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Exh 8DAGENDA ITEM #8D NOVEMBER 10, 2003 CITY OF ATLANTIC BEACH CITY COMMISSION MEETING STAFF REPORT AGENDA ITEM: Lease of City Property Between Atl tic Boulevard and West 1St Street SUBMITTED BY: Jim Hanso Ci DATE: October 30, 2003 BACKGROUND: It was reported to the Mayor and Commission on September 23, 2002 that two business owners were utilizing some City owned property located between Atlantic Boulevard and West 1St Street for pazking. Because the City had (and has) no immediate use for the property, I suggested that the City lease the space to the two property owners for a fair mazket value. After that report, an appraiser prepared an estimated value of the property and the second report was made to the City Commission on January 13, 2003 that the value of the parking was estimated at $500.00 per month. The Commissioners agreed in concept with the lease and a proposal to rent the space to the two property owners for $250.00 per month each. Both property owners declined the City's offer. The City then installed "No Parking" signs on the property line and the business owners advised their employees and customers to stay off the property. A couple of meetings were held over the next several months with the business owners at their request to fmd a solution. On August 18, 2003, the owners sent a joint letter offering to lease a smaller portion of the property than originally proposed for $140 per month. This lease rate would be based upon the same value per squaze foot as established by the appraisal eazlier in the year. The attached lease for commercial property was prepared by Alan Jensen and is now being presented to the City Commission for approval to enter into a lease agreement with the two property owners per their request. The lease includes a 30-day cancellation notice in the event that either party wishes to end the agreement. BUDGET: A lease of $140 per month will bring the city annual revenue of $1,680. The City does not anticipate any additional costs involved with this lease other than those already spent for meeting time and prepazation of the lease agreement. RECOMMENDATION: Authorize the City Manager to sign leases with the two adjoining businesses for a total of $140.00 per month in rent. ATTACHMENT: Commercial Lease AGENDA ITEM #8D NOVEMBER 10, 2003 COMMERCIAL LEASE This Lease is entered into by and between City of Atlantic Beach, FL, a municipal corporation, 800 Seminole Road, Atlantic Beach, Fl 32233, U.S.A. ("landlord"), and Hulihan Territory, Inc. a Florida corporation, 1177 Atlantic Blvd., Atlantic Beach, Fl 32233, U.S.A ("Tenant"). In consideration of the mutual covenants contained herein and other valuable consideration received, and with the intent to be-legally bound, Landlord and Tenant agree as follows: 1. PREMISES, Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord, the following premises: (the "premises"). 2. TERM. The term of this Lease will commence on October 1, 2003 and will continue from month to month on the same terms and conditions herein. Either party may terminate this Lease upon 30 days prior written notice to the other party. This Lease may also .terminate sooner according to the provisions hereof. 3. RENT. Tenant agrees to pay to Landlord, without any deduction or set off, rental payments in the amount of $500.00 per month, payable in advance on the 1St during the term of this Lease. Rent shall be paid to Landlord at 800 Seminole Road ,Atlantic Beach, FL or, at such other address. as Landlord may specify in writing to Tenant. Time is of the essence in this Lease. 4. SECURITY DEPOSIT. Upon the execution of this Lease, Tenant shall pay to Landlord a security deposit in the amount of $500.00 to be held as security for the payment of rent and the faithful performance by Tenant of all of its obligations in this Lease. The security deposit maybe used to reimburse Landlord for all costs and expenses incurred due to Tenant's breach of any covenant, term or condition of this Lease. Landlord may use the security deposit to repair any damage to term of condition of this Lease. Landlord may use the security deposit to repair any damage to the Premises caused by Tenant or others, and to clean the Premises upon termination of this Lease. Should any amount be so used, Tenant agrees to restore the security deposit to its original amount. The security deposit shall be held and applied as provided by the laws of Florida. The security deposit may not be applied by Tenant to the payment of rent. If Tenant fully performs its obligations hereunder, the security deposit, or balance, shall promptly be returned to Tenant after the termination of this Lease. AGENDA ITEM #8D NOVEMBER 10, 2003 5. LATE. CHARGES. If Tenant fails to pay any installment of rent or any other amount due hereunder within 5 days of the date the same is due, Tenant shall pay Landlord a late payment charge equal to 5% of the overdue amounts. 6. USE. The Premises shall be used by Tenant solely for Parking only for employees of Hulihan Territory, Inc. and for activities incidental thereto. Tenant may not use the Premises for any otherpurposes without obtaining the prior written consent of Landlord. 7. LIABILITY INSURANCE. During the term of this Lease and any extension or renewal, Tenant shall maintain, at its sole expense, public liability and property damage insurance with respect to the Premises with such.company as maybe acceptable to Landlord. Such policy shall have limits for personal injury of at least $100,000.00 with respect to one person, and at least $300,000.00 with respect to more than on e person in any one occurrence, and at least $100,000.00 for property damage. Such policy shall name Landlord and Tenant as the insureds, as their interests may appear, and shall provide that the insurer may not change or cancel such insurance without giving 21 days prior written notice to Landlord. Tenant shall furnish Landlord with a copy of such policy or a certificate of insurance upon Landlord's request. 8. MAINTENANCE AND CONDITION. Tenant shall maintain and repair the following: All leased property. Tenant shall keep the same clean, safe and in as good order and repair as they were at the commencement of this Lease, ordinary wear and tear excepted. Tenant will pay for all damage to the Premises and repairs required due to any act or negligence of Tenant or others. Landlord and Tenant each agree to maintain and repair the premises in compliance with all laws, ordinances and regulations applicable to them. Tenant agrees to promptly give notice to Landlord of any required repairs or unsafe conditions and Landlord will be afforded a reasonable period to time to complete the same. 9. TENANT'S IMPROVEMENTS. Tenant shall not make any alterations, additions or improvements without on each occasion obtaining the prior written consent of Landlord, which consent shall not be unreasonably withheld. Unless otherwise agreed in writing, all alterations, additions and improvements shall become the property of Landlord and shall remain on the Premises at the expiration of this Lease; provided, however, that Landlord, at its option, may require Tenant to remove any such alterations, additions or improvements. and restore the Premises to its former condition. 10. DISCHARGE OF LIENS. Tenant agrees to promptly pay its contractors and suppliers for all work performed and materials furnished to the Premises, if any. In .the event any mechanic's or similar lien is filed on the Premises or building. in which the Premises are located which is claimed to arise from Tenant's actions, Tenant shall, at its sole expense, discharge or bond against such lien within 10 days of notice from Landlord. 11. DELIVERY OF POSSESSION. If Landlord is unable through no fault on its part to deliver possession of the Premises to Tenant on the commencement date, this 2 AGENDA ITEM #8D NOVEMBER 10, 2003 Lease will continue in effect, but rent and other amounts will be prorated according to when possession is given to Tenant. The term of this Lease will not be extended by any such delay. If Landlord is unable to deliver possession with 30 days of the commencement date, either Landlord or Tenant may terminate this Lease and all Payments made will be returned to Tenant and all obligations to the parties will cease. Landlord will not be liable for any damages for such delay or failure to deliver. 12. QUIET ENJOYMENT. By paying rent and observing all the agreements, terms and conditions herein, Tenant shall peaceably and quietly have, hold and enjoy the Premises during the term of this Lease and any extension or renewal, subject to the provisions hereof. 13. ACCESS. Landlord and its against may enter the Premises at all reasonable times to conduct inspections and make necessary or desired repairs or improvements. Landlord may also enter the Premises when the same appear to be abandoned. 14. COMPLIANCE WITH LAW. Tenant, at its sole expense, shall comply with all present and future laws, ordinances, regulations and requirements of any federal,- - .state or local authority relating to Tenant's use of the Premises. Tenant shall not make or permit any waste on the Premises, or any nuisance or use which might interfere with the enjoyment of other tenants or persons in the general area of the Premises. Tenant shall not commit or permit any act or use of the Premises which may increase the fire hazard or the cost of fire or other insurance on the building in which the Premises is located, or cause the cancellation of such insurance. Tenant shall pay any additional insurance premiums resulting from Tenant's use of the Premises. Tenant shall obtain, at it sole expense, any licenses or perniits which maybe required for Tenant's use of the Premises. 15. ASSIGNMENT AND SUBLETTING. Tenant shall not assign, transfer or encumber this Lease, nor sublet all or any portion of the Premises, not permit the occupation by others, without on each occasion obtaining the prior written consent of Landlord, which consent shall not be unreasonably withheld. Consent of Landlord on any one occasion shall not be deemed a waiver of the necessity for consent on any other occasion. Notwithstanding any assignment or subletting, Tenant shall remain primarily liable for the payment of rent and the performance of all covenants, terms and conditions of this Lease. Any attempt. to assign or sublet without Landlord's consent shall be void and shall entitle Landlord, at its option, to terninate this Lease. 16. LOSS OR DAMAGE. Unless caused by negligence of Landlord, Landlord will not be liable for any loss, damage or theft of any property of Tenant or others kept. or stored in or about the Premises. Tenant acknowledges that it is Tenant's responsibility to insure its own property and improvements. 17. INDEMNIFICAITON.(a) Tenant shall indemnify and hold Landlord harmless from any and all claims, loss, damages liens, expenses, including reasonable attorney's fees, and liabilities of whatever nature, arising out of or relating to (i), any 3 AGENDA ITEM #8D NOVEMBER 10, 2003 default by Tenant in the performance or observance of any covenant, term or condition of this Lease, (ii) loss or damage to any property or injury or death to Tenant or any person occurring on or about the Premises due to any cause other than Landlord's negligence, and (iii) Tenant's use and occupancy of the Premises. (b) Landlord shall indemnify and hold Tenant Harmless from any and all claims, loss, damages, liens, expenses, including reasonable attorney's fees, and liabilities of whatever nature, arising out of or relating to any default by Landlord in the performance or observance of any covenant, term or condition of this Lease. 18. DEFAULT. Tenant shall be in default of this Lease upon the occurrence of any one of the following events: (a) failure to pay any installment of rent or any other amount required herein which shall continue for 15 days after the same is due; (b) failure to perform or observe any other covenant, term or condition of this Lease which shall not be corrected within 15 days after written notice from Landlord, or for such longer period as may be reasonably necessary to correct such default; (c) abandonment or cessation of business operations at the Premises by Tenant; (d) any misrepresentation or omission of or on behalf of Tenant made to Landlord in connection with this Lease; (e) the taking of the leasehold created hereby on execution or by other process of law; (f) insolvency or failure of Tenant or any guarantor to generally pay its debts as they become due; (g) assignment for the benefit of creditor of, or appointment of a receiver or other officer for, all or any part of Tenant's or any guarantor's property; (h) adjudication of bankruptcy, or filing of a petition under anybankruptcy or debtor's .relief law by or against Tenant or any guarantor. 19. REMEDIES OF LANDLORD. (a) Upon any default by tenant, Landlord may, at its option, terminate this Lease and/or commence eviction proceedings in accordance with the laws of Florida. Upon any such default, Landlord shall also have the right to enter upon the Premise or any part thereof, with demand or notice, and repossess the same and expel Tenant and any other occupants and their effects, either with or without terminating this Lease. Any entry maybe with or without process of law, by force if necessary, or otherwise 4 AGENDA ITEM #8D NOVEMBER 10, 2003 according to law. No entry shall subject Landlord to any liability for trespass or damages. Upon any entry or termination, Landlord agrees to use reasonable efforts to relet the Premises on Tenant's behalf or otherwise, for such term and rent as Landlord may determine. No act or failure to act by Landlord shall waive any remedies which Landlord may have for arrears of rent or breach of covenant or release Tenant from any liability whosoever. (b) Upon any termination or entry as above, Tenant shall indemnify Landlord against all loss of rents and other amounts which Landlord may incur over the remainder of the term in addition to paying all overdue rent and other payments. At Landlord's election, Tenant shall pay to Landlord an amount equal to the excess of the rent and other payments hereunder for the remainder of the term over the fair rental value of the Premises over the same period. Tenant shall also pay to Landlord all costs and expenses incurred by Landlord by reason of Tenant's default including, without limitation, attorney's fees, costs of regaining possession and reletting the Premises, broker's fees, storage fees and repairing and cleaning costs.. 20. NO WAIVER. The failure of Landlord or Tenant to require strict performance by the other of any covenant, term or condition of this Lease is not a waiver for the future of any breach of the same or any other covenant, term or condition herein. Landlord's acceptance of rent is not a waiver of any breach by Tenant. 21. REMEDIES CUMULATIVE. To the extent permitted by law, the rights and remedies of Landlord herein are cumulative, and the exercise of any one of them will not be deemed to be in exclusion of any other. The rights and remedies herein are in addition to any other rights and remedies available to Landlord at law or equity. 22. RIGHT TO CURE OTHER'S DEFUALT. If either Landlord or Tenant fails to perform- any covenant, term or condition of this Lease, the other party may, after giving reasonable notice, perform such covenant, term or condition and expend whatever sums maybe necessary. All sums expended shall be repaid on demand. This performance shall not waive. any rights or remedies which either party may have against the other for such default. 23. SUBORDINATION OF LEASE.-This Lease is subject and subordinate to all present and future mortgages, trust deeds and other security instruments that maybe placed on the property in which the Premises are located; provided that for so long as Tenant is not in default of this Lease, no foreclosure or similar proceeding will terminate this Lease or impair any of Tenant's rights. In the event of any such proceeding, Tenant shall attorn to the new owner and accept such successor as the new Landlord under this Lease. Although no further act by tenant is necessary to accomplish the above, Tenant agrees to sign any other instruments evidencing this subordination and attornment as Landlord may reasonably request. 24. UNAVOIDABLE DELAYS. Neither party will be liable for any delay or failure in the performance of any of its obligations herein when due to labor disputes, 5 AGENDA ITEM #8D NOVEMBER 10, 2003 inability obtain materials or services, wars, governmental laws or restrictions, weather, acts of God ; or any other cause beyond the reasonable control of such party. Provided, however, that this section shall not excuse Tenant from the prompt payment of rent or any other amount due herein. 25. SURRENDER AND HOLDING OVER. No surrender of the Premises or this Lease shall be effective unless accepted in writing. by Landlord. At the expiration or sooner termination of this Lease, Tenant will remove its effects and peaceably. deliver possession of the Premises to Landlord in as good repair and condition as they were at the commencement. of their Lease, ordinary wear and tear excepted. Any property left on the Premises after Tenant vacates or abandons the Premises shall be deemed abandoned and Landlord may remove, store and/or dispose of the same as it sees fit, subject to applicable law. If Tenant holds over beyond the expiration or termination of this Lease and rent is accepted by Landlord, amonth-to-month tenancy only shall be created which will otherwise be governed by the terms and conditions of this Lease. Nothing in this section shall be construed as consent to any holding over by Tenant. 26. TERMINATION IN EVENT OF SALE. It is expressly agreed that Landlord, at its option, may terminate this Lease or ariy extension or renewal upon October 1, 2004 days prior written notice to Tenant in the event of a sale of the building containing the Premises. 27. LIMITED LIABILITY. It is expressly agreed that neither Landlord nor any individual, partner, shareholder or member comprising Landlord shall be personally liable under this Lease. In the event Landlord breaches any provision of this Lease, Tenant will look solely to the equity, if any, of Landlord in the building in which the Premises is located to satisfy its claims and remedies, and Landlord's liability shall not exceed such equity interest. 28. NOTICES. All notices and communications under this Lease shall be in writing and shall be deemed to be properly given when delivered personally or sent by certified mail, return receipt requested, to Landlord at 800 Seminole Road, Atlantic Beach, FL 32233 U.S.A. or Tenant at 1177 Atlantic Blvd., Atlantic Beach, FL 32233 U.S_A. or, to such -other address as either party may specify in writing to the other. 29. ENTIRE AGREEMENT. The parties acknowledge that they have read and understand the terms of this Lease. This Lease contains the entire agreement and understanding between the parties regarding the Premises and is subject to no agreement, conditions or representations that are expressly set forth herein. This Lease may only be amended in writing and signed by both Landlord and Tenant. 6 AGENDA ITEM #8D NOVEMBER 10, 2003 30. INVALID PROVISION. If any provision of this Lease shall be invalid or unenforceable, the remaining provisions shall remain in full force and effect. 31. CAPTIONS. The captions in this Lease are inserted only for convenience and in no way construe or interpret the provisions hereof or affect their scope or intent. 32. PARTIES BOUND. This Lease shall be binding upon and shall inure to the benefit of the parties and their respective heirs, legal representatives, successors and assigns. Provided, however, that if Landlord sells the building in which the Premises is located, Landlord shall be released from all liabilities under this Lease. The purchaser, as successor Landlord, shall be deemed to have assumed all of the obligations and liabilities of Landlord under this Lease. The purchaser, as successor landlord, shall be deemed to have assumed all other obligations and liabilities of Landlord under this Lease. 33. RIDERS. The riders and exhibits, if any, attached hereto and initialed by parties are made a part of this Lease. IN WITNESS WHEREOF, this Lease is executed under seal on October , 2003. Executed in the presence of : LANDLORD Maureen King City of Atlantic Beach, FL, a municipal corporation (Seal) Julie Brandt Hulihan Territory, Inc., a Florida corporation GUARANTY FOR VALUE RECEIVED, and in consideration of Landlord entering into the above Lease with tenant, the undersigned, jointly and severally, hereby unconditionally guarantee the prompt and full payment of rent and other amounts due thereunder, and the performance by Tenant of all other obligations, terms and conditions of the Lease, and any extension or renewal thereof. The undersigned waive notice of acceptance of this Guaranty, demand, notice of Tenant's default, and suretyship defenses of alI kinds. ,(Seal) 7 AGENDA ITEM #8D NOVEMBER 10, 2003 Landlord may extepd the time of payment or performance, or release or grant any indulgence to Tenant without releasing the liability of the undersigned. Landlord need not proceed against Tenant prior to proceeding against the undersigned. The undersigned, jointly and severally, agree to pay all costs, expenses and attorney's fees incurred by Landlord in enforcing the Lease and this. Guaranty. Dated: October , 2003 Executed in the presence of WITNESS GUARANTOR WITNESS Michael J. Hulihan (Seal) WITNESS STATE OF FLORIDA COUNTY OF DUVAL In , on the day of ,before me, a Notary Public in and for the above state and county, personally appeared City of Atlantic Beach, FL, a municipal corporation, known to me or proved to be the person named in and who executed the foregoing instrument, and being first duly sworn, such person. acknowledged that he executed said instrument for the purposes therein contained as his free. and voluntary act and deed. AGENDA ITEM #8D NOVEMBER 10, 2003 NOTARY PUBLIC My Commission Expires: (SEAL) STATE OF FLORIDA COUNTY OF DUVAL In , on the day of ,before me, a Notary Public in and for the above state and county, personally appeared Hulihan Territory, Inc., a Florida corporation, known to me or proved to be the person named in and who executed said instrument for the purposes therein contained as his free and voluntary act and deed. NOTARY PUBLIC My Commission Expires: (SEAL) 9