Attachment 9 - Lease Agreement 8-15-2018.pdf

Attachment “9” to RFP PB 18-9

ATTACHMENT “9”

DEVELOPMENT SITE LEASE AGREEMENT

PALM BEACH INTERNATIONAL AIRPORT

(RFP NO. PB 18-9)

Department of Airports

Palm Beach County, Florida

TABLE OF CONTENTS

ARTICLE 1 - RECITALS

ARTICLE 2 - DEFINITIONS

ARTICLE 3 - EFFECTIVE DATE, TERM AND EVALUATION OF PREMISES

ARTICLE 4 - PREMISES AND PRIVILEGES

ARTICLE 5 - RENTAL, FEES, CHARGES AND SECURITY DEPOSIT

ARTICLE 6 - CONSTRUCTION OF IMPROVEMENTS

ARTICLE 7 - QUALITY AND CHARACTER OF SERVICES

ARTICLE 8 - OBLIGATIONS OF TENANT

ARTICLE 9 - MAINTENANCE AND REPAIR

ARTICLE 10 - UTILITIES

ARTICLE 11 - INSURANCE REQUIREMENTS

ARTICLE 12 - DAMAGE TO OR DESTRUCTION OF PREMISES

ARTICLE 13 - ENCUMBRANCES

ARTICLE 14 - TITLE TO IMPROVEMENTS

ARTICLE 15 - EXPIRATION, DEFAULTS, REMEDIES AND TERMINATION

ARTICLE 16 - ASSIGNMENT, TRANSFER AND SUBLETTING

ARTICLE 17 - RIGHTS OF LEASEHOLD MORTGAGEES

ARTICLE 18 - INDEMNIFICATION

ARTICLE 19 - EXTERIOR SIGNAGE

ARTICLE 20 - LAWS, REGULATIONS AND PERMITS

ARTICLE 21 - AMERICANS WITH DISABILITIES ACT

ARTICLE 22 - DISCLAIMER OF LIABILITY

ARTICLE 23 - GOVERNMENTAL RESTRICTIONS

ARTICLE 24 - NON-DISCRIMINATION

ARTICLE 25 - COUNTY NOT LIABLE

ARTICLE 26 - AUTHORIZED USES ONLY

ARTICLE 27 - MISCELLANEOUS

THIS DEVELOPMENT SITE LEASE AGREEMENT (this “Lease”) is made and entered into this ________ day of ________________, 20___, by and between Palm Beach County, a political subdivision of the State of Florida (“County”), and ____________________, a ______________________________, having its office and principal place of business at ______________________________________________________________ (“Tenant”).

WITNESSETH:

WHEREAS, County, by and through its Department of Airports (the “Department”), owns and operates the Palm Beach International Airport, located in Palm Beach County, Florida (the “Airport”); and

WHEREAS, Tenant submitted a proposal in response to Request for Proposals, PB 18-9 issued on August 15, 2018, for the lease of certain real property located west of the Airport, which is managed by the Department on behalf of County.

NOW, THEREFORE, in consideration of the premises and of the mutual covenants herein contained, and other good and valuable consideration, the receipt of which the parties hereby expressly acknowledge, the parties hereto covenant and agree to the following terms and conditions:

ARTICLE 1 - RECITALS

The foregoing recitals are true and correct and are hereby incorporated herein by reference.

ARTICLE 2 - DEFINITIONS

The following words, terms, and phrases wherever used in this Lease shall have the meanings set forth in this Article and the meanings shall apply to both singular and plural forms of such words, terms and phrases.

2.01 “Additional Insured” has the meaning set forth in Section 11.08.

2.02 “Additional Rent” has the meaning set forth in Section 5.08.

2.03 “Adjustment Date” has the meaning set forth in Section 5.03(A).

2.04 “Airport” has the meaning set forth in the Recitals.

2.05 “Airport Rules and Regulations” means the Palm Beach County Airport Rules and Regulations adopted by Resolution No. R-98-220, as now or hereafter amended, and any successor ordinance or resolution regulating activities or operations on the Airport.

2.06 [Insert if applicable: “Appraisal Adjustment Date” has the meaning set forth in Section 5.03(D).

2.07 “Assignment” has the meaning set forth in Article 16.

2.08 “Base Rental” means the initial annual ground rental set forth in Section 5.01

[Insert if applicable: for the rental adjustments occurring prior to the Appraisal Adjustment Date; the rental established pursuant to Section 5.03(D) for rental adjustments occurring after the Appraisal Adjustment Date; and the rental established pursuant to Section 5.03(E) after the Renewal Term.]

2.09 “Base Rental Year” means 2016 during the Initial Term [Insert if applicable: for rental adjustments occurring prior to the Appraisal Adjustment Date; and calendar year _____ for rental adjustments occurring after the Appraisal Adjustment Date;

and _________ for rental adjustments occurring during the Renewal Term.]

2.10 “Bond Resolution” means the Palm Beach County Airport System Revenue Bond Resolution dated April 3, 1984 (R-84-427), as amended and supplemented, which is hereby incorporated herein by reference and made a part hereof.

2.11 “Board” means the Board of County Commissioners of Palm Beach County, Florida.

2.12 “Bond” has the meaning set forth in Section 5.05.

2.13 “Business Day” means any day other than a Saturday, Sunday or County holiday.

Use of the word “day” as opposed to Business Day means a calendar day.

2.14 “Capital Investment Report” shall have the meaning set forth in Section 6.01(E).

2.15 “Consumer Price Index” has the meaning set forth in Section 5.03(C).

2.16 “County Environmental Assessments” mean the Phase I Environmental Site Assessment Report prepared by Eco Advisors, LLC, dated May 3, 2017.

2.17 “County Party” means the County and its elected officers, employees and agents.

2.18 “Damages” has the meaning set forth in Article 18.

2.19 “Date of Beneficial Occupancy” has the meaning set forth in Section 3.01.

2.20 “Department” means the Palm Beach County Department of Airports.

2.21 “Derelict Vehicle” means a vehicle that is in a wrecked, dismantled or partially dismantled condition, or which is discarded and in an inoperable condition.

2.22 “Director” means the Director or Acting Director of the Department of Airports.

2.23 “Effective Date” means the date that this Lease is approved by the Palm Beach

County Board of County Commissioners and signed by the parties.

2.24 “Environmental Laws” means all applicable Federal, State and local laws, statutes, ordinances, rules, regulations and governmental restrictions relating to the protection of the environment, human health, welfare or safety, or to the emission, discharge, seepage or release of Hazardous Substances into the environment, including, but not limited to, ambient air, surface water, groundwater or land, or otherwise relating to the handling of such Hazardous Substances.

2.25 “FAA” means the Federal Aviation Administration.

2.26 “Hazardous Substances” shall mean any contaminant, hazardous or toxic substance, material or waste of any kind or any other substance that is regulated by any Environmental Laws.

2.27 “Improvement Cost” has the meaning set forth in Section 6.01(E).

2.28 “Infrastructure Improvements” has the meaning set forth in Section 6.01(A)(3).

2.29 “Infrastructure Improvement Credit” has the meaning set forth in Section

6.01(A)(3).

2.30 “Initial Leasehold Improvements” has the meaning set forth in Section 6.01(A).

2.31 “Initial Term” has the meaning set forth in Section 3.01.

2.32 “Inspection Period” has the meaning set forth in Section 3.06(B).

2.33 “Inspections” includes, but is not limited to, the following: (a) physical inspection of the Property and/or Option Property; (b) soil investigation; (c) environmental assessment; (d) topographic studies; and (e) engineering, utilities and site planning studies.

2.34 “Lease” means this Lease and all exhibits attached hereto, which are incorporated herein by this reference. Words such as “herein,” “hereafter,” “hereof,” “hereby” and “hereunder” when used with reference to this Lease, refer to this Lease as a whole, unless context otherwise requires.

2.35 “Leasehold Mortgage” has the meaning set forth in Section 17.01.

2.36 “Leasehold Mortgagee” has the meaning set forth in Section 17.01.

2.37 “Lease Year” means a twelve (12) month period beginning on the Date of Beneficial Occupancy, and each twelve (12) month period thereafter, until the expiration or earlier termination of this Lease.

2.38 “Letter of Credit” has the meaning set forth in Section 5.05.

2.39 “Minimum Capital Investment” has the meaning set forth in Section 6.01(B).

2.40 “Obstructions” has the meaning set forth in Section 23.03.

2.41 “Parcel F” means the property more particularly described in Exhibit “B”.

2.42 “Permitted Exceptions” means those exceptions to title of the Premises as set forth in the attached Exhibit “C”.

2.43 “Phase I EA” has the meaning set forth in Section 20.05.

2.44 “Plans” have the meaning set forth in Section 6.01(C).

2.45 “Premises” means the Property together with all buildings, facilities and other improvements now or hereafter constructed thereon, subject to easements, rights-of-way and any other encumbrances of record.

2.46 “Property” means approximately ______________ square feet of unimproved real property as more particularly described on Exhibit “A”, subject to easements, rights-of-way and any other encumbrances of record. The parties acknowledge the boundary of the Property may change based upon the final site plan for the Initial Leasehold Improvements. Within ninety (90) days following issuance of approval of the site plan for the Initial Leasehold Improvements by County’s Planning, Zoning and Building Department, the parties shall enter into an amendment to this Lease to reflect the final square footage and location of the Property based upon the approved site plan and replace Exhibit “A” with an updated survey and legal description. The updated survey and legal description will be prepared by County’s surveyor at no cost to Tenant.

2.47 “Proposal” means the written proposal submitted by Tenant in response to the

RFP.

2.48 “Release Documents” has the meaning set forth in Section 17.08.

2.49 “Renewal Term” has the meaning set forth in Section 3.02.

2.50 “Rental” means the initial annual rental established in Section 5.01, as adjusted in accordance with Section 5.03.

2.51 “Request for Proposals” or “RFP” means Request for Proposals No. PB 18-9, issued by County on August 15, 2018, as amended and/or supplemented.

2.52 “Risk Management Department” means the Palm Beach County Risk

Management Department.

2.53 “SBE” means a certified small business enterprise as defined in Palm Beach County’s Small Business Enterprise Program Ordinance.

2.54 “SBE Ordinance” means Palm Beach County’s Small Business Enterprise Program Ordinance, which is codified in Sections 2-80.21 through 2-80.34 (as amended) of the Palm Beach County Code, and the Small Business Enterprise Program Policies and Procedures Manual, County PPM No. CW-O-043.

2.55 “Security Deposit” has the meaning set forth in Section 5.05.

2.56 “Tenant Improvements” means all buildings, structures, pavement, facilities, landscaping and other improvements, above and below ground, constructed by Tenant upon the Premises during the Term, including the Initial Leasehold Improvements.

2.57 “Tenant Party” means Tenant and its subtenants, contractors, suppliers, employees, officers, licensees, agents and invitees.

2.58 “Term” means the Initial Term plus any Renewal Term.

2.59 “Title Review Period” has the meaning set forth in Section 3.03.

2.60 “Traffic Concurrency Allocation” has the meaning set forth in Section 6.06.

2.61 “TSA” means the Transportation Security Administration or any successor agency responsible for airport security.

ARTICLE 3 - EFFECTIVE DATE, TERM AND EVALUATION OF PREMISES

3.01 Term. The term of this Lease shall commence on the earlier of: (a) substantial completion of the Initial Leasehold Improvements as defined in Section 6.01(A); (b) the date Tenant commences using the Premises (or any part thereof) for the conduct of its business (other than construction); or (c) twenty four (24) months from the Effective Date (or such later date agreed to by County pursuant to Section 6.01(A)) (“Date of Beneficial Occupancy”) and expire ** years thereafter, unless sooner terminated pursuant to the terms of this Lease (“Initial Term”). [**Total Lease Term, including all renewal terms may not exceed 50 years]

3.02 Option to Renew. Provided that Tenant is not in material default of this Lease (or event has not occurred, which with the passage of time or giving of notice would constitute a material default), Tenant shall have the option to renew this Lease for an additional period of ______________ (** ) years (“Renewal Term”), by notifying County in writing of Tenant’s intent to exercise its option to renew not later than one hundred twenty (120) days prior to the expiration of the Initial Term, with time being of the essence. Such renewal shall be upon the same terms and conditions set forth herein.

3.03 Title Insurance. Tenant shall have thirty (30) days following the Effective Date to examine County’s title to the Property (the “Title Review Period”) and, at Tenant’s option, obtain a title insurance commitment for the issuance of a leasehold title policy, agreeing to issue to Tenant a title insurance policy in such amount as deemed appropriate by Tenant. Tenant shall furnish a copy of the title insurance commitment and title policy, if applicable, to County together with legible copies of all exceptions to coverage reflected thereon upon receipt. The cost of the title insurance commitment and title insurance policy and any premium shall be borne by Tenant.

3.04 Title Defects. In the event the title insurance commitment shows as an exception any matters, other than the Permitted Exceptions, which render title unmarketable or would unreasonably interfere with Tenant’s intended development and use of the Property for the uses permitted hereunder, Tenant shall notify County of Tenant’s objections thereto prior to expiration of the Title Review Period. County shall have the right, but not the obligation, within sixty (60) days from receipt of the notice, to cure such title defects or to make arrangements with the title insurer for the removal of such objections from the title insurance commitment. If the defect(s) shall not have been so cured or removed from the title insurance commitment by endorsement thereto at the termination of the sixty (60) day period, Tenant shall have the option of: (a) accepting title to the Property as it then exists; (b) providing County with an additional ninety (90) days to remove such defects; or (c) terminating this Lease. Tenant shall provide County with written notice of its election within ten (10) days after expiration of the sixty (60) day period. In the event Tenant elects option (b) above and County is unable to cure such defects within the additional ninety (90) day period, Tenant shall have the option of: (a) accepting title to the Property as it then exists; or (b) terminating this Lease. Tenant shall provide County with written notice of its election within ten (10) days after expiration of the ninety (90) day period. In the event Tenant terminates this Lease pursuant to this Section, the parties shall be released from all obligations under this Lease, with the exception of those obligations arising hereunder prior to termination of this Lease or which expressly survive termination. In the event Tenant fails to properly exercise its right to terminate this Lease, Tenant shall be deemed to have waived such right and shall be deemed to have accepted title to the Property subject to all matters of record.

3.05 Survey. Tenant shall have the right, within the Title Review Period, to obtain a current survey of the Property. The survey shall be prepared in accordance with the minimum technical standards for surveys within the State of Florida. If the survey reveals any encroachments, overlaps, boundary disputes or other defects, other than the Permitted Exceptions, which render title unmarketable or unreasonably interfere with Tenant’s intended development and use of the Property for the uses permitted hereunder, the same shall be treated as title defects as described in Section 3.04 of this Lease and Tenant shall have the same rights and remedies as set forth therein.

3.06 Inspections.

(A) Tenant acknowledges and agrees that: (a) County has delivered a copy of the County Environmental Assessment to Tenant; and (b) Tenant has reviewed the County Environmental Assessment and has elected to enter into this Lease with County with the full knowledge of the matters identified therein, subject to the terms and conditions of this Lease.

(B) Commencing on the Effective Date and expiring ninety (90) days thereafter (“Inspection Period”), Tenant may conduct any Inspections that Tenant deems appropriate with respect to the Property. All Inspections performed hereunder shall be conducted at Tenant’s sole cost and expense and shall be performed by licensed persons or firms dealing in the respective areas or matters. Tenant agrees to indemnify the County Parties from and against any and all Damages arising from or out of a Tenant Party’s entry upon and inspection of the Property except if such Damages are caused by a County Party’s negligence or willful misconduct or County’s breach of its obligations under this Lease. Tenant’s obligation to indemnify the County Parties pursuant to this Section shall survive the expiration or termination of this Lease. Prior to the expiration of the Inspection Period, Tenant shall provide County with one (1) complete copy of all written reports detailing the results of the Inspections obtained by Tenant hereunder. If Tenant determines, in its sole discretion, that it will be unable to develop the Property for the uses permitted hereunder as the result of the Inspections, Tenant may elect to terminate this Lease upon written notice to County within sixty (60) days after the expiration of the Inspection Period, time being of the essence. If termination notice is timely given by Tenant pursuant to this Section, this Lease shall be deemed terminated, and the parties hereto shall be relieved of all liabilities and obligations under this Lease, except for those obligations arising hereunder prior to termination of this Lease or which expressly survive termination. In the event Tenant fails to properly exercise its right to terminate this Lease, Tenant shall be deemed to have waived such right.

In the event Tenant terminates this Lease pursuant to this Section, Tenant, at its sole cost and expense, shall repair any damage resulting from the Inspections and restore the Property to the condition in which it existed prior thereto, using materials of like kind and quality.

ARTICLE 4 - PREMISES AND PRIVILEGES

4.01 Description of Premises. County hereby demises and leases to Tenant, and

Tenant rents from County, the Property, subject to the terms, conditions and covenants set forth herein.

4.02 Description of Specific Privileges, Uses and Rights. Tenant shall have the right and obligation to use the Property for the purpose of constructing, operating, and maintaining the ________________ on the Property.

4.03 Prohibited Uses, Products and Services. Tenant agrees the Premises shall be utilized solely for the uses permitted herein and for no other purpose whatsoever. Tenant shall not provide any products or services not specifically authorized by this Lease or the Department.

4.04 Restrictions on Privileges, Uses and Rights.

(A) The rights granted hereunder are expressly limited to the improvement, maintenance, and operation of the Premises pursuant to the terms and conditions of this Lease.

(B) Parking of boats, motor homes or inoperable vehicles and the stockpiling or storage of inoperable equipment, machinery and containers on the Premises is strictly prohibited.

(C) All storage and dumpsters must be screened or concealed from public view, and storage shall be limited to storage incidental to Tenant’s overall operation on the Premises.

(D) Tenant shall not permit the Premises to be used for vehicular parking or storage by the public, its customers or employees or any other person whomsoever while traveling from the Airport in lieu of utilizing the Airport’s public parking facilities. Tenant further agrees that its customers shall only be permitted to park vehicles on the Premises only while utilizing Tenant’s services or facilities on the Premises.

(E) Tenant shall not use the Premises for the operation of rental car facilities or ground transportation services such as taxicab, limousine, transportation network companies or other similar ground transportations service providers.

4.05 Condition and Use of the Premises. Except as otherwise provided for herein, and subject to Tenant’s rights to complete inspections pursuant to Sections 3.03, 3.04, 3.05, and 3.06 Tenant accepts the Premises in its “AS IS CONDITION” and “WITH ALL FAULTS,” together with all defects, latent and patent, if any. Tenant further acknowledges that County has made no representations or warranties of any nature whatsoever regarding the Premises including, but not limited to, the physical and/or environmental condition of the Premises or any improvements located thereon; the value of the Premises or improvements; the zoning of the Premises; title to the Premises; the suitability of the Premises or any improvements for Tenant’s intended use; or Tenant’s legal ability to use the Premises for Tenant’s intended use.

ARTICLE 5 - RENTAL, FEES, CHARGES AND SECURITY DEPOSIT

5.01 Rental. For the use and occupancy of the Premises, Tenant shall pay to County initial annual ground rental of ($_____________) per square foot, for approximately ___________________ square feet of ground or ($_____________) annually.

5.02 Commencement and Time of Payment of Rental. Payment of the Rental by Tenant to County shall commence upon the Date of Beneficial Occupancy. Rental shall be payable in equal monthly installments, in advance, on or before the first (1st) day of each and every month throughout the Term of this Lease. All payments must be delivered (together with applicable sales taxes), without demand and without any deduction, holdback or set off whatsoever, to: Palm Beach County Department of Airports, 846 Palm Beach International Airport, Finance Division, West Palm Beach, Florida 33406, or at such other address as may be directed by the Department from time to time. Payments shall be made payable to “Palm Beach County.” Rental Commencement provisions may be modified in the event of phased-development.

5.03 Adjustment of Rental. [Based on the length of the Initial Term, the County may require an appraisal only adjustment.]

(A) On October 1, 2022, and each three (3) year anniversary thereof (each such date, an “Adjustment Date”), the then current Rental shall be adjusted in accordance with the provisions of this Section. The new Rental shall be determined by an appraisal obtained by County, which shall set forth the fair market rental for the Premises (exclusive of the Tenant Improvements). The appraisal shall be performed, at County’s sole cost and expense, by a qualified appraiser selected by County.

County shall notify Tenant in writing of the fair market rental of the Property as established by the appraisal, which shall become the new Rental subject to the limitations set forth in Section 5.03(B) below.

Tenant shall commence paying the new Rental on the Adjustment Date.

The new Rental shall not be less than the Rental for the prior period. This Lease shall automatically be considered as amended to reflect the new Rental rate, without formal amendment hereto, upon County’s written notification of the establishment of the new Rental rate applicable to the Property.

(B) Notwithstanding the foregoing, the Rental payable hereunder shall not exceed an amount that would be obtained by multiplying the Base Rental by a fraction, the numerator of which shall be the “Consumer Price Index” (as hereinafter defined) figure for May of the calendar year in which such adjustment is to become effective and the denominator of which shall be the Consumer Price Index figure for April of the Base Rental Year.

(C) For the purposes hereof, the “Consumer Price Index” shall mean the

Consumer Price Index for Urban Wage Earners and Clerical Workers, United States city average, all items (1982 - 1984 = 100), not seasonally adjusted, or any successor thereto as promulgated by the Bureau of Labor Statistics of the United States Department of Labor. In the event that the Consumer Price Index ceases to use the 1982 - 1984 average of one hundred (100) as the standard reference index base period, the then current standard reference index base period shall be utilized. In the event the Consumer Price Index (or successor or substitute Consumer Price Index) is not available, a reliable governmental or other nonpartisan publication evaluating information theretofore used in determining the Consumer Price Index shall be used.

(D) [Insert if applicable: Notwithstanding any provision of this Lease to the contrary, on October 1, ______ (an “Appraisal Adjustment Date”), the then current Rental shall be adjusted and new Rental shall be determined as set forth in this Section by appraisal and shall not be subject to the provisions of Section 5.03(B). Prior to the Appraisal Adjustment Date, County, at its sole cost and expense, shall obtain an appraisal of the Premises (exclusive of the Tenant Improvements during the Initial Term) to determine its fair market rental value. Prior to the Appraisal Adjustment Date, County shall provide a complete copy of the appraisal to Tenant. In the event Tenant objects to the fair market rental value set forth in the appraisal obtained by County, Tenant shall notify County in writing of its objection within thirty (30) days of receipt of County’s appraisal. Provided Tenant has notified County in writing of its objection to County’s appraisal within the aforementioned thirty (30) day period, Tenant, at its sole cost and expense, may obtain a second appraisal.

Tenant shall provide County with a copy of the second appraisal within sixty (60) days of the date of Tenant’s objection notice. In the event a second appraisal is not obtained, the Rental shall be adjusted on the Appraisal Adjustment Date in accordance with the rental rate set forth in the first appraisal. In the event a second appraisal is obtained, and the rental rates established in the two (2) appraisals vary by an amount less than or equal to twenty five percent (25%) of the average of the two (2) appraisals, then the Rental shall be adjusted on the Appraisal Adjustment Date based on the average of the two (2) appraisals. In the event the two

(2) appraisals vary by an amount greater than twenty five percent (25%) of the average of the two (2) appraisals, then County and Tenant shall jointly retain an appraiser, reasonably acceptable to both parties, to perform a third appraisal. Except as otherwise provided for below, the cost of the third appraisal shall be borne equally by the parties. In the event the parties are unable to agree upon the selection of the appraiser to conduct the third appraisal, County shall have the right to select the third appraiser;

provided, however, the cost of the third appraisal shall be borne solely by County. In the event a third appraisal is obtained, the Rental shall be adjusted, effective as of the Appraisal Adjustment Date, by the average of the three (3) appraisals. The Rental established pursuant to this Section shall become the new Base Rental for purposes of future rental adjustments pursuant to Section 5.03(B). The parties agree that any appraisers selected pursuant to this Section shall be qualified M.A.I.

appraisers with demonstrated experience in appraising commercial properties.]

(E) [Insert if applicable: In the event Tenant exercises its option to renew, the initial Rental applicable to the Premises (inclusive of all Tenant Improvements) during the Renewal Term shall be determined by appraisal in accordance with the provisions of this Section and shall not be subject to the provisions of Section 5.03(B). County, at its sole cost and expense, shall obtain an appraisal of the Premises to determine its fair market rental value. The appraisal shall be performed by a qualified M.A.I. appraiser selected by County with demonstrated experience in appraising commercial properties. County shall provide a complete copy of the appraisal to Tenant no less than ninety (90) days prior to the date Tenant is required to exercise its option to renew. The Rental established pursuant to this Section shall become the new Base Rental for purposes of future rental adjustments.]

(F) Notwithstanding any provision of this Lease to the contrary, Tenant acknowledges and agrees that County shall have the right to establish and maintain the rental rate hereunder to ensure compliance with the provisions of Section 710 (rate covenant) of the Bond Resolution.

(G) The amount of any rental adjusted pursuant to this Section shall not be less than the rental for the prior period. This Lease shall automatically be considered as amended to reflect the adjusted rental rate, without formal amendment hereto, upon County’s written notification of the establishment of the adjusted rental rate applicable to the Property.

(H) Any delay or failure of County in computing the adjustment in the Rental, as hereinabove provided, shall not constitute a waiver of or in any way impair the continuing obligation of Tenant to pay such adjusted annual Rental from the applicable Adjustment Date.

5.04 Late Payments - Interest. Tenant shall pay to County interest at the rate of one and one-half percent (1.5%) per month on any late payments commencing ten (10) days after the amounts are due. The Department, in its sole and absolute discretion, may elect to waive the aforementioned late fees in appropriate circumstances as determined by the Department.

5.05 Security Deposit. Prior to the Effective Date of this Lease, Tenant shall post a security deposit with County equal to three (3) monthly installments of Rental (the “Security Deposit”). The Security Deposit shall serve as security for the payment of all sums due to County and shall also secure the performance of all obligations of Tenant to County. The Security Deposit shall be either in the form of a clean, Irrevocable Letter of Credit (“Letter of Credit”) or a Surety Bond (“Bond”) in form and substance satisfactory to County. In the event of any failure by Tenant to pay any rentals or charges when due or upon any other failure to perform any of its obligations or other default under this Lease, then in addition to any other rights and remedies available to County at law or in equity, County shall be entitled to draw on the Security Deposit and apply same to all amounts owed. Upon notice of any such draw, Tenant shall immediately replace the Security Deposit with a new Letter of Credit or Bond in the full amount of the Security Deposit required hereunder. Tenant shall promptly increase the amount of the Security Deposit to reflect any increases in the Rental payable hereunder;

provided, however, if the amount of required Security Deposit increase resulting from adjustment of the Rental is less than fifteen percent (15%) of the amount of Security Deposit currently held, no increase in the Security Deposit shall be required. The Security Deposit shall be kept in full force and effect throughout the Term of this Lease and any extension thereof and for a period of six (6) months after the termination of this Lease. Not less than forty-five (45) days prior to any expiration date of a Letter of Credit or Bond, Tenant shall submit evidence in form satisfactory to County that such security instrument has been renewed. Failure to renew a Letter of Credit or Bond or to increase the amount of the Security Deposit as required by this Section shall: (a) entitle County to draw down the full amount of such Security Deposit; and (b) constitute a default of this Lease entitling County to all available remedies. The Security Deposit shall not be returned to Tenant until all obligations under this Lease are performed and satisfied.

Prior to consent from County to any assignment of this Lease by Tenant, Tenant’s assignee shall be required to provide a Security Deposit to County in accordance with the terms and conditions of this Section.

5.06 Triple Net Lease. This Lease shall be deemed to be “triple net” without cost or expense to County including, but not limited to, cost and expenses relating to taxes, insurance, and the maintenance and operation of the Premises.

5.07 Taxes and Fees. Tenant shall pay, on or before their respective due dates, all Federal, State and local taxes and fees, and all special assessments of any kind, which are now or may hereafter be levied upon the Premises (including improvements thereon) or the estate hereby granted, or upon Tenant, or upon the business conducted on the Premises, or upon any of Tenant’s property used in connection therewith, or upon any rentals or other sums payable hereunder, including, but not limited to any ad valorem taxes, and sales or excise taxes on rentals, and personal property taxes against tangible and intangible personal property of Tenant.

Tenant hereby covenants and agrees to pay monthly to County, as “Additional Rent,” any sales, use or other tax, or any imposition in lieu thereof (excluding State and/or Federal Income Tax) now or hereinafter imposed upon the rents, use or occupancy of the Premises imposed by the United States of America, the State of Florida or Palm Beach County, notwithstanding the fact that the statute, ordinance or enactment imposing the same may endeavor to impose the tax upon County as landlord/lessor, to the extent as applicable.

5.08 Additional Rent. Any and all sums of money or charges required to be paid by

Tenant under this Lease, other than the annual rental, shall be considered “Additional Rent”, whether or not the same is specifically so designated and County shall have the same rights to enforce due and timely payment by Tenant of all Additional Rent as are available to County with regards to annual rent.

5.09 Accord and Satisfaction. In the event Tenant pays any amount that is less than the amount stipulated to be paid under this Lease, such payment shall be considered to be made only on account of the stipulated amount. No endorsement or statement on any check or letter shall be deemed an accord and satisfaction. County may accept any check or payment without prejudice to County’s right to recover the balance due or to pursue any other remedy available to County pursuant to this Lease or under the law.

ARTICLE 6 - CONSTRUCTION OF IMPROVEMENTS

NOTE: This Article 6 may be further modified, if necessary, to address specific provisions applicable to phased-development.

6.01 Tenant Construction Requirements. Except as otherwise provided for herein, Tenant shall make no additions, alterations or improvements to the Premises, or improvements constructed thereon, without the prior written approval of the Department, which approval shall not be unreasonably withheld, conditioned or delayed. Tenant acknowledges and agrees that it shall not be deemed unreasonable for the Department or County to withhold consent to any improvements determined to be a potential hazard to air navigation by the Department, County or FAA or which would be inconsistent with applicable federal laws or regulations, or FAA orders, advisory circulars or other similar guidance documents. Any such additions, alterations or improvements shall be made in accordance with the construction requirements contained herein and as established by the Department, which shall be applied in a non-discriminatory basis as similar commercial ground leases managed by the Department, taking into consideration the location of the Premises in relation to the Airport’s airfield facilities and potential impacts on air navigation. All improvements constructed or placed on the Premises, including drainage and landscaping, shall be of attractive construction and first-class design, shall comply with any and all applicable governmental laws, regulations, rules and orders shall follow standard construction methods, and shall be constructed in accordance with the requirements of this Article.

Notwithstanding the foregoing, additions, alterations or improvements to interior improvements to the Premises that do not require a building permit, such as interior painting and replacement of flooring, and replacement of damaged exterior landscaping with the same landscaping materials, shall not require the Department’s prior approval.

(A) Initial Leasehold Improvements.

(1) Tenant shall cause the design and construction of the following improvements at Tenant's sole cost and expense: (a) a _________________ on the Property; and (b) all other improvements and infrastructure, whether located on or off the Property, necessary to support the development of the Property, including, but not limited to, electrical systems, sewage, wastewater disposal, landscaping, lighting, signage, parking, roadways and driveways necessary for ingress, egress and circulation, stormwater control systems, lighting and security measures, as required (the “Initial Leasehold Improvements”).

(2) Construction of the Initial Leasehold Improvements shall be completed no later than twenty four (24) months following the Effective Date, subject to force majeure, unless otherwise approved by the Department in writing, which approval shall not be unreasonably withheld, conditioned or delayed for reasons beyond the reasonable control of Tenant. Substantial completion of the Initial Leasehold Improvements will occur when the applicable governmental authority issues a temporary or permanent certificate of occupancy or completion for the __________________________________ to be built on the Property. Tenant shall promptly notify County in writing when the applicable government authority issues a temporary or permanent certificate of occupancy or completion for such improvements.

(3) The cost of the design and construction of the Initial Leasehold

Improvements and Infrastructure Improvements (as hereinafter defined) shall be at Tenant’s sole cost and expense, subject to reimbursement of certain costs associated with the Infrastructure Improvements as hereinafter provided. insert if applicable:

Tenant shall be entitled to credit from County in the form of rental credit in an amount not to exceed ___________ Dollars and 00/100 ($__________) against the rental payable to County by Tenant hereunder for the reasonable, actual and necessary costs incurred by Tenant for the design and construction of the following infrastructure improvements and development costs (hereinafter collectively referred to as the “Infrastructure Improvements”):

(the “Infrastructure Improvement Credit”).

(4) Tenant acknowledges and agrees the Infrastructure Improvement

Credit shall be solely in the form of rental credits against rental payable to County hereunder and shall not be in the form of cash reimbursement. Tenant further acknowledges and agrees that the following costs shall not be eligible for Infrastructure Improvement Credit: (a) administrative, supervisory and overhead and other similar internal costs of Tenant (only true third party costs and payments made by Tenant shall be eligible for Infrastructure Improvement Credit); (b) costs of consultants (other than engineering and design consultants); and (c) legal or accountant fees.

(5) Insert if Infrastructure Improvement Credit is applicable: Tenant agrees to provide the maximum practical opportunity for SBEs and local Palm Beach County businesses to participate in the design and construction of the improvements on the Property. Tenant commits to a minimum of fifteen percent (15%) SBE participation and acknowledges that SBE participation shall be determined in accordance with the SBE Ordinance. Prior to the start of construction of the Initial Leasehold Improvements, Tenant shall provide County with a list of SBEs participating in the design and/or construction, the nature of the work performed by each SBE and the dollars committed to each SBE.

(6) Reserved for provisions pertaining to phased-improvements, if applicable.

(B) Minimum Capital Investment. Tenant shall expend not less than ________________________Dollars ($_____________) on the design, construction and installation of the Initial Leasehold Improvements (the “Minimum Capital Investment”). Capital expenditure costs that may be counted toward the Minimum Capital Investment shall include all costs paid for work performed, services rendered and materials furnished for the construction of the Initial Leasehold Improvements, subject to the following terms, conditions and limitations:

(1) The cost of design (subject to the limitations set forth herein), construction and acquisition of the Initial Leasehold Improvements;

bonds; construction insurance; and building, impact and concurrency fees shall be included in the Minimum Capital Investment.

(2) No more than twelve percent (12%) of the Minimum Capital

Investment for payments made by Tenant to independent contractors for engineering and architectural design work may be included in the Minimum Capital Investment.

(3) Only true third party costs and payments made by Tenant shall be included in the Minimum Capital Investment. Costs incurred by any sublessee, licensee or other occupant of the Premises, or any portion thereof, other than Tenant shall not be included in the Minimum Capital Investment.

(4) Costs for consultants (other than engineering and design consultants, as provided above) shall not be included in the Minimum Capital Investment. Legal fees and accountant fees shall not be included in the Minimum Capital Investment.

(5) Finance and interest expenses shall not be included in the Minimum

Capital Investment.

(6) Administrative, supervisory and overhead or internal costs of Tenant shall not be included in the Minimum Capital Investment.

(7) Costs associated with acquisition or installation of personalty, such as furnishings, trade fixtures and equipment, not permanently affixed to the Premises, or any other personalty whatsoever, shall not be included in the Minimum Capital Investment.

(8) Any costs associated with any improvements other than the Initial

Leasehold Improvements shall not be included in the Minimum Capital Investment unless Tenant has obtained written approval from the Department prior to incurring such costs.

(C) Construction Requirements. Prior to constructing any improvements on the Premises or any other portion of Parcel F (including, but not limited to, the Initial Leasehold Improvements and Infrastructure Improvements), Tenant, without cost to County, shall prepare detailed preliminary construction plans and specifications for the improvements (hereinafter collectively referred to as the “Plans”) in accordance with standards established by the Department and deliver the preliminary Plans to the Department for review, comment and adjustment. All development on Parcel F will need to submit FAA FORM 7460-1 - NOTICE OF PROPOSED CONSTRUCTION OR ALTERATION during concept development for determination of no hazard to air navigation and to ensure no interference with radio navigation facilities. The Department shall review the preliminary Plans and provide a written response to Tenant within fifteen (15) Business Days after receipt of the preliminary Plans; provided, however, in the event the preliminary Plans are subject to review by another governmental authority with jurisdiction over the Airport, including, but not limited to, the FAA, the timeframe for review shall be extended by the amount to time necessary for such authority or agency to complete its review. Approval of the Plans, including Plans for improvements that are required by Tenant’s franchisor as part of its corporate identity program, shall not be unreasonably withheld, conditioned or delayed. In the event the Department does not approve the preliminary Plans, Tenant will be notified of the reasons for the disapproval and the necessary modifications and/or alterations to the Plans. Tenant shall resubmit modified Plans to the Department within thirty (30) days of the date of the Department’s written notice of disapproval and Department shall provide a written response to Tenant within fifteen (15) Business Days thereafter whether the modified Plans have been approved; provided, however, in the event the modified Plans are subject to review by another governmental authority with jurisdiction over the Airport, including, but not limited to, the FAA, the timeframe for review shall be extended by the amount to time necessary for such authority or agency to complete its review. Within one hundred twenty

(120) days following approval of the preliminary Plans by the Department, Tenant shall prepare or cause to be prepared final working Plans in substantial conformity to the approved preliminary Plans and shall submit the final working Plans to the Department for approval. Upon approval of the final working Plans by the Department, Tenant shall obtain all permits and other government approvals required for the commencement of construction. Prior to commencement of construction, Tenant shall deliver to the Department one (1) complete set of the final working Plans as approved by the governmental agencies exercising jurisdiction thereover. Minor changes from the final working Plans shall be permitted if such changes may be reasonably inferred from the final working Plans, or if they are made to comply with requirements of any governmental agency exercising jurisdiction thereover.

(D) Within sixty (60) days following Tenant’s receipt of a certificate of occupancy or certificate of completion, as appropriate, for improvements constructed pursuant to this Article, Tenant, at its sole cost and expense, shall have prepared and deliver to the Department: one (1) complete set of as-built drawings in a hardcopy format, one (1) complete set of as-built drawings in a PDF format and one (1) complete set of as-built drawings in Auto CADD files in the latest version acceptable to the Department.

(E) Within sixty (60) days following the substantial completion of construction of the Initial Leasehold Improvements, Tenant shall, at its sole cost and expense, have prepared and delivered to the Department a detailed statement attested to and certified by an independent Certified Public Accountant, reasonably acceptable to County, detailing the costs of the Initial Leasehold Improvements to evidence satisfaction of the Minimum Capital Investment and SBE requirements set forth in Sections 6.01(A) and 6.01(B), and the amount of Infrastructure Improvement Credit (“Capital Investment Report”). The Capital Investment report shall include schedules detailing: (a) the Minimum Capital Investment made by Tenant to complete the Initial Leasehold Improvements by category and amount, subject to the terms, limitations and conditions of Section 6.01(B) (“Improvement Cost”); (b) the name of each SBE firm that participated in the design and/or construction of the Initial Leasehold Improvements and Infrastructure Improvements, the total dollars paid to each SBE and the overall percentage of SBE participation; and (c) the amount of the Infrastructure Improvement Credit by category and amount, subject to the terms, conditions and limitations of Section 6.01(A)(3). The Capital Investment Report shall be in a form and substance reasonably satisfactory to County and shall be prepared and certified by a qualified and licensed independent Certified Public Accountant, not a regular employee of Tenant, selected by Tenant, and shall include an opinion regarding the information contained in the schedules. The Capital Investment Report shall not contain a qualified opinion, an adverse opinion, or a disclaimer of opinion, as defined by the American Institute of Certified Public Accountants or any successor agency thereto, regarding the information contained in the required schedules.

(F) All improvements constructed upon the Premises shall be completed at

Tenant’s sole cost and expense, with the exception of the Infrastructure Improvement Credit, and shall be completed in accordance with the approved Plans.

(G) Approval of County shall extend to and include architectural and aesthetic matters and County reserves the right, in its sole and absolute discretion, to reject any design proposals submitted and to require Tenant to resubmit any such design proposals until they receive County’s approval.

(H) County reserves the right, in its sole and absolute discretion, to withhold approval of any improvements within the Premises determined to be a potential hazard to air navigation by the Department, County and/or the FAA or which County determines, in its sole and absolute discretion, would have the potential of affecting future Airport operations or development.

6.02 Lighting Improvements. Tenant acknowledges that certain types of lighting may present a hazard to air navigation due to the location of the Premises; therefore, in addition to all other construction requirements set forth herein, Tenant shall comply with the following restrictions and requirements related specifically to lighting on the Premises:

(A) All lighting fixtures shall be shielded and installed so as to project the light in a downward manner in order to avoid interference with air navigation. In no event shall lasers or other light shows be permitted on the Premises.

(B) Lighting shall not be constructed or installed in any manner that may adversely affect pilots in the operation of aircraft or Air Traffic Control personnel’s ability to perform their duties at the Airport. Tenant acknowledges that any lighting that results in sky glow or glare will adversely affect the operation of aircraft and Air Traffic Control personnel’s ability to perform their duties; therefore, any lighting that results in such effects is strictly prohibited.

(C) Prior to installation of any lighting improvements on the Premises, whether temporary or permanent, Tenant shall submit a lighting plan to County and the FAA for review and conceptual approval. The lighting plan shall include: (a) the location of proposed lighting improvements; (b) the height of all lighting improvements; (c) the number and type of lighting fixtures proposed to be installed; (d) photometric data from the manufacturer(s) of the lighting fixtures proposed to be installed; and (e) any other information reasonably requested by…