The URL can be used to link to this page

Home My WebLink About09590 ORDINANCE NO. 9590 AN ORDINANCE APPROVING AN AMENDMENT NO. 2 TO A LEASE AGREEMENT BETWEEN THE CITY OF PUEBLO, A COLORADO MUNICIPAL CORPORATION AND TRINITY PLASTICS, INC., A COLORADO CORPORATION AND AUTHORIZING THE MAYOR TO EXECUTE SAID AMENDMENT NO. 2 BE IT ORDAINED BY THE CITY COUNCIL OF PUEBLO, that: SECTION 1. The Amendment No. 2 to Lease Agreement dated November 11, 2019 between the City of Pueblo, a Colorado municipal corporation and Trinity Plastics, Inc., a Colorado corporation, a copy of which is attached hereto (“Amendment No. 2”), having been approved as to form by the City Attorney, is hereby approved. The Mayor is authorized to execute and deliver the Amendment No. 2 in the name of the City and the 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 Amendment No. 2 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 October 28, 2019. Final adoption of Ordinance by City Council on November 11, 2019 . President of City Council Action by the Mayor: ☒ Approved on November 14, 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 City Clerk City Clerk’s Office Item # R-6 Background Paper for Proposed Ordinance COUNCIL MEETING DATE: October 28, 2019 TO: President Christopher A. Nicoll and Members of City Council CC: Mayor Nicholas A. Gradisar VIA: Brenda Armijo, City Clerk FROM: Daniel C. Kogovsek, City Attorney SUBJECT: AN ORDINANCE APPROVING AN AMENDMENT NO. 2 TO A LEASE AGREEMENT BETWEEN THE CITY OF PUEBLO, A COLORADO MUNICIPAL CORPORATION AND TRINITY PLASTICS, INC., A COLORADO CORPORATION AND AUTHORIZING THE MAYOR TO EXECUTE SAID AMENDMENT NO. 2 SUMMARY: Attached is an Ordinance which approves and authorizes the Mayor to sign an Amendment No. 2 to a Lease Agreement with Trinity Plastics, Inc., a Colorado Corporation (“Trinity”). PREVIOUS COUNCIL ACTION: On July 26, 2010, by Resolution No. 8643, City Council approved a storage lease agreement between the City and Trinity Packaging Corporation (“TPC”) for 26,400 square feet of the building located at 31841 Excellence Avenue, Pueblo, CO 81001 (“Lease Agreement”). The Lease Agreement was assigned with the City’s approval from TPC to Trinity, through an “Assumption of Lease Agreement” dated October 24, 2013. On November 12, 2018, by Resolution No. 14089, the City Council approved an Amendment to Lease Agreement (“Amendment No. 1”) and extended the term of the storage lease for the five (5) year Renewal Term defined in Section 2.02 of the Lease Agreement (the “First Renewal Term”) and agreed that the storage lease would terminate on July 25, 2020. BACKGROUND: Trinity has requested a Second Renewal Term from July 26, 2020 through July 31, 2025. This Ordinance approves the Second Renewal Term. FINANCIAL IMPLICATIONS: Under the attached Amendment No. 2 to the Lease Agreement, which is approved by this Ordinance, Trinity shall pay the City monthly rent as follows: Interval Cost per square foot Monthly rent 07/26/20 to 07/31/21 $1.50 $3,300.00 08/01/21 to 07/31/22 $2.00 $4,400.00 08/01/22 to 07/31/23 $2.50 $5,500.00 08/01/23 to 07/31/24 $3.00 $6,600.00 08/01/24 to 07/31/25 $3.50 $7,700.00 BOARD/COMMISSION RECOMMENDATION: Not applicable to this Ordinance. STAKEHOLDER PROCESS: Not applicable to this Ordinance. ALTERNATIVES: Trinity currently has 61 employees whose average pre-benefit salary is $15.95 per hour. Failure of the City to approve the attached Amendment No. 2 could result in Trinity considering the re- location of its manufacturing operations. RECOMMENDATION: Approve the Ordinance. Attachments: Proposed Ordinance and proposed Amendment No. 2 to Lease Agreement AMENDMENT NO. 2 TO LEASE AGREEMENT This Amendment No. 2 to Lease Agreement ("Amendment No. 2") is entered into this 11th day of November, 2019, by and between the City of Pueblo, Colorado, a Colorado municipal corporation ("City") located at One City Hall Place, Pueblo, Colorado 81003 and Trinity Plastics Inc., a Colorado corporation ("Trinity") located at 33500 Lockheed Drive, Pueblo, Colorado 81001 (together "Parties"). Recitals WHEREAS, a Lease Agreement was entered into on July 26, 2010 by and between City and Trinity Packaging Corporation ("TPC") for the property commonly known as 31841 Excellence Avenue, Pueblo, Colorado 81001 ("Lease Agreement"); and WHEREAS, the Lease Agreement was assigned with the City's consent and approval from TPC to Trinity, through the "Assumption of Lease Agreement" dated October 24, 2013; and WHEREAS, on November 12, 2018, the Parties entered into an Amendment to Lease Agreement ("Amendment No. 1") and extended the term of the lease for the five (5) year Renewal Term defined in Section 2.02 of the Lease Agreement (the "First Renewal Term") and agreed that the lease would terminate on July 25, 2020; and WHEREAS, the Parties wish to further extend the term of the lease on the terms and conditions set forth herein. NOW, THEREFORE, in consideration of the foregoing recitals and the mutual promises, covenants and conditions contained herein and other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the Parties hereby agree as follows: Article 1. Term. The Original Term, as defined in Section 2.01 of the Lease Agreement is hereby extended for an additional renewal term for the period from July 26, 2020 through July 31, 2025 (the "Second Renewal Term"). Occupancy during the Second Renewal Term shall be governed by the Lease Agreement subject to the payment of rent specified in Article 3 herein. Article 2. Option to Renew. Trinity shall have one (1) five (5) year renewal option to extend the lease from August 1, 2025 to July 31, 2030 (the "Third Renewal Option"). Trinity shall have the right to exercise the Third Renewal Option with ninety (90) days' prior written notice to City. Occupancy during the Third Renewal Term shall be governed by the Lease Agreement subject to the payment of rent specified in Article 3 herein. 1 Article 3. Rent. 3.1 Trinity's rent during the Second Renewal Term, as defined in this Amendment No. 2 shall be as follows: Interval Cost per square foot Monthly rent 07/26/20 to 07/31/21 $1.50 $3,300.00 08/01/21 to 07/31/22 $2.00 $4,400.00 08/01/22 to 07/31/23 $2.50 $5,500.00 08/01/23 to 07/31/24 $3.00 $6,600.00 08/01/24 to 07/31/25 $3.50 $7,700.00 All payments of rent due during the Second Renewal Term shall be payable in advance on the first day of each month and shall be paid and addressed to City at: Finance Dept., City of Pueblo, P.O. Box 1427, Pueblo, CO 81002-1427 or at such other address as City may designate to Trinity from time to time. 3.2. Should Trinity exercise its Third Renewal Option to renew this Lease, Tenant's rent during the Third Renewal Term shall be as follows: Interval Cost per square foot Monthly rent 08/01/25 to 07/31/26 $4.00 $ 8,800.00 08/01/26 to 07/31/27 $4.50 $ 9,900.00 08/01/27 to 07/31/28 $5.00 $11,000.00 08/01/28 to 07/31/29 $5.50 $12,100.00 08/01/29 to 07/31/30 $6.00 $13,200.00 3.3 Trinity's obligation to pay rent to City hereunder is absolute and unconditional and rent shall not be offset, abated, reduced or withheld for any reason whatsoever. Article 4. Continuation. Except as modified by this Amendment No. 2, and subject to the payment of rent specified in Article 3 herein, all provisions of the Lease Agreement will continue in full force and effect, including, but not limited to, provisions pertaining to maintenance of insurance coverage and the payment of all applicable taxes and assessments. IN WITNESS WHEREOF, Parties, by their duly authorized representatives, have entered into this Agreement as of the date first written above. 2 CITY OF PUEBLO, CO a Colorado municipal corporation By: 7444/ (424,67 MAYOR ATTESTED [NZ CnClet (LAI/tic CITY CLERK TRINITY PLASTICS INC. a Colorado corporation By: Name: Title: STATE OF ) ) ss. COUNTY OF ) The foregoing instrument was acknowledged before me this day of , 2019 by as of Trinity Plastics, Inc., a Colorado corporation. Witness my hand and official seal. My commission expires: [ SEAL ] Notary Public 3 Article 4. Continuation. Except as modified by this Amendment No. 2, and subject to the payment of rent specified in Article 3 herein, all provisions of the Lease Agreement will continue in full force and effect, including, but not limited to, provisions pertaining to maintenance of insurance coverage and the payment of all applicable taxes and assessments. IN WITNESS WHEREOF, Parties, by their duly authorized representatives, have entered into this Agreement as of the date first written above. CITY OF PUEBLO, CO a Colorado municipal corporation By: MAYOR ATTESTED BY: CITY CLERK Inteplast u6DOTri • Plastics, Inc., Pueblo, Colorado By: Name: c)-GLI( '--2-4thag v, Qi Title: G div e,vi ` `CLQ \Aoto A ✓ V STATE OF T: AAS ) 11 ) ss. COUNTY OF V 01,C.1CSnn ) The foregoing instrument was acknowledged before me this 20 day of NO\itIAW , 2019 by aeb Lia `SQacK't as Wit,11.Q.SS Witness my hand and official seal. My commission expires: \\ \�1 \ 2023. [ SEAL ] 'llrl Not. Public `"""" CECILIA ALSAADI 3 �;cuv PUa�'. °•• �sNotary Public,State of Texas • '.: " Comm. Expires 11-07-2023 .'''rGF ``� P ,,,,,,,� Notary ID 128790600