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HomeMy WebLinkAbout10220
ORDINANCE NO. 10220
AN ORDINANCE APPROVING A FIXED BASE OPERATOR
GROUND LEASE AND OPERATING AGREEMENT BETWEEN THE
CITY OF PUEBLO, A MUNICIPAL CORPORATION, AND
FREEMAN HOLDINGS OF COLORADO, LLC, A LIMITED LIABLITY
CORPORATION, RESCINDING ALL PREVIOUS AGREEMENTS
WITH ROCKY MOUNTAIN FBO, LLC, AND AUTHORIZING THE
MAYOR TO EXECUTE SAME
WHEREAS, the City of Pueblo is the owner and operator of the Pueblo Memorial Airport
together with the land on which said Airport is situated; and
WHEREAS, Freeman Holdings of Colorado, LLC is desirous of leasing certain property
for the purpose of a fixed base operation, where said property is owned by the City of Pueblo;
NOW, THEREFORE,
BE IT ORDAINED BY THE CITY COUNCIL OF PUEBLO, that:
SECTION 1.
A certain Fixed Base Operator Ground Lease and Operating Agreement (“Lease”), by and
between the City of Pueblo, a Municipal Corporation, and Freeman Holdings of Colorado, LLC, a
Limited Liability Company, and Rocky Mountain FBO, LLC, a Colorado Limited Liability Company,
to lease space for a fixed base operation at the Pueblo Memorial Airport, a copy of which is
attached hereto and made a part hereof by reference, after having been approved as to form by
the City Attorney, is hereby approved.
SECTION 2.
The Mayor is hereby authorized to execute the Lease on behalf of the City of Pueblo, and
the City Clerk shall affix the Seal of the City thereto and attest same.
SECTION 3.
The officers and staff of the City are authorized to perform any and all acts consistent with
the intent of this Ordinance and the attached Lease to implement the terms and conditions
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 June 27, 2022 .
Final adoption of Ordinance by City Council on July 11, 2022 .
President of City Council
Action by the Mayor:
☒ Approved on July 13, 2022 .
□ 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-10
Background Paper for Proposed
Ordinance
COUNCIL MEETING DATE: June 27, 2022
TO: President Heather Graham and Members of City Council
CC: Nicholas A. Gradisar, Mayor
VIA: Marisa Stoller, City Clerk
FROM: Greg Pedroza, Director of Aviation
SUBJECT: AN ORDINANCE APPROVING A FIXED BASE OPERATOR GROUND LEASE
AND OPERATING AGREEMENT BETWEEN THE CITY OF PUEBLO, A
MUNICIPAL CORPORATION, AND FREEMAN HOLDINGS OF COLORADO,
LLC, A LIMITED LIABLITY CORPORATION, RESCINDING ALL PREVIOUS
AGREEMENTS WITH ROCKY MOUNTAIN FBO, LLC, AND AUTHORIZING THE
MAYOR TO EXECUTE SAME
SUMMARY:
Attached is an Ordinance approving and authorizing the Mayor to sign a Fixed Base Operator
Ground Lease and Operating Agreement with Freeman Holdings of Colorado, LLC, a limited
liability corporation (“Freeman”), which also rescinds all previous agreements with Rocky
Mountain FBO, LLC dba Flower (“Flower”).
PREVIOUS COUNCIL ACTION:
City Council has approved previous lease and management agreements for Fixed Base
Operators, most recently with Rocky Mountain FBO, LLC.
BACKGROUND
The City owns 31000 Bryan Circle, 30900 Bryan Circle, 525 Skyway Street, and the Fuel Farm at
415 Bell Street at the Pueblo Memorial Airport, which can all be leased out for Fixed Based
Operator services. The facilities are currently being leased to Flower, but Flower wishes to sell
and assign its interests in the properties to Freeman. To establish a clean record, and instead of
assigning a number of documents from Flower to Freeman, the parties wish to enter into a new
Ground Lease and Operating Agreement that incorporates all prior terms and establishes one
agreement that will control.
FINANCIAL IMPLICATIONS:
The hangars, office spaces, and ramp will be rented at various rates and two percent (2%) of
Freeman’s gross revenues derived from its business activities conducted at Pueblo Memorial
Airport will be paid to the City. The fuel farm tanks will also be leased and there will be
commissions paid based on fuel delivered.
BOARD/COMMISSION RECOMMENDATION:
Not applicable to this Ordinance.
STAKEHOLDER PROCESS:
Not applicable to this Ordinance.
ALTERNATIVES:
If this Ordinance is not approved, the current leases will remain in effect.
RECOMMENDATION
It is the recommendation of the Department of Aviation that this Ordinance be approved.
Attachments:
Fixed Base Operator Ground Lease and Operating Agreement
FIXED BASE OPERATOR
GROUND LEASE AND OPERATING AGREEMENT
THIS LEASE AGREEMENT ("Lease") is made and entered into as of I w, LY I I ,
2022 ("Effective Date"),between the City of Pueblo, a Municipal Corporation, with an address of
One City Hall Place, Pueblo, Colorado 81003, ("Lessor") and Freeman Holdings of Colorado,
LLC, a Colorado limited liability company, d/b/a Freeman Jet Center Pueblo, with an address of
16221 Foster Street, Overland Park, Kansas 66085, ("Lessee") and Rocky Mountain FBO, LLC,
a Colorado limited liability company,d/b/a/Flower Aviation FBO,with an address of 31000 Bryan
Circle, Pueblo, Colorado 81001 ("Flower").
WHEREAS, the Lessor is the owner and operator of the Pueblo Memorial Airport
("Airport"),together with the land on which said Airport is situated; and
WHEREAS, Lessee is desirous of leasing certain real property,ramp space,and fuel tanks
on said Airport property for the purpose of the sale of aviation fuels and other related aviation
services; and
WHEREAS, Lessor entered into a certain Ground Lease and Operating Agreement dated
June 25,2005("Lease No. 1")with Travelaire Service, Inc.,a Colorado corporation,("Travelaire")
for the parcel commonly known as 525 Skyway Street, Pueblo, Colorado, and Jet-A Tank No. 4,
the legal description for which is contained in Lease No. 1; and
WHEREAS, Lessor entered into Amendment No. 1 ("Amendment") to the Lease No. 1
dated April 24, 2006 with Travelaire and Flower, evidenced by Resolution No. 10700, where
several changes were made, including but not limited to, the initial term of Lease No. 1 being
amended to end April 30, 2026, AV-Fuel Tank No. B being added to the lease, and Lessor
consenting to assignment of Lease No. 1 from Travelaire to Flower; and
WHEREAS, Lessor entered into the Fuel Tank Agreement ("FT Agreement") dated May
1, 2008 with Flower, where Lease No. 1 was further amended to substitute AV-Fuel Tank No. C
for AV-Fuel Tank No. B and more specific terms were set out with regards to use of the fuel tanks
under the lease; and
WHEREAS, Lessor executed the Consent to Assignment evidenced by Resolution No.
13354 on December 28, 2015, consenting to and assigning Lease No. 1 from Flower to PDC
Acquisition Corp., a Colorado corporation ("PDC"); and
WHEREAS, Lessor entered into the Assignment of Lease Agreement ("Assignment") to
the Lease No. 1 dated March 24, 2017 with PDC and Flower, where Lease No. 1, was assigned
back to Flower; and
WHEREAS, Lessor entered into a certain Ground Lease and Operating Agreement dated
October 26, 2015 ("Lease No. 2") with PDC for Parcel C, more commonly known as 31000 and
30900 Bryan Circle, Pueblo, Colorado, and attached spaces; and
WHEREAS, Lessor executed the Assignment of Lease Agreement dated December 31,
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2016 with PDC and Flower, assigning Lease No. 2 from PDC to Flower; and
WHEREAS, Flower is selling all of its assets to Lessee in accordance with the Asset
Purchase Agreement, including its interests in Lease No. 1 and Lease No.2,as each were amended
and assigned, and Lessor does not object to the sale and transfer; and
WHEREAS, the parties desire to condense the aforementioned documents and create a
single agreement with which to bind the parties.
NOW THEREFORE, in consideration of the mutual covenants set forth herein, the parties agree
as follows:
1. Leased Property:
A. The Lessor hereby leases unto the Lessee and Lessee hereby leases from Lessor for
the term and upon the requirements and conditions hereinafter stated, the real
property marked as "Leased Premises" on the plot plan, attached hereto and
incorporated herein as Exhibit B, ("Leased Premises") situated in the County of
Pueblo, State of Colorado, subject to existing easements and deed restrictions,
including all structures thereon which Lessee acknowledges are the property of
Lessor, including but not limited to:
i. 525 Skyway Street: six thousand four hundred (6,400) square foot
hangar and two thousand four hundred seventy-two (2,472) square
feet of office space that includes one thousand three hundred fifty-
two (1,352) square feet of ground floor and one thousand one
hundred twenty(1,120)square feet of second story. Land leased for
525 Skyway Street is 36,216 square feet.
ii. 30900 Bryan Circle: ten thousand (10,000) square foot hangar, two
thousand five hundred (2,500) square foot ground floor office and
garage, thousand five hundred (2,500) square foot of second story
improved space, two thousand (2,000) square foot attached shop,
two thousand (2,000) square foot second story storage, three
thousand (3,000) square foot ground floor vehicle shop, and five
hundred eighty-eight (588) square foot second story improved
space.
iii. 31000 Bryan Circle: four thousand three hundred sixty-seven
(4,367)square feet of improved space. Land leased for 30900 Bryan
Circle and 31000 Bryan Circle totals 79,335 square feet.
The term Leased Premises as used herein,means and includes the real property and
structures described above, as well as any improvement hereafter constructed or
added thereto.
B. Subject to the terms of this Lease, Lessor hereby leases to Lessee 83,626 square
feet of ramp space,meaning and including that ramp space indicated as"Ramp"on
the plot plan attached hereto and incorporated herein as Exhibit C, ("Ramp")
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situated in the County of Pueblo,State of Colorado.The Leased Premises and Ramp
do not include gates through the Airport fence, including but not limited to Gate D
or the FBO Pedestrian Gate adjacent to the Ramp,and Lessor, its staff,and all users
of the Airport may use such gates in accordance with applicable rules and
regulations. Lessor, its staff, and all users of the Airport may use such areas of the
Ramp as necessary for persons to access and use Airport gates for ingress and
egress.
C. Subject to the terms of this Lease, Lessor hereby leases to Lessee four fuel tanks
designated as (i) 40-3a, (ii) 40-2, (iii) 40-2a, (iv) 40-1, (v) 20-3, and (vi) 20-1
(together the "Fuel Tanks") at Lessor's fuel farm, indicated as "Fuel Tanks"on the
plot plan attached hereto and incorporated herein as Exhibit D, situated in the
County of Pueblo, State of Colorado.
D. The Leased Premises will be used for the regular business of a full service fixed
base operator("FBO"), including the sale of aviation fuel and related products and
services.Any aircraft stored on the Leased Premises must be continually registered
with the Federal Aviation Administration("FAA")throughout the life of this Lease
and the tail numbers for same must be reported to Lessor. Lessee agrees to report
any changes in aircraft tail numbers to Lessor within fourteen (14) days, in order
for Lessor to comply with FAA reporting requirements.
E. This Lease and Lessee's use of the Leased Premises, Ramp, and Fuel Tanks,
together on the plot plan attached hereto and incorporated herein as Exhibit A, are
subject to the easements, rights of way, covenants, conditions, restrictions,
reservations,and limitations appearing of record,and all applicable zoning and land
use laws, ordinances, codes, and regulations, including but not limited to all
conditions, regulations, restrictions, and requirements imposed by the FAA,
governing and regulating the Leased Premises, Ramp, and Fuel Tanks and their
respective uses.Lessee shall have exclusive use of the Leased Premises,Ramp,and
Fuel Tanks subject to the terms of this Lease.
2. Term:
A. The term of this Lease is for a period of twenty (20) years commencing on the
Effective Date ("Commencement Date") and ending midnight on July 31, 2042,
("Initial Term")unless sooner terminated as herein provided. Provided that Lessee
is not in default beyond any applicable cure period,the Lessee shall have the option
to renew this Lease for one additional term of ten (10) years ("First Extension
Term"). After the end of the First Extension Term, provided that Lessee is not in
default beyond any applicable cure period, Lessee shall have the option to renew
this Lease for an additional term of ten(10)years ("Second Extension Term")(the
First Extension Term and Second Extension Term together the "Extension
Terms").
B. These Extension Terms shall automatically be deemed exercised by the Lessee
unless it provides the Lessor with written notice of its intention not to do so at least
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sixty (60) days prior to the end of the then current term. Should either the Lessor
or Lessee not wish to renew this Lease for the Second Extension Term,a party may
provide the other written notice of its intention not to renew this Lease.This written
notice shall be given not earlier than one hundred eighty (180) days nor less than
one hundred twenty (120) days prior to the expiration of the Initial Term or either
Extension Term.
C. All conditions and covenants contained herein shall remain in full force and effect
during any and all extension periods.
3. Rental Rate, Other Fees,and Commercial Charge:
A. Lessee shall pay to Lessor monthly as rent for the land and structures covered by
this Lease, the following amounts: $1,529.86 per month for the land portion of
Leased Premises;and $8,551.13 per month for the structures located on the Leased
Premises; and $567.81 per month for exclusive use Ramp. The total monthly rent
for the land, structures, and Ramp is equal to $10,648.80.
B. Lessee shall also pay as rent and for the privilege to sell or dispense aviation fuel
from the Leased Premises a monthly fuel flow fee of nine and four-tenths cents
($0.094) per gallon, starting with the month of August 2022 and each month
thereafter for each gallon of aviation fuel delivered,or caused to be delivered to the
Fuel Tanks, or if Lessee constructs its own fuel storage facilities, either alone or
with Lessor or other lessees, or uses other fuel storage facilities at the Airport,
delivered,or caused to be delivered by Lessee to such fuel storage facilities. Lessee
shall not construct its own fuel storage facilities, either alone or with Lessor or
other lessees, or use other fuel storage facilities at the Airport, without Lessor's
prior written consent and an agreement governing the work and use. Lessee may
choose, at its sole and absolute expense, to install fuel meters on the dispensing
units of the fuel tanks. Such dispensing meters shall not be installed without the
prior written approval of the Airport.
C. In addition, Lessee shall pay a monthly fee to Lessor for the Lease herein granted
of two percent (2%) of Lessee's monthly gross revenues derived from all sales,
operations, and services made, furnished, or conducted on or from the Leased
Premises, Ramp, and Fuel Tanks, with the exception of revenue derived from the
sale and dispensing of aviation fuel. Lessee shall file with Pueblo Memorial Airport
monthly activity reports on or before the tenth (10th) day of each calendar month
throughout the effective term indicating gross revenues and commissions derived
from activity on any part of the Airport.
D. The rents for land, structures, and the Ramp shall be increased biennially based
upon the consumer price index for all urban consumers, CPI-U (all items 1982-
1984=100) or comparable index if the Department of Labor changes or modifies
the CPI-U or no longer publishes the CPI-U. The rents shall be increased by a
percentage equal to the percentage increase in the CPI-U during each preceding
two-year period over the comparable CPI-U for the first month of each 2-year
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period. If there is no percentage increase in the CPI-U for any preceding 2-year
period, the rents will remain the same as the preceding 2-year period for the next
2-year period. In no event, shall the percentage increase for the rents be greater
than five percent(5%) for any 2-year period.
E. At the option of the Lessor, the monthly fuel flow fee may be increased by up to
three cents ($0.03) every four (4) years, the first increase being available and
effective in 2024 immediately upon expiration or termination of Lessee's now
current Domestic-Into-Plane Purchase Program contract with the Defense Logistics
Agency — Energy ("DLA Energy"), and every four (4) years thereafter. Any
increase in the fuel flow fee shall not take effect until the then current Domestic-
Into-Plane Purchase Program contract with DLA Energy entered into by Lessee
expires or terminates after its four(4)year term.Notwithstanding the foregoing, in
no event may any increase in fees be deferred for more than one calendar year from
whenever such an increase would normally become available, where Lessor may
increase the fee after the additional calendar year if the Domestic-Into-Plane
Purchase Program contract is extended or otherwise modified to continue after its
standard four (4) year period. Such a deferral shall not otherwise alter when a fee
increase becomes available.
F. The Lessee hereby agrees to pay when due all rent, fees, and charges imposed by
the Lessor for the use and operation of the Airport. The fees and charges include,
but are not limited to,fuel flowage fees, landing fees,permit fees, security charges,
and administrative or service fees.
G. Such rents shall be paid monthly without notice, offset, or deduction on or before
the tenth (10th)of the month,and fees shall be paid monthly without notice,offset,
or deduction on or before the tenth (10th) of the following month, at the City of
Pueblo Director of Aviation's office and shall be accompanied with such reporting
forms as the Director of Finance shall determine. Rent not paid by the tenth (10th)
of the month shall accrue a late fee of eight percent (8%) per month. Lessor shall
have the right to examine and audit Lessee's and its subtenant's books and records
to determine the accuracy of the numbers of gallons sold and the revenues derived
by Lessee, fees, and their calculation.
4. Deposit:
A. Lessee agrees to pay a security deposit to the Lessor equal to one month's rent of
$10,648.80. The security deposit and first month's rent shall be paid immediately
upon execution of this agreement. Deposit shall be refunded following termination
of this agreement, less any rent due or damages to the Leased Premises, Ramp, or
Fuel Tanks.
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
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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.
5. Use of Leased Premises:
A. The Leased Premises shall be used and occupied by Lessee as a full service fixed
base operator and facility for the sale of aviation fuel and other related aeronautical
services and products. The office areas shall be used for Lessee's business, flight
preparation, and other incidental office work. The Leased Premises shall not be
used for the storage of non-aeronautical personal property, living accommodations,
or in any other way inconsistent with this Lease. Failure to abide by this provision
shall constitute a material breach of this Lease.
B. All aircraft stored on the Leased Premises for more than seven (7) days must be
reported to Airport administration.Lessee may perform maintenance and repairs to
aircraft in accordance with the Airport's minimum standards, including routine
maintenance, preventative maintenance, and regular maintenance required prior to
flight. Lessee may wash aircraft within the Leased Premises but shall at all times
protect the Lessor's stormwater system and abide by any requirements Lessor
places on Lessee with regards to the cleaning of aircraft, including for the disposal
of used water and other products.
C. Lessor retains and Lessee grants to the Lessor the right to enter the Leased Premises
to do what is necessary for the purposes of repairing, replacing,and/or maintaining
any and all utility lines under the Leased Premises which serve other uses at the
Pueblo Memorial Airport, it being understood that the Lessor will repair, in a good
and workmanlike fashion, any and all damage done to the Leased Premises as the
result of work done hereunder.
D. Lessee shall maintain the Leased Premises, Ramp, and Fuel Tanks in
accordance with the requirements and regulations of the Lessor and Lessor's
fire code. The Lessee shall be responsible for all costs, fees, charges, and
penalties associated with the discharge or release of any hazardous material
(including petroleum products)or mitigating the containment or removal of any
contamination or hazardous material (including petroleum products) on, over,
or under the Leased Premises, Ramp, and Fuel Tanks which is caused by the
Lessee, its officers, agents, or employees. The storage and accumulation of
aviation fuel, flammables, explosive liquids, or solids, waste, debris, or other
hazardous materials within or on the Leased Premises, Ramp, and Fuel Tanks
shall be in an environmentally sound manner and comply with all federal, state,
and local laws and regulations. Lessee agrees that no flammable liquids or
hazardous materials shall be used or stored on the Leased Premises or Ramp,
excepting those used in accordance with all laws and regulations and in the
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furtherance of Lessee's authorized use of the leased premises, to include, but
not limited to, the fuel in the Fuel Tanks, the aircraft fuel tanks, or in the tank
of a stored automobile, properly parked. Lessee agrees to provide drip pans of
a non-flammable material under aircraft to prevent damage to the floor, should
any aircraft leak any fluids.
E. Lessee, at its sole cost and expense, may cause to be constructed and installed
upon the Leased Premises and Fuel Tanks additional improvements in
accordance with plans and specification approved by Lessor, including
architectural approval, which consent will not be unreasonably withheld or
arbitrarily denied. The improvements shall be constructed in a good and
workmanlike manner in accordance with the applicable laws, ordinances, and
building codes and pursuant to a building permit issued by the Regional
Building Department. Lessee will not modify, alter, or improve any structure
or improvements upon the Leased Premises whether now existing or hereafter
constructed without the prior written approval of Lessor, which approval shall
not be unreasonably or arbitrarily denied. Lessee may paint any improvements
upon the Leased Premises and the Fuels Tanks with the approval of Lessor.
F. Lessee shall not park or leave, or allow to be parked or left, aircraft on the
taxiways or on pavement adjacent to the Leased Premises,Ramp,or Fuel Tanks
in a manner which interferes with or obstructs access to adjacent hangars or
public areas.Parking of automobiles will be permitted only in designated spaces
outside of the airport fence. No person or public roadway going automobile
shall go beyond the immediate vicinity of the Leased Premises without the
express written consent of the Director of Aviation. Automobiles must be
parked in designated parking spaces or within the Hangar, except that the
Hangar cannot be used solely for storage of automobiles. Nothing in this
agreement provides exclusive access to the entrance and exit gates into and out
of the Airport to Lessee.
G. Lessee, its employees, and invitees shall have the right of ingress and egress
between designated Airport access points and the Leased Premises over, upon,
and through such streets and not others as from time to time shall be designated
by the Director of Aviation. Driveways from existing streets into the Leased
Premises shall be located as designated by the Lessor through the Director of
Aviation.
H. Hangar doors shall remain closed and locked except during periods when the
Hangar is attended by Lessee. This is to prevent damage from sudden storms
and the creation of foreign object debris.
On the Effective Date and annually thereafter, Lessee shall provide Lessor with
a list of the Airport areas and any Airport tenants it intends to access when
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providing services. Lessee shall keep this list current and report any changes to
the Lessor upon such change being made.
J. Lessee shall not have exclusive use of any area of the Airport or of any Lessor
equipment, unless Lessee contracts with Lessor for such use, and all such uses
shall be as determined by the Director of Aviation in his or her sole discretion.
All areas of the Airport and all Airport equipment will be inspected by Airport
staff prior to use by Lessee, and Lessee shall be required to sign-off on Airport
staff's inspection prior to said use.
K. Lessee acknowledges and agrees that Lessor's primary obligation is to operate
the Airport for the use and benefit of the public and that the leased premises and
ramp are prime locations for full service fixed-based operations at the Airport.
Therefore, in view of the foregoing and long-term nature of this Lease, Lessee
and Lessor shall meet at least annually to discuss Lessee's plans for the
development and use of the Leased Premises, Ramp, and Fuel Tanks and the
types, kinds, and classes of aeronautical activities then reasonably anticipated
to be provided in the future, and Lessee's planned additions to and/or
modifications of the Leased Premises and Fuel Tanks.
6. Ramp Use:
A. Lessee's use of the common ramp area,taxiways,and runways is non-exclusive
and same may be used by the Airport,other tenants,users, and occupants of the
Airport ("Airport Users"). Use of the Ramp shall be limited to the movement
of aircraft, fueling of aircraft, movement, and parking of aircraft service
vehicles, temporary parking of aircraft, servicing, and tie-down of aircraft.
Lessee shall not use common area ramp space for the fueling of aircraft,
temporary parking of aircraft, servicing and tie-down of aircraft, parking or
storage of aircraft service vehicles, or any other purpose without the prior
express written consent of the City of Pueblo. If Lessee collects a fee for any
use of common areas at the Airport, it shall pay to Lessor as commission ten
percent(10%) of said fees.
B. Lessee shall use the Ramp and common ramp area in compliance with Lessor's
ground traffic and aircraft parking plans and regulations,which will reasonably
accommodate Lessee's current and future use for the purposes set forth in this
Lease.
C. Lessee acknowledges that portions of the Ramp,common ramp area,taxiways,
and runways are currently in need of repairs and resurfacing and accept in whole
the Ramp,common ramp area,taxiways,and runways in their present condition
"AS IS" and "WITH ALL ITS FAULTS," without warranty or representation,
express or implied, including, without limitation, any warranties of
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merchantability or fitness for a particular purpose or condition or usability in
their present condition. Lessee agrees that Lessor shall have no obligation to
upgrade,repair,resurface,or maintain the Ramp,common ramp area,taxiways,
and runways. Lessor maintains the right to close any portion of the Airport not
limiting Lessee's access to airport runways.
D. Lessee shall maintain the surface of the Ramp free and clear of debris, snow,
sand, and ice and shall be responsible to remove same from the Ramp as soon
as reasonably possible in order for the Ramp to be continuously available for
use.
7. Fuel Tank Use:
A. The Fuel Tanks and accessory equipment, including, but not limited to,pumps,
motors, and fuel meter calibrations for each tank, are being leased "AS IS"
"WITH ALL ITS FAULTS," without warranty or representation, express or
implied, including, but not limited to, any warranties of merchantability or
fitness for a particular purpose or condition or usability in their present
condition.
B. Lessor has registered the above ground storage tanks located in its fuel farm
with the Director of the Colorado Division of Oil and Public Safety pursuant to
C.R.S. 8-20-.5-105 and updated its Spill Prevention Control and
Countermeasure ("SPCC") Plan as required by law. Lessor shall continue to
maintain compliance with those requirements.
C. Lessee shall be responsible for quality control of fuel, loading and unloading
fuel to and from the Fuel Tanks, and compliance with the SPCC Plan for the
fuel farm and leased fuel tanks. Lessee shall properly train its employees in the
use of the fuel farm, Fuel Tanks, and the SPCC Plan.
D. Except for structural repairs not caused by the acts or omissions of Lessee, its
officers, agents, employees, contractors, or fuel suppliers, Lessee shall be
responsible to maintain and keep in good and safe repair and working condition the
Fuel Tanks and accessory equipment, ordinary wear and tear excepted. Lessee will
not be responsible for any reconstruction, remodeling, alteration, or modification
of the fuel tanks of the fuel farm required to meet environmental standards not
currently satisfied, unless caused by the acts or omissions of Lessee, its officers,
agents, employees, contractors, or fuel suppliers.
If any such activity is required by the Lessor or if Lessor is required to make
structural or other repairs to or replace the Fuel Tanks or any other fuel tanks
located at the fuel farm for any reason, including fire or other casualty, or if Lessor
is required to remediate or remove any contamination or hazardous materials
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(including petroleum products) at or from the fuel farm, Lessor may, at its sole
option, either (1) complete, at its cost, the required activities, replacement, or
repairs, (2) negotiate a cost-sharing arrangement with Lessee to complete the
required activities, replacement, and repairs, or (3) upon thirty (30) days prior
written notice, terminate the Fuel Tanks lease and Lessee's right to store aviation
fuel in the Fuel Tanks. In the event the Lessor terminates the fuel tanks lease as
provided in(3) above, Lessor will, at the request of Lessee, negotiate in good faith
with Lessee to lease sufficient land to construct and operate its own farm storage
facilities for its own use at a location mutually agreeable to Lessor and Lessee.
E. Lessee shall:
(1) Maintain fuel meter calibration on the fuel tanks and provide required
testing and copies thereof to the Lessor.
(2) Provide filters, hoses, and nozzles required for the Fuel Tanks.
(3) Immediately notify the Lessor of any fuel release or spills during the loading
or unloading of the fuel storage tanks or when fueling or maintaining
aircraft. Lessee shall be responsible for clean up to the satisfaction of
Lessor of any such fuel releases or spills whether caused by Lessee, its
officers, agents, employees, contractors, or fuel suppliers.
F. Lessee's mobile refuelers (fuel trucks) and Lessee's use thereof shall meet and
comply with all applicable EPA spill prevention control and countermeasure
regulations including, if required, drafting and implementing an SPCC Plan
therefor.
G. At the time of the signing of this Lease, the fuel tanks 40-1 and 40-3a each need a
significant capital expenditure to bring them to an operational state and all Fuel
Tanks need Skully Systems installed. More specifically, the fuel tanks need the
following repairs:
a. Tank 40-1 needs:
i. Hose replacement;
ii. Single point installation;
iii. Filter change;
iv. Water slug valve installation;
v. Deadman installation;
vi. Filter diff gauge installation; and
vii. Relief valve installation.
b. Tank 40-3a needs:
i. Water slub valve repair;
ii. Relieve valve repair;
iii. Filter diff gauge repair; and
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iv. Deadman installation.
In exchange for Lessee's use of the Fuel Tanks however it sees fit to meet its
operational needs but subject to this Lease, Lessee agrees to expend the funds necessary
to make all leased Fuel Tanks operational by completing the above listed repairs,
installing Skully Systems, and making other repairs and installations directed by
Lessor. Once the Fuel Tanks are made operational and compliant with law, all
remaining expenditures for maintenance and repair of the Fuel Tanks will be in
accordance with the remaining terms of this Lease. After ten (10) years from the
Effective Date, if any of the Fuel Tanks have not been used to store fuel within the
preceding six (6) months, the parties may negotiate a monthly rent for the lease of
unused fuel tanks.
8. Maintenance Obligations:
A. 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.No outside storage of parts,
materials, equipment, inventory, or other materials shall be permitted.
B. Lessee will at all times, at its sole cost and expense, keep and maintain in good
repair the interior of all buildings and grounds designated for the Lessee's exclusive
use. The maintenance of the interior of the Leased Premises shall include, but not
be limited to, the hangar door and the operation thereof, other entry/exit doors,
ventilation filters, sprinkler systems,all interior walls, interior ceilings, floors/floor
coverings, wiring, plumbing fixtures, and other interior utility fixtures. However,
the Lessee's obligation for the maintenance of the exterior of the Leased Premises
shall not include any repairs or replacement of the roof, foundation, or exterior
walls. Lessee shall perform routine service and maintenance on all heating and air
conditioning equipment and appurtenances thereto,except to the extent such repairs
are occasioned by the negligence or fault of the Lessor. At the termination of the
Lease, or any extension thereof, Lessee shall return the Leased Premises to the
Lessor in good order and condition, ordinary wear and tear excepted.
C. Lessee, at its sole cost and discretion, shall maintain all walkways, sidewalks, and
apron access on the Leased Premises and Fuel Tanks, including to the public
taxiway or ramp area. This includes pavement maintenance,pest control, and other
such activities necessary to access said areas. At no time shall snow, dirt, or other
debris be piled or stored on these areas. It is the Lessee's responsibility to keep
these areas free and clear of all snow,dirt,and other debris. Lessee understands that
snow removal within six(6) feet of the Leased Premises, Ramp, and Fuel Tanks is
always the responsibility of Lessee. However,Lessor,at its sole cost and discretion,
shall be responsible for all major repairs of the public areas.
9. Utility Costs:
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Lessee shall be responsible for all utilities supplied to the Leased Premises, Ramp, and
Fuel Tanks. Agreements for service with utility providers are the responsibility of Lessee.
Additions, deletions, or adjustments to utilities extended to the Leased Premises shall not
be made without prior written approval from the Director of Aviation.
10. Signs:
Lessee shall not erect, paint, or maintain any signs whatsoever upon the Leased Premises,
Ramp, or Fuel Tanks without first securing the written consent of the Lessor. Any such
signs shall comply with all ordinances and regulations of the Lessor and standards which
might be developed by the Department of Aviation.All worn, faded, damaged, or outdated
signs will be repaired or corrected by Lessee upon notice from the Director of Aviation.
11. Right of Inspection:
The Lessor reserves and retains for its officers, employees, and authorized representatives
the right to enter the Leased Premises, Ramp, and Fuel Tanks during reasonable business
hours, and after prior notice, for the purpose of inspecting and protecting the Leased
Premises, Ramp, and Fuel Tanks and for doing any and all things which the Lessor may
deem necessary for the proper general conduct and operation of the Pueblo Memorial
Airport and in the exercise of the Lessor's police power.
12. Title to Improvements:
A. All structures and improvements constructed or erected by Flower on the Leased
Premises and Fuel Tanks, excluding movable trade fixtures, constitute a part of the
Leased Premises and Fuel Tanks and may not be removed from the land. Flower
and Lessee acknowledge and agree that fee simple title to these structures and
improvements vested in Lessor immediately upon completion of construction of
same, free of all liens and encumbrances. Notwithstanding the foregoing, Lessor
shall not be responsible for any defects in the Leased Premises, Fuel Tanks,
structures, or improvements and shall have no obligation or responsibility to
maintain, repair, or restore the same; all such obligation and responsibility shall be
held by Lessee.
B. The structures leased to Lessee hereunder and any improvements constructed or
erected hereunder by Lessee, excluding movable trade fixtures, shall constitute a
part of the Leased Premises and Fuel Tanks and therefore such structures and
improvements cannot be removed from the land. Fee simple title to the structures
are in the Lessor and fee simple title to subsequently constructed improvements
shall vest with Lessor immediately upon completion of construction of same, free
of all liens and encumbrances. Notwithstanding that title is in or vests in Lessor,
Lessor shall not be responsible for any defects in the Leased Premises, Fuel Tanks,
structures, or improvements and shall have no obligation or responsibility to
maintain,repair,or restore the same; all such obligation and responsibility shall be
that of Lessee.
13. Taxes,Licenses,and Liens:
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A. Lessee covenants and agrees to pay promptly when due all taxes, fees, licenses,and
other governmental charges of whatever nature assessed against or applicable to
Lessee, the Leased Premises, Ramp, and Fuel Tanks, or to Lessee's property and
operations thereon. Possessory interest tax is assessed by the County of Pueblo and
is the responsibility of the Lessee. The Lessor is a tax-exempt entity and shall not
be liable for any tax of the Lessee. All applicable taxes and costs shall be paid by
Lessee, even if Lessee was unaware of such taxes and costs.
B. At all times during the term of this Lease, and of any renewal or extension hereof,
Lessee shall, at its own cost and expense, provide and keep in good standing
business licenses with the City of Pueblo and the State of Colorado. Lessee shall
obtain and maintain any other licenses or certifications required by law, including
those required by the FAA. Upon request, Lessee will provide Lessor with
certificates of good standing evidencing that all licenses or certifications are current
and not subject to discipline.
C. Lessee also covenants and agrees not to permit any mechanic's or material man's
lien to be filed against the Leased Premises, Ramp, or Fuel Tanks or any part or
parcel thereof by reason of any work or labor performed or materials furnished by
any contractor, subcontractor,mechanic,or material man. Lessee further covenants
and agrees to pay promptly when due all bills, debts and obligations incurred by it
in connection with its operations on the Leased Premises, Ramp, and Fuel Tanks,
and not to permit the same to become delinquent and to suffer no lien, mortgage,
judgment,or execution to be filed against the Leased Premises without the Lessor's
prior consent which will not be unreasonably withheld, except that in no instance
will the lien,mortgage,judgment,or execution be in any way an impairment of the
rights of Lessor.
D. Lessees performing services using Airport Operations Areas ("AOA") must
annually undergo American Association of Airport Executives ("AAAE") Airport
News Training Network("ANTN") Digicast Signatory Training and hold a current
signatory certificate that must be filed yearly with Airport Administration. Such
Lessees shall keep a record of all documentation related to badging and produce it
upon request.
14. Indemnification:
Lessee assumes the risk of loss or damage to the Leased Premises, Ramp, and Fuel Tanks
and property thereon and therein, including but not limited to aircraft and personal
property, whether from windstorm, fire, earthquake, snow, water run-off, or any other
causes whatsoever except for loss or damage caused by the gross negligence and/or willful
misconduct of Lessor, its agents,officer,representatives,and employees. Lessee covenants
and agrees to indemnify, defend, and save the Lessor, its agents, officer, representatives,
and employees,harmless from and against any and all penalties, liability,or loss, including
costs and attorney fees and all expenses incurred by Lessor in investigating or resisting the
same,resulting from claims or court action,whether civil,criminal,or in equity,and arising
directly or indirectly out of: (i)acts of the Lessee, its agents,employees,or representatives;
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(ii)occurring in on or about the Leased Premises, Ramp, or Fuel Tanks; (iii)arising out of
or resulting from the Leased Premises, Ramp, or Fuel Tanks, or any condition thereon, or
from Lessee's use and occupancy of the Leased Premises, Ramp, or Fuel Tanks, 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. Except, Lessee is not
required to indemnify, defend and save Lessor, its agents, officer, representatives, and
employees from any and all penalties, liability, or loss, including costs and attorney fees
and all expenses incurred by Lessor in investigating or resisting the same, resulting from
claims or court action,whether civil,criminal,or in equity,and arising directly or indirectly
out of Lessor's gross negligence or willful misconduct. Lessee shall not hold or attempt to
hold Lessor liable for any injury, including loss of life,to any person, or for damage to any
property while on the Leased Premises, Ramp, or Fuel Tanks or the Airport, irrespective
of how such injury or damage may be caused or occasioned, unless that injury, including
loss of life,to any person,or for damage to any property is caused by the gross negligence
or willful misconduct of Lessor, its agents, officer, representatives, and employees.
However, nothing herein shall limit the applicability of the Colorado Governmental
Immunity Act or other law limiting the Lessor's liability.The provisions of this Section 14
shall survive the termination of this Lease.
15. Insurance and Damage:
A. Lessee assumes all risk of loss, damage, injury and liability for the same that may
occur to Lessee, Lessee's guests, Lessee's aircraft and Lessee's improvements and
property in or upon the Leased Premises, Ramp, and Fuel Tanks and Lessor shall
not be liable or responsible for any such loss, damage or injury, regardless of the
cause thereof, except any loss, damage, injury and liability for the same that may
occur to Lessee, Lessee's guests, Lessee's aircraft and Lessee's improvements and
property in or upon the Leased Premises, Ramp, and Fuel Tanks caused by the
gross negligence or willful misconduct of Lessor, its agents, officer,
representatives, and employees.
B. Lessor shall maintain storage tank pollution liability insurance covering the Fuel
Tanks located within the fuel farm which are being used by Lessee. This policy
shall name Lessee as an additional insured and loss payee for the policy and waive
subrogation. So long as Lessee uses the Fuel Tanks for storage of aviation fuel,
Lessee shall pay annually to Lessor,on the anniversary dates of the Commencement
Date, a proportional share of Lessor's cost for storage tank pollution liability
insurance. Lessee's portion of such charges shall be the ratio of the gallon capacity
of Fuel Tanks Lessee leases hereunder compared to the total gallon capacity of the
fuel tanks in Lessor's fuel farm being used by Lessor, Lessee, and other parties.
C. Lessee,at its sole cost and expense,shall,during the life of this agreement,procure,
pay for and keep in full force and affect the following types of insurance:
(1) Aviation General Liability Insurance: A comprehensive policy of aviation
general liability insurance, including but not limited to personal injury,
products liability, hangar keepers' liability, and property damage. The
policy shall have limits in an amount of not less than One Million Dollars
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($1,000,000.00) per occurrence and Three Million Dollars ($3,000,000.00)
in the aggregate. Such coverage shall include, without limitation, legal
liability of the insured for property damage, bodily injuries and deaths of
persons in connection with the operation, maintenance or use of the Leased
Premises, Ramp, and Fuel Tanks (including acts or omissions of the
Lessee).
(2) Automobile Insurance: At all times during the term of this Lease, and any
renewal or extension hereof, Lessee shall, at its own cost and expense,
provide, and keep in force commercial automobile liability insurance with
a combined single limit for all owned, hired, and non-owned autos of not
less than one million dollars ($1,000,000.00).
(3) Workers Compensation Insurance: Lessee shall obtain statutory workers'
compensation insurance which shall contain an endorsement waiving
subrogation against the City of Pueblo. Such insurance shall cover all
employees and agents 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. 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.
(4) Storage Tank Pollution Liability Insurance: Lessee shall maintain storage
tank pollution liability insurance covering the Fuel Tanks located within the
fuel farm which are being used by Lessee. This policy shall name Lessor
as an additional insured and loss payee for the policy and waive subrogation.
D. Lessee shall insure the structures and other improvements, except fuel tanks, in an
amount equal to their full insurable value naming Lessor as a loss payee. These
policies shall name the City of Pueblo as additional insured and loss payee for the
policy and waive subrogation. The policies shall contain a provision that the policy
cannot be canceled or materially altered either by the insured or the insurance
company unless thirty (30) days prior written notice thereof is given to the Lessee
and Lessor. Upon issuance or renewal of any such insurance policy,the Lessee shall
furnish to the Lessor a certificate of insurance evidencing coverage required under
this contract.
E. If the structures or other improvements (the "Improvements"), except for the fuel
tanks, are damaged or destroyed by fire or other casualty, Lessee shall within one
hundred twenty (120) days from the occurrence of such casualty either (1) repair
and restore the damaged or destroyed Improvements, (2) demolish the damaged or
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destroyed Improvements, restore the Leased Premises to their original condition,
and terminate this Lease, in which event the net proceeds of the property damage
insurance required to be provided by Lessee shall be retained by Lessor, or (3)
demolish the damaged or destroyed Improvements and commence construction of
replacement Improvements, and thereafter complete such construction as soon as
practicable, but at least within eighteen (18) months from the occurrence of such
casualty, unless Lessor approves additional time which shall not be unreasonably
withheld. All repairs to or restoration of Improvements and/or construction of
replacement Improvements shall be in compliance with applicable laws and codes,
and in accordance with plans and specifications therefor approved by Lessor,which
approval will not be unreasonably withheld. Except in the event of(2) above, the
net proceeds of property damage insurance provided by Lessee shall be released by
Lessor and paid to Lessee for the purpose of Lessee repairing, restoring, or
replacing improvements damaged or destroyed by such insured fire or other
casualty.
F. Lessee shall not violate the terms or prohibitions of any insurance policy herein
required to be furnished by Lessee. Coverage and limits enumerated in this
insurance section represent only the minimum insurance required, 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 of Lessee to
comply with the provisions of this section shall constitute a material breach of this
Lease.
16. Waivers and Holdovers:
No provision of this Lease may be waived except by an agreement signed by the waiving
party. A waiver of any term or provision shall not be construed as a waiver of any other
term or provision. Should Lessee holdover the use of or continue to occupy the Leased
Premises after the termination or cancellation of this Lease, such holding over shall be
deemed merely a tenancy for successive monthly terms upon the same conditions as
provided in this Lease subject to termination upon thirty (30) days prior written notice.
17. Inconvenience During Construction:
Lessee recognizes that from time to time it will be necessary for the Lessor to initiate and
carry forward programs of construction, reconstruction, expansion, relocation,
maintenance, and repair at and to the Airport in order that the Airport and its facilities may
be suitable for the volume and character of air traffic and flight activity which will require
accommodation, and that such construction, reconstruction, expansion, relocation,
maintenance, and repair may inconvenience or interrupt Lessee's operations at the Airport.
Lessee agrees that no liability shall attach to Lessor, its officers, agents, employees,
contractors, subcontractors, and representatives by reason of such inconvenience or
interruption, and for and in further consideration of the premises, Lessee waives any right
to claim damages or other consideration therefore,provided,however,that this waiver shall
not extend to,or be construed to be a waiver of,any claim for physical damage to property
resulting from willful misconduct of the Lessor, its officers, agents, employees,
contractors, subcontractors,and representatives.The Lessee shall be obligated to be pay all
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rent and fulfill all obligations of this Lease at all times, including, but not limited to, when
access to the Airport is temporarily restricted due to routine construction, reconstruction,
expansion, or other potential alteration of the airfield.
18. Place and Manner of Payments:
In all cases where Lessee is required by this Lease to pay any rentals, rates, fees or other
charges or to make other payments to Lessor, such payments shall be made at the
Department of Aviation,or at such other place as Lessor may hereafter designate by notice
in writing to Lessee and shall be made in legal tender of the United States and any check
shall be received by Lessor subject to collection. Lessee agrees to pay any bank charges
made for the collection of any such checks. All payments of rent shall be made on the first
of each month.
19. Assignments and Subletting:
A. Lessee may not assign this Lease, in whole or in part, without the written consent
of Lessor which may be granted or denied in its sole and absolute discretion,except
that Lessee may assign this Lease to a successor legal entity which has merged
with, or acquired substantially all the assets of the Lessee, if such successor legal
entity should specifically agree in writing to perform this Lease, unless Lessor
determines in its sole and absolute discretion based upon written information
supplied to Lessor by Lessee at least sixty (60) days prior to the effective date of
the assignment that the successor legal entity does not have the ability to fulfill the
obligations of this Lease in a competent or financially responsible manner. Failure
of Lessee to provide adequate written information concerning subtenants is
sufficient for Lessor to make such determination and shall be, in and of itself, a
sufficient basis for the Lessor to deny its consent to any proposed assignment.
B. Lessee, with the prior written consent of Lessor, the consent of which may be
granted or denied in Lessor's sole and absolute discretion, may sublet a portion of
the Leased Premises to a subtenant or subtenants ("Subtenant") pursuant to a
written sublease, which shall contain among other provisions the following:
(1) The sublease must be subject to and governed by all of the covenants and
provisions of this Lease. Subtenant must abide by all of the terms and
conditions thereof applicable to the Leased Premises,Ramp,and Fuel Tanks
and use thereof. The sublease may only be for a lesser term than specified
in Section 2.
(2) The Subtenant shall maintain and keep in force aviation general liability
insurance as described in Section 15.C. with a combined single limit not
less than one million dollars($1,000,000). Such insurance requirement will
be satisfied if Subtenant is provided with coverage under Lessee's master
liability insurance policy.
(3) The sublease must contain an Indemnification provision, substantially the
same as set forth in Section 14 hereof, indemnifying Lessor.
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(4) The sublease shall not become effective until an executed copy thereof is
delivered to Lessor's Department of Aviation.
C. Subtenants for Hangaring of Aircraft: Lessee may, upon notice to Lessor but
without Lessor's prior written consent, sublet to an entity or person sufficient
hangar space to hangar the Sublessee's aircraft and any needed office space to
perform Subtenant's aircraft operations pursuant to a template sublease agreement
("Template Agreement") that was prior approved by Lessor. Should Lessee wish
to sublease a portion of the Leased Premises other than through a Template
Agreement, it must obtain Lessor prior written approval in accordance with Section
19.B. above. All Subtenants intending to conduct business at the Airport must first
obtain a commercial permit from the Director of Aviation. Upon entering into a
sublease with a Subtenant,Lessee will provide written notice to Lessor that includes
the name, address, tail number, aircraft model, length of term of sublease, and a
copy of the sublease.
20. Agreements with United States:
This Lease is subject and subordinate to the terms, reservations, restrictions, provisions,
and conditions of the deed of conveyance from the United States Government to the Lessor
and of any other existing or future agreement between the Lessor and the United States,
relative to the use, operation, or maintenance of the Pueblo Memorial Airport and its
appurtenant facilities, the execution of which has been or may be required as a condition
precedent to the participation by any Federal Agency in the extension, expansions, or
development of said Airport and its facilities.
21. Lessee's Default:
A. Any one of the following shall constitute an event of default by Lessee hereunder:
(1) Failure of Lessee to pay in full all installments of rent, fees, additional rent,
or pro rata portion of fuel farm insurance due by the first day of each month
or immediately after written notice and demand therefor are given by Lessor
to Lessee.
(2) Failure of Lessee to perform or comply with any obligation, covenant, or
agreement of Lessee hereunder other than payment of money for a period
of fourteen(14)days after written notice specifying such failure is given by
Lessor to Lessee, except that if such obligation, covenant, or agreement is
not capable of being performed within said fourteen(14)day period,Lessee
shall not be in default if Lessee shall commence such performance within
said fourteen (14) day period and thereafter prosecute the same with
diligence and continuity to completion.
B. Lessee shall have thirty (30) days to cure any default. In the case of a continuing
event of default by Lessee, Lessor shall have the following remedies in addition to
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all other rights and remedies provided by law or in equity, including without
limitation, damages and specific performance:
(1) Terminate this Lease by sixty(60)days prior written notice given to Lessee
specifying the date of termination, and Lessee shall within said sixty (60)
day period vacate the Leased Premises, Ramp, and Fuel Tanks and
surrender possession thereof to Lessor.
(2) Without terminating this Lease, retake possession of the leased areas and
relet the same or any part thereof for such term or terms and upon such other
conditions as Lessee in its reasonable judgment shall determine. If the rent,
fees,and other charges are less than those provided for herein, Lessee shall
be responsible and liable for any deficiency between the amount of the rent,
fees and charges provided for herein and those received through such
reletting. Lessor shall not be responsible or liable for any failure to relet the
leased premises or any part thereof, or failure to collect any rent, fees, or
other charges due upon such reletting. No notices from Lessor hereunder
or under a forcible entry and detainer statute or similar law shall constitute
an election by Lessor to terminate this Lease unless such notice specifically
so states. Lessor reserves the right following any such reentry and/or
reletting to exercise its right to terminate this Lease as provided in Section
21.B.(1) above.
C. If the Lessee shall be declared insolvent or bankrupt, or if any assignment of the
Lessee's property shall be made for the benefit of creditors or otherwise, or if
Lessee's leasehold interest herein shall be levied upon under execution, or seized
by virtue of any writ of any Court of Law,or a Trustee in Bankruptcy or a Receiver
appointed for the property of the Lessee, whether under the operation of the State
or the Federal statutes, then and in any such case, the Lessor may, at his option,
immediately with or without notice, notice being expressly waived, terminate this
Lease and immediately retake possession of the Leased Premises without the same
working any forfeiture of any accrued obligations of the Lessee hereunder.
D. After the expiration of this Lease or any violation of any term or provision as herein
provided for, if Lessee shall refuse to surrender and deliver possession of the
Leased Premises after notice of termination,then in that event Lessor may, without
further notice or demand, enter into and upon said premises, or any part thereof,
and take possession thereof and repossess them, and expel, remove, and put out of
possession the Lessee, using such help, assistance and force in so doing as may be
needful and proper, without prejudice to any remedy allowed by law, available in
such cases.
E. That in case the Leased Premises are left vacant and any part of the rent herein
reserved be due and unpaid, then the Lessor may, without in anyway being
obligated to do so, and without terminating this Lease, retake possession of said
premises and rent the same for such rent, and upon such conditions as the Lessor
may think best, making such changes and repairs as may be required, giving credit
for the amount of rent so received less all expenses of such changes and repairs,
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and said Lessee shall be liable for the balance of the rent herein reserved until the
expiration of this Lease.
F. Lessee agrees to pay the Lessor all costs, including reasonable attorney fees,
incurred by Lessor in recovering any rent or other money due and unpaid under the
terms of this Lease or to recover possession of the Leased Premises after
termination of this Lease.
22. Notices:
All notices, required to be given to Lessor hereunder, shall be in writing and be sent by
certified mail to Pueblo Memorial Airport, Administration Office, 31201 Bryan Circle,
Pueblo,Colorado 81001 with a copy to City of Pueblo, City Attorney's Office, 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 Freeman Holdings of Colorado, LLC,
Attn: Scott Freeman, 16221 Foster Street, Overland Park, Kansas 66085, email:
sfreeman@pvillc.com; with a copy to Freeman Holdings Group, Attn: Reese Hays, 16221
Foster Street, Overland Park, Kansas 66085, email: rhays@freeemanholdingsgroup.com,
provided that the parties, or either of them, may designate in writing from time to time
subsequent or supplementary persons or address in connection with said notices. The
effective date or service of any such notice shall be the date such notice is mailed by Lessee
or Lessor.
23. 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, Ramp, and Fuel Tanks. No activity shall be
undertaken by Lessee, its guests,employees,agents,contractors,or subcontractors,
on all or any portion of the Leased Premises, Ramp, and Fuel Tanks 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, Ramp, and Fuel Tanks or any part thereof in violation of any
Environmental Regulations; (ii) any portion of the Leased Premises, Ramp, and
Fuel Tanks 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
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Pollution Control Act, U.S.C. Section 1251 et seq.and the Clean Air Act,42 U.S.C.
Section 7401 et seq.
C. Except to the extent Lessor is covered by an insurance policy, 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, Ramp, and Fuel Tanks, or any part
thereof, by Lessee, its employees, agents, guests, contractors and subcontractors.
24. Law, Rules and Regulations:
A. Lessee, its officers,agents,and employees shall faithfully observe and comply with
all applicable federal, state, and local laws, regulations, and ordinances now
existing or hereafter adopted relating to the use and occupancy of the Airport or
Leased Premises, Ramp,and Fuel Tanks, including without limitation Chapter 1 of
Title III of the Pueblo Municipal Code and rules affecting the operation of motor
vehicles upon, to, and from the Airport. The Lessee, and all officers, agents, and
employees of Lessee, hereby agree to be bound by and subject to all police
ordinances of the City of Pueblo at all times while on the Airport, whether acting
in the course of Lessee's business or otherwise.
B. Lessee, its officers,agents,and employees shall faithfully observe and comply with
all minimum standards and rules regulating operations and activities from and upon
the Airport adopted from time to time by Lessor. Such minimum standards and
rules shall not be applied arbitrarily, discriminatorily, or unreasonably. If any
provision of this Lease shall conflict with any provision of the minimum standards
or rules adopted or amended by Lessor after commencement date, the conflicting
provision of this Lease shall control.
C. It is expressly understood by Lessee that security within the air operations area of
the Airport is vital. The drive through gate entering the air operations area shall be
kept closed and secured at all times except for ingress and egress. Only public road
going automobiles under escort will be permitted on the air operations area. Any
public road going automobile brought by Lessee shall be the sole responsibility of
the Lessee. Violation of airport security rules as now, or in the future may, exist
shall be grounds for immediate termination of this Lease.
25. F.A.A. Lease Requirements:
A. The Lessor reserves the right,without any obligation on its part to do so,to develop,
modify, change, improve, or abandon the Pueblo Memorial Airport or any part
thereof, as it may determine in its sole discretion, at any time, regardless of the
desires or view of Lessee, and without interference or hindrance from Lessee or
liability to Lessee.
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B. The Lessor reserves the right,without any obligation on its part to do so,to maintain
and keep in repair the landing area of the Airport and all publicly owned facilities
of the Airport, together with the right to direct and control all activities of Lessee
in this regard.
C. Lessor shall have full and unrestricted right to enter upon those portions of the
Airport occupied and leased herein by the Lessee, and Lessor, its agents, or
representatives shall be permitted to inspect same during any regular business hours
or upon twenty-four (24) hours' notice to Lessee.
D. This Lease shall be subordinate to the provisions and requirements of any existing
or future agreement between the Lessor and the United States, relative to the use,
development, operation, and maintenance of the Airport.
E. 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,Ramp,and Fuel Tanks,or in the event
of any planned modification or alteration of any present or future building or
structure on the Leased Premises, Ramp, or Fuel Tanks.
F. All rights not herein granted to the Lessee are reserved to Lessor and nothing herein
contained shall be construed to grant or authorize the granting of an exclusive right
within the meaning of Section 308 of the Federal Aviation Act of 1958 as amended.
G. 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,Ramp,and Fuel
Tanks, 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 Pueblo Memorial Airport.
H. By accepting this Lease, Lessee 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, Ramp, and Fuel
Tanks to a height not to exceed twenty-five (25) feet above ground level. In the
event the aforesaid covenant is breached,the Lessor reserves the right to enter upon
the Leased Premises, Ramp, and Fuel Tanks and to remove the offending structure
or object and cut the offending tree, all of which shall be at the expense of the
Lessee.
Lessee shall not make use of the Leased Premises, Ramp, and Fuel Tanks in any
manner which might interfere with the landing and taking off of aircraft at Pueblo
Memorial Airport or otherwise constitute a hazard to aviation. In the event the
aforesaid covenant is breached, the Lessor reserves the right to enter upon the
Leased Premises, Ramp, and Fuel Tanks and cause the abatement of such
interference at the expense of the Lessee.
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J. If during the term of this Lease, all or part of the Leased Premises, Ramp, or Fuel
Tanks should be taken or threatened to be taken for any public or quasi-public use
under any governmental law or by right of eminent domain or sold to the
condemning authority under threat of condemnation,this Lease shall terminate and
the proceeds, if any,from such taking or sale shall be allocated between Lessor and
Lessee in accordance with applicable condemnation law.
K. Lessor reserves the right to grant and to take easements or rights of way in, under,
over, and across the Leased Premises, Ramp, and Fuel Tanks, in which event,
Lessee shall only be entitled to compensation for damages to improvements of the
Lessee destroyed or damaged thereby, but not to damages for loss of use of the
Leased Premises, Ramp, and Fuel Tanks. Lessor will attempt to ensure such
easements or rights of way will not impede, prohibit, or infringe upon Lessee's
ability to carry out its authorized uses of the Leased Premises, but makes no
guarantees as to such.
L. Lessee agrees to annually complete and submit a Department of Transportation -
Federal Aviation Administration Airport Activity Survey (FAA Form 1800-31), as
may be amended, that documents Lessee's air taxi-commercial passenger
enplanements for each calendar year.
M. It is not the intent of this Lease to grant to Lessee the exclusive right to provide any
or all of the services which Lessee may engage in at any time during the term of
this agreement. Accordingly, the Lessor reserves the right, to grant others certain
rights and privileges upon the Airport which may be similar in part or in whole to
those granted to Lessee, in accordance with any applicable minimum standards and
procedures adopted by the Lessor and amended from time to time for the Airport.
Nothing herein shall prevent Lessor from entering into leases or subleases with
other tenants who may be in competition with the rights and privileges granted to
Lessee hereunder.
26. Nondiscrimination Assurances
A. The Lessee, for itself, its successors, and assigns, as a part of the consideration
hereof, does hereby covenant and agree as a covenant running with the land that in
the event facilities are constructed,maintained,or otherwise operated on the Leased
Premises or ramp, for a purpose for which Department of Transportation program
or activity is extended or for another purpose involving the provision of similar
services or benefits,the Lease shall maintain and operate such facilities and services
in compliance with all requirements imposed pursuant to 49 CFR Part 21,
Nondiscrimination in Federally Assisted Programs of the Department of
Transportation, and as the regulations may be amended.
B. The Lessee, for itself, its successors, and assigns, as a part of the consideration
hereof, does hereby covenant and agree as a covenant running with the land that:
(i) no person on the grounds of race, color, religion, sex, sexual orientation,
disability, 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
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Premises or ramp; (ii) that in construction of any improvements on, over or under
such land and the furnishing of services thereon, no person on the grounds of race,
color, religion, sex, sexual orientation, disability, or national origin shall be
excluded from participation in, denied the benefits of, or otherwise be subjected to
discrimination; and (iii)that the Lessee shall use the Leased Premises and ramp in
compliance with all other requirements imposed by or pursuant to 49 CFR Part 21,
Non-discrimination in Federally Assisted Programs of the Department of
Transportation, and as the regulations may be amended.
C. Lessee assures that it will undertake an affirmative action program as required by
14 CFR Part 152, Subpart E, to ensure that no person shall on the grounds of race,
creed, color, religion, disability, national origin, sex, or sexual orientation be
excluded from participating in any contracting, leasing, or employment activities
covered in 14 CFR Part 152, Subpart E. Lessee assures that no person shall be
excluded, on these grounds, from participating in or receiving the services or
benefits of any program or activity covered by this subpart. Lessee assures that it
will require that its covered suborganizations provide assurances to the Lessee that
they similarly will undertake affirmative action programs and that they will require
assurances from their suborganizations, as required by 14 CFR Part 152, Subpart
E,to the same effect.
D. Lessee agrees to operate the Leased Premises, Ramp, and Fuel Tanks for the use
and benefit of the public and to furnish good,prompt and efficient services adequate
to meet all the demands for its services at the Airport, to furnish service on a fair,
equal, and not unjustly discriminatory basis to all users thereof, and to charge fair,
reasonable,and not unjustly discriminatory prices for each unit of service, provided
that Lessee may be allowed to make reasonable and nondiscriminatory discounts,
rebates, or other similar types of price reductions to volume purchasers.
E. Notwithstanding anything contained herein that may be or appear to the contrary,
it is expressly understood and agreed that the rights granted under this agreement
are non-exclusive and the Lessor reserves the right to grant similar privileges to
another operator or operators on other parts of the Airport. It is not the intent of the
Lease to grant to Lessee the exclusive right to provide any or all of the services
Lessee may engage in at any time during the term of the Lease. Accordingly:
(1) Lessor reserves the right, to grant others certain rights and privileges upon
the Airport which may be similar in part or in whole to those granted to
Lessee, in accordance which any applicable minimum standards and
procedures adopted by Lessor and amended from time to time.
(2) Nothing shall prevent Lessor from entering into leases or subleases with
other tenants who may be in competition with the rights and privileges
granted to Lessee hereunder. However, the Lessor agrees not to enter into
any sublease, lease, contract or other agreement with any similarly situated
full service fixed base operator at the Airport, which contains more
favorable terms than this lease or grants rights, privileges or concessions
which are not granted to Lessee herein,to the extent required by FAA Grant
-24-
Assurances, except where such differences are nondiscriminatory and
substantially comparable.
(3) Lessor will require that a competitor make an investment sufficient to meet
the full requirements of the Airport's applicable minimum standards prior
to competitor's operation.
F. The Lessee for itself, personal representatives, successors in interest, and assigns,
as a part of the consideration hereof, does hereby covenant and agree as a covenant
running with the land that:
(I) In the event facilities are constructed,maintained, or otherwise operated on
the property described in this Lease for a purpose for which a Federal
Aviation Administration activity, facility, or program is extended or for
another purpose involving the provision of similar services or benefits, the
Lessee will maintain and operate such facilities and services in compliance
with all requirements imposed by the Nondiscrimination Acts and
Regulations listed in the Pertinent List of Nondiscrimination Authorities(as
may be amended)such that no person on the grounds of race,color,religion,
national origin, sex, disability, or age, will be excluded from participation
in,denied the benefits of, or be otherwise subjected to discrimination in the
use of said facilities.
(2) In the event of breach of any of the above Nondiscrimination covenants,
City will have the right to terminate the agreement and to enter, re-enter,
and repossess said lands and facilities thereon, and hold the same as if the
agreement had never been made or issued.
27. Prior Agreements:
Upon the Effective Date,Lease No. 1 and Lease No.2,as each were amended and assigned,
will immediately terminate and all of Flower's interests in Lease No. 1, Lease No. 2, the
Leased Premises, Ramp, and Fuel Tanks shall terminate and Flower's rights to the same
will cease and be of no force nor effect. All other agreements entered into between Lessor
and Flower and all other interests in property at the Airport held by Flower will also
terminate on the Effective Date.All interest in the Leased Premises,Ramp,and Fuel Tanks
shall be held solely by Lessee in accordance with the terms of this Lease. All parties
acknowledge and agree that the Leased Premises, Ramp,and Fuel Tanks,and all structures
and improvements thereon,are owned solely by Lessor and Lessor has all rights and powers
to lease the same.
28. Miscellaneous:
A. This Lease and all of its covenants and provisions shall be binding upon and inure
to the benefit of the parties hereto and their respective heirs, personal
representatives, successors, subtenants, and approved assigns.
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B. This Lease and any amendments hereto are subject to prior approval of the Federal
Aviation Administration.
C. Lessee is leasing the Leased Premises, Ramp, and Fuel Tanks"AS IS, WHERE IS,
WITH ALL FAULTS" in their present condition. Lessor makes no representation
or warranties of any kind or character, express or implied, with respect to the
Leased Premises,Ramp,and Fuel Tanks, including but not limited to,any warranty
or representation as to suitability or fitness for a particular purpose, title, zoning,
physical or environment conditions, utilities, governmental approvals, the
compliance of the Leased Premises, Ramp, and Fuel Tanks with governmental and
environment laws and regulations, the truth, accuracy or completeness of any
document or other information provided to Lessee by Lessor or any other person,
or any other matter or thing regarding the Leased Premises,Ramp,and Fuel Tanks.
Lessor shall be under no obligation to maintain the Leased Premises, Ramp, and
Fuel Tanks or the Pueblo Memorial Airport or any part thereof in a particular
location or condition. If the Pueblo Memorial Airport shall permanently close or
relocate, the use restrictions herein shall not apply, and the Lessee may use the
Leased Premises, Ramp, and Fuel Tanks for any lawful use or purpose allowed by
the then existing Pueblo Municipal Code, or in the alternative, Lessee may
terminate this Lease upon thirty (30) days prior written notice given to Lessor.
D. The Lessee represents that it has inspected the Airport, Leased Premises, Ramp,
Fuel Tanks,and facilities and accepts the conditions of same and fully assumes the
risk incident to the use thereof. The Lessor shall not be liable to the Lessee for any
damages or injuries to the property or personnel of the Lessee which result from
hidden, latent, or other dangerous conditions on the Airport or Leased Premises,
Ramp, and Fuel Tanks. Lessee's taking of possession of the Leased Premises,
Ramp,and Fuel Tanks shall be conclusive evidence that Lessee accepts the Leased
Premises, Ramp, and Fuel Tanks in their present condition and that the Leased
Premises, Ramp, and Fuel Tanks are in good and satisfactory condition at the time
such possession was taken.
E. The acts and omissions of Lessee's employees,agents,contractors,and guests shall
be imputed to Lessee for purposes of this Lease.
F. This Lease is expressly made subject to the limitations of the Colorado
Constitution. Nothing herein shall constitute, nor be deemed to constitute, the
creation of a debt or multi-year fiscal obligation or an obligation of future
appropriations by the City Council of Pueblo, contrary to Article X, §20 of the
Colorado Constitution or any other constitutional, statutory, or charter debt
limitation. Notwithstanding any other provision of this Lease, with respect to any
financial obligation of Lessor which may arise under this Lease in any fiscal year,
in the event the budget or other means of appropriations for any such year fails to
provide funds in sufficient amounts to discharge such obligation, such failure shall
not constitute a default by or breach of this Lease, including any sub-agreement,
attachment, schedule or exhibit thereto, by the Lessor.
-26-
G. Nothing in this Lease is intended, nor should it be construed, to create or extend
any rights, claims or benefits or assume any liability for or on behalf of any third
party, or to waive any immunities or limitations otherwise conferred upon the
Lessor under or by virtue of federal or state law, including but not limited to the
Colorado Governmental Immunity Act, C.R.S. §24-10-101, et seq.
H. This Lease contains the entire and exclusive agreement between the parties relating
to the Leased Premises, Ramp,and Fuel Tanks and may not be amended except by
written instrument signed by the parties.Neither party shall be,or hold itself out as,
agent of the other or as joint venturers or partners under this Lease.
I. 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.
J. Each person signing this Lease on behalf of a party represents and warrants that he
or she has the requisite power and authority to enter into, execute, and deliver this
Lease on behalf of such party and that this Lease is a valid and legally binding
obligation of such party enforceable against it in accordance with its terms.
[Remainder of page intentionally left blank.]
-27-
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed as of the
day and year first above written.
LESSOR: LESSEE:
CITY OF PUEBLO Freeman Holdings of Colorado, LLC
a Municipal Corporation a Colorado limited liability company
By!/ ( By /n
"
Nicholas A. radisar Francis B. Freeman Jr.
Title: Mayor Title: Managing Member
Attest: FLOWER:
Rocky Mountain FBO, LLC
a Colorado limited liability company
City d/b/a/ Flower Aviation FBO
By i �l 1 /;ti
. � —
Approved as to form: Name 14 00
Title:
City Attorney
-28-
FIXED BASE OPERATOR
GROUND LEASE AND OPERATING AGREEMENT
JULY 11,1022
Exhibit A
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GROUND LEASE AND OPERATING AGREEMENT
JULY 11,1022
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