HomeMy WebLinkAbout10333ORDINANCE NO. 10333
AN ORDINANCE APPROVING THE LANDLORD CONSENT
AGREEMENT BETWEEN THE CITY OF PUEBLO, A MUNICIPAL
CORPORATION, AND FREEMAN HOLDINGS OF COLORADO,
LLC, A LIMITED LIABILITY CORPORATION, (“FREEMAN”) AND
CENTENNIAL BANK, FOR FREEMAN TO USE ITS LEASEHOLD
INTEREST TO SECURE A BUSINESS LOAN, AND
AUTHORIZING THE MAYOR TO EXECUTE SAME
WHEREAS, it is a condition of Centennial Bank’s agreement to make a loan to Freeman
Holdings of Colorado, LLC that the City of Pueblo execute a Landlord Consent Agreement;
NOW, THEREFORE,
BE IT ORDAINED BY THE CITY COUNCIL OF PUEBLO, that:
SECTION 1.
The Landlord Consent Agreement (“Agreement”), by and between the City of Pueblo, a
Municipal Corporation, and Freeman Holdings of Colorado, LLC, a Limited Liability Corporation,
(“Freeman”) and Centennial Bank, consenting to Freeman’s use of its leasehold interest to
secure a loan, 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 Agreement 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 Agreement 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 November 14, 2022.
Final adoption of Ordinance by City Council on November 28, 2022 .
President of City Council
Action by the Mayor:
☒ Approved on December 5, 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 # R7
Background Paper for Proposed
Ordinance
November 14, 2022
COUNCIL MEETING DATE:
TO: President Heather Graham and Members of City Council
CC: Mayor Nicholas A. Gradisar
VIA: Marisa Stoller, City Clerk
FROM:
Greg Pedroza, Director Aviation
SUBJECT: AN ORDINANCE APPROVING THE LANDLORD CONSENT
AGREEMENT BETWEEN THE CITY OF PUEBLO, A MUNICIPAL
CORPORATION, AND FREEMAN HOLDINGS OF COLORADO, LLC, A
LIMITED LIABILITY CORPORATION, (“FREEMAN”) AND CENTENNIAL
BANK, FOR FREEMAN TO USE ITS LEASEHOLD INTEREST TO
SECURE A BUSINESS LOAN, AND AUTHORIZING THE MAYOR TO
EXECUTE SAME
SUMMARY:
An ordinance approving the Landlord Consent Agreement between the City of Pueblo,
a Municipal Corporation, and Freeman Holdings of Colorado, LLC, a Limited Liability
Corporation, (“Freeman”) and Centennial Bank, for Freeman to use its leasehold
interest in certain Pueblo Memorial Airport property to secure a business loan, and
authorizing the Mayor to execute the same.
PREVIOUS COUNCIL ACTION:
City Council approved Ordinance No. 10220 on July 11, 2022, which ratified the Fixed
Based Operator Ground Lease and Operating Agreement (“Lease”) for a fixed base
operation at the Pueblo Memorial Airport.
BACKGROUND:
The City is the owner of properties at the Pueblo Memorial Airport and has leased 525
Skyway Street, 30900 Bryan Circle, 31000 Bryan Circle, and certain other ramp space
and fuel tanks, Freeman through the Lease. Freeman would like to obtain a loan from
Centennial Bank for the purpose of refinancing indebtedness, secured by Freeman’s
leasehold interest in the fixed base operator facility, for which it needs City’s consent.
With the execution of the Landlord Consent Agreement, should Freeman default on the
loan agreement, Centennial Bank would have the right to step into the Lease in the
same position as Freeman and hold all the same responsibilities, including the payment
of rent and fees.
FINANCIAL IMPLICATIONS:
Not applicable to this Ordinance.
BOARD/COMMISSION RECOMMENDATION:
Not applicable to this Ordinance.
STAKEHOLDER PROCESS:
Not applicable to this Ordinance.
ALTERNATIVES:
If this Ordinance is not approved, Freeman will not be able to use its leasehold interest
to secure the loan, which may affect its ability to conduct business.
RECOMMENDATION:
The Department of Aviation has deferred to the opinion of the Law Department. The
Law Department has recommended that this Ordinance be approved.
ATTACHMENTS:
1. Freeman Holdings 2022 11 28 REDACTED LANDLORD CONSENT
AGREEMENT
2. Freeman Holding Group 2022 07 11 LEASE
Loan Number: 3750110983
LANDLORD CONSENT AGREEMENT
THIS LANDLORD CONSENT AGREEMENT (the "Agreement") is executed as of the
28th day of November, 2022 by and among the CITY OF PUEBLO, a municipal corporation of
the State of Colorado (the "Landlord"), FREEMAN HOLDINGS OF COLORADO LLC (the
"Tenant") and CENTENNIAL BANK (the "Lender").
WHEREAS,the Landlord is the owner and landlord of that certain real property located in
Pueblo County, Colorado, commonly known as 525 Skyway Street, 30900 Bryan Circle, 31000
Bryan Circle, and certain other ramp space and fuel tanks, which are more particularly described
on Exhibits B, C, and D of the Lease (the "Premises"), said Lease being referred to and defined
immediately below;
WHEREAS,the Tenant currently occupies the Premises pursuant to that certain Fixed Base
Operator Ground Lease and Operating Agreement among the Landlord, the Tenant and Rocky
Mountain FBO, LLC, dated as of July 11, 2022 (the "Lease") and has located or intends to locate
various items of personal property on the Premises,including,without limitation, inventory,goods,
furniture and equipment associated with its operation of the Premises as a fixed base operator
(collectively, the "Personal Property");
WHEREAS, the Tenant has requested the Lender to make a loan to it in the original
principal amount of $ for the purpose of refinancing indebtedness secured by
Tenant's interest in the fixed base operator facility (the "Loan");
WHEREAS, it is a condition to Lender's agreement to make the Loan that the Tenant
execute and deliver a Leasehold Deed of Trust, Security Agreement and Assignment of Rents and
related security and collateral documents over and encumbering the Tenant's interests in the
Premises and the Personal Property;
WHEREAS, it is a further condition to Lender's agreement to make the Loan that the
Landlord execute this Agreement and Landlord is willing to do so;
NOW, THEREFORE, in exchange for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. The Landlord hereby consents solely to the Tenant's grant of a Leasehold Deed of
Trust interest in the Premises to the Lender. Tenant shall not grant and Lender shall not accept any
interest in the real property or the structures or improvements thereon. Lender shall not lien or
attempt to foreclose on any interest in the real property or the structures or improvements thereon.
Landlord does not have a lien on the Personal Property, and the Personal Property shall remain
personal property only if it is not affixed to the Premises in such a way that under the law of the
State of Colorado or pursuant to the terms of the Lease, it is deemed to have become a part of the
real estate; but in general, and subject to the terms of the Lease, the parties acknowledge that the
Personal Property is not intended to become a fixture on the Premises but to remain as personal
property.
Loan Number: 3750110983
2. In the event of a default under the Lease, the Landlord agrees to provide the Lender
with written notice of such default upon the same terms as such notice is required to be given by
Landlord to Tenant pursuant to Section 21 of the Lease, and the Lender shall have the option, but
not the obligation, to cure such default on behalf of the Tenant. If the Lender opts to cure such
default, it shall have thirty (30) days to do so in accordance with Section 21.B. of the Lease.
3. Landlord understands and acknowledges that the Lender will execute a Leasehold
Deed of Trust over the Premises in favor of Lender which would entitle Lender to foreclose on its
Leasehold Deed of Trust interest and succeed to the Tenant's interest in the Premises as set forth
in the Lease. Should Lender succeed to the Tenant's interest in the Premises set forth in the Lease,
Lender shall be bound by the terms of the Lease and the obligations therein without amendment.
Landlord has consented to the Leasehold Deed of Trust and upon performance by Lender, or its
successors or assigns if consented to by Landlord, of Tenant's obligations under the Lease,
Landlord shall treat Lender, or its successors or assigns consented to by Landlord, as the rightful
and lawful tenant under such Lease. In such event, Lender shall use reasonable efforts to ensure
that fees and payments to Landlord pursuant to the Lease are equal to or higher than those paid by
the Tenant in the last full month of its operation and control of the Premises, it being understood
and agreed that Lender is not guaranteeing that such fees and payments will not go down and if
such fees and payments do go down despite Lender's performance of its obligations pursuant to
this Agreement and the Lease, Lender shall have no liability with respect thereto. In the event of
a default by Tenant in the payment or performance of any of its obligations to the Lender, the
Lender may, subject to the rights of the Tenant, (i) enter upon the Premises and maintain the
Personal Property and operate the business on the premises, with full right of access thereto, or
find such other operator, to be consented to by Landlord, to do so on Lender's behalf, provided the
Lender pays any rent or other payments to the Landlord that the Tenant would have been required
to pay under the Lease, and provided that Lender complies with all of the terms of the Lease that
Tenant would have been required to comply with in order not to be in default under the Lease, or
(ii) pursuant to a perfected security interest held by Lender, enter upon the Premises for the sole
purpose of removing the Personal Property or any part thereof from the Premises. Lender shall
repair any damage caused by Lender's removal of Personal Property or access to the Premises and
Lender agrees to defend, indemnify, and hold the Landlord harmless from and against any and all
liabilities, damages, injuries, loss, cost and expense of any kind or character, including attorneys'
fees, arising from or in connection with Lender's access to the Premises or the removal of the
Personal Property from the Premises except those caused by the gross negligence or intentional
misconduct of Landlord. Except in the event of a foreclosure as mentioned above, or the payment
of rent or other payments or obligations during periods in which it occupies the Premises, or as
otherwise specifically set forth in writing between Lender and Tenant, the Lender shall have no
obligation for rent or any other payments or obligations of Tenant to the Landlord. Lender's access
to and use of the Premises must at all times comply with the terms of the Lease and federal, state,
and local law, including but not limited to Federal Aviation Administration (FAA) regulations,
security procedures and requirements, and nondiscrimination requirements.
4. Lender and Tenant understand and agree that Landlord owns all fixtures and
improvements on the Premises. Notwithstanding the terms of the Leasehold Deed of Trust,
Security Agreement and Assignment of Rents and related security and collateral documents,
Tenant does not own the fixtures and improvements on the Premises nor those that may in the
Loan Number: 3750110983
future be constructed on the Premises, transfers no right to the same to Lender, and Lender
disclaims and waives all interest in the same.
5. This agreement shall inure to the benefit of the successors and assigns of the Lender
as approved by Landlord and in accordance with the Lease, and shall be binding upon the
successors and assigns of Landlord, and upon any purchaser of the undersigned's interest in the
Premises. Lender must first obtain Landlord's consent prior to assigning the Tenant's leasehold
interest to any other party pursuant to the terms of the Lease. This Agreement and any leasehold
interest shall only be assigned through a signed writing between Landlord and Lender and the
assignee.
6. The Landlord and the Tenant represent and warrant to the Lender that to their
knowledge after reasonable inquiry and investigation: (a) the Lease is in full force and effect and
has not been assigned, modified, supplemented or amended in any way; (b) the Lease represents
the entire agreement between the parties as to the leasing of the Premises; (c) there are no defaults
by either Landlord or Tenant under the Lease; (d) the original term of the Lease began on July 11,
2022 and ends on the last day of July 31, 2042 provided that Tenant may extend the term for two
additional ten (10) year terms; and (e) the Tenant (or its predecessor in interest) took possession
of the Property under the Lease on July 11, 2022, and currently remains in possession of the
Property.
7. The parties hereto agree that: (i)this Agreement and the Lease constitute the entire
agreement between the parties hereto pertaining to the subject matter contained herein; (ii) this
Agreement shall not be modified or amended except by an instrument in writing signed by all of
the parties hereto; (iii) if,after the date hereof, any provision of this Agreement is held to be illegal,
invalid, or unenforceable under present or future laws effective during the term of this Agreement,
such provision shall be fully severable, and in lieu thereof there shall be added a provision as
similar in terms to such illegal, invalid,or unenforceable provision as may be possible and be legal,
valid, and enforceable, but subject to the approval of all parties hereto; (iv) this Agreement has
been negotiated and drafted by all of the parties hereto and no ambiguity found herein shall be
interpreted against one party hereto or the other; (v) all titles, headings, and captions used in this
Agreement have been included for administrative convenience only and do not constitute matters
to be construed in interpreting this Agreement; (vi) each party hereto shall make an effort to
execute and deliver any further commercially reasonable instruments as may be necessary to
implement fully the terms and provisions hereof; (vii)the persons executing this agreement possess
the proper authority necessary in order to bind the parties hereto to their respective obligations;
(viii)all warranties, covenants, and agreements contained herein shall survive this Agreement; (ix)
this Agreement may be executed in multiple separate counterparts which when compiled shall
constitute one document and (ix) the validity, construction, interpretation, and administration of
this Agreement shall be governed by the substantive laws of the State of Colorado.
8. Any notice to be provided to Lender under this Agreement shall be provided to
Lender in the manner provided for notice in Section 22 of the Lease, and the following person at
the following address:
Loan Number: 37501 10983
CENTENNIAL BANK
Attn: Jeannie Hill
1445 Hogan Lane, Suite 1
Conway Arkansas 72034
Facsimile: 501-328-4647
With a copy to:
GILL RAGON OWEN, P.A.
Attn: Daniel Goodwin
425 West Capitol Avenue, Suite 3801
Little Rock, Arkansas 72201
Fax: (501) 372-3359
9. Notwithstanding anything contained in this Agreement to the contrary, this
Agreement is not intended to amend, modify, negate or otherwise change any of the terms
contained in the Lease, and all terms of the Lease remain fully in effect and shall control the rights,
duties, liabilities and other matters related to the parties hereto and to the subject matter contained
herein, and this Agreement is for the purpose of acknowledging and confirming the terms of the
Lease as to their affect on the subject matter contained herein.
10. It is expressly agreed and understood that this document may be executed in
multiple counterparts and with multiple signature pages and that all signature pages,when attached
to and assembled with this document, shall constitute and comprise a single document that is
enforceable against all parties on all signature pages in accordance with this document's terms.
This Agreement may also be executed by providing an electronic signature under the terms of the
Electronic Signatures Act, 15 U.S.C. SS 7001 et seq., and may not be denied legal effect solely
because it is in electronic form or permits the completion of the business transaction referenced
herein electronically instead of in person.
[This Space Intentionally Left Blank; Signatures to Follow]
Loan Number: 3750110983
[Signature Page to Landlord Consent Agreement]
IN WITNESS WHEREOF, the parties have executed this Landlord Consent Agreement as
of the date set forth in the preface.
LANDLORD:
City of Pueblo
By: .7‘.1 .,..4/
4A04-00+
Title: /OA44•
THE STATE OF
COUNTY OF
This instrument was acknowledged before me on this .5 day of
Z.Q-ej0j-4.lo.eA , 2022.
Eilene Tracey Sample E'L
NOTARY PUBLIC Notary Public
STATE OF COLORADO
NOTARY ID#200740 ii8010
MY COMMISSION EXPIRES 1011012023
LENDER:
Centennial Bank
By: ..-Lc_
g..ar
Title: ( V
THE STATE OF 1}r Irari5gS
COUNTY OF rra LA
This instrument was acknowledged before me on this `-s day of
Q C
-f— , 2022.
Notary Public
HO0c ,1
oD� ►
NOTAfi.k
;1...5 g,PuBoo 4':Q�This Space Intentionally Left Blank; Additional Signatures to Follow]
1!t'�,�1, Exp.• 1O' ��%
Loan Number: 3750110983
[Additional Signature Page to Landlord Consent Agreement]
TENANT:
Freeman oldings of Col rado LLC
By: . /.°47 ".. /1--4.40-011P;"7".Z.-
Francis B. Freeman Jr., Managing Member
THE STATE OF
COUNTY OF
VC-kb
instrument was acknowledged before me on this Z l day of
t/l, 1,12.Q. , 2022.
Notary Pub
KOOK PUILIC-1191S OF ARKANSAS
SNOW COUNTY
My Camnimion
• .. 1l00101-2027