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HomeMy WebLinkAbout09458 ORDINANCE NO. 9458 AN ORDINANCE APPROVING AND RATIFYING TWO LEASES BETWEEN THE CITY OF PUEBLO, A MUNICIPAL CORPORATION AND KEY STRUCTURES, LLC, A COLORADO LIMITED LIABILITY COMPANY, RELATING TO A JOB CREATING CAPITAL IMPROVEMENT PROJECT AND AUTHORIZING THE MAYOR TO EXECUTE SAID LEASES AND RATIFYING HIS PRIOR SIGNATURES THERETO BE IT ORDAINED BY THE CITY COUNCIL OF PUEBLO, that: SECTION 1. The following two Leases, both dated May 1, 2019, between the City of Pueblo, a Colorado municipal corporation and Key Structures, LLC, a Colorado limited liability company, for the real property described as follows, copies of which leases are attached hereto and incorporated herein by this reference, having been approved as to form by the City Attorney, are hereby approved and ratified: Lot 1 McDonnell Douglas Subdivision Pueblo, CO 81001 Pueblo County Assessor Parcel Number 03-330-22-001 6.34 acres Parcel Q, Lockheed St., Pueblo Memorial Airport Industrial Park Sub Pueblo County Assessor Parcel Number 03-330-21-038 3.55 acres The Mayor is authorized to execute and deliver said Leases in the name of the City and the Mayor’s prior signatures thereto are ratified and the Acting City Clerk is directed to affix the seal of the City thereto and attest same. SECTION 2. The officers and staff of the City are authorized and directed to perform any and all acts consistent with this Ordinance and the attached Leases which are necessary or appropriate to implement the transactions described therein. SECTION 3. This Ordinance shall become effective on the date of final action by the Mayor and City Council. Action by City Council: Introduced and initial adoption of Ordinance by City Council on . April 22, 2019 Final adoption of Ordinance by City Council on May 13, 2019 . President of City Council Action by the Mayor: ☒ Approved on May 20, 2019 . ☐ Disapproved on based on the following objections: Mayor Action by City Council After Disapproval by the Mayor: ☐ Council did not act to override the Mayor's veto. ☐ Ordinance re-adopted on a vote of , on ☐ Council action on __________________failed to override the Mayor’s veto. President of City Council ATTEST Acting City Clerk City Clerk’s Office Item # R-7 Background Paper for Proposed Ordinance COUNCIL MEETING DATE: April 22, 2019 TO: President Dennis E. Flores and Members of City Council CC: Mayor Nicholas A. Gradisar VIA: Brenda Armijo, Acting City Clerk FROM: Daniel C. Kogovsek, City Attorney SUBJECT: AN ORDINANCE APPROVING AND RATIFYING TWO LEASES BETWEEN THE CITY OF PUEBLO, A MUNICIPAL CORPORATION AND KEY STRUCTURES, LLC, A COLORADO LIMITED LIABILITY COMPANY, RELATING TO A JOB CREATING CAPITAL IMPROVEMENT PROJECT AND AUTHORIZING THE MAYOR TO EXECUTE SAID LEASES AND RATIFYING HIS PRIOR SIGNATURES THERETO SUMMARY: Attached is an Ordinance approving two leases between the City of Pueblo and Key Structures, LLC, a Colorado limited liability company (the “Company”). PREVIOUS COUNCIL ACTION: On October 18, 2018, by Resolution No. 14059, City Council approved the transfer of $2.1 million from the City’s “Half Cent Economic Development Fund” to fund the Company’s capital expenditures (e.g. land acquisition, building improvement costs, equipment costs, rail improvements, etc.) and related training expenses for up to 125 new employees. BACKGROUND: The Company is working to establish a manufacturing facility with business administration offices at the City’s Airport Industrial Park. The Company’s business plan, as it pertains to Pueblo County, is centered on the manufacture of factory-produced pre-engineered building units for distribution outside of Pueblo County. The Company has committed to investing approximately $7,000,000.00 in fixed assets at its new manufacturing facility located at the Airport Industrial Park. The Company has requested that the City lease two unimproved parcels of land near the Company’s manufacturing facility, as follows: Lot 1 McDonnell Douglas Subdivision Pueblo, CO 81001 Pueblo County Assessor Parcel Number 03-330-22-001 6.34 acres Parcel Q, Lockheed St., Pueblo Memorial Airport Industrial Park Sub Pueblo County Assessor Parcel Number 03-330-21-038 3.55 acres FINANCIAL IMPLICATIONS: Lot 1 – two year “net” lease with rent to be paid at the rate of $2,484.00 per month. At the end of the term, the Company has the option of purchasing Lot 1 for its appraised value of $298,000.00. Parcel Q – ten year “net” lease with rent to be paid at the rate of $1,400.00 per month. BOARD/COMMISSION RECOMMENDATION: Not applicable to this Ordinance. STAKEHOLDER PROCESS: Not applicable to this Ordinance. ALTERNATIVES: If this Ordinance is not approved, the Company will be required to lease other property near its manufacturing facility and the City will lose rental income. RECOMMENDATION: The Pueblo Economic Development Corporation recommends approval of this Ordinance. Attachments: Proposed Ordinance; two proposed leases LEASE THIS LEASE is entered into as of this 1st day of May, 2019, by and between the City of Pueblo, Colorado, a Colorado municipal corporation (the "Lessor") and Key Structures, LLC, a Colorado limited liability company(the"Lessee"). WITNESSETH: WHEREAS, Lessor is the owner of an unimproved parcel of land located in the Pueblo Memorial Airport Industrial Park, consisting of approximately 3.55 acres, having the following legal description: Parcel Q, Lockheed St.,Pueblo Memorial Airport Industrial Park Sub Pueblo County Assessor Parcel Number 03-330-21-038 ("Leased Premises"), and WHEREAS, Lessee is desirous of leasing the Leased Premises upon the terms and conditions hereinafter set forth; NOW, THEREFORE, in consideration of the mutual promises, covenants and conditions contained herein, Lessor and Lessee hereby agree as follows: Article 1. Leased Premises. 1.01 Lessor hereby leases to Lessee and Lessee hereby leases from Lessor, the Leased Premises, subject to the covenants,provisions and conditions herein. 1.02 This Lease and Lessee's use of the Leased Premises are subject to the easements, right-of-way,covenants,conditions, restrictions,reservations and limitations appearing of record, and applicable zoning and land use laws, ordinances, codes, and regulations governing and regulating the Leased Premises and its use. Article 2. Term. 2.01 The Term of this Lease shall be for ten (10) years commencing May 1, 2019 and ending April 30, 2028 ("Term"). Article 3. Rent. 3.01 Lessee shall pay to Lessor monthly rent of One Thousand Four Hundred Dollars ($1,400.00) in advance, without notice or demand, beginning with the Commencement Date and on the same day of each month thereafter during the entire term. 3.02 All monthly rent and other payments required to be made by Lessee hereunder which shall remain unpaid thirty(30)days after their due dates,shall bear interest at the rate of to 1 percent (10%) per annum until paid. All rent and other payments shall be made at or mailed by United States mail to the following address: City of Pueblo, Finance Dept., 1 City Hall Place., Pueblo, CO 81003 or such other address as Lessor may from time to time designate to Lessee in writing. The existence of default interest on unpaid rent shall not alter, nor shall it be construed or interpreted to alter the due date, or confer a grace period, after the due date of the rent as set forth in Section 3.01 above. 3.03 Lessee's obligation to pay rent and other payments to Lessor hereunder is absolute and unconditional and rent or additional rent shall not be offset, abated, reduced or withheld for any cause whatsoever. 3.04 It is the intent of the parties hereto that this Lease be a "net" lease with Lessor incurring no obligation, monetary or otherwise, for any expense of any nature associated with the use and operation of the Leased Premises and any component part thereof by the Lessee. Article 4. Use of Leased Premises. 4.01 The Leased Premises shall be used and occupied by Lessee exclusively for commercial purposes associated with or incident to Lessee's established business activities and for such other activities of Lessee as are reasonably incident thereto. 4.02 Lessee shall use the Leased Premises in a careful, safe and proper manner in compliance with all laws and regulations applicable to the Leased Premises and Lessee's use thereof. Lessee shall not cause, maintain or permit any nuisance or waste in, on, or about the Leased Premises. Article 5. Condition of Premises. 5.01 EXCEPT AS SPECIFICALLY SET FORTH IN THIS LEASE, IT IS UNDERSTOOD AND AGREED THAT LESSOR IS NOT MAKING AND HAS NOT AT ANY TIME, MADE ANY WARRANTY OR REPRESENTATION OF ANY KIND OR CHARACTER, EXPRESS OR IMPLIED, WITH RESPECT TO THE LEASED PREMISES, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTY OR REPRESENTATION AS TO HABITABILITY,MERCHANTABILITY,FITNESS FOR A PARTICULAR PURPOSE,TITLE (OTHER THAN THE COVENANT OF QUIET POSSESSION SET FORTH IN ARTICLE 13 HEREOF), ZONING, PHYSICAL OR ENVIRONMENTAL CONDITIONS, UTILITIES, GOVERNMENTAL APPROVALS, COMPLIANCE OF THE LEASED PREMISES WITH GOVERNMENTAL LAWS, THE TRUTH, ACCURACY OR COMPLETENESS OF ANY DOCUMENT OR OTHER INFORMATION PROVIDED TO LESSEE BY ANY OTHER PERSON,OR ANY OTHER MATTER OR THING REGARDING THE LEASED PREMIS (011 2 5.02 The taking of possession of the Leased Premises by Lessee after the Commencement Date shall be conclusive evidence that the Lessee accepts the Leased Premises in its then present condition "As Is, Where Is, With All Faults" and that the Leased Premises are in good and satisfactory condition at the time of the commencement of this Lease. Article 6. Alterations and Improvements. Lessee shall not make any additions, alterations or improvements in or to the Leased Premises ("Alterations") without Lessor's prior written consent. Lessee shall not permit or allow any lien to be filed or recorded against the Leased Premises or Lessor's interest therein, and Lessee shall fully cooperate with Lessor in obtaining the protection afforded Lessor under Section 38-22-105(2), C.R.S., currently in effect or as subsequently amended. All Alterations made in or to the Leased Premises by Lessee shall become part of the Leased Premises and be surrendered with the Leased Premises at the termination of this Lease. Article 7. Right of Entry. Lessor, or Lessor's officers, employees, agents and representatives, as the case may be, may enter the Leased Premises during normal business hours upon oral or written notice to Lessee, except notice shall not be required in case of emergency, such as fire. Article 8. Assignment or Sublease. Lessee shall not voluntarily or by operation of law assign all or any part of this Lease or Lessee's interest herein without the express written consent of Lessor, which consent will not be unreasonably delayed,conditioned or withheld. Lessor may withhold its consent if the proposed assignee's financial standing and responsibility at the time of the proposed assignment is not sufficient in the Lessor's sole discretion to give assurance of performance and compliance with all terms and conditions of this Lease. Upon such an assignment and consent after the effective date of such assignment and consent, such assignee shall execute, acknowledge and deliver to Lessor an assumption agreement in form and substance satisfactory to Lessor, whereby assignee agrees to observe and keep all the terms,provisions,covenants and conditions to be observed,performed and kept by Lessee hereunder. In the event of such assignment, Lessee shall not be released from any obligations arising or occurring under this Lease. Any assignment or attempted assignment of the Lease or any interest herein by Lessee without Landlord's express written consent shall be null and void. Lessee hereby represents and warrants that by hereby entering into this Lease,it is acting on its own behalf and not as an agent for any other person or entity, including any undisclosed principal. For purposes of this Article, sublease or an attempt to sublease by Lessee shall be considered an "assignment". Article 9. Insurance and Indemnification. 3 9.01 Lessee shall indemnify and hold Lessor harmless from and defend Lessor against any and all claims or liability,including cost of defense and reasonable attorney fees, for any injury or damage to Lessee or its officers, agents or employees, or to Lessee's property, or to any third person,or to property of any third person: (a)occurring in,on or about the Leased Premises or any part thereof by or from any cause whatsoever except injury or damage caused by the wrongful or intentional acts of Lessor, its officers or employees; or (b) 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 activity conducted thereon. 9.02 Lessee shall secure and maintain in full force and effect, at its expense, during the Term and any Renewal Term, if applicable, of this Lease, commercial general liability insurance including personal injury, property damage and contractual coverage in the minimum amount of $1,000,000.00 combined single limits naming Lessor as an additional named insured. 9.03 Lessee shall secure and maintain during the Term of this Lease Colorado Worker's Compensation insurance or other similar coverage in the statutorily mandated amounts. 9.04 A copy of each insurance policy, or certificate thereof, issued by an association or company authorized to issue such policy or policies under the law of the State of Colorado containing a provision prohibiting cancellation or material modification of the insurance except after thirty (30) days' notice to Lessor, shall be delivered to the Lessor within thirty (30) days after date of this Lease and thereafter the Lessee will furnish to Lessor evidence of the continuance of the insurance coverage required herein within a reasonable time after the same has been issued. 9.05 Lessee hereby releases Lessor and Lessor's officers, agents, managers, directors, and employees from any and all claims and demands for loss, damages, expense or injury to any person or to personal property occurring on the Leased Premises. Lessee shall each obtain from its respective insurers waivers of all rights of subrogation against Lessor and Lessee shall indemnify Lessor against any loss or expense,including reasonable attorneys' fees,resulting from the failure to obtain such waivers of subrogation. Article 10. Taxes and Assessments. 10.01 Lessee shall pay, before delinquency, any and all property taxes levied or charged against any of the personal property belonging to it and situated on the Leased Premises and any possessory interest real property taxes. 10.02 Lessee shall be solely responsible for the payment of its own tax obligations including, but are not limited to, sales and use taxes. Article 11. Utilities. 4 Lessee shall pay,before delinquent,City of Pueblo's combined service fee and all charges for sewer, water, gas,electricity, telephone and all other utility services furnished to or used in or supplied to the Leased Premises. Lessor shall not be obligated to furnish, provide, or pay for any utilities, facilities or services of any kind. Article 12. Eminent Domain. If the whole or substantial part of the Leased Premises shall be taken or condemned by any competent authority for any public or quasi-public use or purpose under any statute or by the right of eminent domain, or purchased under threat of such taking, then this Lease shall terminate on the date when the condemning authority takes possession of the Leased Premises or the substantial part thereof. There shall be no apportionment of the award for taking or condemnation, the entire award going to the Lessor, provided Lessee shall have the right to recover any award which may be made for damages to or condemnation of Lessee's movable trade fixtures,equipment,furniture and furnishings or payments for relocation, if any. Article 13. Quiet Possession. Lessee shall, and may peacefully have, hold and enjoy the Leased Premises,subject to the other terms hereof, provided that Lessee pays the monthly rent and additional rent herein recited and performs all of Lessee's covenants and agreements contained herein. Article 14. Default. 14.0I In the event of default at any time by Lessee in the payment of the monthly rent or additional rent herein provided for or in the performance of any other of its covenants herein contained, Lessor shall have the right,after five(5)days' notice in writing to Lessee and Lessee's failure within said five (5)day period to cure said default, or if said default does not relate to the payment of money and cannot by its nature be cured within said five (5)day period, to undertake and diligently pursue action to cure said default,to either: (a) terminate this Lease and re-enter and take possession of the Leased Premises, and/or (b) pursue any remedy whatsoever provided by law or equity,and/or (c) re-enter and take possession of the Leased Premises and use its best efforts to re-let the same for and on account of Lessee for the then full remaining portion of the unexpired Term or Renewal Term of this Lease or for any shorter period, and to collect and receive payment of rent therefore, but no such re-entry or re-letting shall be construed as a termination of this Lease or as a release of Lessee from Lessee's obligation to perform any other covenant herein contained. It is expressly understood and agreed that in the event of any such re-entry or re-retting by Lessor such re-entry shall not operate to terminate this Lease or alter the obligation of Lessee to perform its covenants and to pay monthly rent or additional rent pursuant to the terms hereof unless Less;" 5 expressly so elects pursuant to Section 14.01(a) above. Lessor shall in no way be responsible or liable for any failure to re-let the Leases Premises,or any part thereof, or for any failure to collect any rent due upon such re-letting. No notice from Lessor hereunder or under a forcible entry and detainer statute or similar law constitutes an election by Lessor to terminate this Lease unless such notice specifically so states. Lessor reserves the right following any such re-entry and/or re-letting to exercise its right to terminate this Lease;and/or (d) cure the default on Lessee's behalf and at Lessee's expense, in which event, all costs, expenses and reasonable attorney's fees incurred by Lessor in curing the default together with interest thereon at the rate of ten (10) percent per annum shall constitute additional rent payable to Lessor by Lessee upon demand. 14.02 If Lessor does not elect to terminate this Lease but takes possession as provided for in Section 14.01(c), Lessee shall pay to Lessor the monthly rent and other charges at the times and in the manner as herein provided which would be payable if such repossession had not occurred, less the net proceeds, if any,of any re-letting of the Leased Premises after deducting all Lessor's reasonable expenses including, without limitation, all repossessions costs, brokerage commissions, legal expenses, attorneys' fees, alterations and repair costs and expenses of preparation of such re-letting. 14.03 In the event the parties hereto become involved in a dispute arising out of this Lease, or the performance or breach thereof, the Court shall award costs, expenses, and attorney fees to the prevailing party. 14.04 If Lessee violates any of the terms and provisions of this Lease or defaults in any of its obligations hereunder other than the payment of monthly rent or other sum payable hereunder, such violation may be restrained or such obligation enforced by injunction at the instance and request of Lessor without the showing of any special damages or an inadequate remedy at law. Article 15. Waiver and Time of Essence. No waiver of any breach or breaches of any provision, covenant or condition of this Lease 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. Acceptance of monthly rent or partial monthly rent by Lessor shall not constitute a waiver of any then existing or subsequent breach or default. Time is of the essence for each and every provision, covenant and condition herein contained and on the part of Lessee to be done and performed. Article 16. Notices. 16.01 All notices, demands or communications of any kind which may be required or desired to be served, given or made by Lessee upon or to Lessor, under the terms of or, 6 connection with this Lease,shall be sufficiently served,given or made(as an alternative to personal service upon Lessor) if such notice, demand or communication is sent by certified United States mail, addressed to: City of Pueblo ATTN: Mayor I City Hall Place, 2nd Floor Pueblo,CO 81003 with copy to: City Attorney 1 City Hall Place, 3`d Floor Pueblo,CO 81003, (or to such other person or address as may be hereafter from time to time be designated for this purpose by Lessor to Lessee in writing). 16.02 All notices, demands or communications of any kind which may be required or desired to be served, given or made by Lessor upon or to Lessee, under the terms of or in connection with this Lease, shall sufficiently served, given or made (as an alternative to personal service upon Lessee) if such notice, demand or communication is sent by certified United States Mail, addressed to: Key Structures, LLC Attn: Chief Executive Officer do The Challenger Group, Inc. 8605 Explorer Drive,Suite 250 Colorado Springs, CO 80927 (or to such other person or address as may hereafter from time to time be designated for this purpose by Lessee to Lessor in writing). Article 17. Environmental Provisions. 17.01 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 (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 petroleum based products, and(5) lead. 7 17.02 Lessee will comply with Environmental Regulations that are applicable to the Lessee and its use of the Leased Premises. No activity shall be undertaken by the Lessee, 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 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 1221 et seq. and the Clean Air Act,42 U.S.C.Section 7401 et seq. 17.03 Lessee agrees to defend, indemnify and forever hold harmless the Leased Premises and Lessor,and their respective agents,successors,and assigns,as their interest may appear, from all claims,losses,damages,penalties,expenses and costs,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 Lessee, its employees, agents, licensees, invitees, contractors and subcontractors. The provisions of this Article 17 shall expressly survive the expiration of the Term or other termination of this Lease. Article 18. F.A.A. Lease Requirements: 18.01 This Lease shall be subordinate to the provisions and requirements of any existing or future agreement between Lessor and the United States, relative to the use, development, operation, or maintenance of the Pueblo Memorial Airport("Airport"). 18.02 Lessee shall comply with the notification and review requirements covered in Part 77 of the Federal Aviation Regulations with respect to the construction of any structure or building on the Leased Premises,or in the event of any planned modification or alteration of any present or future building or structure on the Leased Premises. 18.03 It is understood and agreed that nothing contained in this Lease shall be construed to grant or authorize the granting of an exclusive right within the meaning of Section 308 of the Federal Aviation Act. 18.04 Lessor reserves for the 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 aircraft no,/ 8 known or hereafter used for navigation or flight in said airspace, and for use of said airspace for landing on,taking off from,or operations on or over the Airport. 18.05 Lessee by accepting this Lease expressly agrees for itself, its successors and assigns that it will not erect nor permit the erection of any structure, building or object nor permit the growth of any tree on the Leased Premises to a height not to exceed thirty-five(35) feet above ground level. In the event the aforesaid covenant is breached, Lessor reserves the right to enter upon the Leased Premises and to remove the offending structure or object or cut the offending tree, all of which shall be at the expense of the Lessee. 18.06 Lessee shall not make use of the Leased Premises in any manner which might interfere with the landing or taking off of aircraft at the Airport,or otherwise constitute a hazard to aviation. In the event the aforesaid covenant is breached, Lessor reserves the right to enter upon the Leased Premises and cause the abatement of such interference at the expense of the Lessee. Article 19. Miscellaneous Provisions. 19.01 Colorado Law. This Lease shall be governed by the laws of the State of Colorado and shall be construed in accordance therewith without reference to such State's choice of law and/or conflict of law principles. 19.02 Writing for Waiver or Modification. No provision of this Lease may be waived or modified except by an agreement in writing signed by the parties hereto. A waiver of any term or provision shall not be construed as a waiver of any other term or provision. 19.03 Binding Effect. This Lease sets forth the entire and complete understanding and agreement of the parties hereto. Lessee acknowledges and agrees that it has not relied upon any statements, representations, agreements or warranties of Lessor except such as are expressed herein. This Lease shall be binding on the parties, their successors and approved assigns. 19.04 Construction. Throughout this Lease, 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. 19.05 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 Lease exists, the text shall control. 19.06 Severability. If any provision of this Lease is declared by any court of competent jurisdiction to be invalid for any reason,such invalidity shall not affect the remaining provisio:•✓ 9 On the contrary, such remaining provisions shall be fully severable, and this Lease shall be construed and enforced as if such invalid provisions had never been inserted in the Lease. 19.07 Venue and Jury Trial. Lessor and Lessee agree that the venue for all actions or causes of action relating to this Lease or the Leased Premises shall be Pueblo County, Colorado. All such actions shall be filed in the District Court, County of Pueblo, State of Colorado, and Lessor and Lessee submit to the personal and subject matter jurisdiction of that Court. To the extent allowed by law,each party hereby waives its right to a jury trial. 19.08 Lessee's Warranties. Lessee and the persons signing this Lease on behalf of Lessee represent and warrant that such parties and Lessee have the requisite power and authority to enter into, execute and deliver the Lease and that this Lease is a valid and legally binding obligation of Lessee enforceable against Lessee in accordance with its terms. 19.09 Time of Essence. Time shall be of the essence as to the performance of all terms, conditions and obligations under this Lease. 19.10 Third Parties. The provisions of this Lease are and will be for the benefit of Lessor and Lessee only and not for the benefit of any third party, and accordingly, no third party shall have any right or remedy hereunder or the right to enforce any provision of this Lease 19.11 Brokerage Commission. Lessor and Lessee each represent to the other that they have not entered into any agreement or incurred any obligation in connection with the Lease transaction which might result in the obligation to pay a brokerage commission to any brother. Each party shall indemnify and hold the other party harmless from and against any claim or demand by any broker or other person for bringing about this Lease who claim to have dealt with such indemnifying party, including all expenses incurred in defending any such claim or demand (including reasonable attorney's fees). 19.12 Hold Over. If Lessee shall hold over after the expiration of the term or any renewal term of this Lease, without a signed renewal or new Lease, then Lessee shall be deemed a Lessee from month to month on all of the terms and conditions set forth in this Lease, except that the monthly rental due under Article 3 hereof shall increase by ten percent (10%) over the rent being charged on the last month prior to the hold over. Nothing in this Section shall be construed as permission of the Lessor to hold over beyond the expiration of the Term or any Renewal Term of this Lease. IN WITNESS WHEREOF, Lessor and Lessee, by their duly authorized representative= have executed this Lease on the day and year first above written. I P - 10 City of Pueblo,Colorado a Colorado Municipal Corporation [SEAL] • Attest: , (p 11 G ' By '/��r4/<1.",e4sedesort Acting City Clerk Nicholas A. Gradcsar Mayor Key Structures, LLC a Colorado Limit iability Company By Brian Bahr Manager STATE OF COLORADO ) {{ OCk60 ) ss. COUNTY OF l , ) The foregoing instrument was acknowledged before me this 16 day of , lh! F, 2019 by Brian Bahr as Manager of Key Structures, LLC,a Colorado limited liability company. Witness my hand and official seal. My commission expires: -- 1 b [ SEAL] Notary 1 blic JANNA KELLEY Notary Public State of Colorado Notary ID N 201 64037 1 1 1 M Commission lx0 1rOS 09.27-2020 11 LEASE THIS LEASE is entered into as of this 1st day of May 2019, by and between the City of Pueblo, Colorado, a Colorado municipal corporation (the "Lessor") and Key Structures, LLC, a Colorado limited liability company(the"Lessee"). WITNESSETH: WHEREAS, Lessor is the owner of an unimproved parcel of land located in the Pueblo Memorial Airport Industrial Park, consisting of approximately 6.34 acres, having the following legal description: Lot 1 McDonnell Douglas Subdivision Pueblo, CO 81001 Pueblo County Assessor Parcel Number 03-330-22-001 ("Leased Premises"),and WHEREAS,Lessee is desirous of leasing and obtaining the option to purchase the Leased Premises upon the terms and conditions hereinafter set forth; NOW, THEREFORE, in consideration of the mutual promises, covenants and conditions contained herein, Lessor and Lessee hereby agree as follows: Article 1. Leased Premises. 1.01 Lessor hereby leases to Lessee and Lessee hereby leases from Lessor, the Leased Premises,subject to the covenants,provisions and conditions herein. 1.02 This Lease and Lessee's use of the Leased Premises are subject to the easements, right-of-way,covenants,conditions, restrictions, reservations and limitations appearing of record, and applicable zoning and land use laws, ordinances, codes, and regulations governing and regulating the Leased Premises and its use. Article 2. Term. 2.01 The Term of this Lease shall be for two (2) years commencing May 1, 2019 and ending April 30, 2021 ("Term"). Article 3. Rent. 3.01 Lessee shall pay to Lessor monthly rent of Two Thousand Four Hundred Eight Four Dollars ($2,484.00) in advance, without notice or demand, beginning with the Commence t Date and on the same day of each month thereafter during the entire term. 1 3.02 All monthly rent and other payments required to be made by Lessee hereunder which shall remain unpaid thirty(30)days after their due dates,shall bear interest at the rate of ten percent (10%) per annum until paid. All rent and other payments shall be made at or mailed by United States mail to the following address: City of Pueblo, Finance Dept., 1 City Hall Place., Pueblo, CO 81003 or such other address as Lessor may from time to time designate to Lessee in writing. The existence of default interest on unpaid rent shall not alter, nor shall it be construed or interpreted to alter the due date, or confer a grace period, after the due date of the rent as set forth in Section 3.01 above. 3.03 Lessee's obligation to pay rent and other payments to Lessor hereunder is absolute and unconditional and rent or additional rent shall not be offset, abated, reduced or withheld for any cause whatsoever. 3.04 It is the intent of the parties hereto that this Lease be a "net" lease with Lessor incurring no obligation, monetary or otherwise, for any expense of any nature associated with the use and operation of the Leased Premises and any component part thereof by the Lessee. Article 4. Use of Leased Premises. 4.01 The Leased Premises shall be used and occupied by Lessee exclusively for commercial purposes associated with or incident to Lessee's established business activities and for such other activities of Lessee as are reasonably incident thereto. 4.02 Lessee shall use the Leased Premises in a careful, safe and proper manner in compliance with all laws and regulations applicable to the Leased Premises and Lessee's use thereof. Lessee shall not cause, maintain or permit any nuisance or waste in, on, or about the Leased Premises. Article 5. Condition of Premises. 5.01 EXCEPT AS SPECIFICALLY SET FORTH IN THIS LEASE, IT IS UNDERSTOOD AND AGREED THAT LESSOR IS NOT MAKING AND HAS NOT AT ANY TIME, MADE ANY WARRANTY OR REPRESENTATION OF ANY KIND OR CHARACTER, EXPRESS OR IMPLIED, WITH RESPECT TO THE LEASED PREMISES, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTY OR REPRESENTATION AS TO HABITABILITY,MERCHANTABILITY,FITNESS FOR A PARTICULAR PURPOSE,TITLE (OTHER THAN THE COVENANT OF QUIET POSSESSION SET FORTH IN ARTICLE 13 HEREOF), ZONING, PHYSICAL OR ENVIRONMENTAL CONDITIONS, UTILITIES, GOVERNMENTAL APPROVALS, COMPLIANCE OF THE LEASED PREMISES WITH GOVERNMENTAL LAWS, THE TRUTH, ACCURACY OR COMPLETENESS OF A 2 DOCUMENT OR OTHER INFORMATION PROVIDED TO LESSEE BY ANY OTHER PERSON,OR ANY OTHER MATTER OR THING REGARDING THE LEASED PREMISES. 5.02 The taking of possession of the Leased Premises by Lessee after the Commencement Date shali,be conclusive evidence that the Lessee accepts the Leased Premises in its then present condition "As Is, Where Is, With All Faults" and that the Leased Premises are in good and satisfactory condition at the time of the commencement of this Lease. Article 6. Alterations and Improvements. Lessee shall not make any additions, alterations or improvements in or to the Leased Premises ("Alterations") without Lessor's prior written consent. Lessee shall not permit or allow any lien to be filed or recorded against the Leased Premises or Lessor's interest therein, and Lessee shall fully cooperate with Lessor in obtaining the protection afforded Lessor under Section 38-22-105(2), C.R.S., currently in effect or as subsequently amended. All Alterations made in or to the Leased Premises by Lessee shall become part of the Leased Premises and be surrendered with the Leased Premises at the termination of this Lease. Article 7. Right of Entry. Lessor, or Lessor's officers, employees, agents and representatives, as the case may be, may enter the Leased Premises during normal business hours upon oral or written notice to Lessee, except notice shall not be required in case of emergency, such as fire. Article 8. Assignment or Sublease. Lessee shall not voluntarily or by operation of law assign all or any part of this Lease or Lessee's interest herein without the express written consent of Lessor, which consent will not be unreasonably delayed,conditioned or withheld. Lessor may withhold its consent if the proposed assignee's financial standing and responsibility at the time of the proposed assignment is not sufficient in the Lessor's sole discretion to give assurance of performance and compliance with all terms and conditions of this Lease. Upon such an assignment and consent after the effective date of such assignment and consent, such assignee shall execute, acknowledge and deliver to Lessor an assumption agreement in form and substance satisfactory to Lessor, whereby assignee agrees to observe and keep all the terms,provisions,covenants and conditions to be observed,performed and kept by Lessee hereunder. In the event of such assignment, Lessee shall not be released from any obligations arising or occurring under this Lease. Any assignment or attempted assignment of the Lease or any interest herein by Lessee without Landlord's express written consent shall be null and void. Lessee hereby represents and warrants that by hereby entering into this Lease,it is acting on its own behalf and not as an agent for any other person or entity, including any undisclo, 3 /� principal. For purposes of this Article, sublease or an attempt to sublease by Lessee shall be considered an"assignment". Article 9. Insurance and Indemnification. 9.01 Lessee shall indemnify and hold Lessor harmless from and defend Lessor against any and all claims or liability,including cost of defense and reasonable attorney fees,for any injury or damage to Lessee or its officers, agents or employees, or to Lessee's property, or to any third person,or to property of any third person: (a)occurring in,on or about the Leased Premises or any part thereof by or from any cause whatsoever except injury or damage caused by the wrongful or intentional acts of Lessor, its officers or employees; or (b) 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 activity conducted thereon. 9.02 Lessee shall secure and maintain in full force and effect, at its expense, during the Term and any Renewal Term, if applicable, of this Lease, commercial general liability insurance including personal injury, property damage and contractual coverage in the minimum amount of $1,000,000.00 combined single limits naming Lessor as an additional named insured. 9.03 Lessee shall secure and maintain during the Term of this Lease Colorado Worker's Compensation insurance or other similar coverage in the statutorily mandated amounts. 9.04 A copy of each insurance policy, or certificate thereof, issued by an association or company authorized to issue such policy or policies under the law of the State of Colorado containing a provision prohibiting cancellation or material modification of the insurance except after thirty (30) days' notice to Lessor, shall be delivered to the Lessor within thirty (30) days after date of this Lease and thereafter the Lessee will furnish to Lessor evidence of the continuance of the insurance coverage required herein within a reasonable time after the same has been issued. 9.05 Lessee hereby releases Lessor and Lessor's officers, agents, managers, directors, and employees from any and all claims and demands for loss, damages, expense or injury to any person or to personal property occurring on the Leased Premises. Lessee shall each obtain from its respective insurers waivers of all rights of subrogation against Lessor and Lessee shall indemnify Lessor against any loss or expense, including reasonable attorneys' fees,resulting from the fail to obtain such waivers of subrogation. Article 10. Taxes and Assessments. 4 10.01 Lessee shall pay, before delinquency, any and all property taxes levied or charged against any of the personal property belonging to it and situated on the Leased Premises and any possessory interest real property taxes. 10.02 Lessee shall be solely responsible for the payment of its own tax obligations including,but are not limited to, sales and use taxes. Article 11. Utilities. Lessee shall pay,before delinquent,City of Pueblo's combined service fee and all charges for sewer, water, gas,electricity, telephone and all other utility services furnished to or used in or supplied to the Leased Premises. Lessor shall not be obligated to furnish, provide, or pay for any utilities, facilities or services of any kind. Article 12. Eminent Domain. If the whole or substantial part of the Leased Premises shall be taken or condemned by any competent authority for any public or quasi-public use or purpose under any statute or by the right of eminent domain, or purchased under threat of such taking, then this Lease shall terminate on the date when the condemning authority takes possession of the Leased Premises or the substantial part thereof. There shall be no apportionment of the award for taking or condemnation, the entire award going to the Lessor, provided Lessee shall have the right to recover any award which may be made for damages to or condemnation of Lessee's movable trade fixtures,equipment,furniture and furnishings or payments for relocation, if any. Article 13. Quiet Possession. Lessee shall, and may peacefully have, hold and enjoy the Leased Premises, subject to the other terms hereof, provided that Lessee pays the monthly rent and additional rent herein recited and performs all of Lessee's covenants and agreements contained herein. Article 14. Default. 14.01 In the event of default at any time by Lessee in the payment of the monthly rent or additional rent herein provided for or in the performance of any other of its covenants herein contained, Lessor shall have the right,after five (5)days' notice in writing to Lessee and Lessee's failure within said five (5) day period to cure said default,or if said default does not relate to t payment of money and cannot by its nature be cured within said five (5)day period, to unde e and diligently pursue action to cure said default, to either: 5 (a) terminate this Lease and re-enter and take possession of the Leased Premises, and/or (b) pursue any remedy whatsoever provided by law or equity,and/or (c) re-enter and take possession of the Leased Premises and use its best efforts to re-let the same for and on account of Lessee for the then full remaining portion of the unexpired Term or Renewal Term of this Lease or for any shorter period, and to collect and receive payment of rent therefore, but no such re-entry or re-letting shall be construed as a termination of this Lease or as a release of Lessee from Lessee's obligation to perform any other covenant herein contained. It is expressly understood and agreed that in the event of any such re-entry or re-retting by Lessor such re-entry shall not operate to terminate this Lease or alter the obligation of Lessee to perform its covenants and to pay monthly rent or additional rent pursuant to the terms hereof unless Lessor expressly so elects pursuant to Section 14.01(a) above. Lessor shall in no way be responsible or liable for any failure to re-let the Leases Premises, or any part thereof,or for any failure to collect any rent due upon such re-letting. No notice from Lessor hereunder or under a forcible entry and detainer statute or similar law constitutes an election by Lessor to terminate this Lease unless such notice specifically so states. Lessor reserves the right following any such re-entry and/or re-letting to exercise its right to terminate this Lease;and/or (d) cure the default on Lessee's behalf and at Lessee's expense, in which event, all costs, expenses and reasonable attorney's fees incurred by Lessor in curing the default together with interest thereon at the rate of ten (10) percent per annum shall constitute additional rent payable to Lessor by Lessee upon demand. 14.02 If Lessor does not elect to terminate this Lease but takes possession as provided for in Section 14.01(c), Lessee shall pay to Lessor the monthly rent and other charges at the times and in the manner as herein provided which would be payable if such repossession had not occurred, less the net proceeds, if any,of any re-letting of the Leased Premises after deducting all Lessor's reasonable expenses including, without limitation, all repossessions costs, brokerage commissions, legal expenses, attorneys' fees, alterations and repair costs and expenses of preparation of such re-letting. 14.03 In the event the parties hereto become involved in a dispute arising out of this Lease, or the performance or breach thereof, the Court shall award costs, expenses, and attorney fees to the prevailing party. 14.04 If Lessee violates any of the terms and provisions of this Lease or defaults in any of its obligations hereunder other than the payment of monthly rent or other sum payable hereunder, such violation may be restrained or such obligation enforced by injunction at the instance and request of Lessor without the showing of any special damages or an inadequ1 remedy at law. 6 Article 15. Option to Purchase Leased Premises. 15.01 If Lessee is not in default hereunder under this Lease, Lessee shall have the option to purchase the Leased Premises upon the terms and conditions contained in as follows: (a) The purchase price during the two(2)year Term of this Lease shall be Two Hundred Ninety Eight Thousand Dollars($298,000.00) 15.02 The option to purchase hereby granted shall be exercised by Lessee by delivering to Lessor written notice of Lessee's exercise of the option at least ninety(90)days prior to the last day of the term of this lease. 15.03 If Lessee fails for any reason to give timely notice of its exercise of the option to purchase,the option rights granted hereby shall automatically terminate. Article 16. Conditions of Purchase Options. 16.01 Upon valid exercise of the purchase option, the terms of purchase and sale shall include the following conditions and requirements: (a) Closing and payment of the purchase price in U.S. dollars, in cash or certified funds to the City of Pueblo to be held and made not later than 30 days after the last day of the Term of this Lease; (b) Conveyance shall be made by special warranty deed free of liens, except those for general property taxes and those created by the acts or defaults of Lessee; subject to easements, rights-of-way, conditions, covenants, restrictions, reservations, and limitations of record and those created by acts of defaults of Lessee; subject to any FAA restrictions and requirements as set forth in Article 20 of this Lease; subject to any matters contained in the Subdivision Plat for Pueblo Memorial Airport Industrial Park,Third Filing;and subject to standard printed exceptions 1 through 4 and any other exceptions contained in owner's title insurance customarily issued in Pueblo County, Colorado. (c) LESSEE ACKNOWLEDGES AND AGREES THAT UPON CLOSING LESSOR SHALL SELL AND CONVEY TO LESSEE AND LESSEE SHALL ACCEPT THE LEASED PREMISES "AS IS, WHERE IS, AND WITH ALL FAULTS." LESSEE HAS NOT RELIED AND WILL NOT RELY ON, AND LESSOR IS NOT LIABLE FOR OR BOUND BY, ANY EXPRESS OR IMPLIED WARRANTIES, GUARANTIES, STATEMENTS, REPRESENTATIONS OR INFORMATION PERTAINING TO THE LEASED PREMISES •-' RELATING THERETO MADE OR FURNISHED BY LESSOR,OR AGENT REPRESENZG 7 fy� OR PURPORTING TO REPRESENT LESSOR, TO WHOMEVER MADE OR GIVEN, DIRECTLY OR INDIRECTLY, VERBALLY OR IN WRITING. LESSEE REPRESENTS TO LESSOR THAT LESSEE HAS CONDUCTED, OR WILL CONDUCT PRIOR TO CLOSING, SUCH INVESTIGATIONS OF THE LEASED PREMISES, INCLUDING BUT NOT LIMITED TO, THE PHYSICAL AND ENVIRONMENTAL CONDITIONS THEREOF, AS LESSEE DEEMS NECESSARY TO SATISFY ITSELF AS TO THE CONDITION OF THE LEASED PREMISES AND THE EXISTENCE OR NONEXISTENCE OR CURATIVE ACTION TO BE TAKEN WITH RESPECT TO ANY HAZARDOUS OR TOXIC SUBSTANCES ON OR DISCHARGED FROM THE LEASED PREMISES, AND WILL RELY UPON SAME AND NOT UPON ANY INFORMATION PROVIDED BY OR ON BEHALF OF LESSOR OR ITS AGENTS OR EMPLOYEES WITH RESPECT THERETO. LESSEE SHALL ASSUME THE RISK THAT ADVERSE MATTERS, INCLUDING BUT NOT LIMITED TO, CONSTRUCTION DEFECTS AND ADVERSE PHYSICAL AND ENVIRONMENTAL CONDITIONS, MAY NOT HAVE BEEN REVEALED BY LESSEE'S INVESTIGATIONS, AND, UPON CLOSING, SHALL BE DEEMED TO HAVE WAIVED, RELINQUISHED AND RELEASED LESSOR FROM AND AGAINST ANY AND ALL CLAIMS, DEMANDS, CAUSES OF ACTION(INCLUDING CAUSES OF ACTION IN TORT),LOSSES,DAMAGES, LIABILITIES, COSTS AND EXPENSES (INCLUDING ATTORNEYS' FEES AND COURT COSTS)OF ANY AND EVERY KIND OR CHARACTER, KNOWN OR UNKNOWN,WHICH LESSEE MIGHT HAVE ASSERTED OR ALLEGED AGAINST LESSOR AT ANY TIME BY REASON OF OR ARISING OUT OF ANY CONSTRUCTION DEFECTS, PHYSICAL CONDITIONS, VIOLATIONS OF ANY APPLICABLE LAWS (INCLUDING ANY ENVIRONMENTAL LAWS) AND ANY AND ALL OTHER ACTS, OMISSIONS, EVENTS, CIRCUMSTANCES OR MATTERS REGARDING THE LEASED PREMISES. LESSOR AGREES THAT SHOULD ANY CLEANUP, REMEDIATION OR REMOVAL OF HAZARDOUS SUBSTANCES OR OTHER ENVIRONMENTAL CONDITIONS ON THE LEASED PREMISES BE REQUIRED BY ANY GOVERNMENTAL ENTITY AFTER THE DATE OF CLOSING, SUCH CLEAN-UP, REMOVAL OR REMEDIATION SHALL, AS BETWEEN LESSOR AND LESSEE, BE THE RESPONSIBILITY OF AND SHALL BE PERFORMED AT THE SOLE COST AND EXPENSES OF LESSEE. THE COVENANTS AND REPRESENTATIONS OF LESSEE SET FORTH IN THIS ARTICLE 16.01(c) SHALL SURVIVE THE RECORDATION OF THE SPECIAL WARRANTY DEED AND CLOSING AND SHALL NOT BE MERGED INTO THE SPECIAL WARRANTY DEED UPON ITS RECORDATION. 8 Article 17. Waiver and Time of Essence. No waiver of any breach or breaches of any provision,covenant or condition of this Lease 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. Acceptance of monthly rent or partial monthly rent by Lessor shall not constitute a waiver of any then existing or subsequent breach or default. Time is of the essence for each and every provision, covenant and condition herein contained and on the part of Lessee to be done and performed. Article 18. Notices. 18.01 All notices, demands or communications of any kind which may be required or desired to be served, given or made by Lessee upon or to Lessor, under the terms of or in connection with this Lease,shall be sufficiently served,given or made(as an alternative to personal service upon Lessor) if such notice, demand or communication is sent by certified United States mail,addressed to: City of Pueblo ATTN: Mayor I City Hall Place,2"Floor Pueblo,CO 81003 with copy to: City Attorney I City Hall Place, 3`u Floor Pueblo, CO 81003, (or to such other person or address as may be hereafter from time to time be designated for this purpose by Lessor to Lessee in writing). 18.02 All notices, demands or communications of any kind which may be required or desired to be served, given or made by Lessor upon or to Lessee, under the terms of or in connection with this Lease, shall sufficiently served, given or made (as an alternative to personal service upon Lessee) if such notice, demand or communication is sent by certified United States Mail,addressed to: Key Structures, LLC Attn:Chief Executive Officer do The Challenger Group, Inc. 8605 Explorer Drive, Suite 250 Colorado Springs,CO 80927 9 (or to such other person or address as may hereafter from time to time be designated for this purpose by Lessee to Lessor in writing). Article 19. Environmental Provisions. 19.01 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 (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. 19.02 Lessee will comply with Environmental Regulations that are applicable to the Lessee and its use of the Leased Premises. No activity shall be undertaken by the Lessee, 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 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 1221 et seq. and the Clean Air Act,42 U.S.C.Section 7401 et seq. 19.03 Lessee agrees to defend, indemnify and forever hold harmless the Leased Premises and Lessor,and their respective agents,successors,and assigns,as their interest may appear,from all claims,losses,damages,penalties,expenses and costs, 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 Lessee, its employees, agents, licensees, invitees, contractors and subcontractors. The provisions of this Article 17 shall expressly survive the expiration of the Term or other termination of this Lease. Article 20. F.A.A. Lease Requirements: 10 20.01 This Lease shall be subordinate to the provisions and requirements of any existing or future agreement between Lessor and the United States, relative to the use, development, operation, or maintenance of the Pueblo Memorial Airport("Airport"). 20.02 Lessee shall comply with the notification and review requirements covered in Part 77 of the Federal Aviation Regulations with respect to the construction of any structure or building on the Leased Premises,or in the event of any planned modification or alteration of any present or future building or structure on the Leased Premises. 20.03 It is understood and agreed that nothing contained in this Lease shall be construed to grant or authorize the granting of an exclusive right within the meaning of Section 308 of the Federal Aviation Act. 20.04 Lessor reserves for the 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 aircraft now known or hereafter used for navigation or flight in said airspace,and for use of said airspace for landing on,taking off from, or operations on or over the Airport. 20.05 Lessee by accepting this Lease expressly agrees for itself, its successors and assigns that it will not erect nor permit the erection of any structure, building or object nor permit the growth of any tree on the Leased Premises to a height not to exceed thirty-five (35) feet above ground level. In the event the aforesaid covenant is breached, Lessor reserves the right to enter upon the Leased Premises and to remove the offending structure or object or cut the offending tree, all of which shall be at the expense of the Lessee. 20.06 Lessee shall not make use of the Leased Premises in any manner which might interfere with the landing or taking off of aircraft at the Airport,or otherwise constitute a hazard to aviation. In the event the aforesaid covenant is breached,Lessor reserves the right to enter upon the Leased Premises and cause the abatement of such interference at the expense of the Lessee. Article 21. Miscellaneous Provisions. 21.01 Colorado Law. This Lease shall be governed by the laws of the State of Colorado and shall be construed in accordance therewith without reference to such State's choice of and/or conflict of law principles. / 11 21.02 Writing for Waiver or Modification. No provision of this Lease may be waived or modified except by an agreement in writing signed by the parties hereto. A waiver of any term or provision shall not be construed as a waiver of any other term or provision. 21.03 Binding Effect. This Lease sets forth the entire and complete understanding and agreement of the parties hereto. Lessee acknowledges and agrees that it has not relied upon any statements, representations, agreements or warranties of Lessor except such as are expressed herein. This Lease shall be binding on the parties, their successors and approved assigns. 21.04 Construction. Throughout this Lease, 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. 21.05 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 Lease exists, the text shall control. 21.06 Severability. If any provision of this Lease 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 Lease shall be construed and enforced as if such invalid provisions had never been inserted in the Lease. 21.07 Venue and Jury Trial. Lessor and Lessee agree that the venue for all actions or causes of action relating to this Lease or the Leased Premises shall be Pueblo County, Colorado. All such actions shall be filed in the District Court, County of Pueblo, State of Colorado, and Lessor and Lessee submit to the personal and subject matter jurisdiction of that Court. To the extent allowed by law, each party hereby waives its right to a jury trial. 21.08 Lessee's Warranties. Lessee and the persons signing this Lease on behalf of Lessee represent and warrant that such parties and Lessee have the requisite power and authority to enter into, execute and deliver the Lease and that this Lease is a valid and legally binding obligation of Lessee enforceable against Lessee in accordance with its terms. 21.09 Time of Essence. Time shall be of the essence as to the performance of all terms, conditions and obligations under this Lease. 21.10 Third Parties. The provisions of this Lease are and will be for the benefit of Lessor and Lessee only and not for the benefit of any third party, and accordingly, no third pt F all have any right or remedy hereunder or the right to enforce any provision of this Lease 12 21.11 Brokerage Commission. Lessor and Lessee each represent to the other that they have not entered into any agreement or incurred any obligation in connection with the Lease transaction which might result in the obligation to pay a brokerage commission to any brother. Each party shall indemnify and hold the other party harmless from and against any claim or demand by any broker or other person for bringing about this Lease who claim to have dealt with such indemnifying party, including all expenses incurred in defending any such claim or demand (including reasonable attorney's fees). 21.12 Hold Over. If Lessee shall hold over after the expiration of the term or any renewal term of this Lease, without a signed renewal or new Lease, then Lessee shall be deemed a Lessee from month to month on all of the terms and conditions set forth in this Lease, except that the monthly rental due under Article 3 hereof shall increase by ten percent(10%)over the rent being charged on the last month prior to the hold over. Nothing in this Section shall be construed as permission of the Lessor to hold over beyond the expiration of the Term or any Renewal Term of this Lease. IN WITNESS WHEREOF, Lessor and Lessee, by their duly authorized representatives, have executed this Lease on the day and year first above written. City of Pueblo,Colorado a Colorado Municipal Corporation [SEAL] Atte 0 ;4By �� Acting City Clerk Nicholas A. Gradisar Mayor Key Structures, LLC a Colorado Limited Li- 'lity Company By 'OP B an Bahr Manager STATE OF COLORADO ) r ) ss. COUNTY OF �, t`(k30 ) The foregoing instrument was acknowledged before me this __J day of 9 , 2019 by Brian Bahr as Manager of Key Structures, LLC,a Colorado limited liability company. 13 Witness my hand and official seal. My commission expires: [ SEAL] 1 �` _ Nota 'ablic JANNA KELLEY Notary Pubtic State of Colorado Notary to M 201640371 1 1 tvly Commission Exeires 09-27-2020 14