999 AGENDA CITY COUNCIL BACKGROUND MEMORANDUM RESOLUTIONS APPROVING AGREEMENTS WITH PUEBLO DEVELOPMENT FOUNDATION AND ALM AVIATION LABOR MANAGEMENT, INC. RELATING TO THE RENOVATION AND LEASE OF THE BLITZ HANGER Resolutions are being presented to City Council for approval of two Agreements, one with Pueblo Development Foundation ( "PDF "), and the other with ALM Aviation Labor Management, Inc. and ALM Aviation of Colorado LLC ( "ALM "). ALM intends to locate its aircraft painting, maintenance and repair business in the Blitz Hangar at Pueblo Memorial Airport and has committed to employ 70 full -time employees during a 7 year Repayment Period starting no later than December 1, 2001. City will advance to ALM $255,000 to be used as follows: $200,000 for purchase of equipment ( "Equipment ") and $55,000 for renovation of the Blitz Hangar. ALM's Repayment Obligation will be secured by a security interest in the Equipment. PDF will renovate the Blitz Hangar and for such purposes, the City will advance to PDF $1,011,224 (including $55,000 to be advanced to ALM and an additional $25,000 for exterior improvements to the Blitz Hangar). PDF has through competitive bidding awarded the construction contract for the renovation. City will lease the Blitz Hangar and ramp area to PDF. PDF will sublease the Blitz Hangar (excluding the attached Quonset Hut) and ramp area to ALM under a 10 year lease for a monthly rent of $8,639.75 with two 5 year renewal options. PDF will pay to City all lease payments received by PDF from ALM. PDF will have no other financial obligations. Monthly rent of $8,639.75 represents the remodeling construction contract sum of $921,624 amortized over 15 years at 7.5% interest. Attached are computations for the construction contract sum which does not include: $6,000 roofing allowance, $33,600 for architect/engineering, $25,000 for contingencies, and $25,000 for exterior appearance improvements. Adding these additional amounts to the construction contract sum, the total cost to remodel the Blitz Hangar for ALM's use will be $1,011,224. The total amount of City's one- half cent sales and use tax funds to be spent for ALM's project will be $1,211,224. The financial details of the ALM project including job commitment and repayment obligations were negotiated by the Executive Committee of Pueblo Economic Development Corporation ( "Executive Committee "). The Executive Committee evaluated the business and financial ability of ALM to fulfill its employment commitment, financial and other contractual obligations under ALM's agreement and sublease for the Blitz Hangar, and recommended that the City Council approve the ALM project and related transactions. D ED L . D City of Pueblo OFFICE OF THE CITY ATTORNEY 127 Thatcher Building MEMORANDUM PUEBLO, COLORADO 81003 TO: Gina Dutcher, City Clerk FROM: City Attorney RE: ALM Aviation - Resolution No. 8664 DATE: April 28, 1999 We enclose for filing with Resolution No. 8664 the following documents: (a) Security Agreement dated March 22, 1999 executed by ALM Aviation Labor Management, Inc. and ALM Aviation of Colorado, LLL. (b) Colorado UCC -1 Financing Statement filed with the Pueblo County Clerk and Recorder on April 22, 1999 as Instrument No. 289342. (c) Resolution of ALM Aviation Labor Management, Inc. For The Execution of Contract. (d) Resolution of ALM Aviation of Colorado, LLC For The Execution of Contract. (e) Resolution of ALM Aviation Labor Management, Inc. For The Execution of Lease. (f) Resolution of ALM Aviation of Colorado, LLC For The Execution of Lease. (g) Affidavit of Todd Mihelich. Very truly yours, Thomas E�aggt - sm enc. AGREEMENT THIS AGREEMENT entered into as of March 22, 1999 between Pueblo, a municipal cor- poration (the "City ") and ALM Aviation Labor Management, Inc., an Arizona corporation and ALM Aviation of Colorado, LLC, a Colorado limited liability company (collectively the "Company "). WHEREAS, Company has expressed a willingness to locate its business and has committed to employ seventy (70) full -time employees at the Pueblo Memorial Airport, and in furtherance thereof has through the Pueblo Economic Development Corporation made application for funds with the City, and WHEREAS, the City has approved such application and will make funds available to Company subject to and upon the terms and conditions of this Agreement. 1. The following terms as used in this Agreement shall have the following meaning unless the context clearly indicates otherwise: "Employment Commitment Date" means the first day of the thirtieth (30th) calendar month after the calendar month in which a certificate of occupancy is issued for the Facility, or December 1, 2001, whichever occurs first. "Facility" means the Blitz Hangar located at Pueblo Memorial Airport to be remodeled in accordance with the Plans and Specifications. "Full -Time Employee" means a person who performs work at the Facility for not less than thirty -two (32) hours per week whether employed by Company or by an outside entity acting as an agency to provide Full -Time Employees for Company. The term "Full -Time Employee" does not include independent contractors nor employees of independent contractors except as described herein. "PDF" means the Pueblo Development Foundation. "Plans and Specifications" means the plans and specifications for the remodeling of the Blitz Hangar approved by Company and PDF. "Quarter" means three consecutive calendar months. "Quarterly Employees" means the sum of the number of Full -Time Employees on each business day of a Quarter divided by the sum of the business days in such Quarter. "Sublease" means the Sublease between Company and PDF for the Facility which will be for a term of not less than 10 years. 2. Company shall enter into the Sublease and locate its business in the Facility in an expeditious manner. 3. City will advance to or for the benefit of Company funds in the amount of $255,000 (the "City Funds "), subject to and contingent upon: (a) Company entering into the Sublease. (b) City Funds being expended by Company as follows: (i) $200,000 for the purchase of the capital equipment described in attached Exhibit "A" (the "Equipment "), and (ii) $55,000 for interior improvements to the Facility. (c) Company filing in the office of the City Clerk copies of the following: (i) Company's certificate or other evidence of authority to transact business in the State of Colorado, (ii) certified copy of the resolution of the governing board of Company approving this Agreement and the Sublease and authorizing its officers to execute and deliver this Agreement and the Sublease in the name of Company, and (iii) evidence satisfactory to City that Company is diligently proceed- ing to locate its business at the Facility. The date of such filings is herein referred to as "Closing." (d) All construction contracts for the remodeling of the Facility shall be awarded through competitive bidding procedures which allows local contractors a reasonable opportunity to participate in the competitive bidding procedures. The general contractor shall use its best efforts in good faith to engage local subcontractors and suppliers to construct the Facility. (e) Company of PDF filing with the Director of Finance of City written request for payment certified by an officer of Company or PDF that the amounts included in the requests for payment have not been included in any prior request for payment and are for the actual cost of either (i) interior improvements to the Facility, identifying the interior improvements for which payment is sought, including certificates of the architect and contractor that such interior improvements have been installed, or (ii) the Equipment, including invoices therefor. 4. Company acknowledges that the primary purpose of City in entering into this Agreement and the sole benefit to the City for making funds available to Company hereunder is the creation of jobs. Therefore, Company represents and agrees that it will employ at the Facility not less than seventy (70) Full -Time Employees by the Employment Commitment Date and thereafter (the "Employment Commitment "). 5. Notwithstanding anything contained herein to the contrary, if Company shall for any reason default in its Employment Commitment set forth in paragraph 4 hereof, Company shall repay to City a pro -rata share of the City Funds advanced by City under paragraph 3 hereof based upon the number of Full -Time Employees employed by Company at the Facility (the "Repayment -2- Obligation "), as follows: (a) During the seven (7) year period starting on the Employment Commitment Date and ending eighty -four (84) months thereafter (the "Repayment Period ") Company shall pay to City an amount each Quarter equal to the Quarterly Employees less than seventy (70) employed at the Facility by Company multiplied by $130.10 (the "Company's Quarterly Payments "). For example, if for the Quarter ending June 2002 the Quarterly Employees is 60, the amount payable by Company to City on or before July 15, 2002 would be (70 - 60) x $130.10 = $1,301.00. Company's Quarterly Payments and Repayment Obligation shall not exceed the amount of City Funds advance by City under paragraph 3 hereof. (b) Company's Quarterly Payments, if any, shall be paid to the City without notice, demand, deduction or setoff on or before the fifteenth (15th) day of the month after the end of each Quarter during the Repayment Period and for one month thereafter at the office of the Director of Finance of City, 1 City Hall Place, Pueblo, Colorado, 81003. All past due Company's Quarterly Payments shall bear interest at the rate of ten (10) percent per annum until paid. (c) Within fifteen (15) days after the end of each Quarter after the Employment Commitment Date and for one calendar month after the Repayment Period, Company will submit to City's Director of Finance Company's statements showing the Quarterly Employees for the preceding Quarter and the basis upon which Quarterly Employees and Company's Quarterly Payment were computed certified by an officer of the Company to be true and correct. For purposes of verifying such employment, City shall have access to Company's books and records including payroll records. City will, however, respect the right of employees and Company as to confidentiality of personnel records. In addition to the foregoing, if Company defaults in its Repayment Obligation and /or Employment Commitment and such default is not cured within ninety (90) days after written notice specifying the default is given by City to Company, City may declare the entire balance of Company's Repayment Obligation due and owing together with interest at the rate of ten (10) percent per annum until paid, and for such purpose, the entire balance of Company's Repayment Obligation shall be an amount equal to seventy (70) x $130.10 multiplied by the remaining Quarters of the Repayment Period plus the amount of Company's unpaid Quarterly Payments, if any. All City Funds advanced to Company by City under this Agreement shall be deemed to be a debt of Company payable to City until Company performs and discharges its obligations hereunder including its Repayment Obligation contained in this paragraph 5 and shall be secured by a first perfected security interest in the Equipment. Company shall execute and deliver to City a Security Agreement and UCC Financing Statement for such purpose acceptable in form and content by the City Attorney. 6. (a) City Council of City may, in its sole discretion, relieve Company, in whole or in part, from Company's Repayment Obligation set forth in paragraph 5, if the City Council, after public hearing, finds and determines based upon competent evidence presented at such hearing that -3- Company was prevented from complying with its Employment Commitment by reason of an act of God, or the elements, fire, explosion, strike, insurrection, riot, or unavailability of materials, supplies or labor, interruption of transportation facilities, governmental laws, regulations or restrictions, or other causes beyond Company's reasonable control. The findings and decision of the City Council shall be final and binding upon Company and City. (b) Prior to instituting any proceedings to enforce Company's Repayment Obligation under paragraph 5, City shall notify Company in writing of its intention to institute such proceedings. If Company desires to seek relief pursuant to paragraph 6(a), Company, within twenty (20) days after receipt of City's notice, shall deliver to City its written request for relief specifying the grounds upon which such relief is sought. Within ninety (90) days after receipt of Company's request, City may schedule a hearing before the City Council and give written notice to Company of the time and place of such hearing. Failure of Company to timely deliver its written request for relief or to appear and submit evidence in support of its request at a scheduled hearing shall constitute a waiver of any right of Company to a hearing before City Council. (c) No delay or failure by City to exercise its right to enforce Company's Repayment Obligation, and no partial or single exercise of that right, shall constitute a waiver of that right, unless the City Council otherwise expressly provides in its findings and decision made pursuant to paragraph 6(a). 7. If Closing does not occur on or before September 1, 1999, or such later date as Company and City shall mutually agree, this Agreement shall terminate and City and Company shall be released and discharged from all obligations hereunder. 8. In the event of any litigation arising out of this Agreement, the court shall award to the prevailing party its costs and reasonable attorney fees. All such litigation shall be filed in the District Court, County of Pueblo, State of Colorado and each party submits to the jurisdiction of that Court. To the extent allowed by law, each party waives its right to a jury trial. 9. This Agreement expresses the entire understanding of the parties and supersedes any and all prior dealings and commitments with respect to the subject matter of this Agreement and may not be amended except in writing signed by City and Company. 10. This Agreement shall be construed in accordance with and governed by the laws of the State of Colorado. 11. The covenants, representations and warranties made by each party herein shall survive the Closing for the benefit of the other party. 12. Company acknowledges and agrees that City reserves the right, without any obligation on its part to do so and without penalty or liability, to maintain and keep in repair the landing area of the airport and other public areas or facilities of the Pueblo Memorial Airport and -4- to develop, modify, change, repair, relocate, abandon, or improve the Pueblo Memorial Airport, or any part thereof as it may determine in its sole and absolute discretion, at any time and from time to time, and to direct and control all activities of Company with respect thereto. Company further acknowledges and agrees that City has not made, nor by any provision of this Agreement or Warranty Deed shall City be construed to have made any representation or warranty to the contrary with respect thereto. 13. Any notices hereunder shall be sufficiently given if given personally or mailed by first class mail, postage prepaid, addressed: (a) if to City, City Manager, City of Pueblo, 1 City Hall Place, Pueblo, Colorado, 81003, or (b) if to the Company, Aviation Labor Management, Inc., 549 S. 48th Street, Suite 101, Tempe, Arizona, 85281, or to such other address as either party shall specify in written notice given to the other party. 14. Time is of the essence hereof. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns, provided Company may not assign this Agreement or any interest herein without the express written consent of the City. Any assignment or attempted assignment of this Agreement by Company without such consent shall be null and void. 15. The persons signing this Agreement on behalf of Company represent and warrant that such party and Company have the requisite power and authority to enter into, execute, and deliver this Agreement and that this Agreement is a valid and legally binding obligation of Company enforceable against Company in accordance with its terms. 16. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument. Executed at Pueblo, Colorado, the day and year first above written. S E A L] PUEB , A MUNICIPA CORPORATION ATTEST: B y Z� I- City C k resident of the City Council [ S E A L ] ALM AVIATION LABOR MANAGEMENT, INC. ATTEST: By -?ter_ Secretary President -5- Ov C F.\FILES\ CITY \AIRPORT\HANGARS \BLITZ \AVIATNLB \AGREEMNT.WPD -v /; : 1111111111111111111111111111lII IIIIIIIIIII IIIIIIIIIIIII 289342 04/22/1999 04.20P UCC100 Chris C. Munoz 2 of 2 R 21.00 D 0.00 Pueblo Cty Clk 8 Rec. PROJECTED EQUIPMENT LIST PUEBLO FACILITY Aircraft Tug 18,000 P.U. Truck 5,000 Trailer 4,000 Computer System 16,000 Bar Coding System 14,000 Breathin; Air System 13,500 Office Furniture 8,000 Office Equipment 3,500 Telephone System 3,500 Fire Extinguishers 3,500 Fire Safe 2,500 Supply Rack System 5,500 Cold Storage 2,000 Fall Protection System 4,400 Hazardous Storage Cabinets 3,000 Work Stands 35,000 Subtotal 139,400 Electrostatic Paint Guns 4,000 Other Paint Guns 4,100 Paint Buffers 9,000 Laser Leveling System 2,500 Paint Pots & Hoses 4,300 Paint Stripper System 4,450 Paint Shaker 2,000 Paint Gun Cleaner 3,000 Portable Lighting 6,000 Power Washer & Lines 4,000 Aircraft Jacks 1,100 Avionics Kit 3,500 Tire Change Kit 3,000 CSD Pumps 1,000 Portable Generator 4,000 Portable Compressor 2,000 Sheet Metal Repair Kit 3,000 Torque Wrench Kit 2,000 Welder & Saws 2,500 Ladders 1,600 Grease & Sealant Guns 1,000 Air Distribution System 1,750 Hand Tooling Kit 1,500 Stencil Nfachine 1,500 Hazmat Handling 1,250 Balance Fixtures 600 Subtotal 74,650 Total 214,050 EXHIBIT A SECURITY AGREEMENT ALM AVIATION LABOR MANAGEMENT, INC., and Debtor: ALM AVIATION OF COLORADO, LLC Address: Residence No. Street City State Zip Code Business 32451 Walt Bassett Avenue Pueblo CO 81001 No. Street City State Zip Code Secured Party: Name: CITY OF PUEBLO Address: 1 City Hall Place Pueblo CO 81003 No. Street City State Zip Code Debtor, for consideration, hereby grants to Secured Party a security interest in the following propertyxaY+cK 7_ WWKty'1Xnow owned or hereafter acquired by Debtor, together with all additions, accessions, substitutions, proceeds" 4% therefrom, g11bt YdfeVsXAfXvK46&, all herein called the "Collateral ": All equipment described in attached Exhibit "A" To secure the performance of the Debtors' Agreement dated as of March 22, 1999 between Debtors and the Secured Party and the payment of the indebtedness evidenced thereby e ayable to Secured Party. Ts�x► xl�������x �� �a�s� €�xx�x�����+4����x�t�x�t�� and all other liabilities of Debtor to Secured Party, absolute or contingent, due or to become due, now existing or hereafter arising including liabilities arising because of funds advanced in the future at the option of Secured Party, all herein called the "OBLIGATIONS ". DEBTOR EXPRESSLY WARRANTS AND COVENANTS: The Collateral is used or bought primarily for: ❑ Personal, family or household purposes; ❑ Use in farming operations; ® Use in business. That Debtor's residence is as stated above, and the Collateral will be kept at 32451 Walt Bassett Ave. Location Blitz Hangar, Pueblo Memorial Airport County Pueblo State CO 81 001 If any of the Collateral is crops, oil, gas, or minerals to be extracted or timber to be cut, or goods which are or are to become fixtures, said Collateral concerns the following described real estate situate in the n / a County of and State of Colorado, to -wit: The undersigned acknowledge receipt of a copy of this Security Agreement on date hereof, and agree that it includes and is subject to the ADDITIONAL PROVISIONS on the reverse side hereof, the some being incorporated herein by reference. Debtor: ALM AVIAT BO MANAG T, INC. AL OLO 0 LLC B __.�' By A=:�:20_2 esic�'ent an ger Dated: March 22, 1999 Nu. 651. Rev. 8 -90. SECURITY AGREEMENT Bradford Publishing, 1743 Wazee St., Denver, CO 80202 — (303) 292 -2500 — 11 -96 COLORADO UCC -1 FINANCING STATEMENT (See instructions on back) Standard Form Effective May 1, 1998 Total Fee = $16 1 111111 11111 11111 11111111111111 11111111 III IIIII (III IIII 289342 04/22/1999 04:20P UCC100 Chris C. Mulloz 1ST DEBTOR 1 of 2 R 21.00 D 0.00 Pueblo Cty Clk & Rec. Name (Last, First): ALM AVIATION LABOR MANAGEMENT, INC. SSN /FED Tax ID: 86-0761410 Check One: Street: 549 S. 48th ST. , SUITE 101 IN Business City, State, Zip: TEMPE , ARIZONA 85281 ❑ Individual 2ND DEBTOR (Put additional Debtors on attachment) Name (Last, First): ALM AVIATION OF COLORADO, LLC SSN /FED Tax ID: 84 Check One: Street: 32451 WALT BASSETT AVE. IX Business City, State, Zip: PUEBLO, CO 81001 ❑ Individual 1ST SECURED PARTY (Put additional Secured Parties on attachment) Name (Last, First): CITY OF PUEBLO Street: 1 CITY HALL PLACE City, State, Zip: PUEBLO, CO 81003 ASSIGNED PARTY (Put additional Assigned Party on attachment) Name (Last, First): Street: City, State, Zip: RETURN COPY TO Name: THOMAS E. JAGGER Street: 127 THATCHER BUILDING City, State, Zip: PUEBLO, CO 81003 Name of the Record Owner of the real property containing the collateral is: N/A (See instruction 13) Above Space For Filing Officer Use Only CHECK ONLY ONE (If no box is checked, it will be filed in UCC only) ® File in UCC ONLY ❑ This statement is to be recorded in the real estate records ONLY ❑ This statement is to be filed in UCC AND recorded in real estate records. (Requires an additional recording fee) ❑ The debtor is a transmitting utility. FOR UCC FILINGS (Fill in collateral codes from UCC Codes) 40 FOR AGRICULTURAL LIEN NOTIFICATION Check if this filing is intended as EFS notification ❑ Enter EFS collateral code, County Code and crop years covered. If all years are covered, leave from and to dates blank. EFS Code County Code From To COMPLETE DESCRIPTION OF COLLATERAL (Use if collateral codes do not adequately describe collateral. Attach additional pages if necessary) EQUIPMENT DESCRIBED IN ATTACHED LIST EXHIBIT "A" TOGETHER WITH ALL ADDITIONS, ACCESSORIES, SUBSTITUTIONS AND PROCEEDS THEREFROM CITY OF PUEBLO Debtor Signature(s) (See Instruction 14) Secured Party Signature(s) Printed Names) Title No. 602. Rev 1 -98. FINANCING STATEMENT (UCC -1) Bradford Publishing, 1743 Wazee St., Denver, CO 80202 — (303) 292-2500— 8 -98 BY / 1 =�-� -- THOMAS A (7'GER PrintedName(s) CITY ATTORNEY Title Contact Phone /FAX 11) Secretary of State (Filing Officer) SUBLEASE THIS SUBLEASE entered into as of the 22nd day of March, 1999, by and between Pueblo Development Foundation, a Colorado nonprofit corporation (herein "Landlord ") and ALM Aviation Labor Management, Inc., an Arizona corporation and ALM Aviation of Colorado, LLC, a Colorado limited liability company (herein collectively the "Tenant "), WITNESSETH: WHEREAS, Landlord is the lessee of the property described in attached Exhibit "A" under Ground Lease dated as of March 22, 1999 between Landlord and the City of Pueblo, a municipal corporation (the "Ground Lease "); and WHEREAS, Tenant is desirous of subleasing the property from Landlord on the terms and conditions hereinafter set forth; NOW, THEREFORE, in consideration of the mutual promises, covenants and conditions contained herein, Landlord and Tenant hereby agree as follows: ARTICLE 1. LEASED PREMISES 1.01 Landlord hereby subleases to Tenant and Tenant hereby subleases from Landlord those certain premises situate at the Pueblo Memorial Airport in the County of Pueblo, State of Colorado and more particularly described and shown on the attached Exhibit "A" which is made a part hereof including the Blitz Hangar located thereon to be remodeled by Landlord (the "Building ") (the "Leased Premises. ") Landlord reserves for the benefit of the City of Pueblo the right to the unrestricted use of the easement shown on Exhibit "A." 1.02 This Sublease and Tenant's use of the Leased Premises are subject to the covenants, provisions and conditions of this Sublease and the conditions, restrictions and limitations, if any, appearing of record, and all applicable zoning and land use laws, ordinances and regulations governing and regulating the use of the Leased Premises. 1.03 Tenant acknowledges that the Federal Aviation Administration (the "FAA ") occupies space in the Building under lease with the City of Pueblo (the "FAA Space "). Tenant understands and agrees that the FAA lease will continue in effect and FAA shall have the right to continued use and occupancy of the FAA Space and access thereto. ARTICLE 2. REMODELING BY LANDLORD 2.01 Landlord shall cause the Building to be remodeled in accordance with plans and specifications therefor prepared by HGF Architects, Inc. and approved by Landlord and Tenant (the "Remodeling "). The approval of Landlord and Tenant shall be made by signature of Landlord and Tenant affixed to the plans and specifications for the Remodeling prior to the commencement of construction of the Remodeling. EXHIBIT 2.02 Landlord shall pay the actual cost of Remodeling including architect/engineering fees and all contingencies up to but not exceeding the sum of $986,224.00. All other costs of Remodeling including but not limited to any other or additional work or improvements ordered or approved by Tenant shall be paid by Tenant. 2.03 Landlord and Tenant shall cooperate in good faith with each other to cause the Remodeling to be substantially completed on or before May 31, 1999. The failure to substantially complete the Remodeling by May 31, 1999 shall not affect the validity of this Sublease nor the obligations of Landlord and Tenant hereunder. 2.04 Tenant shall be responsible for the acquisition and installation of its fixtures and equipment in the Building and such installation shall not interfere with the Remodeling. ARTICLE 3. TERM 3.01 The term of this Sublease shall be for a period of ten (10) years, commencing upon the date notice of substantial completion of the Remodeling is given by Landlord to Tenant (the "Effective Date ") and ending ten (10) years thereafter unless sooner canceled or terminated as provided herein. Landlord and Tenant acknowledge and agree that certain obligations under this Sublease shall commence upon the date hereof prior to the Effective Date, and the parties agree to be bound thereby. 3.02 If not in default hereunder, Tenant shall have the option to extend the term of this Lease for two (2) successive five (5) year periods upon the same terms and conditions. In order to exercise the option to extend hereby granted, Tenant shall give to Landlord written notice of its exercise of this option at least six (6) months prior to the expiration of the initial ten year term or first extended period, whichever the case may be. Failure to timely give Landlord notice of the exercise of this option shall constitute waiver thereof by Tenant and the option hereby granted shall be canceled and terminated. ARTICLE 4. RENT 4.01 Tenant shall pay to Landlord rent for the Leased Premises during the term in the sum of $8,639.75 per month, payable monthly in advance, without notice or demand, for each full month (partial months shall be prorated) during said term, with the first payment due on the Effective Date and subsequent payments due on the first day of each month thereafter. All payments shall be made at or mailed by United States mail to the following address: P. O. Box 1663, Pueblo, Colorado, 81002, or such other address as Landlord may from time to time designated to Tenant in writing. 4.02 Tenant's obligation to pay rent to Landlord hereunder is absolute and unconditional and rent shall not be offset, abated, reduced or withheld for any cause or reason whatsoever. 4.03 Tenant shall pay a late charge of five (5) percent of any monthly rent not received by Landlord within ten (10) days after the first day of the month in which it is due. All rent and other IVA payments required to be made by Tenant hereunder which remain unpaid ten (10) days after their due date shall bear interest at the rate of ten percent (10 %) per annum. 4.04 It is the intent of the parties hereto that this Sublease be a "triple net" sublease with Landlord incurring no obligation, monetary or otherwise, except for completion of the Remodeling as provided in Articles 2.01 and 2.02. ARTICLE 5. USE OF THE PREMISES 5.01 The Leased Premises and improvements situated thereon shall be used and occupied by Tenant exclusively for aircraft painting, maintenance and repair. ARTICLE 6. ENVIRONMENTAL PROVISIONS 6.01 For the purpose of this Sublease, "Hazardous Materials" means any hazardous or toxic substance, material or waste which is or become regulated by any local government authority, the State of Colorado or the United States government and shall include, but not be limited to (1) substances defined as "hazardous waste," "restricted hazardous waste," "hazardous substance" or "hazardous material" under any applicable federal, state or local law or regulation ( "Environmental Regulations "), (2) asbestos - containing materials, (3) PCBs, (4) petroleum or petroleum based products, and (5) lead. 6.02 Landlord represents and warrants that it has no actual knowledge of the presence of any Hazardous Materials located on, under or about any portion of the Leased Premises; and that no portion of the Leased Premises is as of the date of execution of this Sublease subject to any lawsuit, proceeding, citation, or investigation pending or overtly threatened relating to any contamination or alleged contamination by any Hazardous Materials or any violation or alleged violation of any Environmental Regulation. 6.03 Tenant will comply with Environmental Regulations that are applicable to the Tenant and its use of the Leased Premises. No activity shall be undertaken by Tenant, its employees, agents, licensees, invitees, contractors or subcontractors, on all or any portion of the Leased Premises which would cause or permit: (i) the presence, use, generation, release, discharge, storage or disposal of any Hazardous Material in, on, under, about, or from the Leased Premises or any part thereof in violation of any Environmental Regulations; (ii) any portion of the Leased Premises to become a hazardous waste treatment, storage or disposal facility without receiving proper governmental authorization, and in compliance with all Environmental Regulations; or (iii) the discharge of pollutants or effluents into any water source or system, or the discharge into the air of any emissions without receiving proper governmental authorization, and in compliance with all Environmental Regulations, including, without limitation, the Federal Water Pollution Control Act, U.S.C. Section 1251 et sea. and the Clean Air Act, 42 U.S.C. Section 7401 et se q. 6.04 Tenant agrees to indemnify and forever hold harmless Landlord and the City of Pueblo, their agents, successors, and assigns, from all claims, losses, damages, expenses and costs, -3- including, but not limited to, attorneys' fees, remedial and cleanup costs, incurred by reason of the use, storage, generation, release, discharge, maintenance, disposal, or removal of Hazardous Materials in, on, under, about, or from the Leased Premises, or any part thereof, by Tenant, its employees, agents, licensees, invitees, contractors and subcontractors. The provisions of the Article 6.04 shall expressly survive the expiration of the Term or other termination of this Sublease. ARTICLE 7. ALTERATIONS AND IMPROVEMENTS 7.01 Tenant shall not make any alterations or improvements to the Leased Premises without first obtaining Landlord's and City of Pueblo's written approval. All Remodeling and other permanent alterations and improvements shall become part of the Leased Premises, subject to Lessee's right to use same during the term hereof. 7.02 All alterations or improvements of a detachable or temporary nature placed upon the Leased Premises by Tenant using its own funds shall remain the property of Tenant, subject to Tenant's ri at its option, to remove same not later than termination of this Sublease. Tenant shall promptly repair any damage resulting from such removal at its own cost and expense. 7.03 All alterations and improvements to the Building and all activities on the Leased Premises constructed and conducted by Tenant shall be in compliance with all applicable federal, state and local law, regulations, and codes. ARTICLE 8. REPAIRS AND MAINTENANCE 8.01 Except for the Remodeling as provided in Article 2, Landlord shall not be obligated to repair, maintain or alter the Leased Premises or any part thereof. Tenant, at its expense, shall keep and maintain the Leased Premises, including without limitation, the ramp area and Building and all its component parts in good condition and repair and in a good, clean and safe condition at all times during the effective term of this Sublease and return the same to Landlord at any termination hereof in as good condition and state of repair as the same were in as of the Effective Date, except for reasonable wear and tear. 8.02 If Tenant becomes obligated to make repairs which are or may be covered by any contractor's or manufacturer's warranty issued to or for the benefit of Landlord, Landlord will assign and transfer to Tenant its interest in any such warranty for the purpose of Tenant making such repairs. 8.03 If Tenant becomes obligated to make repairs caused by an occurrence covered by insurance described in Article 12, the net proceeds of such insurance shall be made available to Tenant to offset the cost of such repairs. ARTICLE 9. TENANT'S PROPERTY AND TRADE FIXTURES 9.01 Any and all property, goods, chattels and fixtures, including trade fixtures, placed in 0 or upon and/or affixed to the Leased Premises by Tenant using its own funds shall remain the exclusive property of Tenant, and Landlord shall have no interest of any kind therein. Unless in default of its obligation to pay rent, Tenant shall have the right to remove any or all such property, goods, chattels and fixtures, including trade fixtures, at any time during the term of this Sublease, and/or at the termination hereof, provided Tenant shall promptly repair any damage to the Leased Premises caused by such removal. ARTICLE 10. LANDLORD'S ACCESS TO LEASED PREMISES 10.01 Landlord, or Landlord's officers, employees, agents and representatives, as the case may be, may enter the Leased Premises during normal business hours upon 48 hours prior written notice to Tenant, except notice shall not be required in case of emergency, such as fire. ARTICLE 11. INSURANCE AND INDEMNIFICATION 11.01 Tenant shall indemnify and hold Landlord and the City of Pueblo and their respective officers, agents and employees harmless from and defend Landlord and the City of Pueblo and their respective officers, agents and employees against any and all claims or liability, including costs of defense and reasonable attorney fees, for any injury or damage to Tenant or its agents or employees or third persons or property while upon, about or around the Leased Premises, caused or occurring by reason of Tenant's use or occupancy of the Leased Premises or the negligent acts or omissions of Tenant, its agents or employees. 11.02 Tenant shall secure and maintain, at its expense, commercial liability insurance with coverage in amounts not less than hereinafter specified for the protection of Landlord and Tenant: $1,000,000 Property damage. $1,000,000 For death, bodily injury, or personal injury to any one person in any one occurrence. $2,000,000 For death, bodily injury, or personal injury to any two or more persons in any one occurrence. 11.03 Tenant shall procure and maintain workers' compensation insurance required by Colorado law. 11.04 A copy of each insurance policy, or certificate thereof, issued by an association or company authorized to issue such policy or policies under the laws of the State of Colorado and containing a provision prohibiting cancellation or material modification of the insurance with respect to the Leased Premises, except after thirty (30) days' notice to Landlord, shall be delivered to the Landlord within a reasonable time after the same has been issued, and thereafter the Tenant will furnish to Landlord evidence of the continuance of the insurance coverage required herein within a reasonable time after the same has been issued. -5- ARTICLE 12. FIRE AND EXTENDED COVERAGE 12.01 Tenant shall, at its expense, secure and maintain in full force and effect during the effective term of this Sublease "All Risk" (including fire, extended coverage, boiler and contractual coverage) insurance upon the Leased Premises. Such insurance shall be in an amount not less than the full replacement value of the Building and improvements, shall contain a standard Colorado loss payee clause in favor of the City of Pueblo, and shall not be subject to cancellation, reduction or modification upon less than thirty (30) days' written notice to the City of Pueblo. Such insurance, by its terms or by its endorsement, shall waive any right of subrogation of the insurer against Landlord and the City of Pueblo and their respective officers, agents and employees, for any loss or damage covered by such insurance. Tenant shall furnish to the City of Pueblo evidence of such insurance and its continuance during the term of this Sublease. 12.02 Tenant shall, at its expense, secure and maintain fire and extended coverage insurance on all equipment and fixtures installed by Tenant on the Leased Premises. Such insurance, by its terms or by endorsement, shall waive any right of subrogation of the insurer against the City of Pueblo and Landlord, and their respective agents and employees, for any loss or damage covered by such insurance. ARTICLE 13. LIENS. TAXES AND ASSESSMENTS 13.01 Tenant shall promptly pay and discharge as they become due and before delinquency all liens, taxes, charges, levies or excises, whether private or governmental in nature or whether general or special or ordinary or extraordinary, of every name, nature and kind whatsoever, including all mechanics' or judgment liens, and property, sales and use taxes and governmental charges of whatsoever name, nature or kind, which may be levied, charged or imposed, or which may become a lien or charge on or against the Leased Premises or any part thereof, the Leasehold of Tenant herein, or the improvements situated on the Leased Premises during the term of this Sublease. 13.02 Tenant shall pay all personal property taxes levied or charges against any of the personal property belonging to it and situated on or used in connection with the operation and maintenance of the Leased Premises during the term of this Sublease. 13.03 Tenant shall have the right to contest or review, by legal proceedings at its own expense, and if necessary in the name of Landlord, or in such other manner as it may deem suitable, any lien, tax, assessment, levy or charge herein agreed to be paid by Tenant under this Article 13. Tenant may defer payment of any such contested item if in connection with the proceeding instituted by Tenant there shall have been obtained a stay of the collection of the item so contested. In the event of such contest, Tenant shall give Landlord written notice prior to the commencement of any such contest which shall be at least ten (10) days prior to delinquency of the item in contest and, on request of Landlord, Tenant shall give to Landlord a good and sufficient surety bond indemnifying Landlord and the Leased Premises against any such lien, tax assessment, levy or other charge and from any cost, liability or damage arising out of such contest. In the event any notices of liens or proposed increases in taxes, assessments, levies or charges which are the obligation of Tenant are in received by Landlord, it shall promptly forward the same to Tenant in order that Tenant may proceed with payment or contest procedures within the periods provided for such purposes. 13.04 All rebates or refunds on account of any tax assessments, levy or charge required to be paid and paid by Tenant shall belong to Tenant, and Landlord will, on request of Tenant, execute any documents which may be necessary in order to secure the recovery of any rebates or refunds and will pay over to Tenant any such rebates or refunds that may be received by Landlord. 13.05 Tenant shall furnish Landlord within thirty (30) days after any amount is payable by Tenant under this Article 13, official receipts of the appropriate person or taxing authority or other proof satisfactory to Landlord evidencing such payments as are required under this Article 13. ARTICLE 14. UTILITIES 14.01 Tenant shall pay before delinquent all charges for water, sewer, gas, electricity, telephone and all other utility services used in or supplied to the Leased Premises. ARTICLE 15. DAMAGE TO OR DESTRUCTION OF PREMISES 15.01 If, during the term of this Sublease or any extension thereof, the Leased Premises shall be destroyed or damaged, or partially destroyed or damaged, to such a limited extent that the repair of such destruction or damage and the restoration of the Leased Premises can be accomplished, with reasonable diligence, within one hundred twenty (120) days after such destruction or damage, Tenant shall promptly repair such destruction or damage and cause the Leased Premises to be restored to their condition prior to the event causing the destruction or damage. If, during the term of this Sublease or any extension thereof, the Leased Premises shall be destroyed or damaged, or partially destroyed or damaged to such an extent that the repair of such destruction or damage and the restoration of the Leased Premises cannot be accomplished, with reasonable diligence, within one hundred twenty (120) days after destruction or damage, then Tenant shall promptly notify Landlord in writing of such fact, and either party shall have the right, during a period of thirty (30) days following such notification, to terminate this Sublease by written notice to the other party, declaring this Sublease to be terminated. If this Sublease is so terminated, all proceeds of insurance required to be maintained by Tenant under Article 12.01 shall be paid to the City of Pueblo. Unless such notice of immediate termination shall be given within such'- 0 -day period, this Sublease shall continue in full force and effect and Tenant shall promptly repair such destruction or damage and cause the Leased Premises to be restored to their condition prior to the event causing the destruction or damage. In the event the Leased Premises are destroyed or damaged, or are partially destroyed or damaged, the rent per month payable by Tenant while this Sublease shall remain in effect shall not be reduced or abated. ARTICLE 16. CONDEMNATION 16.01 If the whole or any substantial part of the Leased Premises shall be taken or condemned by any competent authority for any public or quasi - public use or purpose, then this -7- Sublease shall terminate on the date when the possession of the part so taken shall be required for such use or purpose. There shall be no apportionment of the award for taking or condemnation, the entire award going to Landlord, provided, that Tenant shall have the right to recover any award which may be made for damages to or condemnation of Tenant's movable trade fixtures, furniture and furnishings. ARTICLE 17. ASSIGNMENT AND SUBLETTING 17.01 Neither this Sublease nor the Leased Premises shall be assigned or sublet by Tenant, by process or operation of law, or in any manner whatsoever. ARTICLE 18, HOLDING OVER 18.01 In the event that Tenant shall retain possession of the Leased Premises after the expiration of the term of this Sublease, this Sublease shall continued on a month -to -month basis upon all the terms, covenants and conditions herein. ARTICLE 19. QUIET POSSESSION 19.01 Landlord covenants that Tenant, upon paying the rent and complying with the terms, covenants and conditions of this Sublease or any extension thereof, shall and may peaceably and quietly have, hold, and enjoy the Leased Premises subject to the terms and conditions herein. ARTICLE 20. DEFAULT 20.01 In the event of default at any time by Tenant in the payment of the rent herein provided for or in the performance of any other of its agreements or covenants herein contained, Landlord shall have the right, after written notice to Tenant and Tenant's failure within thirty (30) days after Landlord's delivery of such notice to Tenant to cure or undertake and diligently pursue action to cure said default, to either: (a) declare the term of this Sublease ended and re -enter and take possession of the Leased Premises, and/or (b) pursue any remedy whatsoever provided by law; and/or (c) re -enter and take possession of the Leased Premises and use its best efforts to relet the same for and on account of Tenant for the then full remaining portion of the term of this Sublease or for any shorter period, and to collect and receive payment of rent therefor and apply any and all monies so received as rent to the credit of Tenant for the rent accruing under the term of this Sublease, but no such re- letting shall be construed as a termination of this Sublease or as a release of Tenant from Tenant's obligation to pay rent provided during the full term of this Sublease, or from Tenant's obligation to perform any other covenant herein contained, it expressly being understood and agreed that in the event of any such re -entry by Landlord such re -entry shall not operate to -8- terminate this Sublease or alter the obligation of Tenant to perform its covenants to pay rent pursuant to the terms hereof unless Landlord expressly so elects pursuant to paragraph 20.01(a) above. 20.02 Tenant shall pay all Landlord's costs, charges and expenses including costs and fees of legal counsel, agents and others retained by Landlord, incurred in enforcing Tenant's obligations hereunder or incurred by Landlord in any litigation, negotiation or transaction which Tenant causes Landlord without Landlord's fault to become involved or concerned. 20.03 If Tenant violates any of the terms and provisions of this Sublease or defaults in any of its obligations hereunder other than the payment of rent or other sum payable hereunder, such violation may be restrained or such obligation enforced by injunction at the instance and request of Landlord and without the showing of any special damages or other adequate remedy at law. 20.04 If Tenant institutes an action against Landlord for wrongful termination or wrongful eviction and Tenant prevails in such action, the court shall award Tenant its costs and expenses, including reasonable attorney fees. 20.05 All litigation arising out of this Sublease shall be filed in the District Court, County of Pueblo, State of Colorado, and each party submits to the jurisdiction of that Court. To the extent allowed by law, each party waives its right to a jury trial. ARTICLE 21. NONDISCRIMINATION 21.01 Tenant, for itself, its successors and approved assigns, as part of the consideration hereof, does hereby covenant and agree as a covenant running with the Leased Premises that (a) No person on the grounds of race, creed, color, sex, national origin, age or handicap shall be excluded from participation in, denied the benefits of, or be otherwise subject to discrimination in the use of the Leased Premises. (b) In the construction of any improvements on, over, or under the Leased Premises and the furnishing of services thereon, no person on the grounds of race, color, religion, sex, national origin, age or handicap shall be excluded form participating in, denied the benefits of, or otherwise be subjected to discrimination. (c) Tenant shall use the Leased Premises in compliance with all other applicable requirements imposed by or pursuant to 49 CFR, Subtitle A, Part 21, and as said Regulations may be amended. 21.02 Tenant assures that (a) Tenant will undertake an affirmative action program as required by 14 CFR, Part 152, Subpart E, to insure that no person shall, on the grounds of race, creed, color, national origin, or sex, be excluded from participating in any employment, contracting or leasing activities In covered in 14 CFR, Part 152, Subpart E. 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 said Subpart E. (b) Tenant will comply with all other applicable requirements imposed by or pursuant to 14 CFR, Part 152, Subpart E, and as said Regulations may be amended. ARTICLE 22. FEDERAL AVIATION ADMINISTRATION REQUIREMENTS 22.01 Tenant hereby acknowledges and agrees that the City of Pueblo has reserved unto itself, its successors and assigns, for use and benefit of the public, a right of flight for the passage of aircraft in the airspace above the surface of the Leased Premises, together with the right to cause in said airspace such noise as may be inherent in the operation of any aircraft, now known or hereafter used, for navigation of flight in said airspace, and for the use of said airspace for landing on, taking off from, or operation on or over the Pueblo Memorial Airport. 22.02 Tenant shall not permit and shall restrict the height of structures, objects of natural growth and other obstructions on the Leased Premises to a height of not more than 52 feet above ground level, in the event this covenant is breached, Landlord and the City of Pueblo reserve the right to enter upon the Leased Premises at the expense of Tenant to remove the offending stricture or object and to cut the offending growth. 22.03 Tenant shall not permit and shall prevent any use of the Leased Premises which would interfere with landing or taking off of aircraft at Pueblo Memorial Airport, or otherwise constitute an airport hazard. 22.04 Tenant shall comply with the notification and review requirements of the Federal Aviation Administration prior to the construction, modification or alteration of any structure or building on the Leased Premises. 22.05 This Sublease is and shall be subject and subordinate to the provisions and requirements of any existing or future agreement between the City of Pueblo and the United States Government or any agency thereof relating to the use, development, operation, or maintenance of the Pueblo Memorial Airport. 22.06 Neither this Sublease nor any provision hereof shall be construed to grantor authorize the granting of an exclusive right, privilege or franchise. 22.07 Tenant acknowledges and agrees that the City of Pueblo has reserved and shall have the right, without any obligation on its part to do so and without penalty or liability, to maintain and keep in repair the landing area and other public areas or facilities of the Pueblo Memorial Airport and to develop, modify, change, repair, improve, remove or abandon the Pueblo Memorial Airport or any part thereof as it may determine, in its sole and absolute discretion, at any time and from time to time, and to direct and control all activities of Tenant with respect thereto. Tenant hereby waives, KIZ releases and discharges the City of Pueblo from any and all claims, demands and liabilities for any damage or injuries resulting from or occasioned by any such actions taken or omitted to be taken by the City of Pueblo, provided, however, that if the City of Pueblo's actions materially impair Tenant's ability to conduct its business on the Leased Premises, Tenant may terminate this Sublease upon thirty (3 0) days prior written notice given to Landlord. 22.08 Tenant shall comply with all Federal Aviation Administration and City of Pueblo rules and regulations relating to the use, occupancy or operation of the Pueblo Memorial Airport. ARTICLE 23. WAIVER AND TIME OF ESSENCE 23.01 No waiver of any breach or breaches of any provision, covenant or condition of this Sublease by Landlord shall be construed to be a waiver of any preceding or succeeding breach of such provision, covenant or condition, or of any other provision, covenant or condition; and time is of the essence for each and every provision, covenant and condition herein contained and on the part of Tenant to be done and performed. The acceptance of rent or partial payment of rent by Landlord shall not be construed to be a waiver of any then existing breach of this Sublease. ARTICLE 24. NOTICES 24.01 All notices, demands or communications of any kind which may be required or desired to be served, given or made by Tenant upon or to Landlord, under the terms of or in connection with this Sublease, shall be sufficiently served, given or made (as an alternative to personal service upon Landlord) if sent by certified United States Mail, addressed to: Pueblo Development Foundation Post Office Box 1663 Pueblo, Colorado 81002 (or such other address as may hereafter from time to time be designated for this purpose by Landlord to Tenant in writing). All notices, demands or communications of any kind which may be required or desired to be served, given or made by Landlord upon or to Tenant, under the terms of or in connection with this Sublease, shall be sufficiently served, given or made (as an alternative to personal service upon Tenant) if such notice, demand or communication if sent by certified United States Mail, addressed to: Aviation Labor Management, Inc. 549 S. 48th Street, Suite 101 Tempe, Arizona 85281 (or to such other address as may hereafter from time to time be designated for this purpose by Tenant to Landlord in writing). -11- ARTICLE 25. SIGNS 25.01 Tenant shall not inscribe, paint or affix any signs, advertisements, placards or awnings on the exterior or roof of the Building or Land without the prior written consent of the City of Pueblo. ARTICLE 26. MISCELLANEOUS PROVISIONS 26.01 Colorado Law This Sublease shall be governed by the laws of the State of Colorado and shall be construed in accordance therewith. 26.02 Writing for Waiver or Modification No provision of this Sublease may be waived or modified except by an agreement in writing signed by the waiving party. A waiver of any term or provision shall not be construed as a waiver of any other term or provision. 26.03 Binding Effect This Sublease shall inure to the benefit of and be binding on the parties and their respective successors and approved assigns. The parties agree to do any and all things lawful and necessary to effectuate the purposes of this Sublease. 26.04 Construction Throughout this Sublease, the singular shall include the plural; the plural shall include the singular; and the masculine and neuter shall include the feminine, wherever the context so requires. 26.05 Text to Control The headings of sections are included solely for convenience of reference. If any conflict between any heading and the text of this Sublease exists, the text shall control. 26.06 Severability If any provision of this Sublease is declared by any court of competent jurisdiction to be invalid for any reason, such invalidity shall not affect the remaining provisions. On the contrary, such remaining provisions shall be fully severable, and this Sublease shall be construed and enforced as if such invalid provisions had never been inserted in the Sublease. 26.07 Relationships The relationship between Landlord and Tenant is purely contractual and that of Landlord- Tenant. Tenant acts as an independent contractor and not as an agent of Landlord. 26.08 Entire Agreement This Sublease constitutes the entire understanding between the parties and supersedes all prior or independent agreements between the parties covering the subject matter hereof. 26.09 Venue Tenant and Landlord agree that the venue for all actions or causes of action relating to this Sublease or the Leased Premises shall be in Pueblo County, Colorado. All such actions shall be filed in the District Court, County of Pueblo, State of Colorado, and Tenant and Landlord submit to the jurisdiction of that Court for such purposes. To the extent authorized by law, -12- each party waives the right to a jury trial. IN WITNESS WHEREOF, Landlord and Tenant, by their duly authorized representatives, have executed this Sublease on the day and year first above written. PUEBLO DEVELOPMENT FOUNDATION B Title ALM AVIATION LABOR MANAGEMENT, INC. A Title: >� i /� / i i'•ti RIVER. : -13- ARTICLE 4 CONTRACT SUM 4.1 The Owner shall pay the Contractor in current funds for the Contractor's performance of the Contract the Contract Sum of Nine hundred twenty one thousand six hundred twenty four & no /100- - - - - -- Dollars (3 921, 624.00 ), subject to additions and deductions as provided in the Con- tract Documents. 4.2 The Contract Sum is based upon the following alternates, if any, which are described in the Contract Documents and are hereby accepted by the Owner: (State the numbers or other identification of accepted alternates. If decisions on other alternates are to be made by the Ou ner subsequent to the execution of this Agreement, attach a schedule of such other alternates shou -ing the amount for each and the date until u hicb that amount is ralid.) BASE BID Electrical Bid - $75,671 + 5% Overhead Addendums #1 and #2 Addendum #3, Item #1 -Two (2) 30 HP Compressors Addendum #4 - Electrical Electrical for Overhead Door Revise Bifold Door to 42' Wide Value Engineering Use 29 ga R Panels in lieu of 24 ga soffit panels on ceiling Change type of purlin Delete metal paneling on east wall Use 26 ga soffit panels in lieu of 24 ga Use standard motors in lieu of explosion proof on exhaust fans R &R Heating to do their own balancing Change exhaust duct size TOTAL CONTRACT SUM 809,650.00 79,455.00 13,065.00 41,248.00 3,637.00 854.00 575.00 (12,090.00) (1,900.00) (4,511.00) (3,109.00) (3,000.00) (1,250.00) (1,000.00) 0 921, 624.00 AIA DOCUMENT A101 - OWNER- CONTRACTOR AGREEMENT - TWELFTH EDITION - AIA' - ©1987 THE AMERICAN INSTITUTE OF ARCHITECTS, 1735 NEW YORK AVENUE, NX., WASHINGTON, D.C. 20006 All 01 -1987 3 BLITZ HANGER RENO VATION SCHED UL OF VAL UES k nt GENERAL CONSTRUCTION & SUPPLY 2819 FARABAUGH LAME • PUEBLO, CO 81005 (719) 564 -0726 BONDS, INSURANCE & PERMITS 16,500.00 GENERAL CONDITIONS 35,535.00 DEMOLITION 1,150.00 FENCING 1,615.00 CONCRETE 15,985.00 STRUCTURAL STEEL 68,138.00 STEEL ALLOWANCE 5,000.00 METAL BUILDING 159,852.00 INSULATION 49,545.00 CAULKING 17,710.00 DOORS & HARDWARE 11,505.00 GLASS & GLAZING 7,500.00 DRYWALL & ACOUSTICAL 28,100.00 FLOOR COVERINGS 3,050.00 - PAINTING 8,300.00 TOILET PARTITIONS & ACCESSORIES 1,015,00 PLUMBING 18,750.00 FIRE PROTECTION 172,500.00 HVAC 162,400.00 SITE UTILITIES 25,500.00 TOTAL 809, 650.00 t Mangini & Associates Inc. 631 Lake Avenue Pueblo, Colorado 81004 (719) 544 -0865 (719) 544 -0876 Fax LEG AL I)1 E L• A A parcel of land being a portion of the N' /z of Section 30, Township 20 South, Range 6' ) West, also being a portion of Parcel H of the Pueblo Memorial Airport Park Subdivision filed for record in Book 2836 at Pale 665 -670 in the records of the Pueblo County Clerk and Recorder, County of Pueblo, State of Colorado, being more particularly described as follows: BEGINNING at a point on the north right -of -way line of Walt Basset Avenue, from which the centerline intersection of said Walt Bassett Avenue and Fairchild Street bears S 72 °26'39 "W (bearinD based on the said centerline of Walt Bassett Avenue from the intersection of Walt Bassett and Fairchild Street, to the centerline intersection of Walt Bassett and Braniff Street, monumented at each end with a 30" x 3 I /4 " aluminum monument in cast iron monument box to bear N 88 °26'39 "E) a distance of 145.12 feet; thence N 01 °28'35 "W a distance of 493.15 feet; thence N 88 °31'33 "E a distance of 403.88 feet; thence S 01 °38'38 "E a distance of 492.58 feet to a point on the said north right -of way line of Walt Bassett Avenue thence S 88 °26'39 "W along the said north right -of -way line of Walt Bassett Avenue a distance of 405.32 feet to the POINT OF BEGINNING Said Pa ins 4.58 acres more or less. ROCKY L. MA DATE PROFESSIONAL LAND SURVEYOR 16128 _4P!� 4 16128 Q'. OF COQ Professional Engineers EXHIBIT "A" Land Survey P/ Parcels l i the E 712 of the MW 714 of Section M, Township 20 South Range 63 West of the Sixth Principal meridian. Pueblo Count Colcrodf) sure � vsF Watt Bassett - — - — - — - — - — - — - — - — — - — - — - — - — - — - — - — - — - — — Avenue Afi.%A* `' Mangini & Associates Inc. 631 Lake Avenue Pueblo, Colorado 81004 (719) 544 -0865 (719) 544-0876 Fax PARKING E.:1 S L.ti11�._ . � h .... -- 1 R(.. E: l . U A parcel of land being a portion of the NI /z of Section 30, Township 20 South; Range 63 West, also being a portion of Parcel H of the Pueblo Memorial Airport Park Subdivision filed for record in Book 2836 at Page 665 -670 in the records of the Pueblo County Clerk and Recorder, County of Pueblo, State of Colorado, being more particularly described as follows: BEGINNING at a point from which the centerline intersection of Walt Bassett Avenue and Fairchild Street bears S 56 °19'47 "W (bearing based on the said centerline of Walt Bassett Avenue from the intersection of Walt Bassett and Fairchild Street, to the centerline intersection of Walt Bassett and Braniff Street, monumented at each end with a 30" x 3 '/4 aluminum monument in cast i monument box to bear N 88 °26'39 "E) a distance of 1000.97 feet; thence N 01 °48'56 "W a distance of 473.02 feet; thence N 88 0 25'38 "E a distance of 176.18 feet; thence S 01'45'00 "E a distance of 473.32 feet; thence S 88°31'33 "W a distance of 175.64 feet to the POINT OF BEGINNING Said Parcel contains 1.91 acres more or less RESERVING THEREFROM: An access easement for the purpose of ingress and egress across the above described parcel, said easement being (20) twenty feet in width, (10) ten feet on each side of the following described centerline. COMMENCING at a point from which the centerline intersection of Walt Bassett Avenue and Fairchild Street bears S 56'19'47"W (bearing based on the said centerline of Walt Bassett Avenue from the intersection of Walt Bassett and Fairchild Street, to the centerline intersection of Walt Bassett and Braniff Street, monumented at each end with a 30" x 3 '/4" aluminum monument in cast iron monument box to bear N 88 °26'39 "E) a distance of 1000.97 feet; thence N 01 °48'56 "W a distance of 278.35 feet to the POINT OF BEGINNING; thence along an arc of a non- tangent curve to the left whose center bears N 02 °39'34 "W having a central angle of 10 °34'48" an arc length of 79.03 feet and a radius of 428.00 feet; thence N 76 °45'38 "E a distance of 99.49 feet to the POINT OF TERMINUS. �:L- - ROCKY L. MANG PROFESSIONAL LAND SURVEYOR 16128 d15 iilj� 3 l� ; 16129 : 4 y o DATE al i • 4 10% 0 OF Ca Professional Engineers & Land Surveyors RESOLUTION OF ALM AVIATION LABOR MANAGEMENT, INC. FOR THE EXECUTION OF CONTRACT RESOLVED, that it is desirable and in the best interest of ALM AVIATION LABOR MANAGEMENT, INC., togetherwith ALM AVIATION OF COLORADO, LLC, as principals, to enter into contract with the City of Pueblo Colorado, a municipal corporation, which shall be considered to be in the corporation's best interests and in furtherance of corporate business. The President, Vice- President, or Secretary of ALM Aviation Labor Management, Inc. are hereby authorized to execute on behalf of the corporation any contract(s) in furtherance of this stated purpose, including but not limited to the attached Exhibit A, which also shall include any amendments, modifications, renewals, or extensions, and that the execution of said contract(s) by those officers is hereby approved and ratified. PRESIDENT'S CERTIFICATE The undersigned hereby certifies that he is the President of ALM AVIATION LABOR MANAGEMENT, INC., a corporation organized and existing under the laws of the State of Arizona, that the foregoing is a true and correct copy of the resolution duly adopted at a meeting of the Board of Directors of said corporation held on the 24 day of March, 1999, at which meeting a quorum was at all times present and acting; that the passage of said resolution was in all respects legal; and that said resolution is in full force and effect. Dated this , 12 day of Aw l , 1999. Todd Mihelich, President RESOLUTION OF ALM AVIATION LABOR MANAGEMENT, INC., FOR THE EXECUTION OF LEASE RESOLVED, that it is desirable and in the best interest of ALM AVIATION LABOR MANAGEMENT, INC., togetherwith ALM AVIATION OF COLORADO, LLC, as principals, to enter into a lease agreement with the Pueblo Development Foundation, a Colorado nonprofit corporation, which shall be considered to be in the corporation's best interests and in furtherance of corporate business. The President, Vice - President, or Secretary of ALM Aviation Labor Management, Inc. are hereby authorized to execute on behalf of the corporation any contract(s) in furtherance of this stated purpose, including but not limited to the attached Exhibit A, which also shall include any amendments, modifications, renewals, or extensions, and that the execution of said contract(s) by those officers is hereby approved and ratified. PRESIDENT'S CERTIFICATE The undersigned hereby certifies that he is the President of ALM AVIATION LABOR MANAGEMENT, INC., a corporation organized and existing under the laws of the State of Arizona, that the foregoing is a true and correct copy of the resolution duly adopted at a meeting of the Board of Directors of said corporation held on the 24` day of March, 1999, at which meeting a quorum was at all times present and acting; that the passage of said resolution was in all respects legal; and that said resolution is in full force and effect. Dated this 2, �? day of 1 1999. Todd Mihelich, President RESOLUTION OF ALM AVIATION OF COLORADO, LLC FOR THE EXECUTION OF CONTRACT RESOLVED, that it is desirable and in the best interest of ALM AVIATION OF COLORADO, LLC, together with ALM AVIATION LABOR MANAGEMENT, INC., as principals, to enter into contract with the City of Pueblo Colorado, a municipal corporation, which shall be considered to be in the company's best interests and in furtherance of company business. The President, Vice - President, or Secretary of ALM Aviation of Colorado, LLC are hereby authorized to execute on behalf of the company any contract(s) in furtherance of this stated purpose, including but not limited to the attached Exhibit A, which also shall include any amendments, modifications, renewals, or extensions, and that the execution of said contract(s) by those officers is hereby approved and ratified. PRESIDENT'S CERTIFICATE The undersigned hereby certifies that he is the President of ALM AVIATION OF COLORADO, LLC, a limited liability company organized and existing under the laws of the State of Colorado, that the foregoing is a true and correct copy of the resolution duly adopted at a meeting of the Board of Directors of said limited liability company held on the 24 day of March, 1999, at which meeting a quorum was at all times present and acting; that the passage of said resolution was in all respects legal; and that said resolution is in full force and effect. Dated this 2Z day of 6 Pr- ; ( ' 1999. Todd Mihelich, President RESOLUTION OF ALM AVIATION OF COLORADO, LLC FOR THE EXECUTION OF LEASE RESOLVED, that it is desirable and in the best interest of ALM AVIATION OF COLORADO, LLC, together with ALM AVIATION LABOR MANAGEMENT, INC., as principals, to enter into a lease agreement with Pueblo Development Foundation, a Colorado nonprofit corporation, which shall be considered to be in the company's best interests and in furtherance of company business. The President, Vice - President, or Secretary of ALM Aviation of Colorado, LLC are hereby authorized to execute on behalf of the company any contract(s) in furtherance of this stated purpose, including but not limited to the attached Exhibit A, which also shall include any amendments, modifications, renewals, or extensions, and that the execution of said contract(s) by those officers is hereby approved and ratified. PRESIDENT'S CERTIFICATE The undersigned hereby certifies that he is the President of ALM AVIATION OF COLORADO, LLC, a limited liability company organized and existing under the laws of the State of Colorado, that the foregoing is a true and correct copy of the resolution duly adopted at a meeting of the Board of Directors of said company held on the 24t day of March, 1999, at which meeting a quorum was at all times present and acting; that the passage of said resolution was in all respects legal; and that said resolution is in full force and effect. Dated this ZZ day of 6T:/ ' 1999. " I ihelich, President STATE OF COLORADO ) AFFIDAVIT COUNTY OF PUEBLO ) I, Todd Mihelich, being first duly sworn upon oath, do hereby affirm as follows: 1. I am over 18 years of age and a resident of the State of Arizona. 2. 1 am the President of ALM Aviation Labor Management, Inc., an Arizona corporation. 3. ALM Aviation Labor Management, Inc., an Arizona corporation, submitted an Application for Authority which would allow the Arizona corporation, ALM Aviation Labor Management, Inc., to transact business in the State of Colorado. See Exhibit A, attached. 4. The form represented herein as Exhibit A, requesting authority to do business in the State of Colorado, was properly accepted and filed by the Colorado Secretary of State on April 15, 1999. 5. I, by and through Colorado counsel, Shannon Reed of Pueblo, Colorado, have confirmed the acceptance and filing of the Application of Authority, Exhibit A, by telephone conference with the Colorado Secretary of State's Office on April 22, 1999. Further, Affiant saith not. ' Mihelich, President ALM Aviation Labor Management, Inc. An Arizona corporation Subscribed before me under oath this 22 day of April, 1999, by Todd Mihelich. Witness my hand and official seal. My Commission Expires: February 25, 2002 =OFCWOLORAADO No ary Public t 1311 North Greenwood Pueblo, CO 81003 Please include a typed self- addressed envelope MUST BE TYPED FILING FEE: $75.00 MUST SUBMIT TWO COPIES Mail to: Secretary of State,1 Corporations Section 1560 Broadway, Suite 200 Denver, CO 80202 (303) 894 -2251 Fax (303) 894 -2242 APPLICATION FOR AUTHORITY Pursuant to the provisions of the Colorado Business Corporation Act, the undersigned corporation hereby applies for Authority to transact business in Colorado, and for that purpose submits the following statement: FIRST: The name of the corporation is ALM AVIATION LABOR MANAGF.MFNT Tmr (Exact Corporation name must agree with the attached Certificate of Good Standing) SECOND: The name which it elects to use in Colorado is ALM AVIATION LABOR MANAGEMENT, INC (If its corporate name is not available for use in Colorado.) THIRD: It is incorporated under the laws of Arizona FOURTH: The date of its incorporation is 5/1 9/94 The period of duration is Indefinite FIFTH: The street address of its principal office 5 4 9 S . 4 8 th S t ree t , # 10 1 , Tempe , AZ 85281 SIXTH: The street address of its proposed registered office in Colorado is 32451 Walt Aassett Ave. , Pueblo, CO 81 001 , and the name of its proposed registered agent in Colorado at that address is Rober ford Signature of Registered Agent ' (may be in accompanying document) Date Business commenced or expect o Eom nce transa ng business in this state Apr i 1 7, 1999 SEVENTH: The names and respective addresses of its directors and officers are: OFFICE President NAME Todd Mihelich 549 S. BUSINESS ADDRESS 48th Street, #101 je=e, A7 85281 Vice Pres Dave Williams Same as above Secy Mark Mihelich Same as above Treas Robert Rashforri Same as above Director Toad Mihelich Same as above Director rave Williams Same as above Director Mark Mi hPl i r-h games ac Ahninm List additional Officers or Directors on a separate piece of paper. EIGHTH: This application MUST BE ACCOMPANIED BY A CERTIFICATE OF GOOD STANDING ISSUED BY THE JURISDICTION OF ITS INCORPORATION AND DATED WITHIN NINETY (90) PAY,$ OF THE FILING OF THE APPLICATION. By EXHIBIT ALM AVIATION LABOR MANAGEMENT, INC. Director: Robert Bashford 549 S. 48th Street, #101, Tempe, AZ 85281 STATE of AMZONA Office of the CORPORATION COMMISSION To all to whom these presents shall come, greeting: I, Stuart R. Brackney, Acting Executive Secretary of the Arizona Corporation Commission, do hereby certify that ** *ALMA VL4 TION LABOR MANAGEMENT, INC. * ** a domestic corporation organized under the laws of the state of Arizona, did incorporate on May 19, 1994. I further certify that this corporation has filed all affidavits and annual reports and paid all filing fees required to date and, therefore, is in good standing in this state. IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the Arizona Corporation Commission. Done at Phoenix, the Capitol, this 26th day of March, 1999, A. D. Acting Executive Secretary