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HomeMy WebLinkAboutR-98-0155J-97-139 1/21/98 RESOLUTION NO. A RESOLUTION, WITH ATTACHMENT(S), AUTHORIZING THE CITY MANAGER TO EXECUTE A LEASE AGREEMENT, IN SUBSTANTIALLY THE ATTACHED FORM, WITH ALAMILLA AND ASSOCIATES, INC., A FLORIDA FOR PROFIT CORPORATION, SUBJECT TO AN ASSIGNMENT TO FIREHOUSE IV OF MIAMI, INC., A FLORIDA FOR PROFIT CORPORATION, FOR THE LEASING, MANAGEMENT AND OPERATION OF A RESTAURANT ON CITY -OWNED PROPERTY, LOCATED AT 1000 SOUTH MIAMI AVENUE, MIAMI, FLORIDA, FOR A PERIOD OF FIFTEEN (15) YEARS WITH AN OPTION TO EXTEND FOR TWO (2) ADDITIONAL FIVE (5) YEAR PERIODS; REQUIRING SAID LESSEE TO MAKE A TOTAL INVESTMENT IN SAID PROPERTY OF NOT LESS THAN $367,285 AND TO PAY THE CITY OF MIAMI A MINIMUM LEASE PAYMENT TOTALING $1,356,576 FOR YEARS ONE THROUGH FIFTEEN, PLUS ELEVEN PERCENT (11%) OF GROSS REVENUES OVER AN ESTABLISHED BREAKPOINT; AND FURTHER, SUBJECT TO SUCH ADDITIONAL TERMS AND CONDITIONS AS MORE PARTICULARLY SET FORTH IN SAID LEASE AGREEMENT. WHEREAS, pursuant to Resolution No. 96-528, adopted July 11, 1996, the City Commission authorized the City Manager to issue a Request for Proposals for the purpose of soliciting proposals from qualified individuals, corporations, or other legal associations interested in leasing, managing and operating a restaurant, for a term of fifteen years, with two five year renewal options, at City - owned property located at 1000 South Miami Avenue, Miami, Florida (the "Property"); and ATTACHMENT (5) f5S (ONTAiNER My CO�SSIO� DOW= OF FEB 10 1998 R"oludm 140. 58— 155 WHEREAS, in accordance with Resolution No. 96-528, the Request for Proposals was issued on July 25, 1996 (the "RFP"); and WHEREAS, on October 10, 1996, the City Commission adopted Resolution No. 96-723, thereby appointing members to a Review Committee to evaluate proposals received in response to the Request for Proposals; and WHEREAS, pursuant to Resolution No. 97-148, adopted March 20, 1997, the City Commission authorized the City Manager to execute a lease agreement between the City and Firehouse Four, LLC., for the leasing, management and operation of the Property (the "Firehouse Four LLC Lease"); and WHEREAS, as a result of Firehouse Four LLC's failure to obtain the financial resources required to perform under the Firehouse Four Lease, as provided for as a condition subsequent, the parties canceled the Firehouse Four LLC Lease; and WHEREAS, subsequently on July 10, 1997, the City Commission, determined it to be in the best interest of the City to negotiate a lease agreement with Alamilla and Associates, Inc., the second ranked proposer; and WHEREAS, the City Commission on December 9, 1997 directed the City Manager to negotiate the final terms and conditions of a proposed lease agreement with Firehouse IV of Miami Inc., a Florida for profit corporation, and successor in interest to Alamilla and Associates Inc.; and - 2 - ��- 155 WHEREAS, the shareholders of Firehouse IV of Miami, Inc. are Amador Fernandez, Augusto Vidaurreta and Thomas Graham Richardson; and WHEREAS, the City Attorney has reviewed the conditions of the RFP and has determined that the City Commission is authorized to approve this transaction and the attached lease agreement; and WHEREAS, the City Manager has reviewed the financial and operational qualifications of Firehouse IV of Miami Inc., and has determined that the information and documentation provided evidences Firehouse IV of Miami's ability to perform under the Lease; WHEREAS, the City Commission hereby determines that it is in the best interest of the City to enter into the attached lease agreement and to approve the assignment of such lease to Firehouse IV of Miami Inc.; NOW, THEREFORE, BE IT RESOLVED BY THE COMMISSION OF THE CITY OF MIAMI, FLORIDA: Section 1. The recitals and findings contained in the Preamble to this Resolution are hereby adopted by reference thereto and incorporated herein as if fully set forth in this Section. Section 2. The City Manager, subject to the condition set forth in Section 3 below, is hereby authorizedl/ to execute a lease agreement, in a substantially the attached form, between the City of Miami and Alamilla and Associates Inc., a Florida For l� The herein authorization is further subject to compliance with all requirements that may be imposed by the City Attorney, including but not 9R_ 155 Profit Corporation, ("Alamilla") for the leasing, management and operation of a restaurant on City -owned property, located at 1000 South Miami Avenue, Miami, Florida, for a term of fifteen (15) years, with the option to extend for two (2) additional five (5) year periods, and requiring said lessee to make a total investment in said property of not less than $367,285 and to pay the City of Miami minimum annual lease payments totaling $1,356,576 for years one through fifteen, plus eleven percent (11%) of gross revenues over established breakpoints, as specifically set forth in the lease agreement, and subject to such additional terms and conditions as more particularly set forth in said lease agreement. Section 3. The authorization herein granted to the City Manager is subject to and conditioned upon the execution of a valid and legally binding agreement, in a form acceptable to the City Attorney, by and between Alamilla, and Firehouse IV of Miami Inc., ("Firehouse IV") under which all of Alamilla's right, title and interest under the lease shall be assigned to Firehouse IV and all of Alamilla's obligations under the lease shall be expressly assumed by Firehouse IV. Section 4. This Resolution shall become effective immediately upon its adoption. limited to those prescribed by applicable City Charter and Code provisions. 08- 155 PASSED AND ADOPTED this loth WALTER CITY C PREPARED AND APPROVED BY: JULIE OFE A BRU ASSISTANT CITY ATTORNEY APPROVED AS TO FORM AND CORRECTNESS: uv"'IA '6 "'/1 EL EDWARD MAX L INTERIM CITY ATrVbRNEY W1468/JOB/kd/csk day of February 1998. z? 7 e - X—NVIER L.JUAREZ, MAYOR SI-- 155 OF INCORP 9 5 y-'KRRAT UESSE AGREEMENT BETWEEN THE CITY OF MIAM19 FLORIDA ALAMILLA► AND ASSOCIATES, INC. DATED eR- 155 TABLE OF CONTENTS ARTICLE I DEFINITIONS Section 1.1 Definitions I ARTICLE H LEASE OF PREMISES Section 2.1 Lease of Premises 8 Section 2.2 Purpose of Use and Occupancy 8 Section 2.3 Suitability of Premises 9 Section 2.4 Limited Representations by Landlord 9 Section 2.5 Possession 10 Section 2.6 Existing Liens and Encumbrances 10 ARTICLE III TERM Section 3.1 Term of Lease 10 Section 3.2 Right to Renew 10 ARTICLE IV RENT Section 4.1 Graded Minimum Annual Rent and Annual Percentage Rent 1 I Section 4.2 Payment of Minimum Annual Rent 12 Section 4.3 Amount of Annual Percentage Rent 12 Section 4.4 Payment of Annual Percentage Rent Installments 13 Section 4.5 Security Deposit 14 Section 4.6 Rent Adjustment 15 Section 4.7 Tenant's Records 16 Section 4.8 Reports by Tenant 16 Section 4.9 Right to Examine Books 17 Section 4.10 Audit 17 Section 4. 11 Lien for Rent 19 ARTICLE V LEASEHOLD IMPROVEMENTS Section 5.1 Tenant's Obligation to Provide and Fund Leasehold Improvements 19 Section 5.2 Payment and Performance Bond 20 Section 5.3 Contractor's Insurance 21 Section 5.4 Additional Consideration 21 Section 5.5 Landlord's Premises to Remain Free of Liens 22 Section 5.6 Historic Preservation Requirements 22 Section 5.7 Landlord Approval 23 ARTICLE VI CONDUCT OF BUSINESS BY TENANT Section 6.1 Use of Premises 24 Section 6.2 Operation of Tenant's Business 24 Section 6.3 Signs 24 98- 155 ARTICLE VII MAINTENANCE, REPAIR AND ALTERATION OF PREMISES Section 7.1 Tenant's Maintenance Obligations 25 Section 7.2 Tenant's Repair Obligation 25 Section 7.3 Changes/Alterations 25 ARTICLE VHI INSURANCE AND INDEMNITY Section 8.1 Insurance on the Premises 26 Section 8.2 Other Insurance to be Carried 27 Section 8.3 Delivery of Insurance Policies 28 Section 8.4 Adjustment of Loss 29 Section 8.5 Insurer to be Approved - Premium Receipts 30 Section 8.6 Indemnification of Landlord 30 Section 8.7 Waiver of Subrogation 30 Section 8.8 Release of Landlord 30 ARTICLE IX SERVICES AND UTILITIES Section 9.1 Tenant to Provide and Pay for Utilities 32 Section 9.2 Landlord Not Liable for Failure of Utilities 32 ARTICLE X TRANSFERS AND SUBLETTING Section 10.1 Subleasing 33 Section 10.2 Definitions 35 Section 10.3 Transfers 36 Section 10.4 Notice of Transfer 37 Section 10.5 Information as to Shareholders, etc. 37 Section 10.6 Effectuation of Permitted Transfers 37 Section 10.7 Criteria for Consent for Transfer 38 Section 10.8 Liability of Tenant 39 Section 10.9 Payment Upon Transfer or Sale of Tenant Stock 39 Section 10.10 Acceptance of Rent from Transferee 40 Section 10.11 Transfers of the City's Interest 40 Section 10.12 Leasehold Mortgage 40 Section 10.13 No Waiver of Tenant's Obligations or Landlord's Rights 45 Section 10.14 Transfer to Firehouse IV of Miami, Inc. 45 ARTICLE XI COMPLIANCE WITH LAWS Section 11.1 Compliance with Laws 46 ARTICLE XH ENVIRONMENTAL LIABILITY Section 12.1 Definition of Terms 46 Section 12.2 Tenant's Environmental Covenant 48 Section 12.3 Representation by Landlord 48 Section 12.4 Landlord's Indemnification 48 Section 12.5 Tenant's Indemnification 49 Section 12.6 Asbestos 49 Section 12.7 Survival of Tenant's and Landlord's Obligations 49 ARTICLE XIII DAMAGE OR DESTRUCTION OF PREMISES Section 13.1 Definitions 49 Section 13.2 Tenant's Duty to Repair, Restore or Replace the Premises After Damage 50 Section 13.3 Performance of Restoration Work 51 Section 13.4 No Right to Terminate 51 Section 13.5 Tenant's Right to Terminate 52 Section 13.6 Payment for Construction of the Restoration Work 52 Section 13.7 Collection of Insurance Proceeds 52 Section 13.8 Unused Insurance Proceeds and Deposits 52 ARTICLE XIV EMINENT DOMAIN Section 14.1 Total Condemnation 53 Section 14.2 Partial Condemnation 54 Section 14.3 Adjustment of Rent Upon Partial Taking 55 Section 14.4 Deposit of Condemnation Award with Escrow Agent 55 Section 14.5 Rights of Leasehold Mortgagee 55 Section 14.6 Temporary Taking 56 ARTICLE XV PAYMENT OF TAXES, ASSESSMENTS AND OTHER IMPOSITIONS Section 15.1 Payment of Ad Valorem Taxes 57 Section 15.2 Payment of Impositions 57 Section 15.3 Proof of Payment 57 Section 15.4 Tenant's Right to Contest Impositions 58 ARTICLE XVI DEFAULT OF TENANT Section 16.1 Tenant Default 58 Section 16.2 Remedies of Landlord 59 Section 16.3 No Waiver by Landlord 61 Section 16.4 Late Payments 62 Section 16.5 Legal Expenses 62 Section 16.6 Remedies Cumulative 63 Section 16.7 Arbitration 63 ARTICLE XVII ACCESS BY LANDLORD Section 17.1 Right of Entry 66 ARTICLE XVIII DAMAGE TO TENANT'S PROPERTY Section 18.1 Loss and Damage 66 In cip-- 155 ARTICLE XIX HOLDING OVER, SUCCESSORS Section 19.1 Holding Over 67 Section 19.2 Successors 67 ARTICLE XX MINORITY AND WOMEN PARTICIPATION AND EQUAL EMPLOYMENT OPPORTUNITIES Section 20.1 Minority and Women Participation 68 Section 20.2 Equal Employment Opportunities 68 Section 20.3 Affirmative Action 69 ARTICLE XXI MISCELLANEOUS Section 2 1. 1 Accord and Satisfaction 69 Section 21.2 Entire Agreement 69 Section 21.3 Independent Parties 70 Section 21.4 Notices 70 Section 21.5 Captions and Section Numbers 71 Section 21.6 Partial Invalidity 71 Section 21.7 Estoppel Certificate 71 Section 21.8 Recording 72 Section 21.9 Waiver 72 Section 2 1. 10 Time is of the Essence 73 Section 21.11 No Discrimination 73 Section 21.12 Governing Law 73 Section 21.13 Waiver of Counterclaims 73 Section 21.14 Waiver of Jury Trial 73 Section 21.15 Quiet Enjoyment 74 Section 21.16 Surrender of Possession 74 Section 21.17 Attorney's Fees 74 Section 21.18 Joint and Several Liability 74 Section 21.19 Third Party Beneficiary 75 Section 21.20 Radon 75 Section 21.21 No Liability for Act of Other Party 75 Section 21.22 Consents and Approvals 75 Section 21.23 Rights, Privileges and Immunities; Covenants 76 Section 21.24 Approval by the Oversight Board 76 iv 08- 155 LEASE AGREEMENT This Lease (the "Lease" or "Lease Agreement") is made as of the day of 1997, by the CITY OF MIAMI, ("Landlord"), and ALAMILLA AND ASSOCIATES, INC. ("Tenant"). THE PARTIES AGREE AS FOLLOWS: ARTICLE I DEFINITIONS Section 1.1 Definitions. Any word contained in the text of this Lease shall be read as the singular or the plural and as the masculine, feminine or neuter gender as may be applicable in the particular context. More specifically, however, for the purposes of this Lease the following words shall have the meanings attributed to them in this Section: (a) "Acceptable Operator" means an entity possessing a minimum of seven (7) years of direct restaurant experience during the last ten (10) years or five (5) years of experience directly involved in the ownership and day to day operation of a restaurant during the last ten (10) years, and in connection therewith, such entity shall have a good reputation in the business community; and such entity shall possess adequate financial resources and personnel necessary for the proper performance of all of Tenant's obligations under this Lease in a manner consonant with the quality, reputation and economic viability of the Tenant's business at the Premises, including (without limitation) the obligation of payment of Rent payable by Tenant under this Lease. (b) "Additional Rent" means the Minimum Annual Rent, Annual Percentage Rent and all additional sums, charges, or amounts of whatever nature to be paid by Tenant in accordance with the provisions of this Lease, whether or not such sums, charges or amounts are referred to as additional rent. (c) "Applicable Law" means all laws, Florida Statutes, codes, City and Miami - Dade County ordinances, orders, judgments, decrees and injunctions from courts having 1 9R_ 155 jurisdiction over the Premises, rules, and requirements of State and local boards and agencies with jurisdiction over the Premises, now existing or hereafter enacted, adopted, foreseen and unforeseen, ordinary and extraordinary, which may be applicable to the Premises or any part of it. (d) "Business Days" means Monday through Friday excluding legal holidays. (e) "Consumer Price Index" means the monthly indices for the applicable month published by the bureau of Labor Statistics of the United States Department of Labor as "The Consumer Price Index for All Items, All Urban Consumers, Miami -Ft. Lauderdale, (Base Year 1982-84=100". In the event the CPI ceases to use 1982-84=100 as the basis of calculation, or if, in Landlord's reasonable judgment, a substantial change is made in the method used by the federal government to determine the CPI or the items used to calculate the CPI, then the CPI shall be converted (the "Conversion") to the figure that would have been calculated at (or as close to such figure as shall be practical) had the manner in calculating the CPI in effect on the Lease Date not been altered. For purposes of this definition, it shall not be deemed a substantial change in the manner which the CPI Index is calculated if the federal government adjusts the method in which the CPI Index is determined in an attempt to more accurately reflect changes in the cost -of -living. If, in Landlord's reasonable judgment, the Conversion is impossible or impractical, then the revised CPI shall be deemed to reflect the original CPI for purposes of this definition. (f) "Date of Taking" means the earlier of (i) the date on which actual possession of all or less than all of the Premises, as the case may be, is acquired by any lawful power or authority pursuant to the provisions of Applicable Law or (ii) the date on which title to all or less than all of the Premises, as the case may be, has vested in any lawful power or authority pursuant to the provisions of Applicable Law. (g) "Fair Market Value of the Leasehold Estate" means the value that a similar property being used as set forth herein, with such additional uses as may be located on the Premises as may be permitted by the Lease, would bring in a competitive and open market, the buyer and seller each acting prudently, knowledgeably, and assuming the sales price is not affected by undue stimulus. Implicit in this definition is consummation of a sale of a specified date under conditions whereby: 2 98- 155 (i) Buyer and seller are typically motivated; (ii) Both parties are well-informed or well-advised and acting in what they consider their own best interest; (iii) A reasonable time is allowed for exposure in the open market; (iv) Payment is made in terms of cash in U. S. dollars in terms of financial arrangements comparable thereto; and (v) The price represents the normal consideration for property being sold under then current market conditions unaffected by special or creative financing or concessions granted by anyone associated with sale. (h) "Force Majeure" means any period of delay which arises from or through Acts of God; strikes, lockouts, or labor difficulty; explosion, sabotage, accident, riot, or civil commotion; act of war; fire or other casualty; legal requirements; delays caused by the other party; and causes beyond the reasonable control of a party. (i) "Gross Sales" means the entire amount, actually collected by Tenant and Subtenants, of the sales price, whether for cash, credit, credit cards or otherwise, of all sales of food, liquor, merchandise or services, advertising and sponsorships, delivery charges and all other receipts whatsoever of all retail and wholesale business conducted in or from the Premises by Tenant and Subtenants, including, without limitation, mail, catalogue, internet or telephone orders received or filled at the Premises, or procured from the Premises by house -to -house or other canvassing, and all deposits not refunded to purchasers, and orders taken, although said orders may be filled elsewhere, including proceeds of all video games, vending machines and other items in or on the Premises. Gross Sales shall further include any and all amounts received by Tenant from a valet parking concession. If a sale is by credit card no deduction shall be allowed for any commission associated with such sale. A "sale" shall be deemed to have been consummated for the purpose of this Lease, and the entire amount of sales price collected by Tenant and Subtenants, shall be included in Gross Sales, at such time that (i) the transaction is initially reflected in the books or records of Tenant or Subtenant(s), or (ii) Tenant or Subtenant(s) receives all or any portion of the sales price, or (iii) the applicable goods or services are delivered to the customer and payment is 3 made to Tenant or Subtenants, whichever first occurs, irrespective of whether payment is made in installments, the sale is for cash or for credit, or otherwise, or all or any portion of the sale price has actually been paid at the time of inclusion in Gross Sales or at any other time. No deduction shall be allowed for direct or indirect discounts, rebates, or other reductions on sales, unless generally offered to employees or the public on a uniform basis. The term "Gross Sales" shall not include: (i) direct or indirect discounts or other reductions on sales to employees; (ii) any sums collected and paid out by Tenant for any sales or excise tax imposed by and accounted for by Tenant and/or Subtenants to any duly constituted governmental authority; (iii) the exchange of merchandise between the stores of Tenant, a party controlled by Tenant, or Subtenants, if any, where such exchange of goods or merchandise is made solely for the convenient operation of the business of Tenant and not for the purpose of consummating a sale which has theretofore been made in or from the Premises and/or for the purpose of depriving Landlord of the benefit of a sale which otherwise would be made in or from the Premises; (iv) the amount of returns to shippers or manufacturers; (v) proceeds from the sale of trade fixtures, operating equipment or similar assets after use thereof in the conduct of Tenant's and Subtenants' business on the Premises; (vi) the sales price, if Tenant sells part or all of the entire business; (vii) all sums and credits received in settlement of claims for loss or damage to merchandise; (viii) funds collected with regard to the Premises which are not actually related to the day-to-day business of the Premises such as but not limited to the financing of the Tenant's interest in the Premises; (ix) sale or assignment of Leasehold Estate; (x) collection of insurance proceeds; (xi) collection of eminent domain proceeds; 4 SR-- 155 (xii) monies collected for events that are done for charities wherein the total amounts collected are paid to the charitable sponsor or not -for -profit organizations; (xiii) all gratuities paid to employees; (xiv) amounts received by Tenant as reimbursements of expenses and cost sharing (for example, reimbursement of taxes, insurance or utility bills); (xv) any grants, subsidies, rebates, credits or similar benefits received by Tenant or Subtenant from any federal, state, regional or local body, agency, authority, department or organization; (xvi) interest earned on Tenant's deposit accounts, earnings or profits on Tenant's investments; (xvii) interest income from loans or credit facilities granted by Tenant and similar passive or investment income of Tenant related to Tenant's liquid assets, investments or loans/credit facilities granted by Tenant. (xviii) rents paid to Tenant by any Subtenants where the City is collecting rent based on a percentage of Subtenant's Gross Sales as provided in Section 10.1. (xix) amounts received by a valet parking concessionaire when Tenant is remitting the respective percentage due to Landlord as provided above. Gross Sales shall be reduced by the amount of any refund made upon any sale in or from the Premises, provided said amounts had been previously included in "Gross Sales," not to exceed the sum so previously included, where the merchandise sold is thereafter returned by the purchaser and accepted by the Tenant or Subtenants, and if such refund is in the form of a credit to customer, such credit shall be included in Gross Sales when used. 0) "Impositions" means all governmental assessments, including assessments imposed by the City, franchise fees, fire fees, excises, license and permit fees, levies, charges and taxes, including ad valorem real estate taxes on the Premises and the Leasehold Improvements, general and special, ordinary and extraordinary properly levied against the Premises and the Leasehold Improvements and/or the Tenant's Leasehold Estate which constitute a lien on the Premises or the Leasehold Improvements. R (k) "Lease Date" means the date this Lease Agreement is fully executed and legally binding upon the Parties, only after approval by the City of Miami Commission and the Emergency Financial Oversight Board. (1) "Leasehold Estate" means all of Tenant's right, title and interest as Tenant in, to and under this Lease, the Premises and the Leasehold Improvements. (m) "Leasehold Improvements" means a description of remodeling work to be done to the physical plant as described in Exhibit `B" entitled "Schedule of Leasehold Improvements" and all furnishings, fixtures, or equipment to be installed in accordance with Section 5.1, and all other items and improvements installed or constructed thereafter, from time to time during the Lease Term that are hereafter located upon the Premises. (n) "Leasehold Mortgage" means a mortgage, deed of trust, or other instrument which constitutes, or any security interest given in connection therewith, which together constitute an encumbrance or lien upon the Tenant's Leasehold Estate or any part of it, or any related personal property, and Tenant's interest in the Leasehold Improvements as security for any loan. (o) "Leasehold Mortgagee" means any holder of the Leasehold Mortgage or note or notes secured by it, or any person to whom title to the Tenant's Leasehold Estate has been transferred pursuant to foreclosure proceedings or any action in lieu of foreclosure. (p) "Lease Term" means the period of time fixed in Section 3.1 and shall be deemed to include the additional period of time fixed in Section 3.2 if Tenant exercises Tenant's right to renew the Lease. (q) "Lease Year" means 12 consecutive months. The first Lease Year shall begin on the Lease Date. Each succeeding Lease Year shall commence upon the anniversary date of the first Lease Year. (r) "Minimum Annual Rent Monthly Payment Commencement Date" means the first day of the 7th month of the Lease Term. (s) "Net Condemnation Award" means the actual amount of the award paid in connection with or arising from the acquisition or other taking of all or less than all of the Premises, as the case may be, less all reasonable out-of-pocket expenses incurred by Landlord, 3 R- 155 Tenant or any Leasehold Mortgagee in connection with obtaining such award, including, without limitation, all reasonable attorneys' fees and disbursements incurred in connection therewith. (t) "Net Insurance Proceeds" means the actual amount of insurance proceeds paid following an insured casualty to the Leasehold Improvements less all costs and expenses including reasonable attorneys' fees incurred by the Tenant and/or Landlord with respect to the collection thereof. (u) "Parties" means the Landlord and Tenant. (v) "Proposal" means the document received by the Landlord from Alamilla and Associates, Inc. dated October 24, 1996, in response to the RFP, as such term is hereinafter defined in Subsection (y). (w) "Rent" means Minimum Annual Rent and Annual Percentage Rent, as such amounts are described and fixed in Section 4.1. (x) "Restaurant Operations" means all services associated with the preparation, service and sale of food and beverages including alcoholic beverages, entertainment (excluding adult entertainment), private banquets, catering, parties, cigar smoking, art shows, happy hour and such other activities ancillary to the sale of food and beverage including sales of merchandise related to the business conducted on the Premises. (y) "RFP" means the document entitled Request for Proposals For The Leasing Of City Owned Property For Restaurant Use Located At 1000 South Miami Avenue, Miami Florida, issued by the City of Miami on July 25, 1996, a copy of which is available at the City Clerks Office. (z) "Sublease" means any lease (excluding this Lease), sublease, license, concession or other agreement by which Tenant or any person or other entity claiming under Tenant (including, without limitation, an assignee, a subtenant or sublicensee) demises, leases, subleases, licenses or sublicenses to or permits the use or occupancy by another person or entity of any part of the Premises and Leasehold Improvements. (aa) "Subtenants" means any person, firm, corporation or other legal entity using or occupying or entitled to use or occupy any part of the Premises or the Leasehold Improvements under a Sublease. 7 98- 155 (bb) "Tenant" has the meaning ascribed to it in the opening paragraph of this Lease Agreement as well as Tenant's successors and/or assigns. (cc) "Transferor" means the Owner who is transferring in accordance with Article X herein. ARTICLE II LEASE OF PREMISES Section 2.1 Lease of Premises. The Landlord, for and in consideration of the foregoing premises and of the covenants and agreements hereinafter contained to be performed and observed by the Parties, and in consideration of ten dollars and other good and valuable consideration paid by Tenant to Landlord, the receipt and adequacy of which are hereby acknowledged, does hereby lease, let and demise to the Tenant, and the Tenant hereby leases from the Landlord the land, building and improvements located at 1000 South Miami Avenue, Miami, Florida, (the "Premises"), subject to the following terms and conditions, to have and to hold the said lands, tenements and hereditaments, with all of the rights, privileges and appurtenances, thereunto belonging or pertaining unto Tenant for the term herein specified, unless this Lease shall be sooner terminated in a manner hereinafter provided. The Premises are legally described as follows: Miami (A.L. Knowlton) South, Block 74, North 100 feet of Lots 2 and 3. Folio No. 01-0207-040-1010 Section 2.2 Purpose of Use and Occupancy. The Tenant will use and occupy the Premises for Restaurant Operations and for no other purposes or uses of any kind. Section 2.3 Suitability of Premises. Tenant acknowledges that neither the Landlord nor any of Landlord's officers, representatives, or employees has made any representation or warranty with respect to the Premises or with respect to the suitability or fitness of the Premises for the conduct of Tenant's Restaurant Operations or for any other purpose, except as set forth in this Lease or in the RFP. The execution of this Lease by Tenant shall establish that the Tenant accepts the condition of the g Q9- 155 Premises "AS IS", subject to the representations set forth in Section 2.4 herein, the RFP or elsewhere in this Lease. Section 2.4 Limited Representations by Landlord. Landlord makes the following representations, covenants and warranties which shall survive the execution of this Lease and the taking of possession of the Premises by the Tenant: (a) That Landlord has taken all requisite actions to make this Lease binding upon the Landlord, and the Landlord is indefeasibly seized of marketable, fee simple title to the Premises, and is the sole owner of and has good right, title and authority to convey and transfer all property, rights and benefits which are the subject matter of this Lease, free and clear of all liens and encumbrances but subject to the terms of that certain Deed of Easement recorded in Official Records Book 14606, Page 4093. (b) That no party except Tenant shall, on the Lease Date, be in or have any right to possession of the Premises. (c) That there is on the Lease Date legal and physical ingress and egress to the Premises from a paved public street for vehicular traffic and perpetual legal and physical ingress and egress for pedestrian traffic. (d) The Premises may be used and operated for the purpose set forth and as contemplated by the RFP and this Lease; and there are no Applicable Laws, private restrictions or other conditions which restrict or prevent the Premises from being used and operated for Restaurant Operations on the Lease Date. Nothing herein shall be construed to imply that Landlord herein warrants or represents that Tenant can obtain a liquor license. (e) That as of the Lease Date, there are no ad valorem real or personal property taxes or assessments due and owing for the Premises for the year 1997 and all prior years; (f) All of the representations and warranties of Landlord contained in this Lease Agreement shall continue to be true as of the Lease Date and said representations and warranties shall be deemed to be restated and affirmed by Landlord as of the Lease Date without the necessity of Landlord's execution of any document with regard thereto, and the Landlord's 9 Vis- 155 liability (except with respect to the environmental condition of the Premises which is expressly addressed in Article XII of this Lease) therefor shall survive the signing of this Lease Agreement. Should any of the representations and warranties prove to be incorrect, it shall be Landlord's obligation to cure those warranties and representations which are set forth herein forthwith at Landlord's expense. Section 2.5 Possession. On the Lease Date, the Landlord shall deliver possession of the Premises to Tenant, free and clear of all leases, claims of possession, licenses and parties in possession. Section 2.6 Existing Liens and Encumbrances. Landlord shall satisfy or cancel of record all existing liens and encumbrances affecting the Premises as of the Lease Date except as otherwise set forth in this Lease. ARTICLE III TERM Section 3.1 Term of Lease. The initial term of this Lease is for a period of fifteen (15) years, commencing on the Lease Date. The term of this Lease shall be extended to include any fraction of a calendar month between the Lease Date and the first day of the first full calendar month thereof. Section 3.2 Right to Renew. The Tenant has the option of extending this Lease for two (2) five (5) year periods, as long as the Tenant is not in default of any of the Lease provisions (the "First Renewal Term" and the "Second Renewal Term"). To exercise the First Renewal Term, the Tenant must give Landlord written notice not less than one hundred and eighty (180) days before the expiration date of the Lease Term, and to exercise the Second Renewal Term, the Tenant must give Landlord written notice not less than one hundred and eighty (180) days before the expiration date of the First Renewal Term. The First Renewal Term and the Second Renewal Term will be on the same terms and conditions as the Lease Term, except that the Rent will be adjusted as set forth in Section 4.6 below. ARTICLE IV 10 C9- 155 RENT Section 4.1 Graded Minimum Annual Rent and Annual Percentage Rent. Subject to the provisions pertaining to the prepayment of Minimum Annual Rent as set forth in Section 4.2 below and the adjustment, as set forth in Section 4.6 below, in the event that Tenant exercises its right to renew, the Tenant agrees to pay to the Landlord the following Rent for the Premises: TABLE NO. 1 LEASE YEAR column 1 MIMINUM ANNUAL RENT column 2 ANNUAL PERCENTAGE RENT column 3 BREAKPOINT column 4 1 $ 57,375 plus 11% over $2,200,000 2 $ 76,500 plus 11% over $2,200,000 3 $ 76,500 plus 11% over $2,200,000 4 $ 83,385 plus 11% over $2,400,000 5 $ 83,385 plus 11% over $2,400,000 6 $ 835385 plus 11% over $2,400,000 7 $ 90,890 plus 11% over $2,600,000 8 $ 90,890 plus 11% over $2,600,000 9 $ 90,890 plus 11% over $2,600,000 10 $ 99,896 plus 11% over $2,850,000 11 $ 99,896 plus 11% over $2,850,000 12 $ 99,896 plus 11% over $2,850,000 13 $107,896 plus 11% over $3,100,000 14 $107,896 plus 11% over $3,100,000 15 $107,896 plus 11% over $3,100,000 * After adjustment in accordance with Section 4.2 below. Section 4.2 Payment of Minimum Annual Rent. Landlord hereby acknowledges that in accordance with the provisions of the RFP, the amount of the Minimum Annual Rent for the first six (6) months of the Lease Term, thirty- eight thousand two hundred and fifty dollars ($38,250) shall be discounted by a fifty percent (50%) reduction for the sole purpose of providing assistance to the Tenant for the initial marketing plan and grand opening. Accordingly, simultaneously with the execution of this Lease on the Lease Date, Tenant shall pay to Landlord the sum of nineteen thousand one hundred and twenty-five dollars ($19,125), in the form of cash or its equivalent, which sum represents 11 8_ 155 prepayment of the Minimum Annual Rent for the first six (6) months of the Lease Term (the "Prepaid Rent"). The Tenant acknowledges and understands that the Prepaid Rent is non- refundable. Commencing on the Minimum Annual Rent Monthly Payment Commencement Date, the Minimum Annual Rent shall be payable by Tenant, during the Lease Term, in equal monthly installments for each Lease Year, together with all applicable sales taxes thereon, on the first day of each month, in advance, at Landlord's Address as provided in Section 21.4 of Article 21 of this Lease, or at such other place designated by Landlord, without any prior demand therefore and without any deduction, holdback, setoff or defense whatsoever. Section 4.3 Amount of Annual Percentage Rent. In addition to the payment of the Minimum Annual Rent as provided for in Section 4.1, Table No. 1, of this Article, Tenant shall pay to Landlord for each Lease Year of the Lease Term, as Annual Percentage Rent, an amount equal to eleven percent (11 %) multiplied by the amount of Gross Sales during such Lease Year in excess of the Breakpoint for such Lease Year as specifically set forth in Section 4.1, Table No. 1, column four (4). Example: for Lease Year No. 1 0.11 x (Gross Sales (of Year No.1 - Breakpoint ) for Year No. 1) 12 sk- 155 Example: Assume Gross Sales = $2,500,000 0.11 x ($2,500,000 - $2,200,000) = 0.11 (300,000) = $33,000 (Lease Year 1) Section 4.4 Payment of Annual Percentage Rent Installments. Commencing on the first Lease Year, and every Lease Year thereafter during the Lease Term, the Tenant shall pay the Annual Percentage Rent in semi-annual installments on or before the thirtieth (30'') day following the close of each six (6) month period. For the first fractional calendar month of the Lease Year, if any, the Gross Sales, if any, will be added to the Gross Sales of the first full calendar month of the first Lease Year. The semi-annual payments of Annual Percentage Rent shall be calculated by multiplying eleven percent (11 %) by the amount of Gross Sales collected by Tenant during the preceding six (6) month period of the Lease Term in excess of 50% of the dollar amount of the corresponding year Breakpoint as specifically set forth in Section 4.1, Table No. 1, column four (4). Example: Semi-annual Percentage Rent Installment for Lease Year No. 1 0.11 x (Semi-annual Gross Sales - Breakpoint Year No. 1) ( for Lease Year No. 1 2 ) The Tenant must deliver the semi -annual —statement for Gross Sales with each semi-annual installment of Annual Percentage Rent, together with all applicable sales taxes thereon to the Landlord's Address as provided in Section 21.4 of Article 21 of this Lease, or at such other place designated by Landlord, without any prior demand therefore and without any deduction, holdback, setoff or defense whatsoever. In the event that the total of the two installments of Annual Percentage Rent paid by the Tenant for any Lease Year shall not equal the Annual Percentage Rent computed on the total amount of Gross Sales for each Lease Year, the Tenant, at the time it submits the annual statement for Gross Sales required under this Section, shall pay Landlord any deficiency, or the Tenant will receive a credit equivalent to the excess on the next installment(s) of Rent due, as the case may be. 13 Section 4.5 Security Deposit. Simultaneously with the execution of this Lease on the Lease Date Tenant shall deposit with the Landlord, the sum of thirty eight thousand two hundred fifty dollars ($38,250) (Security Deposit") in the form of cash or its equivalent which funds may be commingled by Landlord with its other funds. No interest shall be paid on the Security Deposit. For so long as the Security Deposit has not been repaid by Landlord, it shall constitute an account payable by Landlord to Tenant within thirty (30) days following termination of this Lease to the extent, if any, that the Security Deposit has not been applied by Landlord as hereunder provided. If Tenant shall default with respect to any covenant duty, or obligation of Tenant under this Lease, then the Security Deposit or any part thereof may be applied by Landlord (but Landlord shall not be obligated to do so) to the damages sustained by Landlord by reason of any such default or to indebtedness owing by reason of any failure of Tenant to make any required monetary payment under this Lease. No such application shall be construed as an agreement to limit the amount of Landlord's claim or as a waiver of any damage or release of any indebtedness, and any claims of Landlord under this Lease not recovered in full from the Security Deposit shall remain in full force and effect. At any time or times when Landlord has made any such application of all or any part of the Security Deposit, Landlord shall have the right (but not the obligation) at any time thereafter to request in writing that Tenant pay to Landlord a sum or sums equal to the amounts so applied by Landlord so that Landlord will always be in possession of a sum equal to the amount of the Security Deposit stated above. Tenant shall make each such requested remittance within ten (10) days following such request from Landlord and each such remittance received by Landlord shall thereupon constitute a part of the Security Deposit subject to the terms and provisions thereof. Failure to make any such requested remittance within such ten (10) day period may be treated by Landlord as a failure by Tenant to make timely payment of rent and as an Event of Default. In the event of any conveyance or other transfer of the Premises by the Landlord, Landlord's remittance of the Security Deposit or any remaining portion thereof to the purchaser of the Premises shall release and relieve Landlord of any further obligation or liability to Tenant with respect to the Security Deposit. 14 Section 4.6 Rent Adjustment. Prior to the date of the commencement of the First Renewal Term, and if the Tenant elects to exercise the Second Renewal Term, then also prior to the commencement of the Second Renewal Term, the Rent to be payable by Tenant to Landlord shall be determined by the following process: (a) Appraisals shall be made by two (2) independent business appraisers, each having not less than ten (10) years experience in appraising Restaurant Operations. One to be appointed by the Tenant and one to be appointed by the Landlord. (b) After appointment, the two appraisers, shall proceed promptly to prepare an appraisal of the Premises. The appraisers shall use the income approach to determine the fair rental value. The Rent determined by the higher result of the two appraisals shall be binding and conclusive on the Landlord and the Tenant, provided however, that if the results of the two (2) appraisals have a difference of more than (5%) five percent, then a third appraiser shall be appointed by the first two appraisers so appointed to review the two appraisals and the findings of the third appraiser so appointed shall be binding and conclusive on the Parties. (c) Each party shall be responsible for payment of the fees associated with the appraiser appointed by it. In the event a third appraiser is required, the fee shall be paid 50/50 by the Parties. (d) If prior to the commencement of the First Renewal Term, the adjusted Rent has not been determined by the independent appraisals, the Tenant shall continue to pay Rent at the rate in effect for the last year of the Lease Term. When the Rent has been determined, the Rent will be adjusted as provided retroactively to the commencement of the First Renewal Term and the Tenant shall pay to the Landlord with the next installment of Rent due the amount, if any, by which the Rent, as adjusted, exceeds the Rent that has been paid by the Tenant for the retroactive period. (e) If prior to the commencement of the Second Renewal Term, the adjusted Rent has not been determined for any reason, the Tenant shall continue to pay Rent at the rate in effect for the First Renewal Term. When the Rent has been determined, the Rent will be adjusted as provided retroactively to the commencement of the Second Renewal, and the Tenant shall pay 15 OR- 155 to the Landlord with the next installment of Rent due the amount, if any, by which the Rent, as adjusted, exceeds the Rent that has been paid by the Tenant for the retroactive period. Section 4.7 Tenant's Records. Tenant shall prepare and keep full, complete and proper books and source documents in accordance with generally accepted accounting principles, of the Gross Sales, whether for cash, credit or otherwise, of each separate department at any time operated in the Premises. The books and source documents to be kept by Tenant shall include, without limitation, true copies of all federal, state and local tax returns and reports, records of inventories and receipts of merchandise, daily receipts from all sales and other pertinent original sales records and records of any other transactions conducted in or from the Premises by Tenant. Pertinent original sales records shall include, without limitation: (i) sales reports off back office systems fed from point of sale terminals, (ii) cash register tapes, including tapes from temporary registers, if any, (iii) serially pre -numbered sales slips, (iv) the original records of all mail, internet and telephone orders at and to the Premises, if any, (v) settlement report sheets of transactions with any person conducting business in the Premise, if any, (vi) original records indicating that merchandise returned by customers was purchased at the Premises by such customers, (vii) memorandum receipts or other records of merchandise taken out on approval, (viii) detailed original records of any exclusions or deductions from Gross Sales, (ix) sales tax records, and (x) such other sales records, if any, which would normally be examined by an independent accountant pursuant to accepted auditing standards in performing an audit of Tenant's sales. Tenant shall record at the time of each sale or other transaction, in the presence of the customer, all receipts from, such sale or other transaction, whether for cash, credit or otherwise, in a cash register or cash registers having a cumulative total which shall be sealed in a manner approved by Landlord and which shall possess such other features as shall be required by Landlord. Tenant shall be required to install point of sale terminals, pollable, point of sales cash register systems or such other point of sale equipment of a make and model mutually agreed to by the Parties. Section 4.8 Reports by Tenant. Tenant shall furnish to Landlord within thirty (30) days after the expiration of each semi-annual period of each Lease Year a complete statement (the "Semi -Annual Report"), certified by Tenant's Chief Financial Officer or other appropriate officer of Tenant, of the amount 16 S8_ 155 of Gross Sales, as defined in Section 1.1(d) of Article 1. hereof, made in, on or from the Premises during said period. Failure of Tenant to timely submit any Semi -Annual Report as aforesaid shall entitle Landlord to estimate Gross Sales based upon available data (with a reconciliation upon receipt of the Annual Report), and Tenant shall be obligated to pay Annual Percentage Rent, as set forth in Section 4.3, on such estimated Gross Sales. Within ninety (90) days after the end of each Lease Year, Tenant shall also furnish to Landlord a financial report by an independent certified public accountant (the "Annual Report"), showing in all reasonable detail of the amount of such Gross Sales made by Tenant from the Premises during the preceding Lease Year. Tenant shall in all events furnish to Landlord within fifteen (15) days after the end of each month of the Lease Term a written statement of Gross Sales covering the preceding month, the statement to be in such form and style and contain such details and breakdown as Landlord may reasonably require. Any intentional misstatement of Gross Sales will constitute a default under this Lease. Section 4.9 Right to Examine Books. Notwithstanding the acceptance by Landlord of payments of Minimum Annual Rent and Annual Percentage Rent, Landlord shall have the right to all rents and other charges actually due hereunder, and the right to examine, make extracts from and copy, at the Premises or Tenant's main accounting office, Tenant's books, source documents, accounts, records and sales tax reports filed with applicable government agencies by Tenant in order to verify the amount of Gross Sales in and from the Premises. For a period of two (2) years after the expiration of each Lease Year, Tenant shall make all such documents and records available at the Premises or Tenant's main accounting office upon ten (10) days prior written notice from Landlord. Section 4.10 Audit. (a) At its option, Landlord may at any time, upon ten (10) days, prior written notice to Tenant, arrange for an auditor selected by Landlord to conduct a complete audit (including a physical inventory) of the entire records and operations of Tenant and Subtenants included in Gross Sales from the Premises during the period covered by any statement issued by Tenant. Tenant shall make available to the Landlord's auditor at the Premises or Tenant's main accounting office on the day set forth in Landlord's notice, requiring such audit, all of the books, source documents, accounts and records referred to in Section 4.9 hereof and any other materials 17 S,4- 155 which such auditor deems necessary or desirable for the purpose of making such audit. Tenant shall promptly pay to Landlord the amount of any deficiency in Annual Percentage Rent payments disclosed by any such audit. If such audit shall disclose that Tenant's statement of Gross Sales is at variance to the extent of five percent (5%) or more, Landlord may bill to Tenant the cost of such audit, which shall be paid by Tenant within thirty (30) days after Tenant's receipt of Landlord's invoice. If such audit shall disclose that Tenant's statement of Gross Sales is at variance to the extent of ten percent (10%) or more, then Landlord, in addition to the foregoing remedy and other remedies available to Landlord, shall have the option, upon Tenant's failure to pay such additional sums within thirty (30) days after written notice to the Tenant, to declare this Lease terminated and the Lease Term ended, in which event this Lease shall cease and terminate on the date specified in such notice with the same force and effect as though the date set forth in such notice were the date originally set forth herein and fixed for the expiration of the Lease Term, and Tenant shall vacate and surrender the Premises but shall remain liable for all obligations arising during the balance of the original stated term as provided in this Lease. If such audit shall disclose an overpayment, Landlord shall credit such overpayment towards the next payment of Rent due. In addition to the foregoing, and in addition to all other remedies available to Landlord, in the event Tenant's auditor and Landlord's auditor shall schedule a date for an audit of Tenant's records in accordance with this Section 4.10, and Tenant shall fail to be available or shall otherwise fail to comply with the requirements for such audit, Tenant shall pay all costs and expenses associated with the canceled audit. (b) In addition to all other remedies available to Landlord, in the event that any such audit shall disclose that Tenant's records and other documents as referred to in Section 4.7, 4.8, 4.9 and 4.10 hereof and such other materials provided by Tenant to Landlord's auditor are inadequate, in the opinion of an independent CPA serving as Landlord's auditor, to disclose accurately Tenant's Gross Sales, then Landlord shall be entitled to collect as Additional Rent from Tenant an amount equal to fifty percent (50%) of the Minimum Annual Rent payable by Tenant for the period in question. Landlord's exercise of the foregoing remedy shall in no way limit or otherwise affect Landlord' s ability to exercise other remedies available to it, nor shall Tenant's obligations pursuant to the terms, covenants and conditions of this Lease (including, without 18 n- 155 limitation, Tenant's obligation with respect to reporting Gross Sales and payment of Annual Percentage Rent) be in any manner reduced or diminished by the exercise of such remedy. Section 4.11 Lien for Rent. The whole amount of the Rent, Additional Rent, and each and every installment, and the amount of all taxes, assessments, water rates, insurance premiums and other charges and impositions paid by the Tenant under the provisions of this Lease, and all costs, attorneys fees and other expenses which may be incurred by the Landlord in enforcing the provisions of this Lease, or on account of any delinquency of the Tenant in carrying out any of the provisions of this Lease, shall be and they are deemed to constitute a valid lien upon the Leasehold Improvements, and upon the Tenant's leasehold estate, subject and subordinate, however, to any Leasehold Mortgage and to the rights of any Leasehold Mortgagee, and to the lien given by Tenant in the purchase of any Leasehold Improvement or for the leasing or financing of personal property, fixtures and equipment used by Tenant in the Premises during the Lease Term, provided such Leasehold Mortgage has been obtained in compliance with the provisions of Section 10.12 of this Lease. ARTICLE V LEASEHOLD IMPROVEMENTS Section 5.1 Tenant's Obligation to Provide and Fund Leasehold Improvements. Within thirty (30) days of the Lease Date, Tenant, at its own cost and expense, shall submit to Landlord its plans for the commencement and completion of the construction, and the acquisition and installation of the Leasehold Improvements. The plans shall include: a layout of the Premises, a lighting plan, a depiction of all fixtures to be added to Premises, interior finish and material samples, typical display technique, interior and exterior signage plan, store front and any work or equipment to be done or installed by Tenant affecting any structural, mechanical or electrical part of the Premises (the "Plans"). Within ten (10) Business Days of receipt of the Plans, the Landlord shall give Tenant written notice of either, Landlord's approval or Landlord's disapproval setting forth the reasons therefor. In the event that Landlord disapproves the Plans, the Tenant shall within ten (10) Business Days of receipt of the notice modify the Plans in accordance with the reasons set forth in Landlord's disapproval notice. The modified Plans shall 19 OR- 155 be resubmitted to Landlord for Landlord's final review and approval. Tenant, at its sole cost and expense, shall complete construction, acquisition and installation of the initial Leasehold Improvements as more fully described in Exhibit `B" attached hereto and made a part hereof, and acquire and install the furnishings, fixtures and equipment required for operation of the Premises within ninety (90) days of Landlord's approval of the Plans. Tenant hereby covenants that Tenant shall expend no less than two hundred eighty three thousand five hundred sixty dollars ($283,560) to complete the initial Leasehold Improvements as described in Exhibit B, and shall expend no less than eighty three thousand seven hundred twenty five dollars ($83,725) for the furnishings, fixtures and equipment. Upon completion of the construction, acquisition and installation of the Leasehold Improvements, and acquisition and installation of the furnishings, fixtures and equipment, Tenant shall furnish to Landlord copies of all receipts, releases and bill of sales in connection therewith. Section 5.2 PUment and Performance Bond. Within ten (10) days after the Landlord approves the plans for commencement and completion of the construction, and the acquisition and installation of the permanent Leasehold Improvements by the Tenant ( as described in Exhibit `B" attached), but in any event prior to the commencement of any construction, the Tenant shall, at Tenant's sole cost and expense, furnish the Landlord with a Construction Payment and Performance Bond. The Construction Payment and Performance Bond shall be issued by a bonding company which shall be approved by Landlord, in an amount equal to one hundred percent (100%) of the costs to construct the Leasehold Improvements described in Exhibit `B" naming the Landlord as the owner, and the Tenant or Tenant's general contractor, as the principal guaranteeing the payment and performance of Tenant's obligations with respect to any and all construction work pertaining to the Leasehold Improvements, free of mechanic's or other liens. The conditions of the Construction Payment and Performance Bond shall be to insure that the Tenant or Tenant's general contractor will: (i) promptly make payment to all claimants, as defined in §255.05 Florida Statutes, 1995, supplying the Tenant with labor, materials, or supplies, used directly or indirectly by the Tenant in the prosecution of the work related to the Leasehold Improvements under this Lease; and 20 en- 155 (ii) to pay the Landlord all losses, damages, expenses, costs, and attorneys fees, including appellate proceedings, that the Landlord sustains because of a default by the Tenant under this Lease; and (iii) perform the guarantee of all obligations of the Tenant's under this Lease with respect to the construction, and the acquisition and installation of the Leasehold Improvements, as described in Exhibit `B". The Construction Payment and Performance Bond may be terminated at such time as the construction, and the acquisition and installation of the Leasehold Improvement are completed and satisfactory evidence thereof is provided by the Tenant to the City Manager, including certification by the Tenant's architect that all requirements of the Construction Payment and Performance Bond have been satisfactorily concluded, and by the issuance of a certificate of occupancy. The form of the Construction Payment and Performance Bond shall be approved by the City Manager. Section 5.3 Contractor's Insurance. The Tenant shall require every contractor performing any work pertaining to the Leasehold Improvements to furnish Builder's Risk insurance protecting the Landlord and its respective commissioners, officers, agents, and employees, against any claim for personal injuries, death and property damage that may be asserted because of the construction, or the acquisition or installation of the Leasehold Improvements. Section 5.4 Additional Consideration. (a) The Landlord hereby, in consideration for the promises and covenants contained in this Lease to be kept and performed by the Tenant, shall simultaneously with the execution of this Lease on the Lease Date grant and convey unto the Tenant all furnishings, fixtures and equipment listed in Exhibit "A", in its "as is" and "where is" condition. (b) The Tenant hereby, in consideration of the granting of this Lease shall upon termination or expiration of this Lease: (i) grant and convey unto the Landlord, free and clear of all liens, title to all Leasehold Improvements of a permanent character including but not limited to, 21 �8- 155 refrigerators, stoves, freezers, hood systems, grills, dishwashers, sinks, kitchen work stations and light fixtures, and (ii) In addition to the Leasehold Improvements to be conveyed to Landlord as referenced above, Tenant shall further grant to the Landlord the right to purchase from the Tenant, all of Tenant's personal property added to or installed at the Premises by the Tenant during the Lease Term, including all furnishings, and equipment at actual cost less actual "observed" depreciation as determined by an appraisal, provided that the Landlord by notice in writing to the Tenant of at least forty five (45) days prior to the expiration, or earlier termination of the Lease Term, notifies the Tenant of its election. Section 5.5 Landlord's Premises to Remain Free of Liens. The Tenant shall make, or cause to be made, prompt payment of all money due and legally owing to all persons doing any work, including subcontractors, or providing supplies and equipment in connection with the construction, reconstruction or operation of the Premises. The Tenant shall have no power or right to and shall not in any way encumber the Landlord's fee simple interest in the Premises. If any mechanics' liens shall at any time be filed against the Premises, the Tenant shall promptly take and diligently pursue a cause of action to have the same discharged or to contest in good faith the amount or validity thereof and if unsuccessful in such contest, to have the same discharged. Upon the Tenant's failure to do so, the Landlord, in addition to any other right or remedy that it may have, may take such action as may be reasonably necessary to protect its interest, and the Tenant shall be responsible for any and all costs incurred by the City in connection with such action, including all reasonable legal fees, costs and expenses. Section 5.6 Historic Preservation Requirements. Tenant acknowledges that the Premises have been designated by the Miami City Commission as a historic site in accordance with Section 23.1-3 of the Code of the City of Miami, as amended. Accordingly, Tenant agrees that at all times during the Lease Term: (i) Tenant, at Tenant's sole cost and expense, shall ensure that all work done at the Premises shall conform in architectural style and aesthetic form with the overall historic pre 1920's theme or ambiance of the Premises; (ii) Tenant, at Tenant's sole cost and expense, shall ensure that all changes to the exterior of the Premises are approved by the City's Historic and Environmental 22 c,R— 155 Preservation Board (the "Board"); (iii) Tenant, at Tenant's sole cost and expense, shall ensure that the necessary work is undertaken in order to comply with the Board's requirement that the Premises be restored to its appearance prior to certain existing illegal alterations to the doors facing the courtyard on the northwest corner of the Premises, or shall obtain the Board's waiver of such requirement, (iv) Tenant, at Tenant's sole cost and expense, shall ensure that any alterations to the exterior of the Premises must meet the Secretary of the Interior's "Standards for Rehabilitation". Section 5.7 Landlord Approval. All Plans furnished under this Lease are expressly subject to Landlord's written approval, which the City Manager is hereby authorized to act on behalf of for purposes of such approval, and which approval he or she may not unreasonably withhold or delay. No approval by the City Manager of any Plans furnished under this Lease pursuant to this Section shall relieve Tenant of any obligation it may have at law to file such Plans with any department of the City or any other governmental authority having jurisdiction over the issues; or to obtain any building or other permit or approval required by law. Tenant acknowledges that any approval given by the City Manager pursuant to this Section shall not constitute an opinion or agreement by the City that the Plans are structurally sufficient or in compliance with any laws, codes or other applicable regulations. 23 OS- 155 ARTICLE VI CONDUCT OF BUSINESS BY TENANT Section 6.1 Use of Premises. Tenant shall occupy the Premises without delay upon commencement of the Lease Term, and covenants to continuously conduct its permitted business therein. Tenant shall use the Premises solely for Restaurant Operations. Tenant shall not use, permit or suffer the use of the Premises for any other business or purpose. Tenant agrees to conduct its business upon the Premises in accordance with the highest ethical and operating standards of the restaurant industry of which Tenant forms a part. Section 6.2 Operation of Tenant's Business. At all times during the Lease Term, Tenant shall manage the Restaurant Operations at the Premises with due diligence and efficiency, in Tenant's sole and absolute discretion, and in a manner prudent and in accord with the current business techniques within the locale for Tenant's business so as to maximize the amount of Gross Sales, subject to Force Majeure. Tenant shall carry at all times in the Premises a stock of merchandise of such quantity, character and quality as shall be in accord with advanced and highest quality business practices within the locale for Tenant's business. Section 6.3 Sims. Tenant will not place or permit to be placed or maintained on any exterior door, wall or window of the Premises, or within the interior of the Premises, any signage or advertising matter of any kind, without first obtaining Landlord's written approval and consent, which may not be unreasonably withheld. Tenant shall at its sole cost and expense, remove the existing "Firehouse Four Restaurant" sign, which was installed without a permit and does not conform with the architectural character of the Premises. Tenant shall erect an exterior sign of type, composition and design in conformance with the City of Miami Zoning Code and the Historic Preservation Board, which sign shall be subject to the prior written approval of Landlord. Tenant further agrees that such signs, awning, canopy, decoration, lettering, advertising matter or other thing as may be approved shall be maintained in good condition and repair at all times and shall conform to the criteria established from time to time by Landlord. 24 08- 155 ARTICLE VII MAINTENANCE, REPAIR AND ALTERATION OF PREMISES Section 7.1 Tenant's Maintenance Obli atg ions. Tenant, at its sole cost and expense, agrees to provide the necessary management and labor, to continuously maintain the Premises, including all operating equipment, utility services, and connections on the Premises. Tenant, at its sole cost and expense, agrees to provide, janitorial and custodian services, trash and garbage removal services, and any and all other related services necessary to have the Premises, and the Leasehold Improvements remain in good, safe, sanitary condition and repair throughout the Lease Term. Tenant shall be responsible for painting and decorating the interior of the Premises, maintaining its equipment, fixtures, furnishings, and other personal property in good condition and repair. All maintenance shall be at the Tenant's sole cost and expense and will be subject to general inspection by the Landlord to insure a continuing quality of maintenance and appearance and physical condition of the Premises commensurate with maintenance, health, and safety standards established by the Landlord and Applicable Law. Section 7.2 Tenant's Repair Obligation. Tenant, at Tenant's sole cost and expense, at all times during the Lease Term, shall make all interior, exterior, structural repairs, including repairs to the roof, wires, pipes, conduits and other equipment or facilities for supplying heat, light, power, hot and cold water services, all drainage and waste pipes or facilities leading from the Premises, and to all heating, ventilating and air-conditioning equipment and any other repair or replacement to the Premises and to the Leasehold Improvements. Section 7.3 Changes/Alterations. Tenant shall not make any changes, alterations, including without limitation, installing or causing to be installed any trade fixtures, exterior signs, exterior machinery, floor covering, interior or exterior lighting, plumbing fixtures, shades, awnings in and to the Premises or any part thereof without the prior written consent of the Landlord, which consent the City Manager is hereby authorized to give, and may not unreasonably withhold or delay. No approval by the City Manager of any changes or alterations shall relieve Tenant 25 �Q- 155 of any obligation it may have at law to file the required documents with any department of the City or any other governmental authority having jurisdiction over the issues; or to obtain any building or other permit or approval required by law. Tenant acknowledges that any approval given by the City Manager pursuant to this Section shall not constitute an opinion or agreement by the City that the changes or alterations are in compliance with any laws, codes or other applicable regulations. ARTICLE VIII INSURANCE AND INDEMNITY Section 8.1 Insurance on the Premises. Beginning on the Lease Date and at all times during the Lease Term, Tenant shall, at the Tenant's sole cost and expense but for the benefit of the Landlord and the Tenant's as their interests may appear, maintain the following insurance: (a) "All Risk" Premises insurance coverage against loss or damage by fire, windstorm, flood with such endorsement for extended coverage, vandalism, malicious mischief, sprinkler leakage and special coverage, including flammable materials used for cooking, insuring One Hundred Percent (100%) of the replacement cost of the Premises (exclusive of foundation and excavation costs), Tenants alterations, improvements, fixtures, equipment, furniture, trade fixtures and floor coverings, including the expense of the removal of debris as a result of damage by an insured peril (collectively "Insured Premises") on the Premises. Deductibles for such insurance coverage shall not exceed ten thousand dollars ($10,000) for all perils and three percent (3%) of the insured value for wind, storm and hail. The Landlord and Tenant shall be named as Loss Payees and insureds. Unless expressly waived in writing by the Landlord, the replacement cost of the Insured Premises shall be determined every five (5) years during the Lease Term by an insurance appraiser, selected and paid for by the Tenant, provided that the Tenant shall obtain the Landlord's approval (which approval shall not be unreasonably withheld) of the appraiser before commencement of the appraisal. The appraiser selected by the Tenant shall submit a written report of the appraised replacement cost to the Landlord and the Tenant. If the Landlord or the Tenant is not satisfied with this report, the dissatisfied party shall serve upon the other a notice of 26 S8- 155 dissatisfaction within thirty (30) days after receipt of the report and the Landlord and Tenant shall in good faith attempt to resolve any disputes concerning the appraised replacement cost. During this period of the dispute, the Tenant shall continue to maintain insurance in an amount equal to the greater of. the amount determined by the appraiser or that maintained before the dispute arose. Immediately upon receipt of the appraiser's report, the Tenant shall procure and deliver to the Landlord written confirmation from the insurer(s) evidencing the increase in insurance which may be required to comply with the provisions above. During the construction of the Leasehold Improvements, Tenant shall carry or cause to be carried Worker's Compensation Insurance and Builders Risk Insurance in connection with the construction. (b) The replacement of any plate glass damaged or broken from any cause whatsoever in and about the Premises shall be Tenant's responsibility. Tenant shall, during the entire term hereof, keep in full force and effect a policy of plate glass insurance covering all the plate glass of the Premises, in amounts satisfactory to Landlord. The policy shall name Landlord and any person, firm or corporation designated by Landlord and Tenant, as insured and shall contain a clause that the insurer will not cancel or change the insurance without first giving Landlord thirty (30) days prior written notice. The insurance shall be written by an insurance company approved by Landlord and a copy of the policy together with the declarations page thereof shall be delivered to Landlord prior to the commencement of the term of this Lease. (c) Business Interruption insurance in the limits of which insurance, if available, shall not be less than the Minimum Annual Rent and the debt service payment (if any) for the Leasehold Improvements and any other mortgages which include the pledging of the Leasehold Estate. Only the Landlord shall be named as a loss payee and insured. Section 8.2 Other Insurance To Be Carried. The Tenant shall also, at the Tenant's sole cost and expense but for the mutual benefit of the Landlord and the Tenant maintain the following insurance: (a) Commercial General Liability insurance on a comprehensive general liability coverage form, or its equivalent, including contractual liability, products and completed 27 operations, personal injury, liquor legal liability, garage keepers liability, and premises and operations coverages against all claims, demands or actions, bodily injury, personal injury, death or Premises damage occurring on the Premises, the limits of which shall not be less than two million dollars ($2,000,000) per occurrence combined single limit for bodily injury and Premises damage, with a maximum deductible of ten thousand dollars ($10,000). Tenant shall further maintain an excess umbrella policy which limits shall not be less than a combined single limit of five million dollars ($5,000,000). Said insured amounts as provided above shall be adjusted at the beginning of the fifth Lease year and every five years thereafter by any increase or decrease (which decrease shall not result in an amount less than the amounts initially required as set forth above) in the Consumer Price Index from the Commencement Date to the anniversary date in which the adjustment is to be made. In addition to the Tenant, the Landlord shall be named as additional insured on the policy or policies of insurance. (b) Automobile liability insurance covering all owned, non -owned and hired vehicles used in conjunction with operations covered by this Agreement. The policy or policies of insurance shall contain such limits as may be reasonable requested by the Landlord from time to time but not less than five hundred thousand ($500,000) for bodily injury and Premises damage. Said insured amount as provided above shall be increased at the beginning of the fifth Lease year and every five years thereafter by any increase or decrease in the Consumer Price Index from the Lease Date to the anniversary date in which the adjustment is to be made. Only the Tenant shall be named as an insured. In no event shall the insurance limit ever be less than five hundred thousand dollars ($500,000). (c) Workers Compensation Insurance in the amounts and types required by State law. Only the Tenant shall be named as an insured. (d) The Landlord reserves the right to reasonably amend the herein insurance requirements by the issuance of a notice in writing to the Tenant, which amended insurance requirements shall be subject to the reasonable approval by Tenant, which approval shall not be unreasonably withheld. Section 8.3 Delivery of Insurance Policies. All public liability, Workers Compensation and employers liability policies shall be retained by the Tenant. Except as otherwise specifically provided, all other policies of insurance 28 �S_ 155 required to be furnished shall be held by and be payable jointly to the Landlord and the Tenant with the proceeds to be distributed in accordance with the terms of this Lease. Insurance company certificates evidencing the existence of all of these policies of insurance shall be delivered to the Landlord. All policies of insurance required to be provided and obtained shall provide that they shall not be amended or canceled on less than thirty (30) days prior written notice to the Landlord and all insured and beneficiaries of the policies shall contain waiver of subrogation rights endorsements, as required below. The Landlord shall have no obligation to pay premiums or make contributions to the insuring company or any other person or satisfy any deductible. On or before the Lease Date and not less than thirty (30) days prior to the expiration date of any policy required to be carried pursuant to this Section, the Tenant shall deliver to the Landlord the applicable respective policies and insurance company certificates evidencing all policies of insurance and renewals required to be furnished. Receipt of any documentation of insurance by the Landlord or by any of its representatives which indicates less coverage than required does not constitute a waiver of the Tenant's obligation to fulfill the insurance requirements herein. Section 8.4 Adjustment of Loss. Subject to the requirements of any Leasehold Mortgagee, Net Insurance Proceeds recovered on account of any damage or destruction by any casualty shall be made available for the payment of the cost of the reconstruction, replacement or repairs. All of the Net Insurance Proceeds plus the amount of any deductible applicable to said damage or destruction shall be deposited by the insurance company or by the Tenant (in the case of the deductible) with an escrow agent acceptable to the City Manager, with instructions to the escrow holder that the escrow holder shall disburse the funds to the Tenant, with notice thereof to the Landlord, as the work of the reconstruction, replacement or repairs progresses upon certificates of the architect or engineer supervising the work that the disbursements then requested, plus all previous disbursements made from such Net Insurance Proceeds, plus the amount of any deductible, do not exceed the cost of the work already completed and paid for, and that the balance in the escrow fund is sufficient to pay for the reasonably estimated cost of completing the required work. The escrow holder shall be any bank mutually agreeable to Landlord and Tenant. If the amount of the 29 Net Insurance Proceeds is less than the cost of the required work, then Tenant shall pay the excess cost; and if the amount of the Net Insurance Proceeds is greater than the cost of the required work, then the excess shall be paid to and belong to the Tenant. Section 8.5 Insurer To Be Approved -Premium Receipts. All policies of insurance of the character described in Sections 8.1 and 8.2 shall be written by companies of recognized responsibility reasonably acceptable to the Landlord. On request by Landlord, Tenant shall provide photocopies of receipts showing the payment of premium for all insurance policies required to be maintained by this Lease. Section 8.6 Indemnification of Landlord. Tenant shall indemnify, defend and save Landlord harmless from and against any and all claims actions, damages, liability and expense in connection with loss of life, personal injury and/or damage to or destruction of Premises arising from or out of any occurrence in, upon or at the Premises, or the occupancy or use by Tenant of the Premises or any part thereof, or occasioned wholly or in part by any act of omission of Tenant, its agents, contractors, employees, servants, customers, invitees, licensees, Subtenants or concessionaires. In case Landlord shall be made a party to any litigation commenced by or against Tenant covered by this indemnity provision, then Tenant shall protect and hold Landlord harmless and pay all costs and attorney's fees incurred by Landlord in connection with such litigation, and any appeals thereof. Tenant shall also pay all costs, expenses and reasonable attorneys' fees that may be incurred or paid by Landlord in enforcing the covenants and agreements in this Lease. Section 8.7 Waiver of Subro ag tion. Tenant waives all rights to recover against the Landlord for any damages arising from any cause covered by any insurance required to be carried by Tenant, or any insurance actually carried by Tenant. The Tenant shall cause its insurer(s) to issue appropriate waiver of subrogation rights endorsements to all policies of insurance carried in connection with the Premises. Section 8.8 Release of Landlord. The Tenant, and its Leasehold Mortgagees and assignees for and in consideration of the leasing and the demise of the Premises to the Tenant hereby release, remise and discharge the Landlord, its officers and employees, of and from all claims, demands, actions, whether in law 30 nR- 155 or in equity which may be filed or asserted by the Tenant, or its Leasehold Mortgagees, or its assignees for or on account of improvements made and furniture, fixtures and equipment installed in the Premises, and from any and all costs and expenses, of Tenant, its Leasehold Mortgagees or its assignees in connection with this Lease, including, but not limited to the development of the Premises and acquisition of the Leasehold Improvements, which may result from a third party challenging the validity or legality of this transaction under the City Charter or Code or the laws of the State of Florida, or arising out of the award of this Lease Agreement, or any subsequent assignment of this Lease by the Tenant or its assignees (the "Claim"). It is the intent of the Parties that this provision shall control over any other provision in this Lease Agreement and that notwithstanding any limited representations provided by Landlord under Section 2.4 of this Lease Agreement, neither the Tenant, nor its Leasehold Mortgagees or assignees shall seek to recover from the Landlord compensation for, or reimbursement of any costs, losses, fees or expenses incurred by the Tenant, its Leasehold Mortgagees or its assignees, including expenses incurred in connection with the acquisition of this Lease or the financing, and/or installation of the Leasehold Improvements, or otherwise, as a result of any adverse judgment which may be entered or relief granted in connection with the Claim. The terms of this provision shall expressly be made a part of any future assignment or mortgage of the Leasehold Interest. In the event a Claim is filed or asserted within forty (40) days of the Lease Date, either party shall have the right to terminate this Lease and except as otherwise hereafter provided in this paragraph, the Parties shall thereupon be relieved of any and all further responsibility hereunder and neither Party shall have any further obligation under this Lease. In the event of such termination, Landlord shall return the Security Deposit to the Tenant, without interest. Landlord shall further prorate the Minimum Annual Rent due, without a discount, from the Lease Date to the date of termination and shall refund to the Tenant the difference between the pre -paid rent and the amount of rent due. In the event a Claim is filed or asserted after the forty (40) day period has expired, or in the event the Parties agree not to terminate this Lease as provided above, Landlord agrees that it will defend against the Claim in good faith and with reasonable diligence. Tenant agrees that it shall continue to comply with the terms and conditions of this Lease including the timely 31 �8- 155 performance of all construction obligations under this Lease, and the Claim shall not constitute an Event of Force Majeure under this Lease. Notwithstanding anything to the contrary in this Lease, in the event this Lease is terminated as a result of a Claim within the first two years of the Lease Term, Tenant shall be permitted to remove such movable trade fixtures installed as part of the initial Leasehold Improvements so long as same does not damage the Premises. Tenant shall not be permitted to remove the equipment outlined in Exhibit "A" attached hereto and made a part hereof even if same was reconditioned by Tenant. ARTICLE IX SERVICES AND UTILITIES Section 9.1 Tenant to Provide and Pay for Utilities. The Tenant shall pay, or cause to be paid, all proper charges for gas, electricity, light, heat, water and power, for telephone, protective and other communication services, and for all other public or private utility services, which shall be used, rendered or supplied upon or in connection with the Premises and the Leasehold Improvements, or any part of it, at any time during the Lease Term, and the Tenant shall comply with all contracts relating to any such services and will do all other things required for the maintenance and continuance of all services as are necessary for the proper maintenance and operation of the Premises and the Leasehold Improvements. The Tenant shall also at its sole expense procure any and all necessary permits, licenses or other authorization required for the lawful and proper installation and maintenance upon the Premises of wires, pipes, conduits, tubes and other equipment and appliances for use in supplying any such utilities, services or substitutes to the Premises. Section 9.2 Landlord Not Liable for Failure of Utilities. The Landlord shall not be liable for any failure of water supply, sewer, gas or electric current, or for any injury or damage to any person or the Premises caused by or resulting water, gas or electricity which may leak or flow from the water or gas mains on to any part of the Premises or the Leasehold Improvements. The Landlord shall not be required to make any alteration to any service or utility system of the Premises on behalf of Tenant. Landlord shall not be liable for temporary failure of services, and same shall not be deemed to constitute actual or 32 constructive eviction, nor entitle Tenant to any abatement or diminution in rent payable under this Lease. ARTICLE X TRANSFERS AND SUBLETTING Section 10.1 Subleasing (a) Tenant shall not, at any time during the term of this Lease, enter into any Sublease, license, concession or permit agreement with respect to the Premises or any portion thereof, nor permit any third party or parties other than Tenant, its authorized agents, employees, invitees and visitors to occupy or use the Premises or any portion thereof, without first procuring the prior written consent of Landlord's City Manager. Any such attempted Subleasing of the Premises, without the Landlord's prior written consent, shall be void and of no force or effect and shall not confer any interest or estate in the purported Subtenant, and shall constitute a default under this Lease and the Landlord, at its election, may terminate this Lease. Under no circumstances is Tenant allowed to Sublease more than twenty-five (25%) of the total square footage of the buildings situated on the Premises. The provisions of Subsection 10.1(b) constitute the sole means by which Tenant may request Landlord's consent to a Sublease. The consent of Landlord shall not be unreasonably withheld or delayed. It is agreed that all terms and conditions of this Lease shall extend to and be binding on all Subtenants as may be approved by Landlord and shall be for a period of time equal to or less than the Lease Term. Tenant shall be liable for acts and omissions by any Subtenant affecting this Lease. Landlord reserves the right to directly terminate the rights and interests of any Subtenant under any Sublease for any cause for which Tenant's Leasehold Interest may be terminated. Tenant shall reimburse to Landlord, as Additional Rent, all costs and expenses, including attorneys' fees, which Landlord incurs by reason of or in connection with a Sublease, and all negotiations and actions with respect thereto, such Additional Rent to be due and payable within thirty (30) days of receipt of a statement of such costs and expenses from Landlord. 33 8-- 155 (b) Procedure for Sublease. Should Tenant desire to enter into a Sublease, Tenant shall, in each instance, give written notice of its intention to do so to Landlord's City Manager at least thirty (30) days prior to the effective date of any such proposed Sublease, specifying in such notice the nature of such proposed Sublease and the proposed date thereof and specifically identifying the proposed Subtenant. Such notice shall be accompanied by a copy of the proposed Sublease, license, concession or permit agreement and any other documents or financial information Landlord may reasonably require in order to make a determination as to the suitability of the Subtenant. If requested by Landlord, Tenant shall provide to Landlord copies of all Subleases and amendments thereto Landlord shall, within twenty (20) days after its receipt of such notice of a proposed Sublease from Tenant, by mailing written notice to Tenant of its intent to do so, either (i) withhold consent to the Sublease, or (ii) consent to such Sublease upon the terms and subject to the conditions provided for in this Article. Tenant acknowledges and agrees that the imposition of the conditions described in this Article X as a condition of Landlord's consent is reasonable. (c) Additional Consideration Payable to Landlord. Except as provided below with respect to a valet concession, if Landlord gives its consent to any Sublease, Tenant shall in consideration therefor include in Tenant's Gross Sales the amount of Subtenant's Gross Sales which shall be listed separately on Tenant's Semi -Annual Report. Subtenant's records shall be kept in accordance with Section 4.7. Additionally, Landlord reserves the right to examine Subtenant's books and audit Subtenant's entire records in accordance with Sections 4.9 and 4.10 of this Lease. With respect to a valet concession, Tenant shall exercise its good faith effort to collect a fee from the valet concessionaire. In the event Tenant is able to obtain such a fee, Tenant shall include any and all amounts Tenant receives from the valet concessionaire in Tenant's Gross Sales and Landlord shall receive Percentage Rent from Tenant pursuant to Article IV. The acceptance by Landlord of the payment of rent following any Sublease prohibited by this Article shall not be deemed to be a consent by Landlord to any such Sublease nor shall the same be deemed to be a waiver of any right or remedy of Landlord hereunder. Section 10.2 Definitions. 34 0 P, 155 As used in this Article the term: (a) "Transfer" means: (i) any total or partial sale, or assignment (other than by a Leasehold Mortgage) of Tenant's business or Leasehold Estate or any contract or agreement to do any of the same; (ii) any transfer of more than fifteen percent (15%) of the stock of Tenant or of the stock of any Owner, other than an Owner whose shares are publicly traded, if the transfer results in a transfer of more than fifteen percent (15%) of the beneficial ownership of Tenant; (iii) any merger, consolidation or sale or lease of all or substantially all of the assets of the Tenant or of any Owner, other than an owner whose shares are publicly traded. (b) "Owner" means: (i) any person, firm, corporation or other entity which owns, directly or indirectly, legally or beneficially, more than fifteen percent (15%) of the stock of the Tenant, but shall not include any shareholder of an Owner whose shares are publicly traded. (c) "Owner whose shares are publicly traded" means an Owner: (i) who has filed an effective registration statement with the Securities & Exchange Commission (or its successor) with respect to the shares of any class of its voting stock or of all classes of any other form of ownership interest which includes voting rights; and (ii) whose voting stock and other form of ownership interest described in clause (i) is listed for trading purposes on a securities exchange subject to the regulatory jurisdiction of the Securities & Exchange Commission (or its successor) or is publicly traded over the counter. 35 Section 10.3 Transfers. The Tenant recognizes that the operational experience of the Tenant as set forth in the Proposal was given special consideration by the Landlord in the public selection process undertaken by the Landlord for the award of this Lease. Therefore, Tenant agrees that except as permitted pursuant to subparagraphs (a), (b) and (c) below, or as specifically approved pursuant Section 10.14 below, no Transfer may be made, suffered or created by the Tenant, or any Owner without the prior written consent of the City Manager which consent shall not be unreasonably withheld or delayed. The City Manager, in his sole discretion, may, but shall not be obligated to, present any request for Transfer to the City Commission for its final approval. The following Transfers shall be permitted hereunder: (a) Any Transfer directly resulting from the foreclosure of Tenant's Leasehold Estate or any Transfer made by the purchaser at foreclosure of a Leasehold Mortgage, provided that such purchaser or grantee is an institutional investor or an agent, designee or nominee of an institutional investor which is wholly owned or controlled by an institutional investor, and that such purchaser or grantee within six (6) months after taking possession of the Premises, shall have entered into an agreement for the management and operation of the Premises with an Acceptable Operator or is itself an Acceptable Operator; Manager; (b) any Transfer to an Acceptable Operator consented to by the City (c) the issuance of stock or stock options to Tenant's directors, officers, or employees, provided the stock or stock options issued constitute, in the aggregate, less than fifteen percent (15%) of the issued and outstanding stock of Tenant; The Parties hereby acknowledge and agree that anything herein to the contrary notwithstanding, the "going public" by Tenant, including, but not limited to, the filing of a registration statement with the Securities and Exchange Commission, the creation of one or more classes of stock and the offering of shares of stock to the public for purchase, shall not constitute a Transfer hereunder and shall not require the consent of the Landlord. Any consent to a Transfer shall not waive any of the Landlord's rights to consent to a subsequent Transfer. Any Transfer made in violation of the terms hereof shall be null and void and of no force and effect. U51 �R- 155 Section 10.4 Notice of Transfer. With respect to any Transfer which must be approved by the City Manager, the Tenant shall give or cause to be given to the Landlord written notice (including all information necessary for the Landlord to make an evaluation of the proposed Acceptable Operator according to the requirements of this Lease) of any Transfer of which Tenant, or its officers shall have knowledge, not less than thirty (30) days prior to any such proposed Transfer, and the Landlord shall within thirty (30) days of its receipt of such information, advise Tenant in writing if it shall consent to same. If the Landlord shall not consent to a Transfer, the City Manager shall state the reasons for such disapproval in his notice to Tenant. If the Landlord is not required to consent to a Transfer pursuant to the terms hereof, the Tenant shall notify the Landlord in writing of same within thirty (30) days after the date of Transfer. In the event the City Manager elects to exercise his right under Section 10.3 to present any request for Transfer to the City Commission for its approval, the City Manager shall use due diligence to present the request for Transfer to the City Commission as soon as practicable and the time for performance by Landlord shall be reasonably extended to provide sufficient time for presentation to the City Commission. Section 10.5 Information as to Shareholders, etc. Tenant shall from time to time throughout the Lease Term, as the Landlord shall reasonably request, furnish the Landlord with a complete statement, subscribed and sworn to by the President or Vice -President and the Secretary or Assistant Secretary of the Tenant, setting forth the full names and addresses of holders of stock interests in Tenant, and the extent of their holdings, and in the event any other parties have a beneficial interest in such stock, their full names and addresses and the extent of such interest as determined or indicated by the records of Tenant. Notwithstanding the foregoing, the information required by this Section 10.5 shall not be required to be furnished with respect to the shareholders of any Owner whose shares are publicly traded. Section 10.6 Effectuation of Permitted Transfers. No Transfer of the nature described in Subsection 10.3(b) above shall be effective unless and until: 37 SS- 155 (a) all Rents, taxes, assessments, impositions, insurance, permitting and other charges required to be paid by the Tenant under this Lease shall be paid by the Tenant up to the date of transfer, and all other covenants and agreements to be kept and performed by the Tenant shall be substantially complied with at the date of the Transfer; and (b) the entity to which such Transfer is made, by instrument in writing reasonably satisfactory to the City Manager and in form recordable among the land records, shall, for itself and its successors and assigns, and especially for the benefit of the Landlord expressly assume all of the obligations of Tenant under this Lease, and agree to be subject to all conditions and restrictions to which Tenant is subject; provided, however, that any Leasehold Mortgagee or transferee shall not be required to assume any personal liability under this Lease with respect to any matter arising prior or subsequent to the period of such transferee's actual ownership of the Leasehold Estate created by this Lease (it being understood, nevertheless, that the absence of any such liability for such matters shall not impair, impede or prejudice any other right or remedy available to the Landlord for default by Tenant). Nothing herein shall be construed to relive or release the Tenant from liability for the performance of all of the obligations of Tenant under this Lease, unless the Landlord in writing expressly provides for such a release. Section 10.7 Criteria for Consent for Transfer. The Landlord may condition its consent to a permitted Transfer upon satisfaction of all or any of the following conditions: (i) The net assets of the Transferee immediately prior to the Transfer shall not be less than: (a) the net assets of the Transferor whose interest is being transferred immediately prior to the Transfer; (b) the net assets of said Transferor on the Lease Date adjusted for inflation; or (c) an amount reasonably necessary to discharge Tenant's remaining obligations hereunder; (ii) Such Transfer shall not adversely affect the quality and type of business operation which the Tenant has conducted theretofore; (iii) Such Transferee, shall possess qualifications for the Tenant's business substantially equivalent to an Acceptable Operator, or shall engage an Acceptable Operator and shall have demonstrated recognized experience in successfully operating such a 38 08- 155 business, including, without limitation, experience in successfully operating a similar quality business; (iv) Such Transferee shall continue to operate the business conducted at the Premises pursuant to all the provisions of this Lease; (v) Such Transferee shall assume in writing, in a form acceptable to Landlord, all of Tenant's obligations hereunder, and Tenant shall provide Landlord with a copy of all documents pertaining to such Transfer; (vi) Tenant shall pay to Landlord a Transfer fee of one thousand dollars ($1,000) prior to the effective date of the Transfer in order to reimburse Landlord for all of its internal costs and expenses incurred with respect to the Transfer, including, without limitation, costs incurred in connection with the review of financial materials, meetings with representatives of Transferee, and preparation, review, approval and execution of the required documents; (vii) Tenant shall pay to the Landlord any due, but unpaid Rent. Section 10.8 Liability of Tenant. If a Transferee does not meet all of the criteria set forth in Section 10.7, Landlord, at its sole option, may require Tenant or Owner transferring such interest to remain liable under this Lease for the performance of all terms, including, but not limited to, payment of Rent due under this Lease. Section 10.9 Payment Upon Transfer or Sale of Tenant Business or Stock. Tenant agrees to pay Landlord an amount equal to the greater of seven percent (7%) of Net Sale Proceeds, as hereinafter defined, or four and one-half percent (4.5%) of any and all consideration paid or agreed to be paid, directly or indirectly, to Tenant in connection with any Transfer, or for the sale of Tenants' business in connection with any such Transfer, or in connection with the sale of fifteen percent (15%) or more of Tenant's stock (the "Transfer Fee") No Transfer, which requires Landlord's consent shall be effective unless, upon execution of Landlord' s consent to such Transfer, the Tenant pays to the Landlord the Transfer Fee. The Tenant shall pay to the Landlord the Transfer Fee at the time the Transfer becomes effective, or in the case of the sale of Tenant's stock at the time the shares of stock are sold. 39 08- 155 For purposes hereof, "Net Sale Proceeds" shall mean the net proceeds to Tenant, or Owner transferring such interest, remaining after payment of (i) any Leasehold Mortgage or other debt relating to the Premises as prorated proportionately to the interest being transferred; and (ii) all reasonable costs and expenses of the sale or Transfer, including commissions, fees, and closing costs. Section 10.10 Acceptance of Rent from Transferee. The acceptance by Landlord of the payment of Rent following any Transfer prohibited by this Article shall not be deemed to be a consent by Landlord to any such, nor shall the same be deemed to be a waiver of any right or remedy of Landlord hereunder. Section 10.11 Transfers of the City's Interest. At the Tenant's request, Landlord shall provide the Tenant copies of any and all agreements or contracts pertaining to the total or partial sale, assignment, conveyance, mortgage, trust or power, or other transfer in any mode or form of or with respect to the Landlord's reversionary or fee interest in the Premises, or any part thereof, or any interest therein, or any contract or agreement to do any of the same, to any purchaser, assignee, mortgagee, or trustee. Landlord hereby agrees to incorporate the terms and conditions set forth in this Lease, or in any agreement or contract with such purchaser, assignee, mortgagee, or trustee. Section 10.12 Leasehold Mortgage. (a) Notwithstanding the provisions set forth in Article 10 hereof regarding any Transfers ( as defined in Section 10.2), but subject to the provisions of this Article 10, (provided that Landlord has not notified Tenant in writing that an Event of Default has occurred and has not been cured); Tenant shall have the right during the Lease Term, to encumber the Tenant's Leasehold Estate by Leasehold Mortgage, for the sole purpose of securing the financing of part or the total construction, acquisition and installation costs of the Leasehold Improvements and/or for the short-term or long-term financing or refinancing of any such Leasehold Improvements. Notwithstanding anything to the contrary in this Section or in this Lease, it is expressly agreed by and between the Landlord and the Tenant, and (by acceptance of a Leasehold Mortgage) any Leasehold Mortgagee that the Tenant's right to place a Leasehold Mortgage against the Tenant's Leasehold Estate is subject to the following: 40 0S- 155 (i) Review and approval by the City Manager of the mortgage documents to ensure compliance with the conditions for mortgaging as set forth in Section 10.12 of this Lease. Tenant shall provide copies of all mortgage documents required for the City Manager's review; (ii) At the time the Leasehold Mortgage is made, the Tenant has not been notified of any Event of Default under this Lease which remains uncured; (iii) No Leasehold Mortgagee or anyone claiming by, through or under the Leasehold Mortgage, shall , by virtue of it, acquire any greater rights in the Premises than the Tenant has under this Lease; (iv) The Leasehold Mortgage shall be expressly subject and subordinate to all conditions and covenants of this Lease and to the rights of the Landlord; (v) The Leasehold Mortgage shall expressly provide that the Leasehold Mortgagee shall notify Landlord of default by Tenant under the Leasehold Mortgage prior to commencing foreclosure proceedings; (vi) The Landlord and any mortgagee of Landlord shall execute and deliver to any Leasehold Mortgagee a non -disturbance agreement in form and substance reasonably satisfactory to such Leasehold Mortgagee and Landlord; (vii) That unless expressly prohibited by the provisions of this Article 10, any Leasehold Mortgage may be upon such terms and conditions as the Tenant and Leasehold Mortgagee may agree. (b) In no event may the amount of such financing or refinancing exceed eighty percent (80%) of the total construction, acquisition and installation costs of the Leasehold Improvements or eighty percent (80%) of the Fair Market Value of the Leasehold Estate, whichever is greater. Tenant shall deliver to Landlord promptly after execution by Tenant a true and verified copy of any Leasehold Mortgage, and/or any amendment, modification or extension thereof, together with the name and address of the owner and holder thereof. Tenant may not encumber Tenant's Leasehold Estate as security for any indebtedness of Tenant with respect to any other business owned by the Tenant or any other property leased by the Tenant. 41 qq- 155 (c) During the continuance of any Leasehold Mortgage until such time as the lien of any Leasehold Mortgage has been satisfied, provided that a true and verified copy of such Leasehold Mortgage shall have been delivered to the City Manager together with a written notice of the name and address of the owner and holder thereof as provided in this Section 10.12: (i) The City shall not agree to any mutual termination nor accept any surrender of this Lease (except upon the expiration of the Lease Term), nor shall the City consent to any material amendment or modification of this Lease, or waive any rights or consents it may be entitled to pursuant to the terms hereof, without the prior written consent of Leasehold Mortgagee, which consent shall not be unreasonably delayed or withheld. (ii) Notwithstanding any default by Tenant in the performance or observance of any covenant, condition or agreement of this Lease on the part of Tenant to be performed or observed, the City shall have no right to terminate this Lease even though an Event of Default under this Lease shall have occurred and be continuing, unless and until the City Manager shall have given Leasehold Mortgagee written notice of such Event of Default; and Leasehold Mortgagee shall have failed to remedy such default or to acquire Tenant's Leasehold Estate created hereby or to commence foreclosure or other appropriate proceedings in the nature thereof, all as set forth in, and within the time specified by, this Article 10. (iii) Subject to the provisions of subparagraph (iv) immediately below, Leasehold Mortgagee shall have the right, but not the obligation, at any time prior to termination of this Lease, to pay all of the Rent due hereunder, to provide any insurance, to pay any taxes and make any other payments, to make any repairs and improvements, to continue to construct and complete the Leasehold Improvements, and do any other act or thing required of Tenant hereunder, and to do any act or thing which may be necessary and proper to be done in the performance and observance of the covenants, conditions and agreements hereof to prevent the termination of this Lease. All payments so made and all things so done and performed by Leasehold Mortgagee shall be as effective to prevent a termination of this Lease as the same would have been if made, done and performed by Tenant instead of by Leasehold Mortgagee. (iv) If an Event of Default under this Lease occurs with respect to payment of monies, Rent or Additional Rent, Leasehold Mortgagee shall have thirty (30) days after receipt of notice from the City Manager setting forth the nature of such Event of Default, to 42 m- 155 remedy same. If any Event of Default under this Lease occurs with respect to a non -monetary issue, Leasehold Mortgagee shall have sixty (60) days after receipt of notice from the City Manager setting forth the nature of such Event of Default, to remedy same and if the default is such that possession of the Premises may be reasonably necessary to remedy the default, Leasehold Mortgagee shall, within such sixty (60) day period, commence and diligently prosecute a foreclosure action or such other proceeding as may be necessary to enable Leasehold Mortgagee to obtain such possession; provided that (aa) Leasehold Mortgagee shall have fully cured any default in the payment of any monetary obligations of Tenant under this Lease including Rent and Additional Rent within such thirty (30) day period provided above, and shall continue to pay currently such monetary obligations as and when the same are due; (bb) Leasehold Mortgagee shall within six (6) months of the date that it takes possession of the Premises employ an Acceptable Operator subject to approval by the City Manager, which approval shall not be unreasonably withheld or delayed, for the continued management of the Restaurant Operations, under the terms and conditions of this Lease; and (cc) Leasehold Mortgagee shall have acquired Tenant's Leasehold Estate created hereby or commenced foreclosure or other appropriate proceedings in the nature thereof within such sixty (60) day period or prior thereto, and shall be diligently and continuously prosecuting any such proceedings to completion. All rights of the City Manager to terminate this Lease as the result of the occurrence of any such Event of Default shall be subject to and conditioned upon the City Manager having first given Leasehold Mortgagee written notice of such Event of Default and Leasehold Mortgagee having failed to remedy such default or acquire Tenant's Leasehold Estate created hereby or commence foreclosure or other appropriate proceedings in the nature thereof as set forth in and within the time period specified by this subparagraph (iv). (v) An Event of Default under this Lease which in the nature thereof cannot be remedied by Leasehold Mortgagee shall be deemed to be remedied if (aa) within sixty (60) days after receiving written notice from the City Manager setting forth the nature of such Event of Default, Leasehold Mortgagee shall have acquired Tenant's Leasehold Estate or commenced foreclosure or other appropriate proceedings in the nature thereof, (bb) Leasehold Mortgagee shall diligently and continuously prosecute any such proceedings to completion; (cc) 43 08- 155 Leasehold Mortgagee, within such sixty (60) day period, shall have fully cured any default which does not require possession of the Premises, and shall thereafter continue to faithfully perform all such obligations which do not require possession of the Premises; (dd) Leasehold Mortgagee, within thirty (30) days after receipt of the written notice from the City Manager, shall cure any default in the payment of any monetary obligations of Tenant under this Lease and shall continue to pay currently such monetary obligations as and when the same are due; and (ee) within six (6) months after Leasehold Mortgagee shall have gained possession of the Premises, Leasehold Mortgagee shall have employed an Acceptable Operator and shall continue to employ an Acceptable Operator throughout the Lease Term. (vi) If the Leasehold Mortgagee is prohibited by any process, or injunction issued by any court, or by reason of any action by any court having jurisdiction of any bankruptcy, debtor rehabilitation or insolvency proceedings involving Tenant from commencing, or prosecuting foreclosure or other appropriate proceedings in the nature thereof, the times specified in subparagraphs (iv) and (v) above for commencing or prosecuting such foreclosure or other proceeding shall be extended for the period of such prohibition; provided that Leasehold Mortgagee shall have fully cured any default including a default in the payment of any monetary obligations of Tenant under this Lease including Rent and Additional Rent, and shall continue to perform currently such obligations as and when the same fall due, and provided that Leasehold Mortgagee shall diligently attempt to remove any such prohibition. (vii) Foreclosure of a Leasehold Mortgage or any sale thereunder, whether by judicial proceedings or by virtue of any power of sale contained in the Leasehold Mortgage, or any conveyance of the Leasehold Estate to Leasehold Mortgagee by virtue or in lieu of the foreclosure or other appropriate proceedings in the nature thereof, shall not require the consent of the City or constitute a breach of any provision of, or a default under this Lease. Upon such foreclosure, sale or conveyance, the City shall recognize Leasehold Mortgagee, or any other foreclosure sale purchaser, as Tenant hereunder; provided, that Leasehold Mortgagee or any such foreclosure sale purchaser shall employ or shall constitute an Acceptable Operator within Six (6) months of the date of such foreclosure, sale or conveyance, and shall continue to employ an Acceptable Operator throughout the Lease Term. Said Acceptable Operator shall be subject to approval by the City Manager, which approval shall not be unreasonably withheld or delayed, 44 OR- 155 M Further, provided, that in the event there are two or more Leasehold Mortgages or foreclosure sale purchasers (whether the same or different Leasehold Mortgages), the City shall have no duty or obligation whatsoever to determine the relative priorities of such Leasehold Mortgages or the rights of the different holders thereof and/or foreclosure sale purchasers. (viii) Subject to the restrictions and limitations imposed on the Landlord by the Charter of the City of Miami and the provisions of Section 10.13, Landlord and Tenant shall cooperate in including in this Lease by suitable amendment from time to time any provision which may be requested by any proposed Leasehold Mortgagee, or may otherwise be reasonably necessary, to implement the provisions of this Section 10.12; provided, however, that any such amendment shall not in any way affect the Lease Term. Section 10.13 No Waiver of Tenant's Obligations or Landlord's Rights. Nothing contained herein or in any Leasehold Mortgage shall be deemed or construed to relieve Tenant from the full and faithful observance and performance of its covenants, conditions and agreements contained herein, or from any liability for the non- observance or non-performance thereof, or to require or provide for the subordination to the lien of such Leasehold Mortgage of any estate, right, title or interest of the Landlord in or to this Lease or Landlord's fee simple interest in the Premises. Nothing in this Lease Agreement shall be deemed or construed as an agreement on the part of the Landlord to subordinate its fee simple interest in the Premises to the lien of any Leasehold Mortgage placed on the Tenant's Leasehold Estate. Section 10.14 Transfer to Firehouse IV of Miami, Inc. Notwithstanding anything to the contrary in this Article, no further consent or approval by the Landlord is required in connection with the Transfer from Tenant to Firehouse IV of Miami, Inc., nor is Tenant required to pay to Landlord the Transfer Fee as a condition of such Transfer. 45 en- 155 ARTICLE XI COMPLIANCE WITH LAWS Section 11.1 Compliance With Laws. Tenant shall, at Tenant's sole cost and expense, comply with all regulations of all Applicable Laws now in force, or which may hereafter be in force, pertaining to Tenant or its use of the Premises, and shall faithfully observe in the use of the Premises or in the performance of any Alterations (including, without limitation, Tenant's work) all Applicable Laws now in force or which may hereafter be in force. Tenant shall indemnify (and such indemnity will survive the termination or expiration of the Lease for a period of three (3) years), defend and save Landlord harmless from penalties, fines, costs, expenses, suits, claims, or damages resulting from Tenant's failure to perform its obligations in this Section. ARTICLE XII ENVIRONMENTAL LIABILITY Section 12.1 Definition of Terms. For purposes of this Article XII the following terms shall have the meaning attributed to them herein: 12.1.1 "Hazardous Materials" means any toxic or hazardous substance, material, or waste, and any other contaminant, pollutant or constituent thereof, whether liquid, solid, semi- solid, sludge and/or gaseous, including without limitation, chemicals, compounds, pesticides, petroleum products including crude oil and any fraction thereof, asbestos containing materials or other similar substances or materials which are regulated or controlled by, under or pursuant to any federal, state or local statutes, laws, ordinances, codes, rules, regulations, orders or decrees including, but not limited to, all Applicable Laws. 12.1.2 "Environmental Laws" shall include, but shall not be limited to, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended by the Superfund Amendment and Reauthorization Act of 1986 ("Sara"), 42 U.S.C. §9601, et seq. (hereinafter collectively "CERCLA"); the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act of 1976 ("RCRA') and subsequent Hazardous and Solid Waste Amendments of 1984, also known as the 1984 "RCRA' amendments, 42 U.S.C. §9601, et seq.; the Hazardous Material Transportation Act, 49 U.S.C. § 1801, et seq.; the Clean U01 S8- 155 Water Act, as amended, 33 U.S.C. §1311, et seq.; the Clean Air Act, as amended, 15 U.S.C. §2601 et seq.; the Federal Insecticide, Fungicide, and Rodenticide Act ("FIFRA" ), as amended, 7 U.S.C. §136-136y; the Emergency Planning and Community Right -to -Know Act of 1986 ("EPCRTKA" or EPCRA" ), as amended, 42 U.S.C. §11001, et seq. (Title III of Sara); the Occupational Safety and Health Act of 1970 ("OSHA"), as amended, 29 U.S.C. §651, et seq.; any similar state statute, including without limitation Chapters 252,255,376,403,442, Florida Statutes, as amended; and the regulations promulgated thereunder, and any other local laws regulations, including, but not limited to Chapter 24, Environmental Protection, of the Code of Miami -Dade County, Florida, as all of the foregoing may be amended, modified, supplemented, superseded or replaced at any time during the Term, that govern or relate to: (i) The existence, cleanup and/or remedy of contamination of property; (ii) The protection of the environment from spilled, deposited or otherwise emplaced contamination; (iii) The control of hazardous or toxic substances or wastes; or (iv) The use, generation, discharge, transportation, treatment, removal or recovery of Hazardous Materials. 12.1.3 "Costs" shall mean all costs incurred in connection with correcting any violations of any Environmental Laws and/or in connection with the clean-up of contamination on the Premises. 12.1.4 "Underground Storage Tanks" shall mean those certain fuel oil and petroleum underground storage tanks which may be located on the Premises as identified and described in that certain Phase I environmental audit prepared by Clayton Environmental Consultants, Clayton Project Number 23-98016.00.000 dated January 12, 1998 (hereinafter referred to as the "USTs"). 12.1.5 "Clean Up" shall mean any remediation and/or disposal of Hazardous Materials at or from the Premises which is ordered by any federal, state, or local environmental regulatory agency. 47 �8- 155 Section 12.2 Tenant's Environmental Covenant. The Tenant shall not cause or permit any Hazardous Materials to be brought upon, treated, stored, disposed of, discharged, released, produced, manufactured, generated, refined, or used upon, about or beneath the Premises or any portion thereof by the Tenant, its agents, employees, contractors, licensees, or invitees except as may be customarily used and required to conduct Restaurant Operations. Tenant shall not permit any activities on the Premises that would violate Environmental Laws. If Tenant should breach this covenant, Tenant shall take all actions necessary to comply with all Environmental Laws and shall, at Tenant's sole cost and expense, perform any Clean Up. Tenant's obligation under this section shall survive the expiration or earlier termination of this Lease for a period of one (1) year. Section 12.3 Representation by Landlord. The Landlord represents and warrants that no lawsuits, claims, legal or administrative, have been brought against Landlord, in connection with the environmental condition of the Premises or the USTs as a result of the Landlord's or any prior tenant's use or occupancy of the Premises, nor is Landlord aware of the existence of any Hazardous Materials thereon, except as may be present in connection with the USTs and/or the asbestos containing materials as expressly provided for herein. Section 12.4 Landlord's Indemnification. The Landlord hereby releases and discharges and agrees to hold harmless and defend the Tenant and its assignees, from any and all liability which may result from the presence of the USTs at the Premises. In the event that Tenant is required, as a result of enforcement action by a local, state or federal agency, to remove, dispose of or abandon the USTs, then the Parties agree that: (a) the Landlord shall undertake, at Landlord's sole cost and expense, the removal, disposal of or abandonment of the USTs and shall restore the area to the same condition as existed prior to such work taking place; or (b) the Tenant shall undertake the removal, disposal or abandonment of the USTs including the restoration of the area provided that, subject to such work being approved by the Landlord, the Landlord shall reimburse Tenant for all Costs incurred by the Tenant in connection with such work. The indemnity provided in this Section 12.4 is 48 �8- 155 subject to and limited by the provisions of Section 768.28, Florida Statutes, and notwithstanding anything herein to the contrary, nothing herein shall be deemed to constitute an obligation on the part of the Landlord to hold harmless, defend or release Tenant from any liability arising out of a negligent act or omission of the Tenant, its employees, contractors, agents or assignees. Section 12.5 Tenant's Indemnification. Tenant shall indemnify, protect, defend and hold Landlord free and harmless from and against any and all suits, actions, claims, regulatory actions, liabilities, penalties, losses, injuries, and expenses, including attorney's fees, resulting from the death or injury to any person, destruction or damage to property, arising from or caused by the presence, in or about the Premises, of any Hazardous Materials placed on or about the Premises by Tenant, or its agents, employees or assignees, or at Tenant's direction, or by Tenant's failure to comply with all applicable Environmental Laws. Section 12.6 Asbestos. The Tenant acknowledges that prior to the Lease Date, the Tenant has undertaken an environmental site assessment of the Premises and accordingly, the Tenant knows that there may be asbestos containing materials ("ACM") in the form of ceiling tiles, plaster walls and roofing material. The Tenant shall, at Tenant's sole cost and expense, Clean Up any such ACM in the event that as a result of building renovations or modifications such ACM becomes friable. Section 12.7 Survival of Tenant's and Landlord's Obligations. The respective rights and obligations of Landlord and Tenant under this Article XII shall survive the expiration or termination of this Lease for a period of one (1) year. ARTICLE XIII DAMAGE OR DESTRUCTION OF PREMISES Section 13.1 Definitions. For the purposes of this Article XIII, the following words shall have the meanings attributed to them in this Section 13.1: (a) "Completely Destroyed" means the destruction of the safe, tenantable use or occupancy of a substantial portion of the Premises under this Lease which damage cannot reasonably be repaired, restored or replaced within 49 os- 155 one hundred and eighty (180) calendar days from the date on which the damage occurred. (b) "Partial Destruction" means any damage to the Premises which damage can reasonably be repaired, restored or replaced within one hundred eighty (180) calendar days from the date on which the damage occurred. Section 13.2 Tenant's Duty to Repair, Restore or Replace the Premises After Damage. In the event of damage by fire or otherwise of the Premises including any machinery, fixtures or equipment which are a part of the Premises, the Parties agree as follows: (i) In the event of Partial Destruction, within sixty (60) calendar days of the damage (subject to reasonable delay and/or Force Majeure), the Tenant shall use the Net Insurance Proceeds available for that purpose, together with Tenant's own funds (if the Net Insurance Proceeds are insufficient) to commence and diligently pursue to completion within one hundred eighty (180) calendar days from the date the damage occurred (subject to reasonable extension and/or Force Majeure), the repair, restoration or replacement of the damaged or destroyed portion of the Premises (the "Restoration Work"), and this Lease shall remain in full force and effect, with no abatement in Rent. (ii) In the event the Premises are Completely Destroyed at any time during Lease Years one (1) through eighteen (18) of the Lease Term, and in Lease Years nineteen (19) through twenty-two (22), if the second option has been exercised, within sixty (60) days of the damage, the Tenant, in its sole discretion, shall have the option (a) at the Tenant's sole cost and expense, (together with Net Insurance Proceeds available for that purpose), to commence and diligently pursue to completion the Restoration Work, in accordance with the provisions of Section 13.3 below, and Tenant shall complete the Restoration Work within twelve (12) months from the date the damage occurred and this Lease shall remain in full force and effect, with no abatement in Rent, or (b) to elect not to undertake the Restoration Work by providing written notice to Landlord and in which event this Lease shall terminate, and the Tenant shall, at the Tenant's sole cost and expense, (but using along with the Tenant's own funds, Net Insurance Proceeds available for that purpose) deliver possession of the Premises to Landlord free and clear of all debris and Landlord and Tenant shall each be released thereby from any further obligations hereunder accruing after the effective date of such termination, except that such release shall not 50 9S_ 155 apply (aa) to any Rent or Additional Rent or other sums accrued or due (bb) Tenant's obligations regarding surrender of the Premises including the removal of debris, and (cc) environmental liability as provided for in Article XII. (iii) In the event the Premises are Completely Destroyed at any time during Lease Years nineteen (19) or twenty (20), if the second option has not been exercised, and at any time during Lease Years twenty-three (23), twenty-four (24) and twenty-five (25), either Party, in its sole discretion, shall have the right to terminate this Lease Agreement by giving written notice to the other Party within ninety (90) days from the date the damage occurred. In the event this Lease is terminated as provided above, the Tenant shall, at the Tenant's sole cost and expense, (but using along with the Tenant's own funds, Net Insurance Proceeds available for that purpose) deliver possession of the Premises to Landlord free and clear of all debris and Landlord and Tenant shall each be released thereby from any further obligations hereunder accruing after the effective date of such termination, except that such release shall not apply (aa) to any Rent or Additional Rent or other sums accrued or due (bb) Tenant's obligations regarding surrender of the Premises including the removal of debris, and (cc) environmental liability as provided for in Article XII. Section 13.3 Performance of Restoration Work. In the event Tenant undertakes any Restoration Work in accordance with the provisions of this Article, such Restoration Work by Tenant shall be substantially as possible to the condition that existed immediately prior to the damage, and shall be performed in accordance with the provisions of Article V applicable to the construction of the initial Leasehold Improvements. Landlord hereby acknowledges and agrees that Tenant's obligations hereunder and the time periods set forth above are subject to Force Majeure, and reasonable extensions based on the severity of the damage. Section 13.4 No Right to Terminate. Except for the Tenant's right to terminate this Lease Agreement in accordance with the provisions of Subsections 13.2(ii)(b) and (iii), Tenant waives the provisions of any statute, code or judicial decision which grants Tenant the right to terminate this Lease in the event of damage or destruction of the Premises. 51 qs- 155 Section 13.5 Tenant's Right to Terminate. If Tenant or Landlord elect to exercise the option given under Subsections 13.2(ii) or (iii), respectively, to terminate this Lease, then any and all Net Insurance Proceeds paid for damage or destruction of the Premises shall be applied as follows: (i) First toward the reduction of the unpaid principal balance of any and all obligations secured by a Leasehold Mortgage; (ii) Second toward cost for debris removal; and (iii) The balance of the proceeds, if any, after payment of any Rent and/or Additional Rent due, shall be paid to the Parties as their respective interests may then appear. Section 13.6 Payment for Construction of the Restoration Work. Subject to any requirements of a Leasehold Mortgagee, all Net Insurance Proceeds shall be applied by the Parties to the payment of the cost of the Restoration Work (pursuant to this Article and Section 8.4) to restore the Premises. The Net Insurance Proceeds shall be paid out, the Restoration Work shall be performed, and the Tenant shall make additional deposits with an escrow agent, if any are required, all in accordance with Section 8.4, as may be applicable. Section 13.7 Collection of Insurance Proceeds. The Landlord shall in no event be responsible for the non -collection of any insurance proceeds under this Lease Agreement but only for insurance money that shall come into its hands. Section 13.8 Unused Insurance Proceeds and Deposits. In the event any Net Insurance Proceeds or sums deposited with an escrow agent or Landlord in connection with the Restoration Work shall remain in the hands of an escrow agent or the Landlord, if the Parties have agreed to allow the Landlord to hold the insurance proceeds until completion of the Restoration Work, and if the Tenant shall not then be in default under this Lease Agreement in respect of any matter or thing of which notice of default has been served on the Tenant, then the remaining funds shall be applied first towards any unpaid Rent, and the balance paid to the Tenant. ARTICLE XIV EMINENT DOMAIN 52 0,8— 155 Section 14.1 Total Condemnation. In the event that all of the Premises (or such portion thereof as shall, in the good faith opinion of Landlord or Tenant, render it economically unfeasible to effect restoration thereof for its intended purpose) shall be taken for any public purpose by the right of condemnation, the exercise of the power of eminent domain or shall be conveyed by the Landlord and Tenant acting jointly to avoid proceedings of such taking, the Rent and money to be treated as Additional Rent pursuant to this Lease shall be prorated and paid by the Tenant to the Date of Taking or conveyance in lieu thereof, and this Lease shall terminate and become null and void as of the Date of Taking or such conveyance; and the amount of damages resulting to Landlord and Tenant, respectively, and to their respective interests in and to the Premises, the Leasehold Improvements, and in connection with this Lease, shall be separately determined and computed by the court having jurisdiction and separate awards and judgments with respect to damages to Landlord and Tenant, respectively, and to each of their respective interests, shall be made and entered. In the event that a court shall make a single Net Condemnation Award without separately determining the respective interests of Landlord and Tenant, and if Landlord and Tenant shall not agree in writing as to their respective portions of an award within twenty (20) days after the date of the final determination by the court of the amount of it, Landlord and Tenant agree to submit the matter to the court on stipulation for the purpose of a judgment determinative of their respective shares. In the event for any reason the trial judge refuses to permit a determination by judgment, then the respective interests of Landlord and Tenant shall be determined by arbitration under the provisions set forth in Section 16.7 of this Lease. In any event, the Landlord shall be entitled to receive its reversionary interest in the Premises and Leasehold Improvements and Landlord's present value of Rent and Additional Rent due under the terms of the Lease Agreement. Tenant shall be entitled to the then value of its Leasehold Estate and the Leasehold Improvements which a buyer willing but not obligated to buy, would pay therefore in an arms length transaction. In no event shall Tenant be entitled to compensation for any fee simple ownership interest in the Premises at the time of condemnation. Section 14.2 Partial Condemnation. 53 W981- 155 (a) In the event less than all of the Premises shall be taken for any public use or purpose by the right or the exercise of the power of eminent domain, or shall be conveyed by the Landlord and Tenant acting jointly to avoid proceedings of such taking, and Tenant shall be of the good faith opinion that it is economically feasible to effect restoration thereof, then this Lease and all the covenants, conditions and provisions hereunder shall be and remain in full force and effect as to all of the Premises not so taken or conveyed (except as provided in Section 14.3). Tenant shall to the extent the proceeds of the Net Condemnation Award are made available to it, pursuant to the terms hereof, remodel, repair and restore the Premises so that it shall be comparable to the Premises prior to the condemnation, taking into consideration the fact of the condemnation; provided, however, that in so doing, Tenant shall not be required to expend more than the amount of any Net Condemnation Award actually received by Tenant. (b) The Net Condemnation Award allowed to Landlord and Tenant shall be paid to and received by the Parties as follows: (i) There shall be paid to the Landlord the value of the portion of the land so taken and Landlord's reversionary interest in the improvements so taken , which land and reversionary improvements shall be valued as if unencumbered. Landlord shall further be paid an amount by which Landlord's Rent and Additional Rent have been reduced by the taking; (ii) There shall be paid to the Tenant any amount by which Tenant's profits and value of Tenant's interest in the Lease Agreement and the Premises have been reduced by the taking after any payment required by the Lease Agreement; (iii) There shall be paid to the Tenant the amount required to complete the remodeling and repairs to the Premises pursuant to (a) above; (iv) The Landlord and Tenant shall be paid portions of the balance of the Net Condemnation Award or awards, if any, which are allocable to and represented by the value of their respective interest in the Premises as found by the court in its condemnation award. In the event that a court shall make a single Net Condemnation Award without separately determining the respective interests of Landlord and Tenant, and if Landlord and Tenant shall not agree in writing as to their respective portions of such award within twenty (20) days after the date of the final determination by the court of the amount of it, Landlord and Tenant agree to submit the matter to the court on stipulation for the purpose of a judgment determinative of their 54 98- 155 respective shares. In the event for any reason the trial judge refuses to permit a determination by judgment, then the respective interests of Landlord and Tenant shall be determined by the arbitration provisions set forth under Section 16.7 of this Lease. Section 14.3. Adjustment of Rent Upon Partial Taking. In the event a part of the Premises shall be taken for any public use or purpose by the exercise of the power of eminent domain, or shall be conveyed by Landlord and Tenant acting jointly to avoid proceedings of such taking, then Rent, and money to be treated as Additional Rent pursuant to this Lease Agreement shall be paid by Tenant to the Date of Taking or conveyance in lieu thereof, and after such date the Rent for the remainder of the Premises shall be reduced in the same proportion that Gross Sales have been reduced due to such taking compared to the Gross Sales immediately prior to the taking. Section 14.4. Deposit of Condemnation Award with Escrow Agent. Unless the effect of a condemnation proceeding shall be to terminate this Lease Agreement by operation of law or as provided in Section 14.2 above, and except as may be provided in any Leasehold Mortgage to, or agreement with, any Leasehold Mortgagee described in Article 10 above, any Net Condemnation Award made in respect to the Premises in a condemnation proceeding shall be deposited with the Leasehold Mortgagee as escrow agent (unless Leasehold Mortgagee refuses to act as such, in which case the Landlord and Tenant shall select a bank to serve as escrow agent) to be disbursed for the cost of restoring the Premises and for other related purposes. Section 14.5. Rights of Leasehold Mortgagee. Landlord and Tenant shall not settle or compromise the amount or division of any Net Condemnation Award in any condemnation proceeding without any Leasehold Mortgagee's reasonable consent. Any Leasehold Mortgagee of Tenant shall be entitled to appear in any condemnation proceedings and make claim for the share of any award to which Tenant is entitled by the terms of this Article. 6SJ 08- 155 Section 14.6. Temporary Taking. In the event that all or any portion of the Premises shall be taken by the right of condemnation or the exercise of the power of eminent domain for governmental use or occupancy for a temporary period, this Lease Agreement shall not terminate and Tenant shall continue to perform and observe all of its obligations (including the obligation to pay Rent as provided throughout this Lease Agreement) as though the temporary taking had not occurred except only to the extent that it may be prevented from so doing by the terms of the order of the authority which make the temporary taking or by the conditions resulting from the taking, including the loss of its possession of all or any part of the Premises. In the event the taking for governmental occupancy is for a period entirely within the term of this Lease Agreement, then Tenant shall be entitled to receive the entire amount of any Net Condemnation Award made for the taking, whether paid by way of damages, Rent or otherwise. If the period of governmental occupancy extends beyond the termination of the Lease Term, the Landlord shall only be entitled to receive that portion of the Net Condemnation Award allocable to the period beyond the termination of the Lease Term. The amount of any Net Condemnation Award payable to Tenant, on account of a temporary taking of all or any part of the Leasehold Improvements, shall be deemed a part of the Tenant's Leasehold Estate for all purposes in this Lease Agreement. If the Net Condemnation Award does not separately determine the amount applicable to the taking of the interest of the Landlord in this Lease Agreement and in the Leasehold Improvements and if Landlord and Tenant shall not agree in writing as to the proportion of the award so applicable to the respective Parties, then Landlord and Tenant shall submit the matter to the court on stipulation for the purpose of a judgment determinative of the interest of the Parties in accordance with the terms of this Section 14.6. In the event for any reason the trial judge refuses to permit a determination by judgment, then the respective interests of Landlord and Tenant shall be determined by the arbitration provisions set forth under Section 16.7 of this Lease. 56 %R- 155 ARTICLE XV PAYMENT OF TAXES, ASSESSMENTS AND OTHER IMPOSITIONS Section 15.1 Payment of Ad Valorem Taxes. Tenant agrees that in the event the Premises or any interest thereon becomes subject to ad valorem taxation, Tenant, at its option, may enroll in the Miami -Dade County Ad Valorem Tax Payment Plan. Section 15.2 Payment of Impositions. The Tenant agrees to pay or cause to be paid, as Additional Rent, all Impositions before any fine, penalty or interest is added for nonpayment. If by law any Imposition is payable or may, in the case of taxes, at the option of the taxpayer be paid in installments (whether or not interest shall accrue on the unpaid balance of the Imposition), the Tenant may pay the same (and any accrued interest on the unpaid balance of the Imposition), in installments before any fine, penalty, interest or cost is added for the nonpayment of any installment and interest. Any Imposition relating to a fiscal period of the taxing authority, a part of which period is included before the Lease Date and part of which is included after the Lease Date shall be adjusted as between the Landlord and the Tenant as of the commencement of the Lease Term, so that the Tenant shall pay that portion of the Imposition attributable to that part of the fiscal period included in the Lease Term, and the Landlord shall pay the remainder, if applicable. Any Imposition relating to a fiscal period of the taxing authority, a part of which period is included within the Lease Term and a part of which is included in a period of time after Lease Term shall be adjusted as between the Landlord and the Tenant as of the termination of the Lease Term, so that the Tenant shall pay that proportion of the Imposition attributable to that part of the fiscal period included in the term of this Lease, and the Landlord shall pay the remainder, if applicable. Section 15.3 Proof of Payment. The Tenant shall furnish to Landlord, within thirty (30) days after the date whenever any Imposition is payable by or in behalf of the Tenant, official receipts of the 57 98- 155 appropriate taxing authority, photocopies or other proof satisfactory to the Landlord, evidencing the payment. Section 15.4 Tenant's Right to Contest Impositions. Anything herein to the contrary notwithstanding, Tenant shall have and retain the right to contest by legal proceedings, or in such other manner as it may deem suitable, any Imposition, (including ad valorem tax on the Premises and the Leasehold Improvements), or any valuation in connection therewith, without the consent of Landlord, even if the same ultimately results in the payment of any interest, costs or penalties. Notwithstanding the above, if at any time during the last Three (3) years of the Lease Term, Tenant shall contest an Imposition (including ad valorem tax on the Premises and the Leasehold Improvements), Tenant may defer payment of a contested item upon the condition that, before instituting any such proceedings, Tenant shall furnish to Landlord, or to any mortgagee Landlord may designate, a surety company bond, a cash deposit, or other security satisfactory to Landlord and such mortgagee, sufficient to cover the amount of the contested item or items, securing payment of such contested items. The legal proceedings herein referred to shall include appropriate proceedings to review tax assessments and appeals from an order issued therein and appeals from any judgments, decrees or orders. Any such contest shall delay the time periods set forth in Section 15.2 above. ARTICLE XVI DEFAULT OF TENANT Section 16.1 Tenant Default. The occurrence of any one or more of the following events is deemed a "Tenant Default": (a) If the Tenant defaults in the due and punctual payment of any installment of Minimum Annual Rent, Annual Percentage Rent or any other sums required to be paid hereunder as Additional Rent, as and when due and payable in accordance with this Lease, and such default continues for more than (10) ten days after the sum is due; (b) Except with respect to an event of Force Majeure, in the event Tenant shall cease to operate its business, unless permitted by Landlord in connection with alterations or renovations, for a period of fifteen (15) consecutive days; 5s 08- 155 (c) In the event a petition in bankruptcy under any present or future bankruptcy laws (including but not limited to reorganization proceedings or voluntary insolvency filing) be filed by or against Tenant and such petition is not dismissed within Thirty (30) days from the filing thereof, or in the event Tenant is adjudged a bankrupt; Tenant; (d) In the event an assignment for the benefit of creditors is made by (e) In the event of an appointment by any court of a receiver or other court officer of Tenant's Premises and such receivership is not dismissed within thirty (30) days from the date of such appointment; (f) In the event Tenant removes, attempts to remove, or permits to be removed from the Premises, except in the usual course of trade, the Leasehold Improvements (furnishings, fixtures, and equipment) installed or placed upon the Premises by the Tenant during the Lease Term; (g) In the event Tenant, before the expiration of the term of this Lease, and without the written consent of Landlord, vacates the Premises or abandons the possession thereof, or uses the same for purposes other than the purposes for which the same are hereby leased, or ceases to use the Premises for the purposes herein contained; (h) In the event an execution or other legal process is levied upon the goods, furniture, effects or other personal property of Tenant brought on the Premises, or upon the interest of Tenant in this Lease, and the same is not satisfied or dismissed within thirty (30) days from such levy; or (i) In the event Tenant defaults in the due performance or observance of any lease covenant or condition or provision, other than the payment of Rent, and such default continues for more than (15) fifteen days after written notice of the default from the Landlord to the Tenant, or such longer period as is reasonably necessary to diligently cure such default. Section 16.2 Remedies of Landlord. (a) If any Tenant Default occurs, Landlord shall have the right after the expiration of the applicable cure period, at the option of Landlord, to terminate this Lease upon providing fifteen (15) days written notice if the default has not been cured by the expiration of 6M 98- 155 such fifteen (15) day period. An Event of Default shall be deemed to have occurred at the expiration of such fifteen (15) day period if the default has not been cured by the expiration of such fifteen (15) day period. Additionally, if any Event of Default occurs, Landlord may, at its option, from time to time, without terminating this Lease, re-enter and re -let the Premises, or any part thereof, as the agent and for the account of Tenant upon such terms and conditions as Landlord may deem advisable or satisfactory, in which event the rents received on such re -letting shall be applied first to the expenses of such re -letting and collection including but not limited to, necessary renovation and alterations of the Premises, reasonable attorneys fees, any real estate commissions paid, and thereafter toward payment of all sums due or to become due to Landlord hereunder, and if a sufficient sum shall not be thus realized or secured to pay such sums and other charges, at Landlord's option, Tenant shall pay Landlord any deficiency immediately upon demand therefor, notwithstanding that Landlord may have received periodic rental in excess of the periodic rental stipulated in this Lease in previous or subsequent rental periods, and Landlord may bring an action therefore as such deficiency shall arise. Nothing herein, however, shall be construed to require Landlord to re-enter and re -let the Premises in any event. Landlord shall not, in any event, be required to pay Tenant any surplus of any sums received by Landlord on a re - letting of said Premises in excess of the rent provided in this Lease. (b) If any Event of Default occurs, Landlord shall have the right to obtain injunctive and declaratory relief, temporary and/or permanent, against Tenant or any acts, conduct or omissions of Tenant, and to further obtain specific performance of any term, covenant or condition of this Lease. (c) If any Event of Default occurs, Landlord shall have the right, at its option, to declare all Rent (or any portion thereof) for the entire remaining Lease Term, and other indebtedness owing by Tenant to Landlord, if any, immediately due and payable without regard to whether possession of the Premises shall have been surrendered to or taken by Landlord, and may commence action immediately thereupon and recover judgment therefor. (d) If any Event of Default occurs, Landlord, in addition to other rights and remedies it may have, shall have the right to remove all or any part of Tenant's personal property from the Premises and any personal property removed may be stored in any public warehouse or elsewhere at the cost of, and for the account of Tenant, and Landlord shall not be responsible for 60 �8 - 155 the care or safekeeping thereof whether in transport, storage or otherwise, and Tenant hereby waives any and all claim against Landlord for loss, destruction and/or damage or injury which may be occasioned by any of the aforesaid acts. (e) No such re-entry or taking possession of the Premises by Landlord shall be construed as an election on Landlord's part to terminate this Lease unless a written notice of such intention is given to Tenant. Notwithstanding any such re -letting without termination, Landlord may at all times thereafter elect to terminate this Lease for such previous default. Any such re- entry shall be allowed by Tenant without hindrance, and Landlord shall not be liable in damages for any such re-entry, or guilty of trespass or forcible entry. (f) Any Rent which may be due Landlord, whether by acceleration or otherwise as herein provided in this Article, shall include Minimum Annual Rent, Annual Percentage Rent and any other rents, costs and expenses denominated as Additional Rent in this Lease. (g) It is expressly agreed that the forbearance on the part of Landlord in the institution of any suit or entry of judgment for any part of the Rent herein reserved to Landlord, shall not serve as a defense against nor prejudice a subsequent action for such Rent. Tenant hereby expressly waives Tenant's right to claim a merger or waiver of such subsequent action in any previous suit or in the judgment entered therein. Furthermore, it is expressly agreed that claims for liquidated Minimum Annual Rent and/or Annual Percentage Rent may be regarded by Landlord, if it so elects, as separate and independent claims capable of being separately assigned. (h) Any and all rights, remedies and options given in this Lease to Landlord shall be cumulative and in addition to and without waiver of, or in derogation of, any right or remedy given to it under any laws now or hereafter in effect. Section 16.3 No Waiver by Landlord. The waiver (either expressed or implied by law) by Landlord of any default of any term, condition or covenant herein contained shall not be a waiver of any subsequent default of the same or any other term, condition or covenant herein contained. The consent or approval by Landlord to or of any act by Tenant requiring Landlord's consent or approval shall not be deemed to waive or render unnecessary Landlord' s consent to or approval of any subsequent similar act 61 OWJ8- 155 by Tenant. No re-entry hereunder shall bar the recovery of rents or damages for the default or delay on the part of Landlord to enforce any right hereunder and shall not be deemed a waiver of any preceding default by Tenant of any term, covenant or condition of this Lease, or a waiver of the right of Landlord to annul this Lease or to re-enter the Premises or to re -let same. Section 16.4 Late Payments. In the event any payment due Landlord under this Lease shall not be paid on the due date, Tenant agrees to pay, in addition to the payment then due, one-half percent (0.5%) of the amount due, for each day that the payment is late, (the "Late Fee"), and in the event that any check, bank draft, order for payment or negotiable instrument given to Landlord for any payment under Lease shall be dishonored for any reason whatsoever not attributable to Landlord, Landlord, in addition to the one-half percent (0.5%) Late Fee, shall be entitled to make an administrative charge to Tenant of one hundred dollars ($100), or the actual charge, to Landlord by Landlord's bank for dealing with such dishonored tender, whichever is more. In the event that it shall be necessary for Landlord to give more than one (1) written notice to Tenant of any violation of this Lease, during the term hereof, Landlord shall be entitled to make an administrative charge to Tenant of twenty-five dollars ($25) for each such subsequent notice after the first notice. Tenant recognizes and agrees that the charges which Landlord is entitled to make upon the conditions stated in this section represent, at the time this Lease is made, a fair and reasonable estimate and liquidation of the costs of Landlord in the administration of the Premises resulting from the events described which costs are not contemplated or included in any Rent, or other charges provided to be paid by Tenant to Landlord in this Lease. Any charges becoming due under this Section of this Lease shall be added to and become due with the late payment for which the charge was assessed and shall be collectible as a part thereof. Section 16.5 Le ag l Expenses. In the event that it shall become necessary for either Tenant or Landlord to employ the services of an attorney to enforce any of their respective rights under this Lease or to collect any sums due to them under this Lease or to remedy the breach of any covenant of this Lease on the part of either party to be kept or performed, regardless of whether suit be brought or not, either party shall pay to other such reasonable fees and costs as shall be charged by the damaged party's for such services. Should suit be brought for the recovery of possession of the Premises, 62 "8- 155 or for Rent or any other sum due Landlord under this Lease, or because of the default of any of Tenant's covenants under this Lease, Tenant shall pay to Landlord all expenses of such suit and any appeal thereof, including a reasonable attorneys' fee at both the trial and appellate level. Section 16.6 Remedies Cumulative. No remedy conferred upon or reserved to the Landlord or the Tenant shall be considered exclusive of any other remedy, but shall be cumulative and shall be in addition to every other remedy given under this Lease or existing at law or in equity or by statute; and every power and remedy given by this Lease to the Landlord or the Tenant may be exercised from time to time and as often as occasion may arise or as may be deemed expedient by the Landlord or the Tenant. No delay or omission of Landlord or Tenant to exercise any right or power arising from any default shall impair any right or power, nor shall it be construed to be a waiver of any default or any acquiescence in it. Section 16.7 Arbitration. (a) Request to Arbitrate. The Parties hereby agree that, subject to the consent of the City Manager and the Tenant, which consent may be withheld by either party for any reason, any dispute, disagreement or controversy arising under this Lease, or with respect to the interpretation or enforcement of this Lease may be settled by arbitration. Either Party may request to arbitrate by providing written notice to the other Party setting forth the nature of the request to arbitrate. Within fifteen (15) days of receipt of such request to arbitrate, the other Party shall respond as to its agreement or disagreement to arbitrate. Failure of the other Party to respond shall be deemed denial of a request to arbitrate. (b) Procedures. In the event arbitration is agreed to, the following procedures will govern any arbitration according to this Lease. (i) Within ten (10) days of the Parties agreeing to arbitrate, each party shall designate an arbitrator. (ii) Within ten (10) days after the appointment of the two arbitrators, the two arbitrators shall meet and appoint a third arbitrator which shall constitute the Arbitration Panel. 63 58 - 155 (iii) Every member of the Arbitration Panel must be a member of the American Arbitration Association (hereinafter referred to as a "Member"). In addition to the foregoing criterion, each Member shall satisfy the following conditions: (i) no Member shall be a person who is or has been an employee of either the Landlord or Tenant during the five (5) year period immediately preceding his or her appointment; (ii) each Member shall be neutral and independent of the Parties to this Lease; (iii) no Member shall be affiliated with either Parties' auditors; and (iv) no Member shall have a conflict of interest with (including, without limitation, any bias towards or against) a Party hereto. (iv) If either party shall fail to designate a Member within ten (10) days after receipt of the written notice from the other party, then such other party may request the President of the Florida Chapter of the American Arbitration Association to designate a Member, who, when so designated, shall act in the same manner as if he had been the Member designated by the party so failing to designate an arbitrator. (v) If the two Members appointed by the Parties are unable to agree upon the third Member within ten (10) days from the last date of designation, then upon the request of either of the two (2) Members, or either Party, such third Member shall be designated by the President of the Florida Chapter of the American Arbitration Association, who shall appoint such third Member within ten (10) days of the request. (vi) A hearing shall be commenced within thirty (30) days following the selection of the Arbitration Panel. The Parties shall each make a good faith effort to cooperate with each other in all respects in connection with the exchange of documents relevant to the subject dispute. A court reporter shall make a transcript of the hearing. The Parties and the Arbitration Panel shall use their best efforts to conclude the hearing within ten (10) days. The Parties shall be entitled to such pre-trial discovery as they may agree, or as determined by the Arbitration Panel. The Arbitration Panel shall have the right to question witnesses at the hearing, but not to call witnesses. The Arbitration Panel may grant continuances only by the agreement of both Parties. The Arbitration Panel may render a decision at the close of the hearing, or may request briefs on any or all issues. Any and all such briefs, including reply briefs, shall be filed with the terms and on the schedule set by the Arbitration Panel, but in any event no later than forty-five (45) days following the commencement of the hearing. The Arbitration Panel shall render a 64 9- 155 determination within thirty (30) days from the conclusion of the hearing, and in the event briefs are submitted, within thirty (30) days after receipt of said briefs. If no determination is rendered within such time, unless the Parties agree otherwise, a new Arbitration Panel shall be selected as described above, but the new Arbitration Panel shall render a determination solely upon review of the record of the hearing without a further hearing. (vii) All actions, hearings and decisions of the Arbitration Panel shall be conducted, based upon and in accordance with the Commercial Arbitration Rules of the American Arbitration Association. In determining any matter before them, the Arbitration Panel shall apply the terms of this Lease Agreement, and shall not have the power to vary, modify or reform any terms or provisions of the Lease Agreement in any respect. No Arbitrator is authorized to make an award of punitive or exemplary damages. The Arbitration Panel shall afford a hearing to the Landlord and to the Tenant who shall each have the right to be represented by counsel at such hearing and to call witnesses, and the right to submit evidence with the privilege of cross- examination on the question at issue. All arbitration hearings shall be held at a place designated by the Arbitration Panel in Miami -Dade County, Florida. (viii) The Arbitration Panel selected hereunder shall agree to observe the Code of Ethics for Arbitrators in Commercial Disputes promulgated by the American Arbitration Association and the American Bar Association, or any successor code. The decision of a majority with respect to any matter referred to it under this Lease shall be final, binding and conclusive on the Landlord and Tenant and enforceable in any court of competent jurisdiction. Together with the determination, the Arbitration Panel shall provide a written explanation of the basis for the determination. Each party shall pay the fees and expenses of the Member of the Arbitration Panel designated by such party, such party's counsel and witness fees, and one-half ('/2) of all expenses of the third Member of the Arbitration Panel. The decision of the Arbitration Panel will be final, and may be enforced according to the laws of the State of Florida and judgment upon the award rendered by the Arbitration Panel shall be entered in any Court having jurisdiction thereof. ARTICLE XVII ACCESS BY LANDLORD 65 08- 155 Section 17.1 Right of Entry. Landlord and Landlord's agents shall have the right to enter the Premises at all reasonable times upon reasonable notice to the Tenant (except in the case of an emergency when no notice is required), to examine the same. If Tenant shall not be personally present to open and permit entry into the Premises at any time when for any reason an entry therein shall be necessary or permissible, Landlord or Landlord's agents may enter the same without in any manner affecting the obligations and covenants of this Lease. Nothing herein contained, however, shall be deemed or construed to impose upon Landlord any obligation, responsibility or liability whatsoever, for the care, maintenance or repair of the Premises or any part thereof, except as otherwise herein specifically provided. ARTICLE XVIII DAMAGE TO TENANT'S PROPERTY Section 18.1 Loss and Damage. Unless caused by a negligent act or omission of Landlord or the Landlord's officers, employees, or agents, the Landlord shall not be responsible for any damage to any property of Tenant (including without limitation appliances, equipment, machinery, stock, inventory, fixtures, furniture, improvements, displays, decorations, carpeting and painting), or of others located on the Premises, nor for the loss of or damage to any property of Tenant, or of others by theft or otherwise. Landlord shall not be liable for any injury or damage to persons or Premises resulting from fire, smoke, explosion, falling plaster, steam, gas, electricity, water, rain, or leaks from any part of the Premises or from the pipes, appliances or plumbing works or from the roof, street or subsurface or from any other place by dampness or by any other cause of whatsoever nature. -Landlord shall not be liable for any latent defect in the Premises. All property of Tenant kept or stored on the Premises shall be so kept or stored at the risk of Tenant only and Tenant shall hold Landlord harmless from any and all claims arising out of damage to same, including subrogation claims by Tenant's insurance carriers. ARTICLE XIX HOLDING OVER, SUCCESSORS 66 08- 155 Section 19.1 Holding Over. In the event Tenant remains in possession of the Premises after the expiration of the Lease Term, Tenant, at the option of Landlord, shall be deemed to be occupying the Premises as a tenant at sufferance at a monthly rental equal to two (2) times the Minimum Annual Rent and the Annual Percentage Rent of the preceding Lease Year, payable during the last month of the Lease Term hereof. In addition, Tenant agrees to pay monthly: (a) one -twelfth (1/12) of the taxes for the Premises based upon the total taxes payable for the Lease Year immediately prior to the Lease Year in which the expiration occurs; (b) cost of insurance for which Tenant would have been responsible if this Lease had been renewed on the same terms contained herein; (c) all sales taxes assessed against such increased rent, and (d) any and all Additional Rent otherwise payable by Tenant hereunder. Such tenancy shall be subject to all the other conditions, provisions and obligations of this Lease. Tenant's obligation to pay any rents or sums provided in this Lease shall survive the expiration or earlier termination of this Lease. Section 19.2 Successors. All rights and liabilities herein given to, or imposed upon, the respective Parties hereto shall extend to and bind the several respective heirs, executors, administrators, successors, and permitted assigns of the said Parties; and if there shall be more than one Tenant, they shall be bound jointly and severally by the terms, covenants and agreements herein. Nothing contained in this Lease shall in any manner restrict Landlord's right to assign or encumber this Lease and, in the event Landlord sells its interest in the Premises and the purchaser assumes Landlord's obligations and covenants, Landlord shall thereupon be relieved of all further obligations hereunder. 67 �,k__ 155 ARTICLE XX MINORITY AND WOMEN PARTICIPATION AND EQUAL EMPLOYMENT OPPORTUNITIES Section 20.1 Minority and Women Participation. The Tenant shall comply with the provisions set forth in The Minority and Women Business Affairs and Procurement Program Ordinance of the City of Miami, as amended, and the First Source Hiring Agreement, as they currently exist and as they may be amended hereafter, both of which are attached hereto as Exhibit "C" and incorporated herein. In compliance therewith, Tenant agrees during construction and operation of the Premises; (a) it will take reasonable affirmative action in the recruitment and recruitment advertising to attract and retain qualified minority and female contractors and subcontractors; (b) provide a reasonable opportunity in the recruitment, recruitment advertising and hiring for contractors and subcontractors residing within the City of Miami; (c) will take reasonable affirmative action to retain employees regardless of race, color, place of birth, religion, national origin, sex, age, marital status, veteran and disability status; (d) maintain equitable principles in the recruitment, recruitment advertising, hiring, upgrading transfer, layoff, termination, compensation and all other terms, conditions and privileges of employment; and (e) monitor and review personnel practices to guarantee that equal opportunities are being provided to all employees, regardless of gender, race, color, place of birth, religion, national origin, sex, age, marital status, veteran and disability status. Section 20.2 Equal Employment Opportunities. The Tenant agrees that during the Lease Term; (a) it will not discriminate against any employee or applicant for employment because of race, creed, color, place of birth, religion, national origin, sex, age, marital status, veteran and disability status and will take affirmative action to assure that applicants are employed and that employees are treated during employment without regard to race, creed, color, place of birth, religion, national origin, sex, age, marital status, veteran and disability status; (b) post in conspicuous places, available to employees and applicants for employment, notices, the form of which is to be provided by the Landlord, setting forth provisions for this nondiscrimination clause; (c) in all solicitations or advertisements for 68 58- 155 employees placed by or on behalf of the Tenant shall state that all qualified applicants will receive consideration for employment without regard to race, creed color or national origin; and (d) to send to each labor union or representative of workers with which the construction contractor has a collective bargaining agreement or other contract or understanding a notice, the form of which is to be provided by the Landlord, advising the union or representative of the Tenant's commitment and posting copies of the notice in a conspicuous places available to employees and applicants for employment. Section 20.3 Affirmative Action. Tenant shall have in place an Affirmative Action/Equal Opportunity Policy and shall institute a plan for its achievement which will require that action be taken to provide equal opportunity in hiring and promoting for women, minorities, the disabled and veterans. Such plan will include a set of positive measures which will be taken to insure nondiscrimination in the work place as it relates to hiring, firing, training and promotion. In lieu of such a policy/plan, Tenant shall submit a Statement of Assurance indicating that their operation is in compliance with all relevant Civil Rights laws and regulations. ARTICLE XXI MISCELLANEOUS Section 21.1 Accord and Satisfaction. No payment by Tenant or receipt by Landlord of a lesser amount than the Rent herein stipulated to be paid shall be deemed to be other than on account of the earliest stipulated Rent, nor shall any endorsement or statement on any check or any letter accompanying any check or payment as rent be deemed an accord and satisfaction, and Landlord may accept such check or payment without prejudice to Landlord's right to recover the balance of such Rent or pursue any other remedy provided herein or by law. Section 21.2 Entire Agreement. This Lease and the Exhibits attached hereto and forming a part thereof as if fully set forth herein constitute all of the covenants, promises, agreements, conditions and understandings between Landlord and Tenant concerning the Premises and there are no 1st ",Q-- 155 covenants, promises, conditions or understandings, either oral or written, between them other than as are herein set forth. Neither Landlord nor Landlord's agents have made nor shall be bound to any representations with respect to the Premises except as herein expressly set forth, and all representations, either oral or written, shall be deemed to be merged into this Lease. No course of prior dealings between the Parties or their officers employees, agents or affiliates shall be relevant or admissible to supplement, explain or vary any of the terms of this Lease. Acceptance of, or acquiescence in, a course of performance rendered under this or any prior agreement between the Parties or their affiliates shall not be relevant or admissible to determine the meaning of any of the terms of this Lease. Except as herein otherwise provided, no subsequent alteration, change or addition to this Lease shall be binding upon Landlord or Tenant unless reduced to writing and signed by the Parties. This Lease has been negotiated "at arm's length" by and between Landlord and Tenant, each having the opportunity to be represented by legal counsel of its choice and to negotiate the form and substance of this Lease, and therefore in construing the provisions of this Lease neither party will be deemed disproportionately responsible for draftsmanship. Section 21.3 Independent Parties It is understood and agreed by the Parties hereto that this Lease does not create a fiduciary or other relationship between Landlord and Tenant, other than Landlord and Tenant or contracting parties, as applicable. Landlord and Tenant are and shall be independent contracting parties and nothing in this Lease is intended to make either Party a general or special agent, joint venturer, partner or employee of the other for any purpose. Section 21.4 Notices. Any notice by the Parties required to be given must be served by certified mail return receipt requested, or by hand delivery, addressed to Landlord or Tenant at: If to Landlord at: City Manager City of Miami 444 SW 2 Avenue, 10t' Floor Miami, Florida 33130 70 If to Tenant at: Alamilla and Associates, Inc. Carlos Alamilla, President c/o Carol and Associates, PA 201 S. Biscayne Boulevard, #2400 Miami, FL 33131 08-- 155 With a copy to: City of Miami Asset Management 444 SW 2 Avenue, Suite 325 Miami, Florida 33130 With a copy to: Rasco, Reininger and Perez, PA 5700 Blue Lagoon Drive, Suite 700 Miami, FL 33126 All notices given hereunder shall be effective and deemed to have been given upon receipt by the party to which notice is being given, said receipt being deemed to have occurred upon hand delivery or posting, or upon such date as the postal authorities shall show the notice to have been delivered, refused, or undeliverable, is evidenced by the return receipt or proof of deliver. Notwithstanding any other provision hereof, Landlord shall also have the right to give notice to Tenant in any other manner provided by law. If there shall be more than one Tenant, any notice required or permitted by the terms of this Lease may be given by or to any one thereof, and shall have the same force and effect as if given to all thereof. Section 21.5 Captions and Section Numbers. The captions, section numbers, and article numbers appearing in this Lease are inserted only as a matter of convenience and in no way define, limit, construe, or describe the scope or intent of such sections or articles of this Lease nor in any way affect this Lease. Section 21.6 Partial Invalidity. If any term, covenant or condition of this Lease or the application thereof to any person or circumstances shall, to any extent, be invalid or unenforceable, the remainder of this Lease, the application of such term, covenant or condition to persons or circumstances other than those as to which it is held invalid or unenforceable, shall not be affected thereby and each term, covenant or condition of this Lease shall be valid and enforceable to the fullest extent permitted by law. Section 21.7 Estoppel Certificate. Tenant agrees that it will, at any time and from time to time, within ten (10) Business days following written notice by Landlord specifying that it is given pursuant to this Section, execute, acknowledge and deliver to Landlord a statement in writing certifying that this Lease is unmodified and in full force and effect (or if there have been modifications, that the same 71 08- 155 is in full force and effect and stating the modifications), and the date to which the Minimum Annual Rent, Annual Percentage Rent and any other payments due hereunder from Tenant have been paid in advance, if any, and stating whether or not there are defenses or offsets claimed by Tenant and whether or not to the best knowledge of Tenant, Landlord is in default in performance of any, covenant, agreement or condition contained in this Lease, and if so, specifying each such default of which Tenant may have knowledge. The failure of Tenant to execute, acknowledge and deliver to Landlord a statement in accordance with the provisions of this Section within said ten (10) Business day period shall constitute an Event of Default hereunder and shall also constitute an acknowledgment by Tenant, which may be relied on by any person holding or proposing to acquire an interest in the Premises or any party thereof or this Lease from or through the other party, that this Lease is unmodified and in full force and effect and that such rents have been duly and fully paid to and including the respective due dates immediately preceding the date of such notice and shall constitute, as to any person entitled as aforesaid to rely upon such statement, a waiver of any defaults which may exist prior to the date of such notice. It is agreed that nothing contained in the provisions of this Section shall constitute waiver by Landlord of any default in payment of rent or other charges existing as of the date of such notice and, unless expressly consented to in writing by Landlord and, Tenant shall still remain liable for the same. Section 21.8 Recording. Either party may record this Lease, or any memorandum or short form thereof. Section 21.9 Waiver. Failure on the part of either part of complain of any action or non -action on the part of the other, no matter how long the same may continue, shall never be deemed to be a waiver by such party of any of its rights hereunder. Further, it is covenanted and agreed that no waiver at any time of any of the provisions hereof by either party shall be construed as a waiver of any of the other provisions hereof, and that a waiver at any time of any of the provisions hereof shall not be construed as a waiver at any subsequent time of the same provisions. The consent or approval to or of any action by either party requiring such consent or approval shall not be deemed to waive or render unnecessary such consent or approval to or of any subsequent similar act by such party. Section 21.10 Time is of the Essence. 72 e,q_ 155 Time is of the essence with respect to the performance of every provision of this Lease in which time of performance is a factor. Section 21.11 No Discrimination. It is intended that the Premises shall be developed so that all customers, employees, licensees and invitees of the Tenants shall have the opportunity to obtain all the goods, services, accommodations, advantages, facilities and privileges of the Premises without discrimination because of race, creed, color, sex, age, national origin, ancestry, handicap or disability of any kind. To that end, Tenant shall not discriminate in the conduct and operation of its business in the Premises against any person or group of persons because of the race, creed, color, sex, age, national origin, ancestry, handicap or disability of such person or group of persons. Section 21.12 Governing Law. It is the intent of the Parties hereto that all questions with respect to the construction of the Lease and the rights and the liabilities of the Parties hereto shall be determined in accordance with the laws of Florida and that all disputes arising hereunder shall be heard and decided in Miami -Dade County, Florida. Section 21.13 Waiver of Counterclaims. Tenant shall not impose any counterclaim or counterclaims for damages in a summary proceeding or other action based on termination or holdover, it being the intent of the Parties hereto that Tenant be strictly limited in such instances to bringing a separate action in the court of appropriate jurisdiction. The foregoing waiver is a material inducement to Landlord making, executing and delivering this Lease and Tenant's waiver of its right to counterclaim in any summary proceeding or other action based on termination or holdover is done so knowingly, intelligently and voluntarily. Section 21.14 Waiver of Jury Trial. Landlord and Tenant hereby waive trial by jury in any action, proceeding or counterclaim brought by either of the Parties hereto against the other on, or in respect of, any matter whatsoever arising out of or in any way connected with this Lease, the relationship of Landlord and Tenant hereunder, Tenant's use or occupancy of the Lease Premises and/or any 73 155 claim of injury or damage. Section 21.15 Quiet Enjoyment. Subject to the terms of this Lease, upon the observance by the Tenant hereunder of all the terms, provisions, covenants and conditions impose dupon the Tenant, the Landlord covenants to the Tenant that the Tenant shall peaceably and quietly hold, occupy and enjoy the Premises for the Lease Term without any interruption, disturbance or hindrance by the Landlord, its successors and assigns, or by persons claiming by, through or under the Landlord for the Premises leased herein, or by persons with title superior to the Landlord, its successors and assigns. Section 21.16 Surrender of Possession. Upon the expiration or earlier termination of the Lease pursuant to the provisions hereof, the Tenant shall deliver to the Landlord possession of the Premises in good repair and condition, reasonable wear and tear excepted. Section 21.17 Attorney 's Fees. In the event that legal action is taken by either party to enforce any of the provisions of this Lease, the prevailing party shall be entitled to reasonable attorney's fees in connection with any such action. Section 21.18 Joint and Several Liability. If two or more individuals, corporations, partnerships or other business associations (or any combination of two or more thereof) shall sign this Lease as Tenant, or by virtue of a Transfer assume the rights and obligations of the Tenant hereunder, the liability of each such individuals, corporations, partnerships or other business associations (or any combination of two or more thereof) to pay Rent and perform all other obligations hereunder shall be deemed to be joint and several, and all notices, payments and agreements given or made by, with or to any one of such individuals, corporations, partnerships or other business associations (or any combination of two or more thereof) shall be deemed to have been given or made by, with or all of them. Section 21.19 Third Party Beneficiary. Nothing contained in this Lease shall be construed so as to confer upon any other 74 �1Q_ 155 party the rights of third party beneficiary except rights contained herein for the benefit of a Leasehold Mortgagee. Section 21.20 Radon. Radon is a naturally occurring radioactive gas that, when it has accumulated in a building in sufficient quantities, may present health risks to persons who are exposed to it over time. Levels of Radon that exceed Federal and State guidelines have been found in buildings in Florida. Additional information regarding Radon and Radon testing may be obtained from your county public health unit. Section 21.21 No Liability for Act of other Party Tenant shall not sign any contract, application for any license or permit or do anything that may result in liability to the Landlord for any indebtedness or obligation of Tenant, unless expressly provided herein or approved in writing by the Landlord. Except as expressly authorized in writing, neither Landlord nor Tenant shall make any express or implied agreement, warranties, guarantees or representations or incur any debt, or represent that their relationship is other than Landlord and Tenant, unless otherwise agreed to herein for the management and operation of the Premises and neither Landlord nor Tenant shall be obligated by or have any liability under any agreements or representations made by the other that are not expressly authorized as aforesaid. Landlord reserves the right, at its sole option, to refuse an agreement for any Federal, State or local grants and loans when the acceptance of same by either Landlord or Tenant may impose a hardship upon Landlord or include obligations which extend beyond the Lease Term. Section 21.22 Consents and Approvals. Except as otherwise provided in Sections 16.7, 13.2(iii) and 21.21, the Landlord agrees that whenever in this Lease the Landlord's consent or approval or act is required or permitted, such consent, approval or act shall not be unreasonably withheld or delayed; and that whenever in this Lease, the Landlord may request or require some act or thing of Tenant, such request or requirement shall not be unreasonably withheld, conditioned or delayed. At all times during the Lease Term, each Party shall conduct itself in a commercially reasonable manner subject to the Landlord's obligations to protect its proprietary interests and carry out its regulatory powers which shall be effected in a not unjustly discriminatory manner. 75 vS- 155 Section 21.23 Rights, Privileges and Immunities, Covenants. The Tenant shall have, and the Landlord shall fully cooperate in providing to the tenant, for its use and enjoyment, all rights, privileges and immunities as shall from time to time be granted or afforded by Federal, State or local law to restaurant operators or proprietors. The Parties agree that each of the terms, covenants and conditions hereof agreed to be observed or performed by each party shall constitute concurrent conditions of exchange. Section 21.24 Approval by the Oversight Board. The State of Florida has appointed an Emergency Financial Oversight Board (the "Oversight Board") which is empowered to review and approve all pending City of Miami contracts. As a result, contracts shall not be binding on the Landlord until such time as they have been approved by the Oversight Board. Execution of this Lease Agreement by the City Manager shall constitute evidence of its approval by the Oversight Board. IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease, or have caused the same to be executed, as of the date and year first above written. ATTEST: Walter J. Foeman City Clerk 76 LANDLORD: CITY OF MIAMI, a municipal corporation of the State of Florida Jose Garcia -Pedrosa City Manager 5IS-- 155 ATTEST: LIM Print Name and Title APPROVED AS TO INSURANCE REQUIREMENTS: Mario Soldevilla Risk Management Department 77 TENANT: Alamilla and Associates, Inc. Print Name and Title APPROVED AS TO FORM AND CORRECTNESS: A. Quinn Jones, III City Attorney J 155 CITY OF MIAMI, FLORIDA 16 INTER -OFFICE MEMORANDUM FEB 2 i,�Ia;r TO: Honorable Chairman and DATE: FILE Members of the City Commission Resolution Authorizing the City SUBJECT: Manager to Execute a Lease Agreement With Alamilla and Associates, Inc. for Firehouse Four Restaurant FROM: Jose Garcia -Pedrosa REFERENCES: City Manager City Commission Agenda ENCLOSURES: February 10, 1998 It is recommended that the City Commission adopt the attached Resolution authorizing the City Manager to execute a Lease Agreement, in substantially the attached form, with Alamilla and Associates, Inc., for the leasing, management and operation of a restaurant on the City -owned property located at 1000 South Miami Avenue, Miami, Florida, subject to an assignment to Firehouse IV of Miami, Inc. BACKGROUND: The following is a summary of City Commission legislation related to the leasing of this property: Reso. No. 96-528 July 11, 1996 Authorizing the City Manager to issue a Request for Proposals (RFP) for the leasing and management of a restaurant at 1000 S. Miami Avenue Motion No. 96-723 October 10, 1996 Appointing a Review Committee to evaluate and rank proposals in response to the RFP Reso. No. 97-13 January 16, 1997 Selecting Firehouse Four, LLC as the successful proposer for the leasing of 1000 S. Miami Avenue; directing the City Manager to negotiate a lease agreement with said proposer Reso. No. 97-148 March 20, 1997 Authorizing the City Manager to execute a lease with Firehouse Four, LLC for the leasing, management and operation of a restaurant 98- 155 Reso. No. 97-411 June 9, 1997 Granting Firehouse Four, LLC an additional 30 days to comply with the terms and conditions of the lease agreement dated April 24, 1997; deadline to be no later than July 9, 1997 Discussion Item July 10, 1997 Direction to Administration to begin negotiations with the second ranked firm which bid for the Firehouse Four property under the same conditions as the firm who was awarded said contract Motion No. 97-728 October 14, 1997 Directing the City Manager to require a final proposal from Alamilla & Associates, Inc. in connection with the lease of 1000 S. Miami Avenue no later than Friday October 17, 1997; further directing the City Manager to come back with a recommendation for Commission consideration on this matter at the meeting of October 28, 1997 Motion No. 97-758 October 28,1997 Instructing the Administration to continue negotiations with Alamilla and Associates, Inc. Motion No. 97-888 December 9, 1997 Instructing the Administration to proceed with negotiations concerning the Firehouse lease; proceed with a transfer of current negotiations from Alamilla and Associates, Inc. to Firehouse IV of Miami, Inc.; directing the administration to bring back the proposed lease to the Commission on 1/13/98 Motion No. 98-60 January 13, 1998 Granting an extension to Firehouse IV of Miami, Inc. until noon on Friday, January 16, 1998 to finalize with the administration the terms for the lease for the property known as Firehouse Four Restaurant; further stipulating that if said time frame is not met, the City is to reject all proposals received in connection with said property and proceed to issue a new RFP 2 �,�_ 155 The proposed lessee has met all the requirements specified at the January 13, 1998 City Commission meeting as of noon, Friday, January 16, 1998. THE LEASE AGREEMENT: The Lease is for a period of fifteen (15) years with two (2) five (5) year renewal options, requiring said lessee to make a total investment in the property of not less than $367,285. Upon execution of the lease agreement, said lessee is requited to pay to the City the sum of $57,375 which represents prepayment of the minimum annual rent for the first six months of the lease term and six months security deposit. Pursuant to the RFP, lessee has been granted a fifty percent (50%) reduction in the minimum annual rent due for the first six months of the lease. The lessee is required to pay to the City the following minimum annual rent plus a percentage of gross revenues, which exceeds the goals established in the RFP for percentage rent (see Exhibit "A!'). YEAR FIXED MINIMUM ANNUAL RENT ANNUAL PERCENTAGE RENT 1 $ 57,375 plus 11% over $2,200,000 2 $ 76,500 plus 11 % over $2,200,000 3 $ 76,500 plus 11 % over $2,200,000 4 $ 83,385 plus 11% over $2,400,000 5 $ 83,385 plus 11% over $2,400,000 6 $ 83,385 plus 11% over $2,400,000 7 $ 90,890 plus 11 % over $2,600,000 8 $ 90,890 plus 11% over $2,600,000 9 $ 90,890 plus 11% over $2,600,000 10 $ 99,896 plus 11 % over $2,850,000 11 $ 99,896 plus 11% over $2,850,000 12 $ 99,896 plus 11 % over $2,850,000 13 $107,896 plus 11% over $3,100,000 14 $107,896 plus 11% over $3,100,000 15 $107,896 plus 11 % over $3,100,000 TOTAL $1,356,576 A summary of the lease is attached hereto as Exhibit "B". cc: Honorable Mayor Xavier L. Suarez 0 DB/sa/2firehousecovermemo sR- 155 3 EXHIBIT "A" 1000 South Miami Avenue - Comparison of Financial Terms REQUEST FOR PROPOSALS (Issued 7/25/96) Annual Rent, Percentage Rent and Breakpoint: Lease Minimum Annual Breakpoint Year Annual Rent % Rent ALAMILLA & ASSOCIATES, INC. (Proposed Lease Agreement) Annual Rent, Percentage Rent and Breakpoint: Lease Minimum Annual Breakpoint Year Annual Rent % Rent 1 $ 57,375 ** 6% $ 2,200,000 1 $ 57,375 "" 11% $ 2,200,000 2 $ 76,500 6% $ 2,200,000 2 $ 76,500 11% $ 2,200,000 3 $ 76,500 6% $ 2,200,000 3 $ 76,500 11% $ 2,200,000 4 $ 83,385 6% $ 2,400,000 4 $ 83,385 11% $ 2,400,000 5 $ 83,385 6% $ 2,400,000 5 $ 83,385 11% $ 2,400,000 6 $ 83,385 6% $ 2,400,000 6 $ 83,385 11% $ 2,400,000 7 $ 90,890 6% $ 2,600,000 7 $ 90,890 11% $ 2,600,000 8 $ 90,890 6% $ 2,600,000 8 $ 90,890 11% $ 2,600,000 9 $ 90,890 6% $ 2,600,000 9 $, 90,890 11% $ 2,600,000 10 $ 99,070 6% $ 2,850,000 10 $ 99,896 11% $ 2,850,000 11 $ 99,070 6% $ 2,850,000 11 $ 99,896 11% $ 2,850,000 12 $ 99,070 6% $ 2,850,000 12 $ 99,896 11% $ 2,850,000 13 $ 107,896 6% $ 3,100,000 13 $ 107,896 11% $ 3,100,000 14 $ 107,896 6% $ 3,100,000 14 $ 107,896 11% $ 3,100,000 15 $ 107,896 6% $ 3,100,000 15 $ 107,896 11% $ 3,100,000 TOTAL: $ 1,356,576 TOTAL: $ 1,356,576 tn to ** This amount represents a 50% reduction in the total amount of rent due for the first six months of the lease, as stated in the RFP. 1 I"i Prepaid Rent: CT Not addressed UT Prepaid Rent: $19,125 - which represents 50% of the first 6 months of the Minimum Annual Rent Un Page 1 of 2 P2 REQUEST FOR PROPOSALS (Issued 7/25/96) Security Deposit: Not addressed Leasehold Improvements: The estimated cost for physical improvements cannot vary below 15% of what the proposer estimated in the proposal. Performance Bond: To be negotiated Payment Upon Transfer: To be negotiated r, 1� CO I Ij G32 ALAMILLA & ASSOCIATES, INC. (Proposed Lease Agreement) Security Deposit: $38,250 upon execution of the Lease Leasehold Improvements: Not less that: $367,285 TOTAL ($ 83,725 for furniture, fixtures & equipment and $283,560 for initial leasehold improvements) Performance Bond: In an amount equal to 100% of the improvements Payment Upon Transfer: Tenant to pay City the greater of 7% of net sale proceeds or 4.5% of any and all consideration in connection with any transfer or sale of 15% or more of tenant's stock. Page 2 of 2 Lessee: Location: Contact: Term: Options: Use: Rent: EXHIBIT "B" LEASE AGREEMENT Alamilla & Associates, Inc. 1000 South Miami Avenue (Former Fire Station #4) Carlos Alamilla, President 15 Years - Commencing upon execution of Lease Two (2) five (5) year options to extend the term with six (6) months prior notification Restaurant Operations Minimum plus percentage rent as follows: YEAR FIXED MINIMUM ANNUAL RENT ANNUAL PERCENTAGE RENT 1 $ 57,375 plus 11% over $2,200,000 2 $ 76,500 plus 11% over $2,200,000 3 $ 76,500 plus 11% over $2,200,000 4 $ 83,385 plus 11% over $2,400,000 5 $ 83,385 plus 11% over $2,400,000 6 $ 83,385 plus 11% over $2,400,000 7 $ 90,890 plus 11% over $2,600,000 8 $ 90,890 plus 11% over $2,600,000 9 $ 90,890 plus 11% over $2,600,000 10 $ 99,896 plus 11% over $2,850,000 11 $ 99,896 plus 11% over $2,850,000 12 $ 99,896 plus 11% over $2,850,000 13 $107,896 plus 11% over $3,100,000 14 $107,896 plus 11% over $3,100,000 15 $107,896plus 11% over $3,100,000 TOTAL 1 $1,356,576 �R- 155 7 Prepaid Rent: $19,125. which represents a 50% reduction in the total amount of minimum annual rent due for the first six months of the Lease as stated in the RFP Rent Increases: Prior to the commencement of each renewal term, appraisals shall be made by two independent appraisers, one appointed by the Lessee and one appointed by the City. Appraisers shall use the income approach to determine fair rental value Security Deposit: $38,250 which represents six months minimum rent which is due upon execution of the Lease Agreement Condition to Lease Approval: The approval of the lease is subject to an assignment from Lessee to Firehouse IV of Miami, Inc. Stockholders in Firehouse IV of Miami, Inc. are as follows: Augusto Vidaurreta Amador Fernandez Thomas Graham Richardson President 30% Vice President 40% Secretary/Treasurer 30% Transfer Fee: Except for the initial assignment to Firehouse IV of Miami, Inc., in the event of a transfer of more than 15% of Lessee's stock, the transferor shall pay to City the greater of 7% of net sale proceeds or 4.5% of gross proceeds Maintenance: Lessee to provide the necessary management and labor to continuously maintain the Premises, including all operating equipment, utility services, connections to the Premises, janitorial services, trash and garbage removal services and any and all other related services necessary Utilities: Lessee shall pay for all charges for gas, electricity, light, heat, water and power, telephone, protective and other communication services and for all other public or private utility services Insurance: Commercial General Liability of $2,000,000 per occurrence bodily injury/premises damage, umbrella policy combined single limit of $5,000,000, "All Risk" coverage on the Premises and improvements on a replacement cost basis, auto insurance coverage of not less than $500,000, workers 8 compensation as required by State law. City and Lessee shall be named as Loss Payees and insureds Performance Bond: In an amount equal to 100% of the construction costs Taxes: Lessee shall pay all ad valorem taxation, assessments and other impositions Environmental: Lessee assumes all environmental responsibilities, with the exception of any possible storage tanks that may be located on the property. There are no environmental findings on this property by DERM at this time -CLIR- 155 9