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HomeMy WebLinkAboutresolution.council.014-07 RESOLUTION NO.4 Series of 2007 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ASPEN, COLORADO, APPROVING A CONTRACT FOR OPERATING CONCESSIONS AT THE ASPEN RECREATION CENTER, BETWEEN THE CITY OF ASPEN AND ZG HOLDINGS LLC, AND AUTHORIZING THE MAYOR OR CITY MANAGER TO EXECUTE SAID CONTRACT ON BEHALF OF THE CITY OF ASPEN, COLORADO. WHEREAS, there has been submitted to the City Council a Contract for the operation of the concessions for the Aspen Recreation Center, between the City of Aspen and ZG Holdings, LLC, a true and accurate copy of which is attached hereto as Exhibit "A"; NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF ASPEN, COLORADO: That the City Council of the City of Aspen hereby approves that Contract for operation of concessions for the Aspen Recreation Center, between the City of Aspen and ZG Holdings, LLC, a copy of which is annexed hereto and incorporated herein, and does hereby authorize the Mayor or City Manager to execute said agreement on behalf of the City of Aspen. INTRODUCED, READ AND ADOPTED by the City Council of the City of Aspen on the 2.b daYOf~007. I, Kathryn S. Koch, duly appointed and acting City Clerk do certify that the foregoing is a true and accurate copy of that resolution adopted by the City Council of the City of Aspen. Colorado, at a meeting held on the day hereinabove stated. G:\tara\RESOS\ARC.concessions,doc Aspen Recreation Center Concession Facility Page 1 LEASE AGREEMENT CONCESSION FACILITY AT ASPEN RECREATION CENTER THIS LEASE AGREEMENT is made and entered into this 26th day of Februarv , 2007 by and between The City of Aspen, 130 South Galena Street, Aspen, Colorado 81611 ("Landlord") and ZG Holdiul!:s, LLC whose address is 0133 Prospector Road, Suite 4114R Aspen, Colorado 81611 ("Tenant"). WIT N E SSE T H: WHEREAS, Landlord is the owner of the real property and all of the improvements thereon, known as the Aspen Recreation Center, Iselin Park, and Rotary Park located in Pitkin County, Colorado and described on Exhibit A attached hereto and incorporated herein by this reference; and, WHEREAS, Landlord desires to lease a certain portion of the Aspen Recreation Center, consisting of approximately 299 square feet of concession space (including a kitchen area), the exclusive right to vend from carts at Iselin and Rotary parks, and vending from vending machines as more specifically described in Exhibit A attached hereto and incorporated herein and referred to herein as the "premises" or the "lease premises", in accordance with the terms and conditions contained in this Lease Agreement; and, WHEREAS, Tenant desires to lease from Landlord the lease premises in accordance with the terms and conditions contained in this Lease Agreement. NOW, THEREFORE, for and in consideration of the payments to be made hereunder, and in further consideration of the terms, conditions, covenants and mutual promises contained herein, the parties hereto agree as follows: 1. Lease of Premises. Landlord does hereby rent to Tenant the following described premises, subject to the covenants and conditions hereinafter contained, to wit; (a) That portion of the Aspen Recreation Center, Pitkin County, Colorado, delineated and outlined in red on Exhibit A attached hereto and incorporated herein, with a street address of 0895 Maroon Creek Road, constituting approximately 299 square feet of concession space; and (b) The right to vend upon Iselin Park and Rotary Park from a movable cart; and (d) The right to place furniture in an area adjacent to the concession space to serve customers; provided, however, that Landlord grants prior Aspen Recreation Center Concession Facility Page 2 written approval to the location of the furniture and the type and design of the furniture. For the term, at the rents, and upon the conditions and covenants hereinafter set forth. Taking possession of the lease premises by Tenant shall constitute acknowledgment that such premises are in good condition and neither the City of Aspen nor Landlord shall be required to make any alterations thereto, unless agreed to in advance and in writing by Landlord. 2. Term. (a) Unless sooner terminated, as provided herein, the initial term of this Lease Agreernent shall be for a period of (3) years (the "Initial Term"). The Initial Term shall commence at 12:00 A.M. on 5th, 2007, or the date that a certificate of occupancy or temporary certificate of occupancy is issued by the AspenlPitkin County Environmental Health department, whichever date is later, and shall expire at 12:00 noon three calendar years later. A Lease Year shall be a calendar year starting on the commencement date of the Initial Term through 12:00 P.M. of the following calendar year and each calendar year thereafter. Tenant's occupancy of the Leased Premises shall be limited by paragraph 5, below. If Tenant is not in default of the terms of this Agreement during the Initial Term, Tenant shall have the right to renew this Agreement for two separate additional periods of five years each. Renewal discussions shall commence no later than six months prior to the expiration of the Initial Term, and conclude no later than three months before the expiration of the Initial Term. (b) In the event that a governmental authority, including Landlord, bans the sale of certain goods or foods from the leased premises that represent ten percent (I 0%) or more of Tenant's total gross sales as defmed in paragraph 3(b) above, Tenant shall have the right to terminate this Agreement upon sixty (60) days written notice to Landlord. 3. Rent. Tenant agrees to pay Landlord a fixed minimum annual rental for each Lease Year during the term of this Lease Agreement, which initial rent shall be 0.00 per square feet of space. This minimum rental is payable in equal monthly installments due on the first day of each calendar month during the term hereof without prior demand. (a) In the event that this Lease Agreement is renewed following the Initial Term in accordance with Paragraph 2(a), commencing at the start of the renewal period, the minimum annual rental shall be adjusted upward, based upon increases (if any) in the cost ofIiving during (i) the preceding Initial Term (five Lease Years) for the first increase for the first Lease Year of the renewal term, and (ii) during the preceding Lease Year for every succeeding Lease Year after the first Lease Year of the renewal term, using the "Price Index", all as more particularly described in Exhibit D appended and made a part hereof as if fully set forth herein. (b) In addition to the payment of the fixed mmrrnum annual rental as hereinabove provided, Tenant shall pay to Landlord during each Lease Year Aspen Recreation Center Concession Facility Page 3 during the term hereof, including any renewal term, as percentage rental, a sum equal to three percent (3 %) of all gross sales rnade in, on or from the Leased Premises, without prior demand therefore and without any set-off or deduction whatsoever. i) Tenant shall pay his fIrst installment of percentage rent on or before the twentieth (20th) day of the calendar month immediately after the one in which the percentage rent became effective, and thereafter it shall pay the required percent of each month's sales by the twentieth (20th) day of the following month. Tenant shall also submit to Landlord an iternized statement of gross sales (as defined below) and sales tax report for the preceding month on or before the twentieth (20th) day of each calendar month during the term of this Lease and any renewal, extensions, or holding over hereunder. ii) In addition, within thirty (30) days after the end of each Lease Year, Tenant shall deliver to Landlord a written statement signed by a certified public accountant or by some other person acceptable to Landlord, setting forth the amount of Tenant's gross sales for the preceding Lease Year. The accountant or other person shall certify that the gross sales have been computed in accordance with the definition given below, and the staternent shall be suffIciently detailed to show it was in fact prepared in accordance with such defInition. If the percentage rent for the Lease Year is more than the total thereof actually paid by Tenant, Tenant shall pay the balance due to Landlord within thirty (30) days of delivery of the annual statement. iii) The term "gross sales" as used in this Lease Agreement shall mean the full amount of the actual sales price of all merchandise or services sold for cash or credit in or from the Leased Premises by the Tenant, including any and all sales from vending machines and cart sales. The figure for gross sales will include deposits not refunded to customers, orders of any kind received or fIlled at the Leased Premises, receipts from vending machines located upon the Leased Premises, receipts from all sales generated from the carts referenced in paragraph I (b), and any other receipts which the Tenant ordinarily would credit to his business. Each credit or installment sale will be treated as a sale for the full price in the month it is made, and there will be no deductions for uncollected accounts or bad debts. The following items, if applicable, shall be deducted from gross sales: I) refunds or customer discounts included in gross sales; 2) returns to shippers and manufacturers; 3) sales of trade fixtures or operating equipment; 4) sums received in settlement of claims of loss or damage ofmerchandise; Aspen Recreation Center Concession Facility Page 4 5) retail sales tax recorded at the time of each sale and expressly charged to the customer; 6) postage charged to customers; and 7) co-operative advertising revenues provided by suppliers. 8) All property and sales taxes paid by Tenant. iv) In operating on the Leased Premises, the Tenant agrees to issue a serially-numbered duplicate sales slip, invoice, non-resettable cash register receipt, or other record approved by Landlord, with each sale of any kind. During the term of the Lease, Tenant shall keep accurate records of all his operations. These records shall conform to generally accepted accounting practices, and shall include records of gross sales and of receipts and deliveries of all merchandise. Tenant shall keep all the documents relating to Tenant's operations for at least thirty-six (36) months from the end of the Lease Year to which they apply. If any audit is required, or Tenant and Landlord disagree about the rent, Tenant will keep its records until the audit is completed or the disagreement is settled. v) At any reasonable time, and following at least twenty-four (24) hours notice in writing to Tenant, Landlord or Landlord's authorized representative may audit any of Tenant's records of gross sales. If, when Landlord audits the records for a Lease Year based on normal accounting procedures, it finds that the Tenant has understated its gross sales for the Lease Year by five percent (5%) or more, Tenant shall be required to pay for the audit, and shall promptly deliver to Landlord the difference Tenant owes it, plus interest on such difference at the rate of eighteen percent (18%) per annum from the first day of the current Lease Year to the date such difference is paid. If such audit discloses that Tenant has understated his gross sales for that Lease Year by five percent (5%) or more, Landlord shall be permitted to treat such event as a material default hereunder. In this matter, the report of Landlord's accountant shall be binding and conclusive. 4. Equipment. Fixtures and Finishes Provided bv Landlord and Tenant. (a) Tenant represents that he has had an opportunity to review the building plans for the Leased Prernises. On a date mutually agreed to by the parties, but no later than the start of the term of this Lease Agreement, Tenant shall be given an opportunity to inspect the Leased Premises to assure himself that the Leased Premises are satisfactory. Tenant shall prepare a punch list of all items that require further work and shall present the punch list to Landlord. Landlord shall take all reasonable steps to correct or complete all items on the punch list within a reasonable period of time. Unless an item on the punch list shall materially affect the Tenant's intended use of the Leased Premises, the scheduled start of the lease term shall not be postponed. Aspen Recreation Center Concession Facility Page 5 (b) The Landlord shall furnish Tenant with certain fixtures and those items of moveable equipment (equipment that is not attached or otherwise built in to the premises) described in the inventory appended hereto as Exhibit B. Tenant shall furnish other fixtures and articles deemed necessary by Tenant for its use of the premises but not enumerated in Exhibit B, at Tenant's expense. Such fixtures, equiprnent, and articles shall be sold to Landlord at the end of the lease period, and extensions thereto, at Landlord's option, for a price not to exceed the original purchase price less normal depreciation. (Tenant shall provide to Landlord a bill of sale and schedule of useful life for any fixtures or equipment that Landlord requests at the commencement of this Lease.) All items of equipment and fixtures set forth in Exhibit B shall be maintained in good working order by Tenant, at Tenant's own cost and expense, and shall be returned to the Landlord upon the termination of this Lease in the same condition as when accepted by Tenant, ordinary wear and tear excepted. If the equipment or fixture is determined to be fully depreciated or incapable of repair, Tenant shall neither be required to purchase a new piece of equipment or fixture nor shall the Landlord be obligated to purchase new equipment or substitute working equipment for equipment that can't be repaired. Special or time sensitive maintenance other than routine maintenance as required by warranties covering individual pieces of equipment and fixtures shall be the responsibility of the Landlord; provided, however, that the equipment or fixture is supplied by Landlord as indicated on Exhibit B; and provided further, that Tenant operates the equiprnent and fixtures in accordance with any operational manuals supplied by the equipment or fixture manufacturer. 5. Occupancv of the Leased Premises. Tenant shall be entitled to occupy the Leased Premises throughout the term of the lease; provided, however, that Tenant uses the premises as set forth in Paragraph 6 below, and all other terms and conditions of this Lease Agreement. The parties agree to meet no less than once every two weeks to discuss Tenant's performance and any other issues relating to the terms and conditions of this Lease Agreement. 6. Permitted Uses and Required Performance Standards. The parties hereto recognize and acknowledge that the construction of the Aspen Recreation Center, including the Leased Premises, by Landlord was done, in part, to create a concession facility that caters to the customers and users of the Aspen Recreation Center, Iselin Park and Rotary Park facilities. Tenant recognizes that a major and important consideration inducing Landlord to rent the Leased Premises to Tenant is the operation of a high quality concession business offering food services to the customers and users of the recreational facilities at the Aspen Recreation Center, Iselin Park, and Rotary Park. Accordingly, Tenant agrees to the following minimum standards of operation and uses of the Leased Premises: Tenant shall operate the leased premises in accordance with the following schedule of hours of operation: December 1st through March 31st Aspen Recreation Center Concession Facility Page 6 lOam to 7pm daily (Monday thru Friday) 7am to 7pm weekends (Saturday & Sunday) April 1st through May 31 st 3pm to .7pm daily (Monday thru Friday) I2pm to 7pm weekends (Saturday & Sunday) June I st through August 31st lOam to 7pm daily (Monday thru Friday) lOam to 7pm weekends (Saturday & Sunday) September 1st through November 30th 3pm to 7pm daily (Monday thru Friday) I2pm to 7pm weekends (Saturday & Sunday) In addition to the above stated minimum hours of operation, Tenant shall operate the concession during all special events; provided, however, that Landlord notifies Tenant of such special events at least 72 hours in advance. Special events shall include, but not necessarily be limited to, ice skating shows, exhibition hockey games, Hockey Tournaments, or swim meets. Vending machines required to be provided and operated by Tenant within the Aspen recreation Center shall be operational at all times during the year. Vending machines required to be provided and operated by Tenant in any exterior locations shall be required to operate from May through October. The parties hereto agree to review and negotiate in good faith the above stated hours of operation at the end of the first Lease year. In the event of an impasse in said negotiations, Tenant agrees to abide by Landlord's decision in this regard. Tenant may provide outdoor food service from a cart to customers at Iselin Park and Rotary Park. The Landlord shall approve the design and operation of the food cart(s) before Tenant uses them. Landlord shall not allow any other vendors to vend upon Iselin Park or Rotary Park during any times that Tenant is vending from Tenant's cart(s) provided that the Tenant is operating the cart during the minimum established and agreed upon hours of operation. Landlord shall provide any electrical outlets required by Tenant to vend upon the aforernentioned parks. Special Events - Tenant shall have the exclusive right to all food service in the Aspen Recreation Center (except the area leased by the Youth Center), and surrounding parks (Iselin and Rotary). Any groups or outings desiring food service shall negotiate with Tenant for such service. In such case that a special event requests their own food supplier, approval must be in writing by Lessee and a buyout charge will be assessed to the group in the amount of $5.00 per person or $500.00 minimum. Tenant shall be encouraged by Landlord to work with large groups in pricing for such events. Landlord shall encourage such groups to use the Tenants' services for such events. Tenant shall not schedule or serve any special event that is not authorized in advance and in writing by Aspen Recreation Center Concession Facility Page 7 Landlord. User groups desiring to have "bake sales" or other similar fundraising activities, or desiring to bring food for any purpose within the Aspen Recreation Center shall be required to obtain the prior written permission of Tenant. Tenant shall not unreasonably withhold its permission for such events. 7. Prohibited Uses. Tenant will not use, occupy, or permit the Leased Premises or any part thereof to be used or occupied for any unlawful or illegal business, use, or purposes deemed by Landlord to be disreputable, or hazardous, nor in such manner as to constitute a nuisance of any kind, nor for any purpose or in any way in violation of any present or future laws, rules, requirements, orders, directions, ordinances or regulations of the United States of America, State of Colorado, County Pitkin, City of Aspen, or other municipal, governmental, or lawful authority whatsoever. Tenant shall not do or permit anything to be done in or about the Leased Premises or bring or keep anything therein which will in any way increase the rate of fire insurance upon the Building wherein the Premises are situated. Tenant shall, at its sole cost and expense, comply with any and all requirements pertaining to the Leased Premises of any insurance company necessary for the maintenance of reasonable fire and public liability insurance covering the Leased Premises. Tenant shall prornptIy comply with all laws, ordinances, orders, and regulations affecting the Leased Premises and the cleanliness, safety, and use of the same, including installation of additional facilities as required for the conduct and continuance of Tenant's business on the Leased Premises. No auction for fire or bankruptcy sales may be conducted on the Leased Premises without Landlord's consent. 8. Service to Patrons/No Discrimination. The service provided to patrons by Tenant shall be rendered courteously and efficiently and within the limits for which the facility is designed. Landlord reserves the right to prohibit the sale of any item that it deems objectionable, and shall have the right to order the improvement of the quality of either the merchandise or the services rendered. Landlord's right to prohibit the sale of any item shall not be unreasonably withheld. Tenant shall not discriminate against any employee or applicant for employment because of race, religion, color, creed, ancestry, sex, age, sexual orientation or national origin. Tenant and Tenant's employees shall not discriminate against any person because of race, religion, color, creed, ancestry, sex, age, sexual orientation or national origin by refusing to furnish such person any service or privilege offered to or enjoyed by the general public. Neither Tenant nor Tenant's employees shall publicize the services provided hereunder in any manner that would directly or inferentially reflect on the acceptability of the patrons of any person because of race, religion, color, creed, ancestry, sex, age, sexual orientation or national origin. 9. Employee Uniforms. All employees of Tenant shall wear, at all times, uniforms of a consistent appearance. Said uniforms shall be subject to the approval of Landlord. 10. Entertainment. Live entertainment and the use or playing of televisions, stereo systems, games, and the type and volume of music, shall be approved by Landlord before implementation. Aspen Recreation Center Concession Facility Page 8 I I. Parking. Free parking will be designated by the City of Aspen and provided for the Tenant's patrons and employees. Patron and employee parking shall be consistent with the parking provided for the City's employees and patrons. 12. Accounting. In addition to the accounting to be provided to Landlord pursuant to paragraph 3, above, Tenant shall provide Landlord: a) with copies of the quarterly sales and withholding tax statements it provides to the appropriate authorities, with a notation thereon by Tenant's accountants reflecting the portion ofthe income reflected on those returns that is derived from the gross sales; and, b) statements prepared by Tenant's accountants reflecting the gross sales and sales taxes paid by Tenant for each Occupancy Period. 13. Late Charges. The Tenant hereby acknowledges that late payment by Tenant to . Landlord of rent or other sums due hereunder will cause Landlord to incur costs not contemplated by this Lease, the exact amount of which shall be extremely difficult to ascertain. Such costs include, but are not limited to, processing and accounting charges and the late charges. Accordingly, if any bona fide installment of rent or any other sum due from Tenant hereunder shall not be received by Landlord or Landlord's designee on or before the twentieth (20th) day of each calendar month that a rent payment is due, then Tenant shall pay to Landlord a late charge often percent (10%) on such overdue amount. The parties hereby agree that such a late charge will represent a fair and reasonable settlement of the cost that Landlord would incur by reason of the late payment by Tenant. Acceptance of such late charges by Landlord shall in no event constitute a waiver of Tenant's default with respect to such overdue amount, nor prevent Landlord from exercising any of the other rights and remedies granted hereunder unless the entire amount due, plus late charge, is accepted by Landlord. In addition. any sum for which the Tenant shall be obligated to the Landlord, which is not received on the due date thereof, shall bear interest at the rate often percent (10%) per annum from and after the due date until paid. 14. Personal and Real PropertY Taxes. Tenant shall pay, as additional rent hereunder, all personal property taxes assessed against the personal property used by Tenant and located on the Leased Premises. Likewise, Tenant shall be responsible for any and all sales, use, withholding and other taxes assessed against the Leased Premises for Tenant's business operation therein. Landlord shall pay any real estate taxes assessed upon the Leased Premises, except for leasehold property interest taxes referenced above. 15. Fire and Casualtv Insurance. The Tenant, at its own cost and expense, shall provide and keep in full force for the benefit of the Tenant and the City and the Landlord (as named or additional insureds) during the term hereof or any extension or renewal period, insurance to insure the Leased Premises against fire, normal extended coverage perils, vandalism, malicious mischief, and liability. Such insurance shall provide protection to the extent of at least one hundred percent (100%) of the insurable replacement cost of the building containing the Leased Premises. In connection herewith, it is acknowledged that Landlord, for ease of administration, is carrying such insurance upon the entire Aspen Recreation Center. Accordingly, Tenant shall pay to Landlord, Tenant's prorated share of the insurance premium Landlord pays to insure the Leased Premises. Tenant's prorated share shall be equal to 0.0037 Aspen Recreation Center Concession Facility Page 9 multiplied by the annual premium paid by Landlord for such insurance. This premium shall be paid to Landlord within ten (10) days of Tenant's receipt of notice of the amount due from Landlord. Throughout the term of this Lease, the Tenant shall carry and maintain in effect casualty insurance covering its trade fixtures, equipment, furnishings, leasehold improvements and plate glass, which insurance shall protect against fire, normal extended coverage perils, vandalism, malicious mischief, and sprinkler malfunction. Such insurance shall provide coverage to the extent of at least one hundred percent (100%) of the insurable replacement cost of the insured property. Both the Landlord and the Tenant waive any right of subrogation that their respective insurers may acquire against either of them. Both of these waivers shall automatically terminate at such time as either party's insurer requires that an additional premium be paid as a consequence of this waiver provision. 16. Liability Insurance. The Tenant, at its own cost and expense, shall provide and keep in full force for the benefit of the Tenant and the Landlord (as named or additional insureds) during the term hereof or any extension or renewal period, general public liability insurance for claims of liability arising out of, occasioned by or resulting frorn an accident or otherwise in or about the Leased Premises, for Five Hundred Thousand Dollars ($500,000.00) each occurrence with a One Million Dollar ($1,000,000.00) general aggregate combined single limit covering bodily injury, property damage, and personal injury. In addition, if Tenant serves, manufactures, or distributes alcoholic beverages on the Leased Premises, Tenant shall carry liability insurance for such activity with limits in the same amounts as stated above. The policy or policies of insurance (or binders of insurance therefore) shall be issued by a reputable company or companies authorized to do business in this State and shall name Landlord as an additional insured. Tenant shall provide evidence of such insurance coverage to Landlord prior to the commencement of the term hereof. The Tenant also agrees to and shall save, hold and keep hannless and indemnify the Landlord from and against any and all payments, expenses, costs, attorneys' fees and/or damage to property or injuries to persons occasioned wholly or in part by or resulting from any acts or omissions by the Tenant or any subtenants, assignees or successors. If for any reason as a result of Tenant's activities, use, or business, it shall be impossible to obtain fire and other hazard insurance on the buildings and improvements on the Leased Premises, in an amount and with insurance companies acceptable to the Landlord, the Landlord may terminate this Lease and the term hereof, upon giving to Tenant fifteen (15) days notice in writing of the Landlord's intention to do so and upon the expiration of the time provided in said notice, this Lease and the term hereof shall terminate. If by reason of the use of the Leased Premises by the Tenant or by character or manner in which the Tenant's business is carried on, Landlord's insurance rates for fire and other hazards shall be increased, the Tenant shall pay, as additional rent, the amounts by which the premiums for such insurance are increased. The Tenant waives all rights of recovery against the Landlord or Landlord's agents, employees or other representatives, for any loss, damages or injury of any nature whatsoever to property or persons for which the Tenant is insured. Each party shall give the other party prompt notice of any claim coming to the knowledge of any party that in any way directly or indirectly affects either party, and both parties shall have the right to participate in the defense of such claim to the extent of its interest. Aspen Recreation Center Concession Facility Page 10 17. Notice of Cancellation of Insurance Coverage. The above insurance policies shall contain clauses substantially similar to the following: (a) Notwithstanding any other provision in this policy, the insurance afforded hereunder to the Landlord shall be primary as to any other insurance or reinsurance covering the Landlord and such other insurance or reinsurance shall not be required to contribute to any liability until. the appropriate limit of liability afforded hereunder is exhausted. (b) This policy may not be canceled or changed until forty-five (45) days after receipt by Landlord of a written notice of such cancellation or change in coverage, as endorsed by receipt of a certified letter, unless such cancellation is a result of nonpayment of premium due, in which case, this policy may not be canceled until ten (10) days after receipt by Landlord of a written notice of such cancellation, as endorsed by receipt of a certified letter. 18. Utilities and Maintenance. During the first Lease Year, Tenant shall pay $100 rnonthly as and for its prorated share of all charges for utilities that are not separately metered or contracted for separately by Tenant. Those utilities covered by this pro-rated share include gas, electricity, water, sewer, trash removal, and the cost of cleaning the common restrooms on the main floor. Utilities not covered by this pro-rated share amount shall include telephone, cable televisions and any other utility or maintenance services used by the Tenant in or about the Leased Premises during the term of this Lease. After the first Lease Year, the prorated share amount shall be increased (or decreased) based upon any percentage change in the actual cost of providing the pro-rated share of the utilities. 19. Alterations. Any improvements to be made by Tenant are listed on Exhibit C appended hereto. No alterations, additions, or improvements shall be made, and no fixtures shall be installed in or attached to the Leased Premises that are not listed on Exhibit C, without the written consent of the Landlord. Unless otherwise provided herein, all such alterations, additions or improvements (including those listed on Exhibit C) when made, installed in or attached to the said Leased Premis~s, shall belong to and become the property of the Landlord and shall be surrendered with the Leased Premises as part thereof upon the expiration or sooner termination of this Lease, without hindrance, molestation, or injury. Notwithstanding that they may have become an integral part of the Leased Premises, Landlord may require Tenant to remove all or any part of such alterations, additions, improvements or fixtures at the expiration or earlier termination of this Lease, restoring the Leased Premises to the same condition existing at the beginning of the original term, ordinary wear and tear excepted. If Landlord does so require, Tenant shall repair all damages resulting from such removal and should Tenant fail to repair damages resulting from such removal, Landlord may remove the same or make such repairs for Tenant's account, and Tenant shall pay to Landlord, on demand, an amount equal to Landlord's costs incurred in such removal or repair. All work with respect to any permitted alterations, additions, or improvements shall be done at Tenant's sole expense in a good and workmanlike manner, strictly in accordance with the plans and specifications approved by Landlord. In doing Aspen Recreation Center Concession Facility Page 11 said work, other Tenants of Landlord (if any) shall not be adversely affected nor unreasonably inconvenienced. Tenant shall, at its own expense, obtain all necessary building or other permits or approvals required by appropriate governmental authorities prior to beginning such work. If any rnechanics' or other liens shall be created or filed against the Leased Premises by reason of labor performed or materials furnished for the Tenant in the alteration, addition or repair to any building or improvement, the Tenant shall within ten (10) days thereafter, at the Tenant's own cost and expense, cause such lien or liens to be satisfied and discharged of record together with any Notices of Intention that may have been filed. Failure to do so shall entitle Landlord to resort to such remedies as are provided herein in the case of any default of this Lease, in addition to such as are permitted by law. Any goods, inventory or other personal property of Tenant not affixed to the Leased Premises and not removed by Tenant upon the termination of this Lease, or upon any quitting, vacating or abandonment of the Leased Premises by the Tenant, or upon the Tenant's eviction, shall be considered abandoned and Landlord shall have the right, without any notice to the Tenant, to sell or otherwise dispose of the same, at the expense of the Tenant, and shall not be accountable to the Tenant for any part of the proceeds of such sale, if any. 20. Reoairs. The Tenant has examined the Leased Premises and has entered into this Lease without any representation on the part of the Landlord as to the condition thereof, other than as stated in this Lease Agreement. Tenant shall take good care of the Leased Premises and shall, at the Tenant's own cost and expense, make all repairs, including painting and decorating, and shall maintain the Leased Premises in good condition and state of repair, and at the end or other expiration of the term hereof, shall deliver up the Leased Premises in good order and condition, wear and tear from reasonable use thereof, and damage by the elements not resulting from the neglect or fault of the Tenant, excepted. The Tenant shall neither encumber nor obstruct the sidewalks, driveways, yards, entrances, hallways and stairs, but shall keep and maintain the same in a clean condition, free frorn debris, trash, refuse. In case of destruction of, or any damage to the glass in the Leased Premises, or the destruction of, or damage of any kind whatsoever to the Leased Premises, caused by the carelessness, negligence or improper conduct on the part of the Tenant or the Tenant's agents, employees, guests, licenses, invitees, subtenants, assignees or successors, the Tenant shall repair the said damage or replace or restore any destroyed parts of the Leased Premises, as speedily as possible, at the Tenant's own cost and expense. 21. Damage to Premises. If the Leased Premises shall be so damaged by fire or other catastrophe (which is not caused by the fault or negligence of the Tenant or imputable to the Tenant) as to render said Leased Premises untenantable, the Tenant thereupon shall surrender the Leased Premises to the Landlord. The Tenant shall pay rent, duly apportioned, up to the time of such termination of this Lease. Notwithstanding the foregoing, in lieu of any termination of the Lease, Landlord may elect, at its sole option, within thirty (30) days after the event of such damage, to continue the Lease without regard of such damage, whereupon Landlord shall at its expense make the Leased Premises fit for occupancy and the rent shall be abated only for the period during which the Tenant shall be deprived of the use of said Leased Premises by reason of such damage and the repair thereof. If said Leased Premises, without the fault of the Tenant, shall be slightly damaged by fire or other catastrophe but not so as to render the same Aspen Recreation Center Concession Facility Page 12 untenantable for any substantial period of time, the Landlord, after receiving notice in writing of the occurrence of the injury, shall cause the same to be repaired with reasonable promptness; and in such event, rent shall be proportionately abated, according to the loss of use, until the Leased Premises are substantially restored. 22. Sublease/Assignment. Tenant shall not assign, sublease, mortgage, pledge or otherwise hypothecate or transfer all or any part of Tenant's leasehold estate hereunder, or permit the Leased Premises or any portion thereof to be occupied by anyone without Landlord's prior written consent in each instance, which consent shall not unreasonably be withheld. In the event Tenant is a corporation, these provisions shall apply to any transfer, sale or other disposition, whether voluntary or involuntary, of any stock in Tenant or to any merger, consolidation or dissolution or any other transaction, the effect of which would be in any way to avoid or circumvent such prohibitions. Any assignment or subletting contrary to the provisions of this Paragraph shall be void and shall, at the option of the Landlord, constitute a default under the terms of this Lease. 23. Maintenance and Reoairs. Tenant shall during the term of this Lease keep in condition and repair equal to that which existed at the commencement of this lease the Leased Premises and every part thereof, including without limiting the generality of the foregoing, all plumbing fixtures, within the Leased Premises, refrigeration, electrical fixtures and lighting fixtures, additional fixtures, interior walls, wall coverings and paint, ceilings, floors and floor coverings, windows, doors, plate glass, awnings, and entrances. Landlord shall have responsibility for the repair and maintenance of the building structure, roof, foundation and structural integrity of any additional stories above the Leased Premises, and shall, at its expense provide major repairs and required replacement to mechanical systems situated within the Leased Premises that were originally provided by the Landlord. Major repairs and replacements are agreed to be those which cost more than $500.00 for each single item, and are of what the Landlord provided initially when construction was completed on the new facility, (other additions that need repair which were completed by lease holder will be undertaken by the lease holder at the lease holders sole cost and expense) and are required to provide the level of service and serviceability thereof and there from currently existing. Absent such agreement, Landlord shall have no obligation to execute such repair or replacement, but in the event Landlord determines to effectuate such repair or replacement, Landlord shall have the sole discretion to determine the type, extent and quality of repair or replacement that shall be undertaken. 24. ~. The Tenant shall not place nor allow to be placed any signs of any kind whatsoever, upon, in or about the said Leased Premises or any part thereof, except of a design and structure and in or at such places as may be indicated and consented to by the Landlord in writing. In case the Landlord or the Landlord's agents, employees or representatives shall deem it necessary to remove any such signs in order to paint or make any repairs, alterations or improvements in or upon the Leased Premises, they shall be replaced at the Landlord's expense when the said repairs, alterations or improvements shall have been completed. Any signs permitted by the Landlord shall at all times conform with all municipal ordinances or other laws Aspen Recreation Center Concession Facility Page 13 and regulations applicable thereto. Exhibit F appended hereto is a list of signs and locations showing the general location of all signage permitted to be located by Tenant. 25. Compliance with Law. Tenant shall obtain and pay for all permits or licenses that may be required for the operation of the Leased Premises in accordance herewith. A copy of such permits or licenses shall be submitted to Landlord for verification of this requirement prior to occupancy. The Tenant shall promptly comply with all laws, ordinances, rules, regulations, requirernents, and directives of the federal, state, and municipal governments or public authorities and of all their departments, bureaus and subdivisions, applicable to and affecting the said Leased Premises, their use and occupancy, and shall prornptIy comply with all orders, regulations, requirements and directives of the Board of Fire Underwriters or similar authority and of any insurance companies which have issued or are about to issue policies of insurance covering the said Leased Premises and its contents, for the prevention of fire or other casualty, damage or injury, all at Tenant's own cost and expense. Tenant shall obtain and maintain during the life of this Lease, worker's compensation insurance and employer's liability insurance for Tenant's employees in strict compliance with state laws. Certificates evidencing such insurance or approved self-insurance shall be submitted to Landlord prior to occupancy. Tenant shall not use the Leased Premises for any purposes deemed unlawful, disreputable, or extra hazardous. 26. Ouiet Enjovment. So long as the Tenant is not in default hereunder during the term hereof or any renewal or extension hereof, the Landlord covenants that the Tenant shall peacefully and quietly occupy and enjoy the Leased Premises subject to the terms hereof. The Landlord warrants that it has full power and authority to execute this Lease, be bound by, and perform all its obligations hereunder. Notwithstanding anything to the contrary contained herein, Tenant acknowledges that Landlord's right to occupy and lease the Leased Premises to Tenant is based upon Landlord's rights under the Master Lease. In the event Landlord loses the right to occupy and lease the Leased Premises because of a default by Landlord or the Owner of the building in accordance with the provisions of the Master Lease, Landlord shall have no obligation hereunder to Tenant and this Lease shall be of no further force or effect, subject to the City of Aspen's rights pursuant to the Master Lease. 27. Condemnation. rfthe land and the Leased Premises leased herein, or of which the Leased Premises are a part, or any portion hereof, shall be taken under eminent domain or condemnation proceedings, or if suit or other action shall be instituted for the taking or condemnation thereof, or ifin lieu of any formal condemnation proceedings or actions, if any, the Landlord shall grant an option to purchase and/or shall sell and convey the said Leased Premises, or any portion thereof, to the governmental or other public authority, agency, body or public utility seeking to take said land and Leased Premises or any portion thereof, then this Lease, at the option of Landlord, shall terminate and the term hereof shall end as of such date as the Landlord shall fix by notice in writing; and the Tenant shall have no claim or right to claim or be entitled to any portion of any amount which may be awarded as damages or paid as the result of such condemnation proceedings or paid as the purchase price for such option, sale or conveyance in lieu of formal condemnation proceedings; and all rights of the Tenant to damages, if any, are Aspen Recreation Center Concession Facility Page 14 hereby assigned to the Landlord. The Tenant agrees to execute and deliver any instruments, at the expense of the Landlord, as may be deemed necessary or required to expedite any condemnation proceedings or to effectuate a proper transfer oftitle to such governmental or other public authority, agency, body, or public utility seeking to take or acquire the said lands and Leased Premises or any portion thereof. The Tenant covenants and agrees to vacate said Leased Premises, remove all the Tenant's personal property there from and deliver up peaceable possession thereof to the Landlord or to such other party designated by the Landlord in the aforementioned notice. Failure by the Tenant to comply with any provisions in this clause shall subject the Tenant to such costs, expenses, damages and losses as the Landlord may incur by reason of the Tenant's breach hereof. 28. Landlord's Lien. Tenant hereby grants to Landlord a security interest in any and all of Tenant's furniture, fixtures, equipment and inventory whenever acquired, their proceeds and the proceeds of any and all insurance policies carried thereon as and for additional security for the faithful performance by Tenant of all of its obligations hereunder. Tenant agrees to execute and deliver to Landlord, upon request, such additional documents as Landlord may require to establish and perfect such security interest including, without limitation, a financing staternent in form satisfactory to Landlord, which is to be executed and delivered by Tenant to Landlord. The exercise by Landlord of any rights in and to such furniture, fixtures, equipment and inventory upon default hereunder shall be governed by Article 9 of the Colorado Uniform Commercial Code, as in effect at the time of such default, but such exercise shall not preclude Landlord from exercising any or all other rights and remedies hereunder or as provided by law. 29. Inspection and Repair. The Tenant agrees that the Landlord and the Landlord's agents, employees or other representatives, shall have the right to enter into and upon the Leased Premises or any part thereof, at all reasonable hours and upon reasonable notice, for the purpose of examining the same or making such repairs or alterations therein as may be necessary for the safety and preservation thereof. Nothing in this section is intended to restrict access to the premises by an authorized City of Aspen inspector conducted pursuant to law, including, but not limited to Environmental Health employees conducting routine health inspections. This clause shall not be deemed to be a covenant by the Landlord nor be construed to create an obligation on the part of the Landlord to make such inspection or repairs. Tenant expressly waives and releases any claim, demand, or cause of action it might have by reason of any inconvenience, annoyance to Tenant, its guests, licensees or invitees arising from any maintenance, alteration or repair to any portion of the Leased Premises, the building in which it is located or the property upon which it is situate. Tenant grants to Landlord the right to temporarily discontinue utilities or any of them at any such time or times as may be necessary by reason of any such maintenance work, alteration or repair. 30. Landlord Remodel of Premises. In the event Landlord desires to remodel any portion of the Leased Premises during the term of this lease agreement, it may do so, provided it is solely at Landlord's expense and, provided further, that any remodel work commenced by Landlord shall not interfere with or disrupt Tenant's business within the Leased Premises. Aspen Recreation Center Concession Facility Page 15 31. Default. If there should occur any default on the part of the Tenant in the performance of any conditions or covenants herein contained or if, during the term hereof, the Leased Premises or any part thereof shall be or become abandoned or deserted, vacated or vacant, or should the Tenant be evicted by summary proceedings or otherwise, the Landlord, in addition to any other remedies herein contained or as may be permitted by law, may either by force or otherwise, without being liable for prosecution therefore or for damages, re-enter the said Leased Premises and again possess the same with or without terminating this Lease; and as agent for the Tenant or otherwise, re-Iet the Leased Premises and receive the rents therefore and apply the same, first to the payment of such expenses and costs, as the Landlord may have been put in re- entering and repossessing the same and in making such repairs and alterations, as may be necessary; and second to the payment of the rents due hereunder. Whether or not the Landlord shall terminate this Lease, the Tenant shall remain liable for such rents as may be in arrears and also the rents as may accrue subsequent to the re-entry by the Landlord, to the extent of the difference between the rents reserved hereunder and the rents, if any, received by the Landlord during the remainder of the unexpired term hereof, after deducting the aforementioned expenses, fees, and costs; the same to be paid as such deficiencies arise and are ascertained each month. In addition, upon any such default, or if Tenant be adjudicated a bankrupt, insolvent or placed in receivership, or should proceedings be instituted by or against the Tenant for bankruptcy, insolvency, receivership, agreement of composition or assignment for the benefit of creditors, or if this Lease or the estate of the Tenant hereunder shall be transferred by virtue of any court proceedings, writ of execution or levy sale, the Landlord may, if the Landlord so elects, at any time thereafter, terminate this Lease, upon written notice to Tenant or to any trustee, receiver, or other person in charge of or acting as custodian of the assets or property of the Tenant. In the event of default, except in the payment of rent or additional rent hereunder, Landlord, prior to the exercise of any of its rights or remedies hereunder, shall give Tenant notice of such default together with a ten (10) day right to cure should such default be in the payment of any other sums . due Landlord hereunder or a twenty (20) day right to cure should such default be in any of the other conditions or covenants of this Lease to be performed by Tenant, unless the same by its or their nature require immediate or earlier attention. Upon the giving of such notice, this Lease and the term hereof shall, unless the default shall be cured during the applicable period, end on the date fixed in such notice as if the said date were originally fixed in this Lease for the expiration hereof; and the Landlord shall have the right to remove all persons, goods, fixtures and chattels therefrom, by force or otherwise, without liability for damages. No right of redemption shall be exercised under any present or future law of the State of Colorado in case the Tenant shall be dispossessed for any cause or if the Landlord shall, in any other manner, obtain possession ofthe Leased Premises in consequence of the violation of any of the covenants and agreements of the Tenant. The Landlord shall have a lien paramount to all others on every right and interest of the Tenant in and to this Lease, and on any furnishings, equipment, fixtures, or other personal property of any kind belonging to the Tenant, or the equity of the Tenant therein, on the leased property. Such lien is granted for the purpose of securing the payment of rents, taxes, assessments, insurance charges, liens, penalties and damages herein covenanted to be paid by the Tenant and for the purpose of securing the performance of all of the Tenant's obligations under Aspen Recreation Center Concession Facility Page 16 this Lease. Such lien shall be in addition to all rights of the Landlord given under statutes ofthis State, which are now or shall hereinafter be in effect. 32. Attornevs' Fees. In the event of any litigation or other action or proceeding between the parties hereto arising out of the performance or non-performance of this Lease, or enforcement of any rights or remedies hereunder, including any indemnities herein contained, the prevailing party shall be entitled in such litigation, action or proceeding to also recover as part of any judgment, award or other relief, its reasonable attorneys' fees and costs incurred. 33. Delays. Whenever a period of time is provided in this Lease for either Landlord or Tenant to do or perform any act or thing, neither Landlord nor Tenant shall be liable or responsible for performing any obligation hereunder as a result of any unavoidable delay due to strikes, lockouts, casualties, acts of God, or other governmental regulations or control or other causes beyond such party's reasonable control, and the time for performance specified herein shall be extended for a period of time corresponding to such delay. 34. Mortgage Prioritv. This Lease shall not be a lien against the Leased Premises with respect to any mortgages or trust deeds now or hereafter placed upon the Leased Premises or the building. The recording of such mortgage or mortgages shall have preference and precedence and be superior and prior in lien to this Lease, irrespective of the date of recording and the Tenant agrees to execute any instruments, without costs, which may be deemed necessary or desirable, to further effect the subordination of this Lease to any such mortgage or mortgages. Tenant shall, upon request, execute any estoppel certificates or attornment agreements that may be required by the holder of any mortgage or trust deed now. or hereafter placed upon the Leased Premises or the building or by the Owner of the building in which the Leased Premises are located. A refusal by the Tenant to execute any such instruments shall entitle the Landlord to at once terminate this Lease. Tenant agrees not to record or file this Lease in the real estate records affecting the building in which the Leased Premises is located. Any such recording in violation hereof shall be considered a slander of Landlord's title and a breach of this entire Lease. This covenant shall survive the expiration or earlier termination of this Lease. 35. Holding Over. This Lease shall expire of its own accord without notice at the end of the term or earlier, as herein specified. If, after the expiration of this Lease, Tenant remains in possession of the Leased Premises with the Landlord's consent, such holding over shall be a tenancy-at-wilI at a rental equal to 125% of the last monthly rental provided in this Lease, and otherwise subject to all the obligations and conditions of this Lease. 36. Cumulative Remedies. The various rights, remedies, options and elections of the Landlord' expressed herein are cumulative and the failure of the Landlord to enforce strict performance by the Tenant of the conditions and covenants of this Lease or to exercise any election or option or to resort or have recourse to any remedy herein conferred or the acceptance by the Landlord of any installment of rent after any breach by the Tenant, in anyone or more instances, shall not be construed or deemed to be a waiver or a relinquishment for the future by Aspen Recreation Center Concession Facility Page 17 the Landlord of any such conditions and covenants, options, elections or remedies, but the same shall continue in full force and effect. 37. Cleanliness; Waste and Nuisance. Tenant shall keep the Leased Premises at all times in a neat, clean and sanitary condition, shall neither cOl;nmit nor permit any waste or nuisance thereon. Tenant shall store all trash in the containers provided for that purpose. 38. Brokers. Each party represents to the other that it has had no dealings with any real estate broker or agent in connection with the negotiation of this Lease. 39. Waiver. No waiver by Landlord or Tenant of any provision of this Lease shall be effective unless in writing nor shall such waiver be deemed a waiver of any other provision hereof, nor of any subsequent breach by Tenant of the same or of any other provision. 40. Surrender of Premises. At the end of the lease period of possession of the Leased Premises by Tenant, as well as at the termination of this Lease, Tenant shall surrender the Leased Premises to Landlord in good condition and repair, excepting for reasonable wear and tear and acts of God. Tenant shall have the right at the end of the term hereof to, and upon demand by Landlord Tenant shall, remove any equipment, furniture, trade fixtures not affixed to the realty, and other personal property placed in the Leased Premises by Tenant and Tenant shall promptly repair any damage to the Leased Premises caused by such removal. 41. Governing Law. This Lease shall be construed and enforced in accordance with the laws of the State of Colorado. In the event of any litigation arising out of this Lease, jurisdiction and venue shall rest with any court of competent jurisdiction in Pitkin County. 42. Time of Essence. Time is of the essence with respect to the performance of every provision of this Lease in which the time of performance is a factor. 43. Severability. The terms, conditions, covenants, and provisions of this Lease shall be deemed to be severable. If any clause or provision herein contained shall be adjudged to be invalid or unenforceable by a court of competent jurisdiction or by operation of any applicable law, it shall not affect the validity of any other clause or provision herein, but such other clauses or provisions shall remain in full force and effect. 44. Notices. All notices required under the terms of this Lease shall be given in person or by mailing such notices by certified or registered mail, return receipt requested, to the address of the party as shown at the beginning of this Lease, or to such other address as rnay be designated in writing, which notice of change of address shall be given in the same manner. If not sooner received, any notice given by mail shall conclusively be deemed received three (3) days after the date of certification or registration. 45. Entire Lease. This Lease contains the entire contract between the parties and there are no other agreements, understandings, representations, or warranties except as expressly set Aspen Recreation Center Concession Facility Page 18 forth herein. No additions, changes or modifications, renewals or extensions hereof shall be binding unless reduced to writing and signed by the Landlord and Tenant. To the extent possible, this Lease shall be construed vis-a-vis the Landlord and Tenant without reference to the Master Lease. However, in the event the rights of Landlord and Tenant hereunder are directly affected by and in conflict with provisions of the Master Lease, such that to adhere to the terms of this Lease would result in a default by Landlord under the Master Lease, the Master Lease provision shall control. 46. References. In all references herein to any parties, persons, entities or corporations, the use of any particular gender or the plural or singular number is intended to include the appropriate gender or number as the text of the within Lease may require. 47. Tenant is an Independent Contractor. This Lease is not a contract of employment. No relationship of employer and employee, joint venture or partnership, exists between Landlord and Tenant or between the Landlord and any employee or agent of the Landlord. Tenant shall at all times be deemed to be an independent contractor. Tenant is not authorized to bind Landlord to any agreements or obligations. The term Landlord when used in this Lease shall mean and include the Executive Director of the Landlord and any other agent or employee of the Landlord designated by the Director with the responsibility of enforcing any of the terms of this Lease. 48. Binding Effect. All the terms, covenants, and conditions herein contained shall be for and shall inure to the benefit of and shall bind the respective parties hereto, and their heirs, executors, administrators, personal or legal representatives, successors and assigns respectively. 49. Guarantv. In the event Tenant hereunder is a corporation, this Lease and the performance of all the payments, obligations, conditions and covenants contained herein shall be personally guaranteed by the shareholders of Tenant by execution of a guaranty oflease in a form provided by Landlord. IN WITNESS WHEREOF, the parties hereto have executed this Lease as of the day and year above first written. TENANT: LANDLORD: Aspen Recreation Center Concession Facility Page 19 THE CITY OF ASPEN APPROVED AS TO FORM: APPROVED AS TO CONTENT: ddlfJ~ Jo . orcester, Esq., City Attorney S~!(~ City Manager List of Exhibits Annended to Lease Al!reeIDent A - Description of Leased Premises (including legal description of ARC property and sketch of leased premises) B - Inventory of Equipment and Fixtures to be Provided by Landlord. C - List ofhnprovements and Fixtures to be Made or Provided by Tenant. D - Calculation of Cost of Living Increases. E - Menu F - Signage Aspen Recreation Center Concession Facility Page 20 EXHIBIT D COST OF LIVING INCREASE CALCULATION a) "Price Index" shall mean the Consumer Price Index - All Urban Consumers (CPI-U) - U.S. City Average - All Items, or a successor or substitute index published or authorized by the United States Department of Labor, Bureau of Labor Statistics. b) The following formula shall be used for determining the adjustment, if any, in the fixed minimum annual rent: Current Index Number Base Index Number "Price Index" for the first month of next Lease Year "Price Index for first month of of preceding Lease Year c) As promptly as practicable after the commencement of the first adjustment year, and thereafter as promptly as practicable after the first day of each succeeding adjustment year, Landlord shall compute the increase, if any, in the cost of living for the year immediately preceding said adjustment year. Such computation shall pe made by use of current and base index numbers provided for each adjustment year as set forth in Paragraph c) above. d) In computing increases for each adjustment year the current index number shall be divided by the base index number. From the quotient thereof, there shall be subtracted the integer 1 and any resulting positive number shall be deemed to be the percentage of increase of cost ofliving. e) The percentage of increase in the cost ofliving shall be multiplied by the minimum annual rental including increases for the year preceding the adjustment year for which the increase is being computed. f) The Landlord shall, within a reasonable time after obtaining the appropriate data necessary for computing such increases, give the Tenant notice of any increase so determined, and the Landlord's computation thereof shall be conclusive and binding but shall not preclude any adjustment of the index figures upon which the computation was based and Tenant shall, within sixty (60) days after receiving such notice, notify Landlord of any claimed error therein; provided, however, nothing herein shall be construed to extend the time when rents, as determined by Landlord, are due and payable by Tenant. g) Minimum annual rent for each adjustment year, together with increases calculated in accordance with Paragraphs b) through f) of this Section Il, shall be due and payable to Landlord in equal monthly installments due on the first day of each calendar month of Aspen Recreation Center Concession Facility Page 21 each adjustment year (retroactive payments then due being payable within thirty (30) days after giving notice thereof by Landlord to Tenant). h) If publication of the pertinent Consumer Price Index shall be discontinued, the parties hereto shall thereafter accept comparable statistics on the cost ofliving for the average of all U.S. cities, all items, as the same shall be computed and published by an agency of the United States or by a responsible financial periodical of recognized authority then to be selected by the parties hereto. In the event of (1) use of comparable statistics in place of the Consumer Price Index as above mentioned, or (2) publication of the Index figures at other than bi-monthly intervals, there shall be made in the method of computation above provided revisions as the circumstances may require to carry out the intent ofthis Article. Aspen Recreation Center Concession Facility Page 22 GUARANTY OF LEASE FOR VALUE RECENED, and in consideration for, and as an inducement to the aforesaid Landlord to make the foregoing Lease with ZG Holdings LLC, as Tenant, the undersigned . unconditionally guarantees the full performance and observance of all the covenants, conditions, and agreements therein provided to be performed and observed by Tenant, and expressly agrees that the validity of this agreement and the obligations of the guarantors hereunder shall in no wise be terminated, affected or impaired by reason of the assertion by Landlord against Tenant of any of the rights or remedies reserved to Landlord pursuant to the provisions of the within Lease or by the relief of Tenant frorn any of Tenant's obligations under the Lease by operation of law or otherwise (including, but without limitation, the rejection of the Lease in connection with proceedings under the bankruptcy laws now or hereafter enacted); the undersigned hereby waiving all suretyship defenses. The undersigned further covenants and agrees that this guaranty shall remain and continue in full force and effect as to any renewal, modification, or extension of this Lease. The undersigned further agrees that his liability under this guaranty shall be primary, and that in any right of action which shall accrue to landlord under the Lease, landlord may, at Landlord's option, proceed against the undersigned and Tenant, jointly or severally, and may proceed against the undersigned without having commenced any action against or having obtained any judgment against Tenant. It is agreed that the failure of Landlord to insist in anyone or more instances upon a strict performance or observance of any of the terms, provisions or covenants of the foregoing Lease or to exercise any right therein contained shall not be construed or deemed to be a waiver or relinquishment for the future of such term, provision, covenant or right, but the same shall continue and remain in full force and effect. Receipt by Landlord ofrent with knowledge of the breach of any provision of the foregoing Lease shall not be deemed a waiver of such breach. Except as may be otherwise specifically provided in the Lease subletting, assignment, or other transfer of the within Lease, or any interest therein, shall not operate to extinguish or diminish the liability of the undersigned guarantors under this guaranty; and wherever reference is made to the liability of Tenant named in the within Lease, such reference shall be deemed likewise to refer to the undersigned guarantors. It is further agreed that all of the terms and provisions hereof shall inure to the benefit of the respective heirs, personal representatives, successors and assigns of Landlord, and shall be binding upon the heirs and assigns ofthe undersigned. Aspen Recreation Center Concession F acijity Page 23 IN WITNESS WHEREOF, the undersigned guarantor has caused this guaranty to be executed effective as of the day of ,2007. 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Landlord's Fixture, Equipment and Finishes List Sec 4- Exhibit B Demising walls (except for opening as shown on Ted Guy Assoc drawing dtd 6-14-02 Sheet I 200 amp electrica:Iservice panel live as shown on Ted Guy Assoc drawing dtd 6-14-02 Sheet 1 and circuits installed in accordance with the Utilities Rough In Plan and accompanying notes from the Katz Company dtd 7-24-02 2" wide corrugated metal roof constructed as shown on Ted Guy Assoc drawings dtd 6- I 4-02 Sheets I and 2 . 3 floor sinks as quoted in letter from Colorado Plumbing Service dtd 6-7-02.. Low profile grease interceptor as quoted in letter from Colorado Plumbing Service dtd 4-24-02 GWB drop ceiling laid out for 14 light fixtures and 4 ventilation grills ..JUN""'~""'::::l!:I\:::l~ ! Hl:::U0UKl::: K ljUY H::::i=>UC ~b;:::d I . , -. . . -" '- ---;~.,- .....t.<:----... ~-.._ '''0 .:'.:J_~.. .-. ..,,:. : r . 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CClCR.4.00 8~S21 C9:70) 927.,,'e7 ';;fr"I:1'::lZ(<.l31::5 P. 02 ? j. fxl; .~ \ \. \\ 'c:/) -. . ... .--.... '. I . ';-. -.. ~ -'~"" ~ -. ~. -J r- '-.' '. - ----.......~- -, ~ tlt N ~ _l "F .. ,..,,( . . I ~i~~ 8iit..:-rz--;-----. . I (4lL fZ .tJ . .---" f ' --\ \ '., \ '. '''. ". " ~< _/ ,0:". -r..... .--.... -..... ---------.- "'eT / =z, EXHIBIT "C" TENANT IMPROVEMENTS NO IMPROVEMENTS ARE BEING IDENTIFIED AT THIS TIME. ANY FUTURE IMPROVEMENTS MUST BE PASSED BY THE CITY OF ASPEN AND APPROVED PRIOR TO WORK COMMENCING. FUTURE IMPROVEMENTS WILL BE ADDRESSED AS AN ADDENDUM TO THIS CONTRACT. "h<\\\; \; U t " Bunz Menu Naked Juices and Smoothies ($3) Seattle Roast Coffee ($2) Novus Tea ($2) Made to order protein Shake with Powder, Soy or Rice milk, fresh fruit (banana or strawberry) ($4) Veggie Snacks: Carrot Sticks, Sugar Snap Peas, Ranch Dressing ($3) Soup of the Day ($4) Salads Caeser ($5) Caeser with Chicken ($9) Mixed Greens with choice of Ranch or Balsamic with Tomatoes and Cucumbers ($7) Pizza by the slice (made from Crust and reheated on premise) Plain ($3) Pepperonni ($4) Dessert offering: Cookie, Brownie, Candy ($1) EXHIBIT "F" SIGNAGE AT THIS TIME SIGNAGE HAS NOT BEEN IDENTIFIED AND AT SUCH TIME A RECOMMENDATION IS SUBMITTED, THE CITY OF ASPEN MUST APPROVE. ANY SIGNAGE ADDITIONS WILL BE HANDLED THROUGH AN ADDENDUM TO THIS CONTRACT.