City staff is presenting on Dec. 8 to the city council’s Enterprise Committee a lease amendment for Pate Cold Storage that will extend the lease through 2022 and take away the city’s right to cancel the agreement without a huge payment to the lessee.
The cost to terminate would be $4,150,000 before Dec. 31, 2013, $3,090,700 if between January 1, 2014 and December 31, 2018 and $2,100,400 if between January 1, 2019 and December 31, 2022.
The current lease only has $1 million buy-out clause. However, we don’t have to renew it at all when it expires on March 31, 2009 and there would be no penalty.