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HomeMy WebLinkAbout10700RESOLUTION NO. 10700 A RESOLUTION TERMINATING THE JANUARY 26, 1987 GROUND LEASE AND OPERATING AGREEMENT AND CONSENTING TO THE ASSIGNMENT OF THE JUNE 27, 2005 GROUND LEASE AND OPERATING AGREEMENT BETWEEN THE CITY OF PUEBLO, A MUNICIPAL CORPORATION, AND TRAVELAIRE SERVICES, INC., A COLORADO CORPORATION, TO ROCKY MOUNTAIN FBO, LLC, A COLORADO LIMITED LIABILITY COMPANY, AND APPROVING AMENDMENT NO. 1 TO THE JUNE 27, 2005 GROUND LEASE AND OPERATING AGREEMENT AND AUTHORIZING THE PRESIDENT OF CITY COUNCIL TO EXECUTE SAME WHEREAS, both parties desire to terminate the current Ground Lease and Operating Agreement between the City of Pueblo and Travelaire Services, Inc., relating to land and operations at the Pueblo Memorial Airport entered into on January 26, 1987 (1987 Lease "); and WHEREAS, Travelaire Services, Inc., entered into a Ground Lease and Operating Agreement with the City of Pueblo relating to land and buildings at the Pueblo Memorial Airport on June 27, 2005 ("2005 Lease "); and WHEREAS, Travelaire Services, Inc., desires to assign the 2005 Lease to Rocky Mountain FBO, LLC and change the effective date to May 1, 2006; and WHEREAS, both parties wish to amend the provisions of the lease; now, therefore, BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, that: SECTION 1. The 1987 Lease between the City of Pueblo and Travelaire Services, Inc. is hereby terminated at midnight on April 30, 2006. SECTION 2. The City does hereby consent to the assignment of the 2005 Lease by Travelaire Services, Inc., to Rocky Mountain FBO, LLC, as described in, and contemplated by the Assignment and Assumption Agreement, a copy of which is attached thereto, subject to and contingent upon Rocky Mountain FBO, LLC assuming and performing all of the obligations imposed on the Lessee under the 2005 Lease through the term of the 2005 Lease from May 1, 2006 through April 30, 2026 unless sooner terminated or extended as provided in the 2005 Lease. SECTION 3. Amendment No. 1 to the 2005 Lease, 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, Travelaire Services, Inc., and Rocky Mountain FBO, LLC relating to the 2005 Lease at the Pueblo Memorial Airport, is hereby approved, subject to the conditions as set forth in said Amendment No. 1. SECTION 4. The President of City Council is hereby authorized to execute Amendment No. 1 on behalf of the City of Pueblo, a Municipal Corporation, and the City Clerk shall affix the seal of the City thereto and attest the same. INTRODUCED April 24, 2006 BY Gilbert Ortiz Councilperson /�� "�" APPROVED: �C UJtx VICE FFRESIDLINTof City Council ATTESTED BY: CITY CLERK Background Paper for Proposed A %". #lD 706 AGENDA ITEM # rl DATE: April 24, 2006 DEPARTMENT: AVIATION — DANIEL E. CENTA, P.E. TITLE A RESOLUTION TERMINATING THE JANUARY 26, 1987 GROUND LEASE AND OPERATING AGREEMENT AND CONSENTING TO THE ASSIGNMENT OF THE JUNE 27, 2005 GROUND LEASE AND OPERATING AGREEMENT BETWEEN THE CITY OF PUEBLO, A MUNICIPAL CORPORATION, AND TRAVELAIRE SERVICES, INC., A COLORADO CORPORATION, TO ROCKY MOUNTAIN FBO, LLC, A COLORADO LIMITED LIABILITY COMPANY, AND APPROVING AMENDMENT NO. 1 TO THE JUNE 27, 2005 GROUND LEASE AND OPERATING AGREEMENT AND AUTHORIZING THE PRESIDENT OF CITY COUNCIL TO EXECUTE SAME ISSUE Should City Council terminate the January 26, 1987 Lease ( "1987 Lease ") and consent to the assignment of the June 27, 2005 Lease between the City of Pueblo and Travelaire Services ( "2005 Lease ") to Rocky Mountain FBO and approve an amendment to 2005 Lease. RECOMMENDATION Approval of this Resolution. Travelaire Services has requested to terminate the 1987 Lease executed on January 26, 1987 and approve the assignment of the 2005 Lease in order to separate the air charter from the FBO business at the airport. The amendment to the 2005 Lease: (1) changes the effective date of the 2005 Lease from January 31, 2007 to May 1, 2006; (2) changes the number of fuel tanks they will be using from a single Jet -A tank to one Jet -A tank and one Avgas tank; and (3) modifies the services from air charter to aircraft fueling and other fixed base operation activities as provided therein. FINANCIAL IMPACT The 1987 Lease rent is $240 per acre annually for 1.18 acres of land, the commission is 1% of the gross sales, and the fuel flow fee is $.055 per gallon up to 40,000 gallons and $.066 per gallon over 40,000. The 2005 Lease land rent is $302 per month and structure rent is $896 per month, the commission is 2% of the gross sales and the fuel flow fee is $.06 per gallon up to 1,000,000 gallons, $.05 per gallon for the next 500,000 gallons, and $.04 per gallon for over 1,500,000 gallons. ASSIGNMENT OF LEASE AGREEMENT 01, J,1- Q AGREEMENT made thiso day of siQA 2017 between PDC Acquisition Corp, a Colorado corporation, whose address is 27350 E. Highway 96, Pueblo, CO 81006, herein referred to as "Assignor," and Rocky Mountain FBO, LLC, whose address is 525 Skyway Street, Pueblo, CO 81001, herein referred to as "Assignee." WHEREAS Assignor, and Assignee have previously entered into an assignment agreement on December 15, 2015, whereby Assignor assumed Assignee's obligations under a ground lease and operating agreement for property at the Pueblo Memorial Airport owned by the City of Pueblo dated June 27, 2005, which had been assigned to Assignee by Travelaire Services, Inc., with an effective date of May 1, 2006, approved by Resolution of City Council on April 24, 2006 herein referred to as "Lease Agreement," a copy of which is attached hereto as Exhibit A and incorporated herein by reference; and WHEREAS Assignee and Assignor want to transfer Assignor's obligations and responsibilities under the Lease Agreement back to Assignee; and WHEREAS the members and managers of Assignee have experience in fulfilling Lessee's responsibilities under the Lease Agreement; and WHEREAS Section 17 of the Lease Agreement entitled "Assignments and Subletting" addresses Lessee's obligation to obtain Lessor's written consent for the intended assignment of the Lease Agreement; and WHEREAS the parties to Lease Agreement have reached an agreement whereby Assignor may assign its interest in the Lease Agreement to Assignee. NOW THEREFORE it is agreed as follows: 1. Effective as of January 1, 2017, Assignor assigns its interest in the Lease Agreement to Assignee. 2. Assignee agrees to faithfully perform all duties of Lessee under said Lease Agreement. 3. Lessor, by its signature below acknowledges its consent to the assignment. Dated as of the date and year first above written. ASSIGNOR ASSIGNEE PDC Acquisition Corp, a Colorado corporation Rocky Mountain FBO, LLC, a Colroado limited lia•''- company l ., '--......_ . / ,\Q By: Sam C. Brown,Jr., its Presid By: :mie DeVencenty, Member/Manager r Lessor CITY OF PU0.4,, pir By: Sam . •d, City Manager AMENDMENT NO. 1 This Amendment No. 1 dated as of April 24, 2006 by and between the City of Pueblo ( "Lessor "), Travelaire Service, Inc. ( "Lessee "), and Rocky Mountain FBO, LLC ( "Assignee "), WITNESSETH Whereas, Lessor and Lessee entered into a Ground lease And Operating Agreement dated January 26, 1987 and certain amendments thereto for a certain parcel of property located at the Pueblo Memorial Airport ( "1987 Lease "), and Whereas, Lessee and Lessor entered into a Ground Lease And Operating Agreement dated June 27, 2005 for the same property covered by the 1987 Lease plus buildings located thereon ( "2005 Lease "), and Whereas, Lessor and Lessee are desirous of terminating the 1987 Lease and amending the 2005 Lease. Now Therefore, in consideration of the foregoing and mutual covenants contained herein, Lessor, Lessee and Assignee agree as follows: 1. The 1987 Lease shall terminate and cancel on midnight April 30, 2006 and Lessor and Lessee shall be released and discharged from all future obligations thereunder. 2. The 2005 Lease is hereby amended to read as follows: (a) The fourth paragraph of Section 1 is amended to read: Subject to Section 8, Lessor hereby leases to Lessee Jet -A Tank No. 4 having a capacity of 40,000 gallons and AV -Fuel Tank No. B having a capacity of 20,000 gallons (hereinafter "fuel tank") at Lessor's fuel farm located at the Airport (hereinafter the "fuel farm ") for the exclusive purpose of storing aviation fuel to be dispensed to aircraft using the Airport. (b) Section 2 is hereby amended to read: The term of this Lease is for a period of twenty (20) years commencing midnight April 30, 2006 and ending midnight on April 30, 2026, unless sooner terminated as herein provided. The term of this Lease may be extended for an additional ten (10) year period from midnight April 30, 2026 to midnight April 30, 2036 upon rental and other conditions mutually agreeable to Lessor and Lessee. Either Lessor or Lessee may request that negotiations for such extension be entered into on or after April 30, 2021. (c) The month specified in Section 3.13 is amended from "the month of February 2007" to "the month of May 2006," the date "February 1" is amended to "May 1" and the "last day of January" is amended to "last day of April." (d) Section 4.A is amended to read: The Leased Premises shall be used and occupied by Lessee as a facility for fueling aircraft services and other related aeronautical services and products. (e) The term "air charter service" specified in Section 4.E is amended to read "aircraft fueling services." 3. City does hereby approve and consent to Lessee assigning the 2005 Lease to Assignee and the Assignment And Assumption Agreement attached hereto as Exhibit "A," provided, however, that the Lessee shall not be released and discharged from its obligations under the 2005 Lease. 4. The 2005 Lease as amended by this Amendment No. 1 shall remain in full force and effect, binding on and inuring to the benefit of Lessor, Lessee and Assignee and their respective successors and approved assigns. Executed at Pueblo, Colorado the day and year first above written. (SEAL) Attest: �� CtiCtL City C City of Pueblo NCG By Viity Council (SEAL) A, DeVencenty, DeVencenty, • ASSIGNMENT AND ASSUMPTION AGREEMENT COME NOW the Travelaire Service, Inc., a Colorado corporation and Rocky Mountain FBO, LLC, a Colorado limited liability company and agree as follows: 1. The parties hereby acknowledge having each received a copy of the Ground Lease and Operating Agreement of June 27, 2005, between Travelaire Service, Inc., as Lessee, and the City of Pueblo, as Lessor, (hereinafter the "Lease Agreement"), relating to premises at the Pueblo Memorial Airport, Pueblo, Colorado. 2. Subject to and effective upon the consent of the City the Pueblo, Travelaire Service, Inc., does hereby assign all of its right, title, and interest in and to the Lease Agreement to Rocky Mountain FBO, LLC. 3. Rocky Mountain FBO, LLC, hereby agrees to assume and perform all of the obligations imposed on the Lessee under the Lease Agreement. 4. Rocky Mountain FBO, LLC, does hereby indemnify and agree to hold Travelaire Service, Inc.,harmless from any loss or damage which it may suffer as a result of Rocky Mountain FBO, LLC's, failure to comply with the terms and conditions of the Lease Agreement. 5. Travelaire Service, Inc., hereby acknowledges and recognizes that,pursuant to Section 17 A of the Lease Agreement, this assignment of the Lease does not release or discharge it from its obligations under the Lease. Dated this 25th day of April, 2006. TRAVELAIRE SERVICE, INC. By: Rocky L. DeVencenty, President ROCKY MOUNTAIN FBO, LLC By Jamie A. DeVencenty, Member By Rocky L. DeVencenty, Member EXHIBIT A _