Microsoft has reached an agreement to move forward with a new campus pub -- reversing course after having second thoughts and surprising the bar owner with a lease termination last week. Under the compromise plan, the Spitfire pub will serve beer and wine in the afternoons and evenings, after 3 p.m., but it will be open during those hours only for scheduled gatherings and catered events.

"I feel great," said pub owner Jonathan Sposato. "This is really cool. Ultimately it worked out. I thought it was really great that both sides could come back and engage in a dialog and work something out, and be creative and listen to each other's concerns."

The next test is how Microsoft employees react to the news. The previous cancellation of the pub in the new Entertainment & Devices Division campus disappointed many of them, sparking grumblings on Facebook and elsewhere. Under the new arrangement, the employees will get a bar, but they won't be able to just drop in for a beer unless they're part of a reserved event.

However, Sposato said he still expects the venue to be busy every night, with multiple slots available for booking and plenty of Microsoft employees eager to use the new facility.

[Follow-up: Microsoft set to open swanky new Redmond shopping center.]

Spitfire will also be open for normal lunch hours. The pub won't be serving alcohol then, but that was already the plan. Sposato plans to rehire the 22 employees he was forced to lay off after Microsoft's previous decision. The pub is now aiming to open by the end of the month, Sposato said, adding that he expects the arrangement to work for him and his partners from a business perspective.

Microsoft spokesman Lou Gellos confirmed the news, saying the company was happy to be able to reach a compromise. The company said last week that it had second thoughts about having a bar in the middle of business setting, but the new afternoon and evening arrangement is in line with Microsoft's existing policies for catered employee and company events where alcohol is served.

Gellos called the arrangement "a hybrid" that combines elements of a traditional bar with something appropriate for a corporate environment.

"Being that we’re in the middle of a business campus, we had to be sensitive to the fact that we’re a business," Gellos said. He said Spitfire and Microsoft were able to come up with "a creative way to find that happy medium."

The switch to reserved events at Spitfire in the evenings gives the company a little more control over the situation, and ensures that there's a beginning and an end to the events held in the bar. 

Inside the Spitfire pub on the Microsoft campus.