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HomeMy WebLinkAbout13313RESOLUTION NO. 13313 A RESOLUTION CONSENTING TO THE ASSIGNMENT OF THE HANGAR GROUND LEASE DATED MARCH 24, 1997 BETWEEN THE CITY OF PUEBLO AND K & N PARTNERS, CO., A CO-PARTNERSHIP, FOR LOT NO. 4 IN THE GENERAL AVIATION HANGAR DEVELOPMENT AREA AT THE PUEBLO MEMORIAL AIRPORT AND AUTHORIZING THE PRESIDENT OF CITY COUNCIL TO EXECUTE SAME BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, that: SECTION 1. The Consent to Assignment, a copy of which is attached hereto, having been approved as to form by the City Attorney, is hereby approved, and the President of the City Council is authorized to execute and deliver the Consent to Assignment in the name of the City and the City Clerk is to attest same and affix the seal of the City thereto. SECTION 2. The officers and staff of the City are directed and authorized to perform any and all acts consistent with the intent of this Resolution and the attached Assignment to effectuate the transactions described herein. SECTION 3. This Resolution shall become effective immediately upon passage and approval. INTRODUCED: October 13, 2015 BY: Chris Nicoll City Clerk’s Office Item # M-3 Background Paper for Proposed Resolution COUNCIL MEETING DATE: October 13, 2015 TO: President Steve Nawrocki and Members of City Council CC: Sam Azad, City Manager VIA: Gina Dutcher, City Clerk FROM: Aviation Department SUBJECT: A RESOLUTION CONSENTING TO THE ASSIGNMENT OF THE HANGAR GROUND LEASE DATED MARCH 24, 1997 BETWEEN THE CITY OF PUEBLO AND K & N PARTNERS, CO., A CO-PARTNERSHIP, FOR LOT NO. 4 IN THE GENERAL AVIATION HANGAR DEVELOPMENT AREA AT THE PUEBLO MEMORIAL AIRPORT AND AUTHORIZING THE PRESIDENT OF CITY COUNCIL TO EXECUTE SAME SUMMARY: This Resolution consents to the Assignment of a Hangar Ground Lease at the Pueblo Memorial Airport. PREVIOUS COUNCIL ACTION: The City entered into a Hangar Ground Lease Agreement with K & N Partners on March 24, 1997 for Lot No. 4 in the General Aviation Hangar Development Area at the Pueblo Memorial Airport. On December 8, 1997, the City agreed to an assignment of the lease to Paul R. Nunn. On February 10, 2009, after Mr. Nunn’s death, a Statement of Transfer was entered into with Sharrie I. Nunn and Kristine Irene Nunn. The Nunns then sold the hangar and assigned the lease to Richard F. Leach, Jr. on October 13, 2013. BACKGROUND The original lease was for 20 years with 2 10-year options to extend the lease. The first term of the lease expires March 24, 2017. The lease can then be extended for the additional 10-year options. Mr. Leach is selling the hangar to Kriss Childress and they have asked the City to reassign the Hangar Ground Lease to him. FINANCIAL IMPLICATIONS: There will be no financial impact as Kriss Childress will take over the lease payments. BOARD/COMMISSION RECOMMENDATION: Not Applicable for this Resolution. STAKEHOLDER PROCESS: Not applicable. ALTERNATIVES: Section 17, Paragraph A of the Hangar Ground Lease reads as follows: “Lessee shall not assign or transfer this Lease without the prior written consent of Lessor, which consent shall not be unreasonably withheld. Any assignment or transfer without the prior written consent of Lessor shall be void.” If the assignment is not approved and Mr. Childress purchases the hangar, a new lease will need to be negotiated and brought to City Council for approval. RECOMMENDATION The Aviation Department recommends approval of this Resolution. Attachments: Assignment CONSENT TO ASSIGNMENT The City of Pueblo as Lessor under the Hangar Ground Lease, in reliance upon the Recitals and provisions of the foregoing Assignment, consents to the foregoing Assignment of the Hangar Ground Lease by Assignor to Assignee on the express condition that no further assignment of the Hangar Ground Lease or any part thereof shall be made without the prior written consent of the City of Pueblo. Executed in Pueblo, Colorado the 13th day of October , 2015. CITY OF PUEBLO, A MUNICIPAL CORPORATION . _n ATTEST: B\ „we . awrocki President of City Council City k ASSIGNMENT OF HANGAR GROUND LEASE THIS ASSIGNMENT is entered into this day ofapr, (1 , 2018 ("Effective Date") by and between Kriss Childress, 489 South Hook Court, Pueblo, Colorado 81007 ("Childress") and Grant Alan Von Ahlefeldt, 1325 North Greenwood, Pueblo, Colorado 81003 ("Ahlefeldt") and the City of Pueblo, a Municipal Corporation, through its Department of Aviation, 31201 Bryan Circle, Pueblo, Colorado 81001 ("City"). Recitals WHEREAS, City and K&N Partners, a Co-Partnership,entered into a hangar ground lease dated March 24, 1997 for Lot No. 4 located in the General Aviation Hangar Development Area of the Pueblo Memorial Airport and evidenced by City Resolution No. 8079 ("Hangar Ground Lease"); and WHEREAS, the Hangar Ground Lease was previously assigned from K & N Partners, a Co-partnership, to Richard F. Leach, Jr., and Richard F. Leach, Jr. then assigned the Hangar Ground Lease to Childress on September 30, 2015, evidenced by Resolution No. 13313; and WHEREAS, the Hangar Ground Lease was amended by City and Childress through the Amendment to Lease dated April 12, 2017; and WHEREAS, Childress wishes to assign the Hangar Ground Lease, as amended, to Ahlefeldt, and Ahlefeldt wishes to assume said Hangar Ground Lease, as amended; and WHEREAS, the City consents to said assignment and Ahlefeldt's assumption of the Hangar Ground Lease, as amended; NOW, THEREFORE, in consideration of the foregoing recitals and the terms, conditions and mutual promises set forth in this agreement, the parties agree as follows: 1. Assignment. Childress hereby transfers,sells,and assigns to Ahlefeldt, Childress's right, title, and interest in and to the amended Hangar Ground Lease. 2. Assumption. Ahlefeldt accepts the assignment of the amended Hangar Ground Lease and hereby assumes and agrees to observe, perform and otherwise discharge when due all obligations of the amended Hangar Ground Lease a copy of which, marked as Exhibit A, is attached hereto and incorporated herein by reference. This shall include, but is not limited to, the making of all payments and performance of all covenants and duties. 3. Consent. City hereby consents to the foregoing assignment and assumption of the amended Hangar Ground Lease and City agrees to afford Ahlefeldt the same rights under the amended Hangar Ground Lease as previously enjoyed by Childress. No further assignment of the Hangar Ground Lease, or any part thereof, shall be made without the prior written consent of City. Any assignment or transfer without City's prior written consent shall be void. 4. Effective Date. This assignment shall become effective on the date set forth above. IN WITNESS WHEREOF the parties have executed this assignment as of the Effective Date. GRANT ALAN VON AHLEFELDT CITY OF PUEBLO A MUNICIP• MOR'ORATION r By: Sam ad City Manager KRISSC. " 1 I ATTEST: nd ATTEST: a Acting City Clerk EXHIBIT A AMENDMENT TO HANGAR GROUND LEASE This Amendment is entered into as of the 97 day of Cij , 2018 ("Effective Date"), by and between the City of Pueblo, Colorado, a Municipal Corporation ("Lessor"), and Grant Alan Von Ahlefeldt, 1325 North Greenwood, Pueblo, Colorado 81003, an individual ("Lessee"). WHEREAS, Lessor and K& N Partners, a Co-Partnership, entered into a Hangar Ground Lease dated March 24, 1997 for Lot No. 4 located in the General Aviation Hangar Development Area of the Pueblo Memorial Airport and evidenced by City Resolution No. 8079 ("Hangar Ground Lease"); and WHEREAS, the Hangar Ground Lease was previously assigned from K & N Partners, a Co-partnership, to Richard F. Leach, Jr., and Richard F. Leach, Jr. then assigned the Hangar Ground Lease to Kriss Childress on September 30, 2015, evidenced by Resolution No. 13313; and WHEREAS, the Hangar Ground Lease was amended by Lessor and Kriss Childress through the Amendment to Lease dated April 12, 2017, and said amendment remains effective; and WHEREAS, Kriss Childress assigned the Hangar Ground Lease, as amended, to Lessee, and Lessee assumed said Hangar Ground Lease, as amended; and WHEREAS, Lessor and Lessee wish to further amend the Hangar Ground Lease. NOW THEREFORE, in consideration of the foregoing recitals, and the promises and conditions set forth below, the parties agree to amend the Hangar Ground Lease as follows: 1. A new Subsection 3(D) to the Hangar Ground Lease shall be inserted to read: D. Should the Lessee pursue and use the leased premises for commercial purposes, after obtaining prior written approval from the Director of Aviation, the Lessee shall pay to Lessor additional rent at two percent (2%) of Lessee's commercial operation gross revenue, calculated at the end of each month and paid with other rent as due prior to the first day of the following month. 2. Section 4(C) of the Hangar Ground Lease is hereby amended in its entirety and replaced with the following: C. The leased premises shall be used and occupied by Lessee as a Hangar facility for the storage of aircraft owned or leased by Lessee and for such incidental purposes directly related to such use. Lessee shall have no right to utilize the leased premises, or any improvement thereon, other than as specifically allowed under this subsection. The leased premises shall not be used for any commercial purpose, unless the Director of Aviation has provided prior written approval for the commercial purpose. Failure to obtain the Director of Aviation's prior written approval shall be a material breach of this lease, and this lease may be immediately terminated for such reason. The leased premises shall not be used for any fueling operations nor any full-service FBO. The Lessee shall obtain all required permits and licenses from federal, state, and local governments or any associated organizations. 3. Section 4(D) of the Hangar Ground Lease is hereby amended in its entirety and replaced with the following: D. No aircraft service or maintenance shall be performed on the leased premises on any aircraft not owned or leased by the Lessee or Subtenant of the Lessee, unless such service or maintenance is pursuant to a commercial purpose granted prior written approval from the Director of Aviation. 4. A new Subsection 12(E) to the Hangar Ground Lease shall be inserted to read: E. Lessee shall obtain statutory workers' compensation insurance which shall contain an endorsement waiving subrogation against Lessor. Workers' compensation coverage shall be obtained notwithstanding that Lessee may have no employees as defined under said Act or that Lessee might otherwise avail itself of an exemption under the Act from any legal requirement to obtain such coverage. Such insurance shall cover all employees of Lessee performing work at the leased premises or airport irrespective of whether such employees may be shareholders, managers, partners, or owners of Lessee or exempt employees under the Act. Lessee may purchase, for non-statutory employees, a participant accident insurance policy which would include death, disability, dismemberment, and medical benefits. Any independent contractors of Lessee shall be covered under Lessee's workers' compensation insurance and/or participant accident insurance policy, or show evidence that said independent contractor is covered under its own workers' compensation insurance policy. Lessee shall have full and sole responsibility for ensuring compliance with this Section, including without limitation indemnification required under this Lease. All insurance policies required hereunder shall provide that such policies not be cancelled or reduced without thirty (30) days' advance written notice to the Lessor. Coverage and limits enumerated in this insurance provision represent only the minimum insurance required by the Lessor, and Lessee should rely on its expertise to obtain any additional insurance coverage needed for the Lessor and Lessee in its performance under this Lease. Failure to comply with the provisions of this Section shall constitute a material breach of this Lease by Lessee. 5. Section 17(B)(4) of the Hangar Ground Lease is hereby amended in its entirety and replaced with the following: (4) The sublease shall not become effective until an executed copy thereof is approved in writing by the Director of Aviation. 6. Section 20 of the Hangar Ground Lease is hereby amended in its entirety and replaced with the following: All notices required to be given to Lessor hereunder shall be in writing and be sent certified mail to Pueblo Memorial Airport, Director of Aviation, 31201 Bryan Circle, Pueblo, Colorado 81001 with a copy to City of Pueblo, City Attorney, 1 City Hall Place, Pueblo, Colorado 81003. All notices required to be given to Lessee hereunder shall be in writing and sent by certified mail, addressed to Grant Alan Von Ahlefeldt, 1325 North Greenwood, Pueblo, Colorado 81003. The parties may later designate in writing other persons or addresses in connection with said notices. The effective date of service of any such notice shall be the date such notice is mailed by Lessor or Lessee. 7. New subsections to Section 23 of the Hangar Ground Lease shall be inserted to read: D. Lessee shall, at its own expense, keep the 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 Lessee's activities at the Airport. Outside storage of parts, equipment, inventory,or other materials shall be permitted at the discretion of the Director of Aviation, but only so long as the parts, equipment, inventory, or other materials remain within the leased premises, meet the intent of this subsection, and the Lessee follows all applicable rules, regulations, and laws of the Lessor. Lessee understands that snow removal and vegetation management upon the leased premises is the responsibility of Lessee. E. Lessee agrees to indemnify, defend, and save the Lessor, it's agents, officer's representatives and employees,harmless from and against any and all penalties, liability or loss including costs and attorney fees resulting from claims or court action, whether civil, criminal or in equity, and arising directly or indirectly out of (i) acts of the Lessee, his agents, employees, or servants; (ii) occurring in on or about the leased premises; (iii) arising out of or resulting from the leased premises, or any condition thereon, or from Lessee's use and occupancy of the leased premises, or any equipment thereon or appurtenances thereto, or any activity conducted therein; or (iv) through any injury or damage that may be caused or occasioned. F. The Lessee, as a part of the consideration hereof, does hereby covenant and agree, as a covenant running with the land, that: (1) no person on the grounds of race, color or national origin shall be excluded from participation in, denied the benefits of, or be otherwise subjected to discrimination in the use of the leased premises; (2) that 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, or national origin shall be excluded from participation in, denied the benefits of, or otherwise be subjected to discrimination; and (3) that the Lessee shall use the leased premises in compliance with all other applicable requirements imposed by or pursuant to Title 49, Code of Federal Regulations, Department of Transportation, Subtitle A, Office of the Secretary, Part 21, Nondiscrimination in Federally-assisted programs of the Department of Transportation- Effectuation of Title VI of the Civil Rights Act of 1964, and as said Regulations may be amended. G. Nothing in this Lease is intended, nor should it be construed, to create any rights, claims, or benefits or assume any liability for or on behalf of any third party, or to waive any immunities or limitations conferred under federal or state law, including but not limited to the Colorado Governmental Immunity Act, § 24-10-101 et seq., C.R.S. H. This Lease shall be governed by the laws of the State of Colorado. Venue for any action arising under this Lease or for the enforcement of this Lease shall be in a state court with jurisdiction located in Pueblo County, Colorado. 8. A new Section 24 to the Hangar Ground Lease shall be inserted to read: 24. Deposit: A. Lessee also agrees to pay a security deposit to the airport equal to two hundred fifty dollars ($250.00). The security deposit and first month's rent shall be paid upon execution of this agreement. Deposits shall be refunded following termination of this agreement, less any rent due or damages to the leased premises. B. In the event that Lessee fails, neglects or refuses to pay any rent, fee, or other sum due, or fails to perform any obligation under this Lease,then Lessor may, in its sole and absolute discretion, draw from the security deposit to remedy Lessee's default. Nothing contained in this Lease shall require Lessor to remedy Lessee's default in this manner, and Lessor may instead, in its sole and absolute discretion, refuse to remedy Lessee's default by drawing on the security deposit, and instead pursue the remedies for default provided in this Lease or by law. C. In the event that Lessor draws from this security deposit to remedy Lessee's default, Lessor shall notify Lessee in writing and require Lessee to replenish the deposit to its original level. Failure of Lessee to comply with this section shall constitute a material breach of this Lease. 9. A new Section 25 to the Hangar Ground Lease shall be inserted to read: 25. State-Imposed Mandates Prohibiting Illegal Aliens from Performing Work: A. At or prior to the time this Lease is executed, Lessee shall submit to the Purchasing Agent of Lessor its certification that it does not knowingly employ or contract with an illegal alien who will perform work under this Lease and that the Lessee will participate in either the "E-Verify Program" created in Public Law 208, 104th Congress, as amended and expanded in Public Law 156, 108th Congress, as amended, that is administered by the United States Department of Homeland Security or the "Department Program" established pursuant to §8-17.5-102(5)(c) C.R.S. that is administered by the Colorado Department of Labor and Employment in order to confirm the employment eligibility of all employees who are newly hired for employment to perform work under this Lease. B. Lessee shall not: (1) Knowingly employ or contract with an illegal alien to perform work under this Lease; (2) Enter into an agreement with a subcontractor that fails to certify to Lessee that the subcontractor shall not knowingly employ or contract with an illegal alien to perform work under this Lease. C. The following state-imposed requirements apply to this Lease: (1) The Lessee shall confirm the employment eligibility of all employees who are newly hired for employment to perform work under this Lease through participation in either the E-Verify Program or Department Program. (2) The Lessee is prohibited from using either the E-Verify Program or Department Program procedures to undertake pre-employment screening of job applicants while this Lease is being performed. (3) If the Lessee obtains actual knowledge that a subcontractor performing work under this Lease knowingly employs or contracts with an illegal alien, the Lessee shall: (a) Notify the subcontractor and the City's Purchasing Agent within three (3) days that the Lessee has actual knowledge that the subcontractor is employing or contracting with an illegal alien; and (b) Terminate the subcontract with the subcontractor if within three (3) days of receiving the notice required pursuant to subparagraph C(3)(a) above the subcontractor does not stop employing or contracting with the illegal alien; except that the Lessee shall not terminate the agreement with the contractor/subcontractor if, during such three (3) days, the contractor/subcontractor provides information to establish that the contractor/subcontractor has not knowingly employed or contracted with an illegal alien. (4) The Lessee is required to comply with any reasonable request by the Colorado Department of Labor and Employment(hereinafter referred to as "CDLE") made in the course of an investigation that CDLE is undertaking pursuant to its authority under §8-17.5-102(5), C.R.S. D. Violation of this Section by the Lessee shall constitute a breach of Lease and grounds for immediate termination. In the event of such termination, the Lessee shall be liable for Lessor's actual and consequential damages. E. As used in this Section, the terms "contractor"and "subcontractor" shall mean any contractor or subcontractor of Lessee rendering services within the scope of this Lease. 10. A new Section 26 to the Hangar Ground Lease shall be inserted to read: 26. Environmental Provisions: A. For the purpose of this Lease, "Hazardous Materials"means any hazardous or toxic substance, material or waste which is or becomes regulated by any local government authority, the State of Colorado or the United States government and shall include, but not be limited to: (i) 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"); (ii) asbestos-containing materials; (iii) PCBs; (iv) petroleum or petroleum based products; and (v) lead. B. Lessee will comply with Environmental Regulations that are applicable to Lessee and its use of the leased premises. No activity shall be undertaken by Lessee, its guests, employees, agents, 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 seq. and the Clean Air Act, 42 U.S.C. Section 7401 et seq. C. Lessee agrees to defend, indemnify and forever hold harmless Lessor, and its officers, employees, agents, successors, and assigns, from all claims, losses, damages, penalties, expenses and costs, including, but not limited to, attorneys' fees, characterization, remediation 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 Lessee, its employees, agents, guests, contractors and subcontractors. 11. The parties hereto further agree that nothing contained within this Amendment alters or modifies any other paragraphs or provisions of the Lease. IN WITNESS WHEREOF the parties have executed this amendment as of the Effective Date. ATTEST: CITY OF PUEBLO, A MUNICIPAL CO)PORATION By (1 ji ,a By_,- '�j '�^-✓ City Clerk `1 City anager � 1 Printed Name Sam Azad GRANT ALAN VON AHLEFELDT By Printed Name day14-ifon /I Title C)•-<.:rut-_v'