HomeMy WebLinkAbout10441RESOLUTION NO. 10441
A RESOLUTION APPROVING A RESTAURANT LEASE AND OPERATING AGREEMENT
BETWEEN THE CITY OF PUEBLO, A MUNICIPAL CORPORATION, AND SPITFIRE GRILL, LLC
AND AUTHORIZING THE PRESIDENT OF CITY COUNCIL TO EXECUTE SAME
BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, that:
SECTION 1.
A certain Restaurant Lease and Operating Agreement, a copy of which is attached hereto
and made a part hereof by reference, after having been approved as to form by the City Attorney,
by and between the City of Pueblo, a Municipal Corporation, and Spitfire Grill, LLC relating to the
lease of space in the terminal building at the Pueblo Memorial Airport for a restaurant operation is
hereby approved, subject to the conditions as set forth in said Restaurant Lease and Operating
Agreement.
SECTION 2.
The President of City Council is hereby authorized to execute said Restaurant Lease and
Operating Agreement on behalf of Pueblo, a Municipal Corporation, and the City Clerk shall affix
the Seal of the City thereto and attest the same.
INTRODUCED July 11, 2005
BY Michael Occhiato
Councilperson
APPROVED:
PRES1DENT 9F CITY C IL
ATTESTED BY:
CITY CLERK
LJ
Background Paper for Proposed
RESOLUTION
/Q0. 1i / 04q I
AGENDA ITEM #I D
DATE: July 11, 2005
DEPARTMENT: AVIATION - DANIEL E. CENTA, P.E.
TITLE
A RESOLUTION APPROVING A RESTAURANT LEASE AND OPERATING
AGREEMENT BETWEEN THE CITY OF PUEBLO, A MUNICIPAL
CORPORATION, AND SPITFIRE GRILL, LLC AND AUTHORIZING THE
PRESIDENT OF CITY COUNCIL TO EXECUTE SAME
ISSUE
Should the City Council approve a Restaurant Lease and Operating Agreement between
the City of Pueblo and Spitfire Grill, LLC for restaurant operations at the Pueblo
Memorial Airport.
RECOMMENDATION
Approval of this Resolution.
BACKGROUND
The existing Operator for the Airport Restaurant has requested the termination of the
present Restaurant Lease and Operating Agreement as of August 11, 2005. A request for
proposals was advertised and proposals were received from Spitfire Grill and Pueblo
Diversified Industries (PDI). A selection committee reviewed the proposals and asked
the Airport Advisory Committee for their recommendation. The Airport Advisory
Committee recommended that the City accept the Spitfire Grill proposal as they proposed
to pay the Airport a greater annual sum than did PDI. The selection committee agreed
with this recommendation. The new Restaurant Lease and Operating Agreement will be
for a term of five (5) years with an option to renew for an additional five (5) year term.
FINANCIAL IMPACT
The monthly rent will be 5.75 per cent of monthly gross revenue or a minimum guarantee
of $416.67, whichever is greater.
PUEBLO MEMORIAL AIRPORT
RESTAURANT LEASE AND OPERATING AGREEMENT
THIS LEASE made and entered into this I Ithh day of ,Iuly, 2005 between THE CITY OF PUEBLO, A
MUNICIPAL CORPORATION, hereinafter referred to as the "LESSOR" and, SPITFIRE GRILL, LLC,
A COLORADO LIMITED LIABILITY COMPANY, hereinafter referred to as the "LESSEE ".
WITNESSETH:
That in consideration of the payment of rent hereinafter provided and the keeping and performance of the
covenants and agreements of the Lessee, as hereinafter set forth, Lessor has and does hereby lease unto
the Lessee, a certain area in the Terminal Building located at Pueblo Memorial Airport, Pueblo County,
Colorado (herein "AIRPORT ") described in Exhibit A attached hereto and incorporated herein as if set
out in full (herein "Property" or "Leased Premises ") for the sole purpose of conducting a restaurant
business therein for a term of five (5) years from July 12, 2005 to July 11. 2010
If not in default under this Lease, Lessee shall have the option to extend the term of this Lease for a five
(5) year period from July 12. 2010 to July 11, 2015 by giving to Lessor written notice of its exercise of
such option on or before January 12, 2010 The extended term shall be upon the same covenants and
conditions except (a) there shall be no further option to extend this Lease, and (b) the rent during the
extended term shall be negotiated on a percent of gross revenues at the time of renewal. If Lessee does
not timely exercise its option to renew, or if Lessor and Lessee are unable for any reason to mutually
agree upon the rent for the extended term, the option to renew shall terminate and be of no further force
and effect.
Prior to the expiration of the initial term, this lease can be terminated by either party by giving one
hundred eighty (180) days written notice. If notice is by Lessee, any deposits held by Lessor shall be
forfeited.
I. DEFINITIONS
A. DIRECTOR OF AVIATION
1. Person in charge of the Airport for the Lessor, his assistant or duly authorized agent.
B. GROSS REVENUES
2. As used herein, the term "Gross Revenues" shall mean and include all money or other
things of value received by or paid to Lessee, or to others for Lessee's use and benefit,
or to Lessee's sublessees, subcontractors and concessionaires, and all credit extended
by lessee or said other persons (regardless of whether collection is made) in
connection with any and all business conducted by Lessee or said other persons in,
about, or from the Leased Premises, including (but without in any wise limiting the
foregoing), the sale of food, beverages, or merchandise of whatever kind and character
for which any compensation is received or is payable, whether such sales or services
are made, performed, or furnished on the Leased Premises or elsewhere or by vending
machines or other mechanical devices or otherwise; provided, however, that in the
computation of Gross Revenues the following shall be excluded to-wit:
a. Sales or use taxes on the sale, performance or furnishing of any service or
merchandise which are by law required to be imposed on and paid by the
consumers thereof and are required to be separately stated.
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b. Meals to employees of Lessee when such are part of the compensation given by
Lessee to such employees for services rendered in and about the Leased
Premises.
C. Sales of Lessee's furniture, fumishings, fixtures, and other improvements to or
from the Leased Premises or to or from any other premises of Lessee.
d. Federal entertainment taxes on the furnishing of any entertainment where such
taxes are by Federal law required to be imposed on and paid by the customers
to whom such entertainment is provided and are required to be separately
stated.
e. Gratuities or "tips" paid to employees if such gratuities or tips are not received
by such employees for the benefit of Lessee or required to be paid by such
employees to the Lessee.
U. RIGHTS AND PRIVILEGES OF LESSEE
A. Lessee shall engage in and conduct said Restaurant business at and on the Property for the
convenience of patrons and tenants of the Airport and the general public desiring such
services at the Airport; which right, without limiting the generality hereof, shall include:
1. The right, subject to necessary licensing, to serve food, soft drinks, and alcoholic
beverages, and other items pertaining to the operation of a restaurant. The right to sell
tobacco products, ice cream products, gum, candies, and similar items commonly
offered for sale at a restaurant.
2. The non -exclusive right to provide in -flight food service to scheduled and
supplemental airlines, private and executive aircraft who have requested said services
of Lessee, and the right to prepare food on the Property and deliver, or cause to be
delivered, to and for the purpose of consumption elsewhere.
3. The right to use, operate, and maintain equipment owned by Lessor and shown in
Exhibit C attached hereto and made a part hereof ( "Equipment ").
4. The right to equip, install, operate and maintain on the Airport, at Lessee's expense
advertising facilities; provided however, that in all cases the number, size, location,
general type and design, and the method of installation shall be subject to the prior
approval of the Director of Aviation. This limitation shall apply to and include all
signs, placards, posters, or other forms of identification or advertising media,
installed, placed upon or affixed to the Property exclusively to Lessee hereunder.
5. The right, subject to prior approval of the Director of Aviation, of plans and
specifications, location and inspection of same; to make improvements, modifications,
revisions and other alterations to the Property. Costs of such improvements,
modifications, revisions and alterations shall be borne solely by Lessee, and all such
improvements, modifications, revisions or alterations shall become and remain the
property of the Lessor.
6. Lessee, its employees and invitees shall have the right of ingress and egress between
the main entrance of the Airport as the same now exists or may hereafter be relocated
and the Leased Premises over, upon and through such streets and no other as from
time to time shall be designated by the Director of Aviation. Driveways from existing
streets into the Leased Premises shall be located as designated by the Director of
Aviation.
III. RIGHTS AND PRIVILEGES OF LESSOR
A. All rights not herein specifically granted to the Lessee are reserved to Lessor.
B. Lessor also reserves the right to require Lessee to make any adjustments deemed necessary
to improve the interior appearance of the Leased Premises or the quality of service rendered
in connection with Lessee's operation.
IV. OBLIGATIONS OF LESSEE
A. It shall be the obligation of Lessee to continuously operate and conduct the restaurant
business as herein set forth in a first class manner, and to maintain the Property at all times
in a safe, clean, orderly and attractive condition.
B. Lessee, its officers, employees, agents or servants shall, at all times, comply with the Federal
Pure Food and Drug Laws, Health Rules and Regulations and other applicable Laws and
Regulations of the United States Government, and the State of Colorado and all applicable
Ordinances, Codes and Regulations of the City and County of Pueblo, including the rules
and regulations governing the operation of the Airport.
C. All food, beverages, confections and other items sold and kept for sale by Lessee shall be of
high quality, wholesome and pure and the service shall be prompt, attractive, clean, efficient
and courteous. Violation of any provision of this paragraph by Lessee, its officers,
employees, agents or servants shall cause this Lease to be subject to cancellation by Lessor,
if not corrected immediately upon written notice by the Director of Aviation.
D. Except as otherwise specifically provided herein, Lessee shall pay all costs of operating the
restaurant business and maintaining the Property, including without restriction because of
enumeration, necessary personnel, all licenses, permits or other similar authorizations as
required under Federal, State or Local Laws and Regulations, insofar as they are necessary
to comply with the requirements of this Lease and the rights and privileges extended against
its property, situated on, or within, the Leased Premises or otherwise within the confines of
the Airport.
E. Lessee shall, at its sole expense, maintain and keep the Leased Premises, and all
improvements thereon, including without limitation, the Equipment, Sewer and Water lines
and connections, Plumbing, Heating and Air Conditioning equipment and systems, in good
condition, appearance, and state of repair and provide all interior building maintenance and
custodial service for the Leased Premises. It being expressly understood and agreed that
Lessor shall not be responsible for any defect in the Leased Premises or improvements
thereon or obligated to make any repair, except for exterior maintenance and repairs to the
exterior of the Property.
If Lessee should fail to keep and maintain the Leased Premises or improvements
thereon in such good order and repair as is reasonably required, Lessor may, without
any obligation to do so, enter the Leased Premises, without such entering causing or
constituting a termination of the Lease, or an interference with the possession of the
Leased Premises by Lessee, and perform the necessary maintenance and/or restoration
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work to the Leased Premises to the condition required by the Lessor, the cost of which
shall be borne solely by Lessee. All such costs shall be paid by Lessee to Lessor in
addition to rents, within thirty (30) days after completion of the work.
F. The Lessee shall, at its own expense, keep the Leased Premises neat, clean, safe and orderly
at all times, free of waste, rubbish and debris, and shall provide a complete and proper
arrangement for the sanitary handling and disposal of all trash, garbage, and other refuse
resulting from its activities at the Airport. All trash, garbage, and other refuse shall be out of
view of the public.
G. Lessee shall pay all utilities supplied to and used in the Leased Premises, and shall enter into
separate agreements with the utility organizations for metering such services; except that the
Lessor shall furnish at its expense water and sewer services for the Leased Premises.
H. Lessee shall at all times retain an active, qualified, experienced and competent manager to
supervise the restaurant business who shall be authorized to represent and to act for and on
behalf of the Lessee.
1. Lessee's personnel shall be courteous, efficient, clean and neat in appearance, and
shall be trained and qualified to perform any and all services to the public required or
contemplated under the terms of this Lease.
2. Lessee shall not employ any person or persons in or about the Leased Premises who
shall use improper language, or act in a loud, boisterous, or otherwise improper
manner.
I. Lessee, except as may be otherwise provided in other contracts entered into with the Lessor,
shall not engage in any business at the Airport other than that which is expressly authorized
herein.
J. Lessee shall repair all damages to the Leased Premises caused by its officers, employees,
invitees, agents or patrons or arising out of Lessee's operations thereon.
K. Period of Restaurant operation:
Except as herein set forth, the dining room area of the Restaurant shall remain open
for service to the public seven (7) days per week during the hours of 7:00 a.m. to 3:00
p.m., and for scheduled Charter flight operations, with adequate service to meet the
public demand. It is understood and agreed upon that the restaurant will be closed
Thanksgiving Day and Christmas Day.
2. The bar area of the restaurant shall remain open for service to the public during dining
room hours of operation; except, that the hours of operation of the bar and the sale of
alcoholic beverages shall be subject to Regulations as provided by the Statutes of the
State of Colorado and Local Ordinances, Rules and Regulations, whichever may apply
to the Premises under the Agreement.
3. Restaurant operating hours may be changed with the prior written approval of the
Director of Aviation.
L. Lessee shall make the following improvements to the Leased Premises: (a) repaint the
dining room before opening, (b) recover all booths within the first year of the term of the
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Lease and (c) install a pizza oven within the first three years of the term of the Lease. All
improvements and cost thereof shall be first approved by the Director of Aviation. Lessee
shall receive credit against rent for the Lessee's actual cost of improvements approved by
the Director of Aviation.
V. OBLIGATIONS OF LESSOR
A. Lessor, at its cost, shall provide water and sewer services for the Leased Premises, unless
conditions beyond the Lessor's control shall prevent Lessor from so supplying such water
and sewer services.
B. Lessor shall provide periodic washing of windows on the outside only.
C. Lessor shall not be responsible for any damage to, or loss of property of Lessee, its officers,
employees, agents, servants, patrons, or any other person or persons at the Airport.
VI. RENTALS AND FEES
A. Lessee agrees to pay to the Lessor, without offset or deduction, at such places as the Lessor
may designate from time to time, for the use of the premises, facilities, concession rights and
privileges, a monthly rent of 5.75 per cent of monthly gross revenue or a minimum guarantee
of $416.67 a month, whichever is greater.
Rent during the renewal term is to be negotiated.
B. Lessee shall make a monthly report of all gross revenues to the Lessor at such places as may
from time to time be designated by Lessor, on a form or forms approved by the Director of
Aviation. Said report to be used as the basis for computation of rents. Said report shall be
submitted no later than the tenth (10th) day of each month for the preceding month, and all
rents shall be paid no later than the fifteenth (15th) day of the following month.
C. Lessee shall keep and maintain at the Leased Premises accurate and complete books and
records of its Restaurant operation and gross receipts. Lessee shall permit the duly
authorized representative of the Lessor to examine Lessee's books at any time during
business hours.
VII. MISCELLANEOUS
A. The Lessee by accepting this Lease expressly agrees for itself, its successors and assignees
that it will not make use of the Leased Premises in any manner which might interfere with
the landing and taking -off of aircraft from Pueblo Memorial Airport or otherwise constitute
a hazard to aviation. In the event the aforesaid covenant is breached, the Lessor reserves the
right to enter upon the Leased Premises and cause the abatement of such interference at the
expense of the Lessee.
B. Lessor and Lessee understand and agree that the General Provisions consisting of Paragraph
1 though 17, attached hereto as Exhibit B are incorporated herein and shall be binding upon
and inure to the benefit of Lessor and Lessee as if set out herein full. In the event of a
conflict between the provisions of the General Provisions and this Lease, the provisions of
this Lease shall control.
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C. If Lessee defaults in the payment of rent or any part thereof or fails to perform or observe
any of the conditions and covenants on its part to be performed or observed hereunder, and
such default or failure shall continue for a period of ten (10) days after written notice thereof
has been mailed to Lessee by first class mail addressed to Lessee at its last known address at
Pueblo Memorial Airport, then, in that event, and as often as same may happen, it shall be
lawful for City, at its election, with or without notice, to terminate this Lease without
prejudice to any claim for rent or for breach of covenants, or without being guilty of trespass
or forcible entry or detainer. City is hereby granted a lien and security interest for payment
of rent and damages for breach of covenants upon all Lessee's goods and personal property
which is or may by placed upon the Property including without limitation business fixtures,
equipment, inventory and proceeds thereof and such lien may be enforced by the taking and
sale of such property in the same manner and as provided for the disposition of collateral
under the Colorado Uniform Commercial Code.
D. If the Property is left vacant and any part of the rent remains due and unpaid, City may,
without being obligated to do so, and without terminating this Lease, retake possession of
the Property and rent the same for such rent and upon such terms as City may think best,
making such changes and repairs as may be required, giving credit for the amount of rent
received less all expenses of such changes and repairs, and Lessee shall be liable for the
balance of the rent until expiration of this Lease.
E. Lessee agrees to pay to City all costs, including reasonable Attorney Fees, of any action
brought by City to enforce the Lease or to recover rent or other money due and unpaid under
the Lease or to recover possession of the Property, whether such action proceeds to
judgment or not.
F. No waiver of any breach of any one or more of the conditions or covenants of this Lease by
City shall be deemed to imply or constitute a waiver of any succeeding or other breach
hereunder. The acceptance of rent by City shall not constitute a waiver of any breach then
existing.
G. If Lessee remains in possession of the Property after termination of the Lease without
written agreement, such possession shall be deemed to be a tenancy from month to month
upon the same covenants and conditions set forth herein and at a monthly rental equal to two
times the average of the monthly rent payable hereunder for the prior twelve months.
H. In the event of a fire or other casualty in or to the Leased Premises, Lessee shall immediately
give notice to Lessor. If the Leased Premises, through no fault nor neglect of Lessee, its
agents, employees or invitees, shall be damaged by fire or other casualty so as to render the
Leased Premises untenantable, and Lessor elects to repair the same, the rent herein shall
abate thereafter until such time as the Leased Premises are made tenantable by Lessor. In
the event the Leased Premises or the Terminal Building shall be damaged by fire or other
casualty and Lessor shall decide not to rebuild or repair (which decision Lessor may make in
its sole discretion) then all rent owed up to the time of such damage shall be paid by Lessee
and this Lease shall terminate.
I. Lessee has deposited the sum of $500.00 with Lessor as security for Lessee's prompt
performance of all the terms covenants and agreements contained in this Lease. Lessee
understands and agrees (i) that such deposit is not a prepayment of rent and that Lessor shall
not be obligated to apply said deposit to any unpaid rent or portion thereof, although it may
do so at its option; and (ii) that Lessor shall have no obligation to account to Lessee and
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Lessee shall have no right to recover from Lessor any interest, earnings or other increments
which may accrue during the time such deposit is held by Lessor.
Notwithstanding anything contained herein to the contrary, the initial five (5) year term of this Lease shall
commence July 12, 2005 or upon negotiated acceptance of the Leased Premises, whichever occurs earlier.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as of this day and year.
DATED THIS 11th day of July 2005.
Attest:
City C
LESSOR:
PUEBLO, A MUNICIPAL CORPORATION
r
By
obert D' r.
President oft City Counc'
APPROVED AS TO FORM:
Ci y Attorne
LESSEE:
SPITFIRE GRILL, LLC
i
[ ?1 3 6L
"sting Baski
Manager/Member
Dere nova
M nager/Member