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HomeMy WebLinkAbout09772ORDINANCE NO. 9772 AN ORDINANCE APPROVING AN AMENDMENT TO A HANGAR LEASE BETWEEN THE CITY OF PUEBLO, A COLORADO MUNICIPAL CORPORATION AND LOCKHEED MARTIN CORPORATION, A MARYLAND CORPORATION, RELATING TO LAND AND A HANGAR BUILDING LOCATED AT THE PUEBLO MEMORIAL AIRPORT AND AUTHORIZING THE MAYOR TO EXECUTE SAID AMENDMENT BE IT ORDAINED BY THE CITY COUNCIL OF PUEBLO, that: SECTION 1. The Amendment to hangar lease dated August 24, 2020 between the City of Pueblo, a Colorado municipal corporation and Lockheed Martin Corporation, a Maryland corporation (“Company”) a copy of which is attached hereto and incorporated herein by this reference, having been approved as to form by the City Attorney is hereby approved. SECTION 2. The Mayor is authorized to execute and deliver the Amendment to hangar lease in the name of the City and the City Clerk is directed to affix the seal of the City thereto and attest same. SECTION 3. 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 to hangar lease which are necessary or appropriate to implement the transactions described therein. SECTION 4. 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 August 10, 2020 . Final adoption of Ordinance by City Council on August 24, 2020 . President of City Council Action by the Mayor: ☒ Approved on August 28, 2020 . □ 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-5 Background Paper for Proposed Ordinance COUNCIL MEETING DATE: August 10, 2020 TO: President Dennis E. Flores 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 TO A HANGAR LEASE BETWEEN THE CITY OF PUEBLO, A COLORADO MUNICIPAL CORPORATION AND LOCKHEED MARTIN CORPORATION, A MARYLAND CORPORATION, RELATING TO LAND AND A HANGAR BUILDING LOCATED AT THE PUEBLO MEMORIAL AIRPORT AND AUTHORIZING THE MAYOR TO EXECUTE SAID AMENDMENT SUMMARY: Attached is an Ordinance approving and authorizing the Mayor to sign an amendment to a hangar lease between the City and Lockheed Martin Corporation, a Maryland Corporation (“Company”). PREVIOUS COUNCIL ACTION: On July 24, 2017, by Ordinance No. 13734, City Council approved the original two year hangar lease between the City and Company. BACKGROUND: The City and the Company have negotiated an extension to the hangar lease containing the following terms and conditions: 1. The lease is for approximately 22,500 square feet of an airplane hangar located at the Pueblo Memorial Airport. 2. The extended term of the lease is for two years, with the Company having the option to renew the lease for an additional two terms of one year each. The monthly base rent for the hangar is $6,000 increasing to $6,500 per month for the first renewal term and $7,000 per month for the second renewal term. In addition, the Company agrees to pay landing fees and further agrees to reimburse the City for snow removal. 3. The amended hangar lease is made on a “triple net” basis with the Company paying all applicable taxes, insurance and utilities. In addition, the Company agrees to pay the City of Pueblo’s combined service fee. 4. The City agrees to install certain electrical upgrades to the hangar building, in an amount not to exceed Thirty-two thousand Dollars ($32,000.00) in accordance with specifications agreed to by the parties. FINANCIAL IMPLICATIONS: As set forth above. BOARD/COMMISSION RECOMMENDATION: Not applicable to this Ordinance. STAKEHOLDER PROCESS: Not applicable to this Ordinance. ALTERNATIVES: If this Ordinance is not approved the hangar lease will not be extended and the City will not receive additional income from the Company for the lease of the airport hangar building. RECOMMENDATION: The Pueblo Economic Development Corporation recommends approval of this Ordinance. Attachments: Proposed Ordinance and Proposed amendment to hangar lease AMENDMENT TO LEASE THIS AMENDMENT TO LEASE ("Amendment") entered into this 24th day of August, 2020 between the City of Pueblo, a Colorado municipal corporation ("Lessor") and Lockheed Martin Corporation, a Maryland corporation ("Lessee"). Lessor and Lessee may be individually referred to herein as "Party" or collectively referred to as "Parties." WHEREAS, Lessor and Lessee entered into an original Lease ("Lease") dated July 24, 2017 through which Lessor leased approximately 22,500 rentable square feet ("RSF") located 32501 Walt Bassett Ave., Pueblo, CO 81001 (the "Leased Premises"); and WHEREAS, Lessee has requested that Lessor install certain electrical upgrades to the Leased Premises and Lessor has agreed to do so in exchange for a longer lease term. NOW, THEREFORE, in consideration of the foregoing and the mutual covenants contained herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Lessor and Lessee agree as follows: 1. Leased Premises. Section 1.03 of the Lease is rescinded and replaced and restated as follows: 1.03 Prior to September 30, 2020, Lessor shall install certain electrical upgrades to the Leased Premises, as agreed to by the Parties, at Lessor's sole cost and expense, in an amount not to exceed Thirty-two Thousand Dollars ($32,000.00). 2. Term. Section 2.01 of the Lease is rescinded and replaced and restated as follows: 2..01 The term of this Lease is from July 24, 2020 (the "Commencement Date") through July 23, 2022. 3. Renewals. The two (2) options to renew the Term of the Lease set forth in Section 2.02 shall apply such that the first Renewal Term, if exercised, shall commence on July 24, 2022. 4. Rent. Section 3.01 of the Lease is rescinded and replaced and restated as follows: 3.01 Lessee shall pay to Lessor monthly rent ("Base Rent") of $6,000.00 in advance, without notice or demand, beginning with the Commencement Date and on the 1St day of each month thereafter during the entire term. Base Rent for the first Renewal 1 Term is $6,500.00 per month with the same terms and conditions of the initial Lease. Base Rent for the second Renewal Term is $7,000.00 per month with the same terms and conditions of the initial Lease. Base Rent for any partial months shall be pro-rated based on the number of days in such month. 5. Ratification of prior Lease. The Lease between the Parties, which is incorporated herein by this reference, shall remain in full force and effect, except as amended by this Amendment. Executed at Pueblo, Colorado, the day and year first above written. LESSOR: CITY OF PUEBLO A Colorado Municipal Corporation [Seal] • By: �&41 Aer.Cr0tt..I&di Attes . C Nicholas A. Gradisar City Clerk Mayor LESSEE: LOCKHEED MARTIN CORPORATION A Maryland corporation By: LMC Properties, Inc., Attorney in Fact under Irrevocable Power of Attorney effective April 4, 2016 By devit7, -" Name: Charles B. Hardie Title: Manager- Real Estate 2