Marina Component Amended and Restated Ground Lease-Clean 8-26-14 Final PDF

MARINA COMPONENT
AMENDED AND RESTATED GROUND LEASE
BETWEEN
THE CITY OF MIAMI, FLORIDA
AND
FLAGSTONE ISLAND GARDENS, LLC
DATED AS OF
May 30, 2014

ARTICLE I INCORPORATION, EXHIBITS, AND DEFINITIONS ................................................ 4
Section 1.1 Incorporation by Reference ............................................................................... 4
Section 1.2 Exhibits and Attachments .................................................................................. 5
Section 1.3 Singular, Plural And Gender ............................................................................. 7
Section 1.4 Section References ............................................................................................ 7
Section 1.5 Defined Terms .................................................................................................. 7
Section 1.6 Notice to Third Parties of Composite Attachment 3 .20
ARTICLE II DEMISE ..................................................................................................................... 21

Section 2.1 Demise ........................................................................................................... 21
Section 2.2 Leasehold Improvements ................................................................................ 21
Section 2.3 Delivery of Title to Lessor .............................................................................. 22
ARTICLE III TERM ......................................................................................................................... 22
Section 3.1 Initial Term ..................................................................................................... 22
Section 3.2 Extension Terms ............................................................................................. 23
Section 3.3 Total Term25
ARTICLE IV DELIVERY OF POSSESSION AND DEVELOPMENT AND OPERATION OF

THE PROJECT ........................................................................................................... 25
Section 4.1 Delivery of Possession of Property .................................................................. 25
Section 4.2 Memorandum ................................................................................................. 25
Section 4.3 Development of the Project ............................................................................. 26
Section 4.4 Operating Team .............................................................................................. 26
ARTICLE V RENT AND SECURITY DEPOSIT ............................................................................ 27
Section 5.1 Application of Composite Attachment 3 to Pre-Paid Construction Rent,
Option Payments, and Construction Rent ........................................................ 27
Section 5.2 Application of Composite Attachment 3 to Base Rent ..................................... 29
Section 5.3 Percentage Rent .............................................................................................. 31
Section 5.4 Security Deposit.............................................................................................. 33
Section 5.5 Place of Payment ............................................................................................ 37
Section 5.6 Default Interest ............................................................................................... 37
Section 5.7 Late Charge .................................................................................................... 38
Section 5.8 Rent To Be Without Deduction ....................................................................... 38
ARTICLE VI LEASEHOLD AND SUBLEASEHOLD MORTGAGES ............................................ 38
Section 6.1 Definitions of Terms ....................................................................................... 38
Section 6.2 Prohibited Mortgages ...................................................................................... 49
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Section 6.3 Permitted Mortgages ....................................................................................... 49
Section 6.4 Notification of Lessor ..................................................................................... 50
Section 6.5 Foreclosure ..................................................................................................... 51
Section 6.6 New Lease. ..................................................................................................... 52
Section 6.7 Subordination, Non-Disturbance and Attornment Agreement. .. 55
Section 6.8 Major Subleasehold Estates ............................................................................. 55

Section 6.9 Liability of Approved Mortgagee .................................................................... 55
Section 6.10 Assignment of Development Plans and Project Approvals ............................... 57
Section 6.11 Mezzanine Financing ...................................................................................... 58
Section 6.12 Purchase Money Financing ............................................................................. 60
ARTICLE VII USE OF SUBJECT PROPERTY ................................................................................. 61
Section 7.1 Certain Conditions of Leasing ......................................................................... 61
Section 7.2 Major Subleases and Space Leases .................................................................. 61
Section 7.3 Permitted Uses; Long-Term Changes .............................................................. 62
Section 7.4 No Discrimination........................................................................................... 63
Section 7.5 Use of the Property ......................................................................................... 63
Section 7.6 Leasehold Improvements to be Open to Public ................................................ 63
Section 7.7 Safety ............................................................................................................. 64
Section 7.8 Continuous Operation ..................................................................................... 65
Section 7.9 Compliance with Laws .................................................................................... 65
Section 7.10 Compliance with Insurance Requirements ....................................................... 66
Section 7.11 Prohibited Uses ............................................................................................... 66
Section 7.12 Casino Gambling ............................................................................................ 67
Section 7.13 Signage ........................................................................................................... 69
Section 7.14 Cure of Defaults Under Approved Leasehold Mortgages and Approved
Major Subleasehold Mortgages ....................................................................... 70
Section 7.15 Enforceability ................................................................................................. 71
ARTICLE VIII RESTRICTIONS ON TRANSFERS AND APPROVAL OF INVESTORS ................. 72
Section 8.1 Definition of Terms ........................................................................................ 72
Section 8.2 Bayraktar Interests .......................................................................................... 76
Section 8.3 Leasehold and Major Subleasehold Estates...................................................... 78
Section 8.4 City Manager Review and Approval Procedures.............................................. 81
Section 8.5 Release from Liability ..................................................................................... 83
Section 8.6 City Managers Consent Required for Affiliate or Related Party Transfer ........ 84
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Section 8.7 Approved Leasehold Mortgages, Leases and Subleases ................................... 85
Section 8.8 Going Public ................................................................................................... 85
Section 8.9 Other Transactions for Which Consent Is Required ......................................... 86
Section 8.10 Violation......................................................................................................... 86
Section 8.11 Acceptance of Rent from Transferee ............................................................... 86
Section 8.12 Lessors Participation In Proceeds ................................................................... 86
Section 8.13 Organizational Documents of Lessee............................................................... 88
Section 8.14 Investors ......................................................................................................... 88
Section 8.15 Transfers of the Citys Interest ........................................................................ 90
ARTICLE IX EASEMENTS AND LICENSES ................................................................................. 91
Section 9.1 Utility Easements ............................................................................................ 91
Section 9.2 Easements in Favor of Lessee ......................................................................... 92
Section 9.3 Access Easement in favor of the Public ........................................................... 92
Section 9.4 Duration of Easements .................................................................................... 93
Section 9.5 Dredging to Facilitate Safe Passage of Vessels ................................................ 93
Section 9.6 Confirmatory Instruments ............................................................................... 93
ARTICLE X PAYMENT OF IMPOSITIONS .................................................................................. 94
Section 10.1 Payment of Impositions................................................................................... 94
Section 10.2 Taxes on Lessor .............................................................................................. 94
Section 10.3 Lessees Right to Contest Impositions ............................................................. 95
Section 10.4 Proof of Payment ............................................................................................ 95
ARTICLE XI INSURANCE .............................................................................................................. 96
Section 11.1 Insurance on the Leasehold Improvements ...................................................... 96
Section 11.2 Other Insurance To Be Carried ........................................................................ 98
Section 11.3 Policies Obtained by Independent Contractors............................................... 101
Section 11.4 Policies Obtained by Major Subtenants ......................................................... 102
Section 11.5 Delivery of Insurance Policies ....................................................................... 102
Section 11.6 Lessors Right to Obtain........... 103
Section 11.7 Insurer To Be Approved; Premium Receipts ................................................. 103
Section 11.8 Waiver of Subrogation .................................................................................. 104
ARTICLE XII RECORDS AND AUDITING ................................................................................... 104
Section 12.1 Records of Sales ........................................................................................... 104
Section 12.2 Audit ............................................................................................................ 106
ARTICLE XIII REPRESENTATIONS AND COVENANTS ............................................................. 109
Section 13.1 Limited Representations by Lessor ................................................................ 109
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Section 13.2 Authority ...................................................................................................... 110
Section 13.3 Lessees Representations and Covenants ....................................................... 110
Section 13.4 Disclaimer of Lessors Representations ......................................................... 111
Section 13.5 Survival ........................................................................................................ 112
ARTICLE XIV DEVELOPMENT AND CONSTRUCTION; REPAIRS, MAINTENANCE,
ALTERATIONS AND IMPROVEMENTS ............................................................... 112
Section 14.1 Construction of Project Components. 113
Section 14.2 Commencement and Completion of Construction .......................................... 114
Section 14.3 Ombudsman and Consultant.......................................................................... 115
Section 14.4 Landscaping and Roadways .......................................................................... 116
Section 14.5 Pre-Construction Maintenance ...................................................................... 118
Section 14.6 Maintenance of Construction Site .................................................................. 118
Section 14.7 Construction Traffic; Coordination ................................................................ 118
Section 14.8 Avoidance of Nuisance ................................................................................. 119
Section 14.9 Other Construction ........................................................................................ 119
Section 14.10 Payment and Performance Bond.................................................................... 120
Section 14.11 Damage to Other Improvements; Interference ............................................... 121
Section 14.12 Underground Utilities ................................................................................... 121
Section 14.13 Liability ........................................................................................................ 122
Section 14.14 Entrance Road .............................................................................................. 122
Section 14.15 Joinders ........................................................................................................ 123
Section 14.16 Maintenance and Repair ................................................................................ 123
Section 14.17 Alteration and Modification to Leasehold Improvements After
Completion of Leasehold Improvements ....................................................... 125
Section 14.18 Removal of Liens 126
ARTICLE XV LESSORS RIGHT TO PERFORM LESSEES COVENANTS;

REIMBURSEMENT OF LESSOR FOR AMOUNTS SO EXPENDED..................... 128
Section 15.1 Performance of Lessees Covenants to Pay Money ........................................ 128
Section 15.2 Lessors Right to Cure Lessees Default ........................................................ 128
Section 15.3 Reimbursement of Lessor and Lessee ............................................................ 129
ARTICLE XVI DAMAGE OR DESTRUCTION ............................................................................... 129
Section 16.1 Definitions of Terms ..................................................................................... 129
Section 16.2 Net Insurance Proceeds; Obligation to Fund Restoration Work ...................... 130
Section 16.3 Restoration Work. ......................................................................................... 132
Section 16.4 Termination .................................................................................................. 134
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Section 16.5 No Other Right to Terminate ......................................................................... 135
Section 16.6 Rights of Approved Leasehold Mortgagee..................................................... 135
Section 16.7 Major Subleases ............................................................................................ 135
Section 16.8 Deferral of Base Rent .................................................................................... 136
ARTICLE XVII ARBITRATION..................................................................................................... 137
Section 17.1 Binding Arbitration ....................................................................................... 137
Section 17.2 Procedures .................................................................................................... 137
Section 17.3 No Delay in Completion of Work .................................................................. 141
Section 17.4 Right of Approved Mortgage to Participate ................................................... 141
ARTICLE XVIII MECHANICS LIENS .......................................................................................... 142
Section 18.1 Definition ..................................................................................................... 142
Section 18.2 No Consent by Lessor ................................................................................... 142
Section 18.3 Notice of No Liability of Lessor .................................................................... 143
Section 18.4 Inclusion in Memorandum of Lease .............................................................. 143
Section 18.5 Discharge of Mechanics Liens ..................................................................... 143
Section 18.6 Right to Contest ............................................................................................ 144
Section 18.7 Releases ........................................................................................................ 145
ARTICLE XIX COVENANT AGAINST WASTE; INSPECTION .................................................... 145
Section 19.1 Waste............................................................................................................ 145
Section 19.2 Inspection of Property. .................................................................................. 145
Section 19.3 Major Subleases and Space Leases ................................................................ 147
ARTICLE XX ENVIRONMENTAL LIABILITY............................................................................. 148
Section 20.1 Definition of Terms ...................................................................................... 148
Section 20.2 Environmental Obligations of Lessee ............................................................ 150
Section 20.3 Lessees Liability for Contamination During Lease Term .............................. 151
Section 20.4 Indemnity ..................................................................................................... 151
Section 20.5 Notices ......................................................................................................... 152
Section 20.6 Lessors Remedies ........................................................................................ 152
Section 20.7 Phase I Environmental Assessment at End of Lease Term ............................. 152
Section 20.8 Major Subleases and Space Leases ................................................................ 153
Section 20.9 Survival of Lessees Obligations ................................................................... 154
ARTICLE XXI PUBLIC UTILITY CHARGES ................................................................................. 154
Section 21.1 Lessee to Provide and Pay for Utilities .......................................................... 155
Section 21.2 Compliance with Utility Services .................................................................. 155
Section 21.3 Permits ......................................................................................................... 155
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Section 21.4 No Obligation for Utilities not on Property .................................................... 155
Section 21.5 Notice and Disclaimer as to Utility Services and Other Services .................... 155
ARTICLE XXII INDEMNIFICATION AND RELEASE OF LESSOR ............................................ 156
Section 22.1 General Indemnification of Lessor Without Limitation of Any Other
Indemnity Given Hereunder .......................................................................... 156
Section 22.2 Defense......................................................................................................... 157
Section 22.3 Lessors Participation .................................................................................... 157
Section 22.4 No Limitation ............................................................................................... 157
Section 22.5 Challenges to Lease ...................................................................................... 157
ARTICLE XXIII LIEN FOR RENT AND OTHER CHARGES ........................................................ 158
Section 23.1 Lien for Rent ................................................................................................ 158
Section 23.2 Other Liens ................................................................................................... 159
Section 23.3 Limitations ................................................................................................... 159
ARTICLE XXIV CONDEMNATION .............................................................................................. 160
Section 24.1 Definition of Terms ...................................................................................... 160
Section 24.2 Entire Property Taken by Condemnation ....................................................... 162
Section 24.3 Part of Property Taken by Condemnation ...................................................... 162
Section 24.4 Takings for Temporary Period ...................................................................... 163
Section 24.5 Event of Lessees Default ............................................................................. 165
Section 24.6 Rights of Approved Leasehold Mortgagee..................................................... 165
ARTICLE XXV DEFAULT PROVISIONS ..................................................................................... 166
Section 25.1 Events of Default by Lessee .......................................................................... 166
Section 25.2 Remedies in Event of Lessees Default.......................................................... 169
Section 25.3 Events of Default Lessor ............................................................................ 173
Section 25.4 Mitigation ..................................................................................................... 174
ARTICLE XXVI COVENANTS OF LESSOR AND LESSEE ......................................................... 174
Section 26.1 Partial Modification of Restrictions ............................................................... 175
Section 26.2 Civic Arts Endowment Trust ......................................................................... 176
ARTICLE XXVII QUIET ENJOYMENT ........................................................................................ 177
ARTICLE XXVIII LESSEE NOT TO ENCUMBER LESSORS INTEREST ................................... 178
ARTICLE XXIX LIMITATION OF LIABILITY ........................................................................... 178
Section 29.1 Limitation of Liability of Lessee. .................................................................. 178
Section 29.2 Limitation of Liability of Lessor ................................................................... 179
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ARTICLE XXX ESTOPPEL CERTIFICATES ................................................................................. 181
Section 130.1 Estoppel Certificates from Lessee ................................................................. 181
Section 30.2 Certificates from Lessor ................................................................................ 181
ARTICLE XXXI NO WAIVER ........................................................................................................ 182
Section 31.1 Delays in Exercising Rights .......................................................................... 182
Section 31.2 Waivers to be in Writing ............................................................................... 182
Section 31.3 Receipt of Rent ............................................................................................. 183
Section 31.4 Consents ....................................................................................................... 183
ARTICLE XXXII SURRENDER AND HOLDING OVER ............................................................... 183
Section 32.1 Surrender at End of Term. ............................................................................. 183
Section 32.2 Rights Upon Holding Over............................................................................ 185
Section 32.3 No Waiver .................................................................................................... 185
ARTICLE XXXIII MAJOR SUBLEASES, SPACE LEASES AND APPROVED
TIME SHARE LICENSES .................................................................................. 186
Section 33.1 Leasing and Subleasing ................................................................................. 186
Section 33.2 Major Subtenant SNDAs ............................................................................. 186
Section 33.4 No Cross-Defaults..................................................................................................189
Section 33.5 Space Leases................................................................................................. 189
Section 33.6 Approved Time Share Licenses ..................................................................... 191
ARTICLE XXXIV MINORITY AND WOMEN PARTICIPATION AND
EQUAL EMPLOYMENT OPPORTUNITIES ........................................................... 192
Section 34.1 First Source Hiring Agreement ...................................................................... 192
Section 34.2 Minority and Women Participation and Equal Employment Opportunity ....... 193
Section 34.3 Skills, Training and Employment Center ....................................................... 194
Section 34.4 Tax Credits ................................................................................................... 194
Section 34.5 Labor Peace Agreement(s)..195
ARTICLE XXXV OPERATING AGREEMENTS FOR HOTELS AND MARINA........................... 195

Section 35.1 Approval ....................................................................................................... 195
Section 35.2 Approved Operators ...................................................................................... 195
Section 35.3 Terms ........................................................................................................... 195
Section 35.4 Non-Disturbance and Attornment Agreement ................................................ 196
ARTICLE XXXVI UNAVOIDABLE DELAY.................................................................................. 196
Section 36.1 Unavoidable Delay(s) ................................................................................... 196
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Section 36.2 Manner of Notice of Unavoidable Delay(s) and Conditions With Respect
to Performance of Obligations ....................................................................... 196
ARTICLE XXXVII NOTICES .......................................................................................................... 197
Section 37.1 Notices ......................................................................................................... 197
Section 37.2 Notice to Approved Mortgagees .................................................................... 198
Section 37.3 Sufficiency of Service ................................................................................... 199
ARTICLE XXXVIII MISCELLANEOUS PROVISIONS ................................................................. 199
Section 38.1 Captions ....................................................................................................... 199
Section 38.2 Conditions and Covenants ............................................................................. 199
Section 38.3 Entire Agreement .......................................................................................... 199
Section 38.4 Modification ................................................................................................. 200
Section 38.5 Time of Essence as to Covenants of Lease .................................................... 200
Section 38.6 Recording ..................................................................................................... 200
Section 38.7 City Manager Approval Procedures ............................................................... 200
Section 38.8 Governing Law ............................................................................................. 203
Section 38.9 Jurisdiction and Venue .................................................................................. 203
Section 38.10 Waiver of Jury Trial ...................................................................................... 204
Section 38.11 Conflict of Interest ........................................................................................ 204
Section 38.12 Covenants to Run with the Leasehold Estate ................................................. 205
Section 38.13 No Merger .................................................................................................... 205
Section 38.14 Brokerage ..................................................................................................... 205
Section 38.15 Counterparts ................................................................................................. 206
Section 38.16 No Third Party Beneficiaries ......................................................................... 206
Section 38.17 Attorneys Fees and Expenses ....................................................................... 206
Section 38.18 Invalidity of Provisions ................................................................................. 206
Section 38.19 No Conflicts of Interest ..207
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MARINA COMPONENT
AMENDED AND RESTATED GROUND LEASE1
This Marina Component Amended and Restated Ground Lease (Lease or Amended
and Restated Ground Lease) made as of May 30, 2014, between The City of Miami, a
municipal corporation of the State of Florida (Lessor or City), having its offices at 3500 Pan
American Drive, Miami, Florida 33133, and Flagstone Island Gardens, LLC, a Delaware limited
liability company (successor by merger to Flagstone Properties, LLC, a Florida limited liability
company) (Lessee), whose principal office is located at 888 MacArthur Causeway, Miami,
Florida 33132. Lessor and Lessee are sometimes hereinafter collectively referred to as the
Parties.
STATEMENT OF BACKGROUND AND PURPOSE
A. The City is the owner in fee simple of certain land located in the City of Miami,
Miami-Dade County, Florida known as and hereinafter referred to as Watson Island. Watson
Island is shown on the sketch set forth in Exhibit A.
B. A portion of land located in the northwest quadrant of Watson Island, consisting
of approximately 10.79 acres, is legally described in Composite Exhibit B1 and is hereinafter
referred to as the Upland Parcel, of which approximately 3.479 acres or 151,544 square feet
as legally described in Composite Exhibit B-2 is hereafter referred to as the Marina
Component Parcel.
1
If this Amended and Restated Ground Lease is used for a Major Project Component separately, then (i)except as
set forth in Section 33.4 concerning cross-defaults, independent non-disturbable ground leases will be signed for
each Major Project Component, (ii) provisions which apply to the Property or the Project as a whole will be revised
to conform and apply proportionately to the Major Project Component, (iii) this document will be substantially
preserved but revised as logically required and as contemplated in the Amended and Restated Agreement to Enter
into Ground Lease to make it applicable to a Major Project Component and (iv) Composite Attachment 3 (as
hereinafter defined in Recital L) will be attached to each ground lease and the relevant provisions of same will be
incorporated.
Marina Component Amended and Restated Ground Lease-Final 459875 Page 1

C. The City is also the owner in fee simple of certain submerged land, consisting of
approximately 13.35 acres, located adjacent and contiguous to the Upland Parcel and legally
described in Exhibit C. Such submerged land, together with the right to use and enjoy the
waters located above same, is sometimes hereinafter referred to as the Submerged Parcel.
D. The respective locations of the Upland Parcel and the Submerged Parcel are
shown on that certain survey prepared by Weidener Surveying and Mapping PA dated July 11,
2002 under Project No. 1712 as updated by Royal Point Land Surveyors Inc., dated February 19,
2013, a copy of which is attached hereto as Composite Exhibit D-1. The Upland Parcel and the
Submerged Parcel, located on Watson Island at approximately 1050 MacArthur Causeway,
together with all appurtenant rights belonging thereto, are sometimes hereinafter collectively
referred to as the Total Project Property.
E. Pursuant to the authority expressly conferred in the City of Miami Charter, and
general law, the City Commission of Miami (the City Commission), on December 14, 2000,
adopted Resolution No. 00-1081, which authorized the publication of a Mega Yacht Marina and
Mixed Use Waterfront Development Opportunity - Watson Island, Miami, Florida, Request for
Proposals dated February, 2001, as amended (the Watson Island RFP), for the development
of the Property as described in the Watson Island RFP.
F. In response to the Watson Island RFP, Lessee submitted to Lessor a proposal
entitled Island Gardens at Watson Island RFP dated July 13, 2001 (the Island Gardens
Proposal). The Island Gardens Proposal was approved by voter referendum by the electorate
of the City of Miami on November 6, 2001 and by the City Commission on November 15, 2001
under Resolution No. 01-1198.

G. The Island Gardens Proposal consists of a proposal for the development on the
Property of the Project. The Island Gardens Proposal contemplates that the Project will include,
but not necessarily be limited to, the Major Project Components, consisting of the Marina, Hotel
A, Hotel B, the Retail Space and the Parking Garage (as all of such terms are hereinafter
defined), together with certain other amenities as are described with greater particularity in
Exhibit E. The Major Project Components, together with such other amenities, are sometimes
hereinafter collectively referred to as the Project Components. The Conceptual Site Plan for
the Project is set forth in Exhibit F.
H. It is the mutual desire of the Parties that the Marina Component portion of the
property attached hereto as Composite Exhibit D-2 (Property) be leased and demised by
Lessor to Lessee for the purposes set forth in this Amended and Restated Ground Lease
(including the development and construction of the Project pursuant to the terms and provisions
set forth herein), subject to and upon the express terms and conditions contained herein. The
Parties believe that this Amended and Restated Ground Lease is consistent in all material
respects with the Watson Island RFP and the Island Gardens Proposal.
I. This document is an Amended and Restated Ground Lease, which incorporates
various revisions to and completely amends, restates and supersedes the original form of
Amended and Restated Ground Lease agreed to by the parties regarding the Marina Component.
J. The City is authorized to enter into this Amended and Restated Ground Lease
pursuant to City Commission Resolution No. 10-0402 adopted September 23, 2010 (attached
hereto and made a part hereof as Composite Attachment 1), and Flagstone is authorized to enter
into this Amended and Restated Ground Lease pursuant to its Company Authorization dated
February 1 2010 (attached hereto and made a part hereof as Attachment 2).

K. Flagstone has requested in accordance with the Watson Island RFP and the Island
Gardens Proposal for certain revisions, including among other things, revisions concerning
construction schedules, rents, options and option payments, development rights, obligations, and
time periods; and
L. The City Commission pursuant to Resolution No. 10-0402, adopted September
23, 2010 with Exhibit A and other attachments thereto which sets forth the key business terms
applicable to, among other things, rents, options and option payments, development rights,
obligations, time periods (attached hereto, made a part hereof, and collectively referred to
hereinafter as Composite Attachment 3) as such terms and conditions relate to this Amended
and Restated Ground Lease and to the Amended and Restated Agreement to Enter Into Ground
Lease, dated as of February 1, 2010 to which a form of this Amended and Restated Ground
Lease is attached as an exhibit (the Agreement to Enter).
In consideration of the foregoing and of the rent, covenants, and agreements hereinafter
set forth, the Parties do hereby covenant and agree as follows:
INCORPORATION, EXHIBITS AND DEFINITIONS
Incorporation by Reference. The foregoing Statement of Background and Purpose is
hereby incorporated into this Amended and Restated Ground Lease by this reference as if set out
in full in the body of this Amended and Restated Ground Lease. Furthermore, as individual
Amended and Restated Ground Leases are prepared with reference to each individual Major
Project Component, Composite Attachment 3 (as amended by City Commission Resolution No.
R-13-0217, adopted June 13, 2013 attached and incorporated as part of Composite Attachment 3)
and the relevant terms and conditions thereof shall be included in such Amended and Restated
Ground Lease(s).
Exhibits and Attachments. Attached hereto and forming a part of this
Amended and Restated Ground Lease are the following Exhibits, Attachments, and Riders:
Exhibit A -- Sketch of Watson Island
Composite Exhibit B-1 and B-2--Legal Descriptions of Upland Parcel and
Marina Component Upland Parcel
Exhibit C -- Legal Description of Submerged Parcel
Composite Exhibit D --Copy of Surveys D-1 and D-2 (updated)
Exhibit E -- Description of Project Components and Amenities
Exhibit E-1 -- Description of Public Art
Exhibit F -- Conceptual Site Plan
Exhibit G -- Definition of Gross Revenues
Exhibit H -- Definition of Marina; Marina Approval Procedures
Exhibit I -- Permitted Title Exceptions
Exhibit J -- List of Pre-Approved Hotel Franchisors (not applicable
to Marina Component)
Exhibit K -- List of Pre-Approved Lenders (not applicable if self-funded)
Exhibit L -- Approved Leasehold Mortgage Subordination, Non-Disturbance
and Attornment Agreement (not applicable if self-funded)
Exhibit M -- Approved Major Subleasehold Mortgage Subordination,
Non-Disturbance and Attornment Agreement
Exhibit N -- Prohibited Uses
Exhibit N-1 -- Covenants as to Port of Miami
Exhibit O -- List of Approved Financial Advisors

Exhibit P -- Organizational Documents
Exhibit Q -- Provisions Not Applicable to Private Lessor
Exhibit R -- Civic Arts Endowment Trust (not applicable to Marina Component)
Exhibit S -- Approved Major Subtenant Subordination, Non-Disturbance and
Attornment Agreement (not applicable to Marina Component)
Exhibit T -- Form of First Source Hiring Agreement and Amendment effective as of
February 1, 2010
Exhibit 14.14 -- Entrance Road
Exhibit 14.18 -- Hold Harmless and Indemnification Agreement
Composite Attachment 1 Citys Authorizing Resolution No. 10-0402,
adopted September 23, 2010
Attachment 2 Flagstones Company Authorization dated February 1, 2010, updated as of
May 30, 2014 and Durable Power of Attorney for Flagstones General Counsel
Composite Attachment 3 Citys Resolution No. 10-0402, adopted September 23,2010 with
Exhibit A and other attachments thereto and as further amended by Citys
Resolution No. R-13-0217, adopted June 13,2013 extending Marina Component
Possession Date and start of construction to on or before June 2, 2014 (previously
and collectively hereafter referred to as Composite Attachment 3)
Composite Attachment 4 City Commission Resolution No. 09-0263, adopted May 28, 2009
and Form of Labor Peace Agreement (if applicable to the particular Ground
Lease and the related Major Project Component)
Composite Attachment 5 Amended Partial Modification of 2011 and City Resolution No.

R-11-0337, adopted September 15, 2011, as further modified by Amended Partial
Modification of 2014 with City Resolution R-14-0186, adopted May 8, 2014 and
State Board of Trustees authorization adopted May 13, 2014 and Flagstones
related Compliance Agreement with City effective as of May 8, 2014.
Attachment 6 Form of Memorandum of Marina Component Amended and Restated
Ground Lease.
Section 1.3 Singular, Plural And Gender. Any word contained in the text of this
Amended and Restated Ground 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.
Section 1.4 Section References. All references herein to an Article, Section,
Subsection, paragraph, subparagraph, or clause shall be deemed to refer to the
applicable Article, Section, Subsection, paragraph, subparagraph or clause of this
Amended and Restated Ground Lease, unless there is a specific reference to another document.
Section 1.5 Defined Terms. Certain terms are defined in various Articles of this
Amended and Restated Ground Lease. In addition, for the purposes of this Amended and
Restated Ground Lease, the following words shall have the meanings attributed to them in this
Section 1.5:
a. Affiliate means any Person which, either directly or indirectly (through one or
more intermediaries) controls, is controlled by, or is under common control with another Person
(where control means the possession, directly or indirectly, by a Person of the power, acting on
ones own, to direct or cause the direction of the management decisions and policies of another
Person, whether through the ownership or control of voting securities, or beneficial interests, by
contract or otherwise).

b. AAA means the American Automobile Association, Mobil, or any similar
rating agency or any successor thereto.
c. Applicable Laws means any and all applicable laws, statutes, codes, ordinances,
orders, rules, regulations, requirements, judgments, decrees and injunctions of any Governmental
Authority, now existing or hereafter enacted, adopted, issued or amended from time to time,
whether foreseen or unforeseen, ordinary or extraordinary, which may be applicable to the
Property and/or the Leasehold Improvements or any part thereof.
d. Approved Initial Construction Lender has the meaning ascribed to it in
Section 6.1.
e. Approved Operators has the meaning ascribed to it in Article XXXV.
f. Approved Time Share License means any Time Share License as defined in
Section 721.05(35), Florida Statutes.
g. Bayraktar Family Members means Mehmet Bayraktar and/or any spouse,
sibling, parent and/or lineal descendant of Mehmet Bayraktar, subject to Section 4.1.3.1
of the Amended and Restated Agreement to Enter Into Ground Lease dated as of
February 1, 2010 and Section 8.14 herein. In the case of lineal descendants, such
individuals must be eighteen (18) years of age or older, unless represented by a legal
guardian.
h. Bayraktar Family Equity Contribution means that the equity in the Project
Provided by Mehmet Bayraktar personally or the Bayraktar Family, through one or more Persons
which are wholly owned by the Bayraktar Family and over which Mehmet Bayraktar has Voting
and Operational Control, shall equal not less than $22,400,000. The foregoing sum shall include
all demonstrable hard costs and soft costs reasonably related to the Project expended or
reimbursed by the foregoing parties prior to or after the date hereof.

i. Base Rent means the base rent to be paid by Lessee as set forth in ARTICLE
V.
j. Business Days means Monday through Friday, excluding legal holidays in the
City of Miami.
k. Certificate of Occupancy means a certificate issued by the City of Miami
Building and Zoning Department as defined within the Florida Building Code Section 106.1 and
in accordance with City of Miami Ordinance No. 6145.
l. City Manager means the administrative head of the Citys
government who is authorized to execute this Amended and Restated Ground Lease and other
documents, including notices required hereunder.
m. City Manager Approval Procedures has the meaning ascribed to it in
Section 38.7.
n. Commence(s) Construction means that all material plans and permits are
approved and issued and the actual act of physical construction has begun.
o. Completion Date means the date upon which the earlier of the temporary
certificate of occupancy (TCO) or the certificate of occupancy (CO), has been issued for the
completion of construction.
p. Construction Plans and Specifications means the detailed and complete plans
and specifications for all proposed construction on the Property (including, without limitation,
infrastructure, elevations, site plans, colors, signage plans, lighting, materials, access, utilities,
security, setbacks, floor plans and landscaping) which are approved by Lessor for the Project or
any applicable Major Project Component.

q. Construction Rent has the meaning ascribed to it in Section 5.1.
r. Debt Service Coverage Ratio means the ratio of the net operating income on
average of the Project (or the applicable portion thereof) during a consecutive twelve (12) month
period over the annual debt service payable in connection with any and all applicable Approved
Leasehold Mortgages during such twelve (12) month period.
s. Default Rate means a per annum interest rate equal to the lesser of: (i) the
LIBOR Rate, plus Seven Percent (7%), with such Default Rate being adjusted each time the
LIBOR Rate is adjusted, effective on the date such adjustment in the LIBOR Rate becomes
effective; or (ii) the highest rate permitted by Applicable Law.
t. Development and Construction Repairs, Maintenance, Alterations and Improvements
and the provisions concerning same means as set forth in Article XIV of this Amended and
Restated Ground Lease.
u. Development Plans means those plans required in connection with the design
and construction of the Project ,or the applicable portion(s) thereof for the particular Major
Project Component(s) being developed at such time including, without limitation: (i) the
Construction Plans and Specifications, (ii) all application materials or other materials necessary
or required in connection with obtaining the Project Approvals; and (iii) any and all other plans,
drawings or renderings, including, without limitation, design development plans, conceptual
layouts and artistic or architectural renderings, elevations or plans.
v. Direct Space Lease means any Space Lease where Lessee is the landlord.
w. Direct Space Tenant means any Space Tenant occupying any portion of the
Leasehold Improvements pursuant to a Direct Space Lease.
x. Disqualified Person means any Person who, as of the time when the applicable

transaction occurs or approval or consent of the City Manager is requested: (i) shall have
committed a material breach under any material lease or other written agreement with Lessor; (ii)
has had any criminal felony convictions within the immediately preceding ten (10) years; (iii)
has a widespread reputation (as evidenced by newspaper articles or other media reports of the
mainstream press which are not subsequently retracted) for corrupt or unlawful business
dealings; or (iv) is named on any Terrorist List.
y. Event of Lessees Default has the meaning ascribed to it in Section 25.1.
z. Extension Option has the meaning ascribed to it in Section 3.2.
aa. Extension Term has the meaning ascribed to it in Section 3.2.
bb. Force Majeure Events means any of the following items, events or conditions,
provided that such item, event or condition has a reasonably demonstrable effect on the Project
or its construction or operation: (i) lockouts; (ii) labor strikes; (iii) shortages in labor, materials
or supplies other than occasional and ordinary shortages in the ordinary course of business
(provided that any such shortages are not caused by any failure to timely order materials or
supplies); (iv) casualty; (v) terrorist acts or threats; (vi) war; (vii) hurricanes; (viii) earthquakes
or other natural catastrophes and other acts of God; or (ix) any similar item, event or condition
beyond the reasonable control of Lessee.
cc. Governmental Authority means any court, agency, authority, board (including,
without limitation, any environmental protection, planning or zoning board), bureau,
commission, department, office or instrumentality of any nature whatsoever of any governmental
or quasi-governmental unit of the United States or the State of Florida, whether now or hereafter
in existence, having jurisdiction over Lessee, Watson Island, the Property or any aspect of the

development or operation of the Project; provided, however, that such term shall include the City
only in its municipal capacity and not its proprietary capacity.
dd. Gross Revenues has the meaning ascribed to it in Exhibit G.
ee. Hotel Retail Operations means any Retail operations or facilities located within,
near or as part of either Hotel, which operations or facilities are part of or integrated into the
operation of such Hotel or are otherwise for the use, support or operation of such Hotel
(including, but not limited to, any spa and fitness facilities made available for the usage of such
Hotels guests, whether or not such facilities are located within such Hotel).
ff. Hotel(s) shall mean, either individually or collectively, Hotel A and/or Hotel B.
gg.Hotel A means a hotel which: (i) shall have the number of units specified in
Exhibit E; (ii) may have (in addition to those units described in clause (i) above) units allocated
to Approved Time Share Licenses, as specified in Exhibit E; (iii) shall be built to, and operated
pursuant to, the standards of a four (4) diamond hotel or better (as defined in the AAAs hotel
rating standards); and (iv) shall participate in a franchise system of a national or international
hotel brand approved by the City Manager pursuant to Section 4.4. For purposes of the
foregoing, the Parties understand and agree that the term units does not include, and Hotel A
may have, associated facilities and amenities, including, but not necessarily limited to: (A) spa
and fitness areas; (B) administrative and office areas; (C) cabanas; (D) lounges; (E) conference
and banquet facilities; and (F) customary non-lodging facilities available for seasonal use by
Marina staff and employees; and (G) Hotel Retail Operations.
hh. Hotel B means a hotel which: (i) shall have the number of units specified in
Exhibit E; (ii) may have (in addition to those units described in clause (i) above) keys which
units allocated to Approved Time Share Licenses, as specified in Exhibit E; (iii) shall be built to,

and operated pursuant to, the standards of a four (4) diamond hotel or better (as defined in the
AAAs hotel rating standards); and (iv) shall participate in a franchise system of a national or
international hotel brand approved by the City Manager pursuant to Section 4.4. For purposes of
the foregoing, the Parties understand and agree that the term units does not include, and Hotel
B may have, associated facilities and amenities, including, but not necessarily limited to: (A) spa
and fitness areas; (B) administrative and office areas; (C) cabanas; (D) lounges; (E) conference
and banquet facilities; and (F) customary non-lodging facilities available for seasonal use by
Marina staff and employees; and (G) Hotel Retail Operations.
ii.Impositions means all governmental assessments, fees, charges and levies
imposed by any Governmental Authority, including, without limitation, assessments imposed by
the City (in its municipal capacity), franchise fees, excises, license and permit fees, levies,
charges and taxes (including ad valorem real estate taxes on the land under the Property and/or
on the Leasehold Improvements), personal property taxes, bed taxes, sales taxes, fire fees and
parking surcharges of any kind now or hereafter enacted, whether general or special, ordinary or
extraordinary, foreseen or unforeseen, any of which is properly levied against the Property, the
Leasehold Improvements, the Leasehold Estate and/or any Major Subleasehold Estate, as
applicable.
jj.Initial Term has the meaning ascribed to it in Section 3.1.
kk. Lease Term has the meaning ascribed to it in Section 3.2.
ll. Leasehold Estate means all of Lessees right, title and interest as Lessee
pursuant to this Amended and Restated Ground Lease, including, without limitation, the right,
title and interest granted hereunder in and to the Property.

mm. Leasehold Improvements means all the buildings, structures and improvements
constituting the Project Components, including the improvements described in the approved
Development Plans, and any improvements constructed thereafter from time to time, which are
now or hereafter during the Lease Term located upon the Property and owned by Lessee or any
Major Subtenant, as applicable; as well as any apparatus and equipment permanently attached
and incorporated into such buildings, structures and improvements at any time, including all
fixtures, fittings, appliances, machinery, garage equipment, heating equipment, lighting
equipment, cooling equipment, air conditioning and ventilating equipment, wiring, controls,
communications equipment, plumbing, switchboards, antennae, elevators, escalators, floor
coverings, refrigerating equipment, hot water heating and all other appliances and equipment, to
the extent same are owned by Lessee or any Major Subtenant, as applicable; provided, however,
that the term Leasehold Improvements does not include any Personal Property.
nn. Lessee has the meaning ascribed to it in the opening paragraph of this Amended
and Restated Lease, and shall include Lessees successors and/or permitted assigns.
oo. Lessor or City has the meaning ascribed to it in the opening paragraph of this
Amended and Restated Ground Lease, and shall include Lessors successors and/or permitted
assigns.
pp. LIBOR Rate means the rate per annum (rounded upward to the nearest 1/16th
of 1.00%) appearing on Telerate Page 3750 (or any successor page) as the London interbank
offered rate for deposits in U.S. Dollars with ninety (90) day maturities; provided, however, that:
(i) if for any reason such rate is not available, the applicable rate shall be the rate per annum
(rounded upward to the nearest 1/16th of 1.00%) appearing on a Reuters Screen LIBOR Page as
the London interbank offered rate for deposits in U.S. Dollars with ninety (90) day maturities;

(ii) if more than one such rate is specified on such Telerate Page or Reuters Screen LIBOR Page,
the applicable rate shall be the arithmetic mean of all such rates; and (iii) if the LIBOR Rate by
reference to either such Telerate Page or such Reuters Screen is unavailable, then the applicable
rate shall be the arithmetic mean of the rates per annum at which U.S. Dollar deposits for a
ninety (90) day term are offered by three (3) prime banks in the London interbank market.
qq. Major Project Components means, individually and collectively, the Marina,
Hotel A, Hotel B, the Retail Space and the Parking Garage.
rr. Major Sublease means any sublease agreement pursuant to which Lessee
subleases any Major Project Component to a Major Subtenant.
ss. Major Subleasehold Estate means all of an applicable Major Subtenants right,
title and interest as a sublessee pursuant to the applicable Major Sublease, including, without
limitation, the right, title and interest granted thereunder to the Major Project Component
demised thereby.
tt. Major Subtenant means any Person using or occupying or entitled to use or
occupy any Major Project Component under a Major Sublease in accordance with the provisions
of this Amended and Restated Ground Lease.
uu. Major Use Special Permit has the meaning ascribed to it in Article 17 of
Ordinance 11000, as amended, the Zoning Ordinance of the City of Miami, Florida.
vv. Marina shall have the meaning ascribed to it in Exhibit H and Composite
Attachment 3.
ww. Mega-Yachts means marine vessels eighty (80) feet or longer.
xx. Open for Business or Opened for Business means the Completion Date.
yy. Operating Agreements has the meaning ascribed to it in Article 35.

zz. Operating Team means: (i) the franchisor or licensor, if applicable, of Hotel A,
and the operator or manager of Hotel A; (ii) the franchisor or licensor, if applicable, of Hotel B,
and the operator or manager of Hotel B; (iii) the operator or manager of the Marina; (iv)
Fairchild Tropical Garden; and (v) The Historical Museum of South Florida.
aaa. Option Payment(s) has the meaning ascribed to it in Section 5.1.
bbb. Parking Garage means a multi-level parking garage containing at least the
minimum required number of dedicated parking spaces for the Hotels, the Marina and the Retail
Space.
ccc. Partial Modification of Restrictions means collectively, that certain Partial
Modification of Restrictions approved by the Trustees with respect to the Project, which
instrument modifies the restrictions set forth within Deed No. 19447 from the Trustees in favor
of Lessor filed for record April 11, 1949 in Deed Book 3130, Page 257, of the Public Records of
Miami-Dade County, Florida, as subsequently amended by that certain Amended Partial
Modification of Restrictions approved by the Trustees and dated September 15, 2011, and as
subsequently amended by Amended Partial Modification of 2014 with City Resolution R-14-
0186, adopted May 8, 2014, and State Board of Trustees authorization adopted May 13, 2014
and Flagstones related Compliance Agreement with City effective as of May 8, 2014, as set
forth in Composite Attachment 5 hereto.
ddd. Percentage Rent means Rent payable by Lessee to Lessor based on a percentage
of Gross Revenues as set forth in Section 5.3.
eee. Permitted Title Exceptions means those certain title matters set forth in Exhibit
I.

fff. Permitted Uses means those certain uses described in the description of the
Project Components and amenities set forth in Exhibit E.
ggg. Person means any natural person, trust, firm, partnership, corporation, joint
venture, association, company, or any other legal or business entity or investment enterprise.
hhh. Personal Property means any and all items of personal property which are: (i)
located on the Property and/or the Leasehold Improvements but not permanently attached thereto
and incorporated therein; and (ii) any and all trade fixtures (i.e., fixtures which can be removed
without permanently defacing or materially injuring any of the Leasehold Improvements) located
on the Property and/or the Leasehold Improvements.
iii. Possession Date has the meaning ascribed to it in Section 4.1.
jjj. Pre-Paid Construction Rent/Base Rent has the meaning ascribed to it in Section
5.1.
kkk. Prohibited Uses has the meaning ascribed to it in Section 7.11 and Exhibit N
lll. Project means all of the Leasehold Improvements (including, but not limited to,
all of the Major Project Components) to be completed pursuant to Article XIV hereof and
substantially in accordance with the approved Development Plans.
mmm. Project Approvals means those approvals and permits from Governmental
Authorities which are required in order to commence and complete construction of the Project,
including, but not necessarily limited to: (i) the approval of the Notice of Proposed Change
which shall, among other things, include the Property within Increment Two of the Downtown
Development of Regional Impact; (ii) a Major Use Special Permit which shall have been issued
for the Project in connection with the Development Plans approved by the City Manager; (iii) the
Partial Modification of Restrictions; and (iv) with respect to the Marina, such applicable permits

and approvals for the Marina as are defined in Section 7.7 of the Amended and Restated
Agreement to Enter Into Ground Lease (it being understood and agreed, however, that Lessee
shall not be required to obtain all Project Approvals for all Major Project Components in order to
commence construction of a particular portion or phase of the Project or a particular Major
Project Component) and in Exhibit H.
nnn. Pro-Rata Share means the proportionate amount of any Rents, Security Deposit,
or other amounts payable to the City that is attributed to each Ground Lease based upon its
related Major Project Components cost as a percentage of the overall Projected Development
Cost (as described in Section 5.4(b) below) for the Project so that the total amount of any such
Rents, Security Deposits, or other amounts payable to the City are fairly divided among the
Ground Lessees and the City receives one hundred percent (100%) of all required Rents,
Security Deposits and any other amounts due to the City.
ooo. Rent shall be as set forth in Article V and shall include Pre-Paid Construction
Rent/Base Rent, Construction Rent, Option Payments, Base Rent, Percentage Rent and any
additional rent or other sums owing or which may be owing from Lessee to Lessor pursuant to
the provisions of this Amended and Restated Ground Lease.
ppp. Retail means the sale of any and all commodities, food and beverages,
merchandise or services to the consumer.
qqq. Retail Space means up to 221,000 square feet of first-class space for Retail
facilities and operations (exclusive of any Hotel Retail Operations), as measured in accordance
with Exhibit E.
rrr. Space Lease means any sublease or sub-sublease or other arrangement between
Lessee or any Major Subtenant, as sublessor, and a Space Tenant, as sublessee, for the leasing of

any portion of the Retail Space or any other space within the Leasehold Improvements
(including, but not limited to, the Parking Garage and the Hotel Retail Operations) in accordance
with Section 33.5. The term Space Leases includes Direct Space Leases, but does not include
Major Subleases.
sss.Space Tenant means any tenant, subtenant, licensee and other occupant (including,
but not limited to, any Direct Space Tenant) of any portion of the Leasehold Improvements
pursuant to a Space Lease. The term Space Tenant does not include any Major Subtenant.
ttt. Start(s) Construction means that all material plans and permits are approved
and issued and the actual act of physical construction has begun.
uuu. Terrorist List means any list issued by a Governmental Authority of individuals
and/or entities engaged in terrorist activities, including, but not limited to, the following: (i) list
of Specially Designated Terrorists (SDTs) issued by the Office of Foreign Assets Control
(OFAC) pursuant to Executive Order 12947; (ii) list of Specially Designated Global Terrorists
(SDGTs) issued by OFAC pursuant to Executive Order 13224; and (iii) list of Foreign Terrorist
Organizations (FTOs) issued by the Secretary of State.
vvv. Trustees means the Board of Trustees of the Internal Improvement Trust Fund
of the State of Florida.
www.Unavoidable Delay(s) means delays on account of Force Majeure Events. Such
term shall be deemed to exclude: (i) delays on account of any lack of funds or economic
conditions; and (ii) typical ordinary delays in obtaining any permits or other approvals from
Governmental Authorities. Such term shall be deemed to include: (i) delays in the completion of
the Project on account of any injunction or other order issued by any court having jurisdiction of

the Property; and (ii) any extraordinary delays in obtaining any permits or other approvals from
Governmental Authorities.
xxx. Voting and Operational Control, as used with respect to any Person, means that
such Person: (i) owns, directly or through one or more intermediary Persons, not less than
Twenty Percent (20%) of the ownership interests of another Person; and (ii) has voting and day-
to-day control over the operation, management and decision-making of such other Person,
subject to usual and customary consent rights of other investors with respect to certain major
decisions or actions.
yyy. Work means all construction to be performed by Lessee under this Amended
and Restated Ground Lease, including any repairing, restoring, removing, or replacing of the
Leasehold Improvements.
Section 1.6 Notice to Third Parties of Composite Attachment 3. All persons or
entities reviewing and/or relying upon this Amended and Restated Ground Lease are hereby put
on notice as follows:
(a) Composite Attachment 3 is a material part of this Amended and Restated
Ground Lease and is intended to have the same weight, and require the same compliance, as each
and every other provision of this Amended and Restated Ground Lease.
(b) The rights and interests of any and all lenders, assignees, sublessees and
other types of encumbrance holders, transferees or holders of any other type of lien, right or
interest whatsoever (collectively, an Interest) in, to or under this Amended and Restated
Ground Lease or the Leasehold Estate created hereby (collectively, Interest Holder), are
hereby provided notice that each of them acquires such Interest subject to all of the terms and
conditions of this Amended and Restated Ground Lease, specifically including, but not limited

to, the terms of Composite Attachment 3, and the foregoing is specifically intended to apply, by
way of example and not limitation, with respect to all Approved Construction Lenders,
Approved Lenders, Approved Mezzanine Lenders, Approved Mortgages and Mortgagees,
Approved Leasehold Mortgages and Mortgagees, Approved Subleasehold Mortgages and
Mortgagees, Approved Major Subleases, Major Space Leases, Space Leases, Direct Space
Leases, and any and all other types of Interest(s) or Interest Holders.
ARTICLE II
DEMISE
Section 2.1 Demise. Subject to and in accordance with the terms and conditions of
this Amended and Restated Ground Lease and the Permitted Title Exceptions, Lessor, for and in
consideration of the Rent and of the covenants and agreements made by Lessee to be kept,
observed and performed hereunder, does demise and lease the Property to Lessee, and Lessee
does lease the Property from Lessor.
Section 2.2 Leasehold Improvements. So long as this Amended and Restated Ground
Lease remains in force, the Leasehold Improvements shall be owned in fee simple by Lessee and
be the sole property of Lessee, and Lessor shall have no interest therein. Upon expiration of the
Lease Term or sooner termination of this Amended and Restated Ground Lease, the Leasehold
Improvements (as well as any Personal Property which is to be delivered to Lessor pursuant to
Section 32.1(a) below and all licenses, easements, permits, and governmental approvals related
to the Property) shall become the sole property of Lessor in fee simple, and free and clear of all
encumbrances other than: (i) the lien of any Impositions assessed but not yet due and payable
(for which Lessee shall remain obligated to pay to the extent that they are allocable to the period

prior to the termination of this Amended and Restated Ground Lease); (ii) any rights surviving
an early termination of this Amended and Restated Ground Lease (i.e., prior to the stated
expiration date of the Lease Term) which are granted hereunder or under an applicable
Subordination, Non-Disturbance and Attornment Agreement to any Approved Mortgagees (as
defined in Section 8.1), Major Subtenants, holders of Approved Timeshare Licenses, and Space
Tenants (it being understood that any and all rights to possession or occupancy of the Property
and/or the Leasehold Improvements or any portion thereof shall in no event extend beyond the
stated expiration date of the Lease Term, as same may be extended pursuant to Section 3.2); and
(iii) the Permitted Title Exceptions and any other title matters consented to in writing by the City
Manager or Lessor during the Lease Term. The provisions of this Section 2.2 shall not affect the
rights and obligations of the Parties under Article XVI or Article XXIV.
Section 2.3 Delivery of Title to Lessor. Upon the expiration or sooner termination of
this Amended and Restated Ground Lease, Lessee shall execute, acknowledge and deliver to
Lessor a proper instrument in writing, releasing and quit-claiming to Lessor all right, title, and
interest of Lessee in and to the Leasehold Improvements (as well as any Personal Property which
is to be delivered to Lessor pursuant to Section 32.1(a) below and all licences, easements,
permits, and governmental approvals related to the Property).
ARTICLE III
TERM
Section 3.1 Initial Term. This Amended and Restated Ground Lease shall be for an
initial term of forty-five (45) years (the Initial Term), commencing on the Possession Date
applicable to this Amended and Restated Ground Lease and ending on the date which is forty-
five (45) years thereafter, unless this Amended and Restated Ground Lease is terminated at an

earlier date pursuant to the terms hereof. Notwithstanding Flagstones right to determine whether
to develop the Project all at once under one ground lease or on a component by component basis
under multiple ground leases, in which case the Initial Term for each ground lease begins on the
Possession Date of the first executed ground lease, subject to lessees rights to extend its ground
lease pursuant to Section 3.2 below.
Section 3.2 Extension Terms. Lessee is hereby granted two (2) consecutive options
(each, an Extension Option) to extend this Amended and Restated Ground Lease for a period
of fifteen (15) years for each such Extension Option (each such fifteen (15) year period, an
Extension Term and collectively, the Extension Terms). Provided that Lessee has
properly and timely exercised an Extension Option, the term of this Amended and Restated
Ground Lease shall be extended for the period of the applicable Extension Term (the Initial
Term, together with any exercised Extension Term(s), shall be referred to herein as the Lease
Term). During any such Extension Term, the terms, covenants and conditions of this Amended
and Restated Ground Lease, including the Rent provisions of Section 5, shall remain unmodified
and in full force and effect (other than any such terms, covenants or conditions which are no
longer applicable);
(a) Exercise of First Extension Option. For purposes hereof, the term First
Extension Option Exercise Period shall mean the period of time commencing on the thirtieth
(30th) anniversary of the Possession Date and ending on the forty-second (42nd) anniversary of
the Possession Date such date to be defined as the date the first ground lease is executed. The
first (1st) Extension Option shall be deemed to have been properly and timely exercised if: (i)
Lessee provides written notice to the City Manager of Lessees exercise thereof at any time
during the First Extension Option Exercise Period, and (ii) no Material Uncured Lessee Default

(as hereinafter defined) then exists. Notwithstanding Flagstones right to determine whether to
develop the Project all at once under one ground lease or on a component by component basis
under multiple ground leases.
(b) Exercise of Second Extension Option. For purposes hereof, the term Second
Extension Option Exercise Period shall mean the period of time commencing on the first day
of the first (1st) Extension Term and ending on the twelfth (12th) anniversary thereof. If the first
(1st) Extension Option is duly exercised, then Lessee may exercise the second (2nd) Extension
Option, which shall be deemed to have been duly and timely exercised if: (i) Lessee provides
written notice to the City Manager of Lessees exercise thereof at any time during the Second
Extension Option Exercise Period; and (ii) no Material Uncured Lessee Default then exists.
Notwithstanding Flagstones right to determine whether to develop the Project all at once under
one ground lease or on a component by component basis under multiple ground leases each
subsequent ground lease shall use the Possession Date of the first executed ground lease.
(c) Exercise is Irrevocable. Once received by Lessor, any such notice of extension
described above shall be irrevocable by Lessee.
(d) Material Uncured Lessees Default. For purposes hereof, the term Material
Uncured Lessees Default means an Event of Lessees Default: (i) which is material in nature;
and (ii) whose occurrence would cause a landlord, acting in a commercially reasonable manner
and in good faith, to elect to terminate this Amended and Restated Ground Lease (regardless of
whether Lessor has not elected to terminate this Amended and Restated Ground Lease in
connection therewith). Notwithstanding the foregoing, no Material Uncured Lessee Default shall
be deemed to exist at a given point in time if it is cured at any time prior to the expiration of the
Initial Term or the first Extension Term, as applicable (whether or not the cure has been effected

within the applicable cure period for the default giving rise to such Event of Lessees Default),
so long as Lessee shall have pursued such cure diligently and in good faith.
Section 3.3 Total Term: The total term of the ground lease(s), regardless if the Project
is developed all at once under one ground lease or on a component by component basis under
multiple ground leases, includes the Initial Term of forty-five (45) years and two Extension
Periods of fifteen (15) years each, for a total of not to exceed seventy-five (75) years from the
Possession Date of the first Ground Lease.
ARTICLE IV
DELIVERY OF POSSESSION AND DEVELOPMENT AND OPERATION OF
THE PROJECT
Section 4.1 Delivery of Possession of Property. Simultaneously with the execution
and delivery of this Amended and Restated Ground Lease by the Parties, Lessor shall deliver
possession of the Property to Lessee; it being understood and agreed that the date of execution
and delivery of this Amended and Restated Ground Lease by the latter of the Parties shall be
deemed to be the Possession Date hereunder.
Section 4.2 Memorandum. At the time of the mutual execution and delivery of this
Amended and Restated Ground Lease, the City Manager and Lessee, upon request of either
Party, shall execute a memorandum in recordable form, setting forth the beginning and
termination dates of the Initial Term, describing the right to the extension of this Amended and
Restated Ground Lease pursuant to Section 3.2, and including such other items as are
contemplated by Section 18.4 and Section 38.6. The parties have agreed for Lessee to record
such Memorandum of Marina Component Amended and Restated Ground Lease in a form of
Attachment 6 hereto, attached and incorporated.

Section 4.3 Development of the Project. Lessee shall cause the Project Components to
be constructed on the Property substantially in accordance with all applicable Development Plans
and with the Project Approvals and the terms and conditions set forth in Article XIV hereof.
Section 4.4 Operating Team.
(a) Selection. Lessees selection of each member of the Operating Team shall be
subject to the prior written approval of the City Manager in accordance with the City Manager
Approval Procedures; provided, however, that Fairchild Tropical Garden and The Historical
Museum of South Florida shall be deemed to have been approved by Lessor.
(b) Replacement. The replacement of any such member of the Operating Team
(including Fairchild Tropical Garden and The Historical Museum of South Florida) by Lessee
shall be subject to the prior written approval of the City Manager in accordance with the City
Manager Approval Procedures. Lessee acknowledges and agrees that the inclusion of Fairchild
Tropical Garden and The Historical Museum of South Florida were important factors in the
Citys selection of the Island Gardens Proposal.
(c) No Approval Required for Lessee or Affiliates. Notwithstanding the foregoing,
no approval by the City Manager shall be required for Lessee and/or any of its Affiliates to be
the initial or replacement operator or manager of either or both Hotels or the Marina so long as
the franchisor or licensor for the applicable Hotel or the Marina is approved by the City Manager
in accordance with the provisions of this Section 4.4.
(d) Pre-Approved Hotel Franchisors. For purposes hereof, the term Pre-Approved
Hotel Franchisor means any of the franchisors or licensors listed in Exhibit J, as well as any
of their successors. Notwithstanding anything to the contrary contained herein, the initial
selection of any Pre-Approved Hotel Franchisor as the franchisor or licensor for Hotel A and/or

Hotel B is hereby pre-approved by, and shall not require any further approval of or consent by,
the City Manager on behalf of Lessor. Furthermore, the subsequent replacement from time to
time of any then-existing franchisor or licensor (whether or not a Pre-Approved Hotel
Franchisor) with any Pre-Approved Hotel Franchisor shall not require any further approval of or
consent by the City Manager on behalf of Lessor, so long as such replacement is made prior to
the tenth (10th) anniversary of the Possession Date.
(e) Operator. If the franchisor or licensor of either Hotel or the Marina is approved
(or deemed pre-approved) by the City Manager pursuant to this Section 4.4, then any operator of
such Hotel which: (i) is an Affiliate of such franchisor or licensor; or (ii) is a Person which has
been retained by such franchisor or licensor for a substantial number of the hotels in its franchise
or license system (or is an Affiliate of any such Person) shall not be subject to the City
Managers approval.
(f) Manager. If an operator of either Hotel or the Marina has been approved (or is,
pursuant to subparagraph (e) above, not required to be approved) by the City Manager, then any
individual who is employed by such operator as the general manager and any other employee of
such Hotel or the Marina shall not be required to be approved by the City Manager.
ARTICLE V
RENT AND SECURITY DEPOSIT
Section 5.1 Application of Composite Attachment 3 to Pre-Paid Construction Rent/Base
Rent, Option Payments, and Construction Rent:
(a) In Section II of Composite Attachment 3, the parties have set forth the General
Payment Schedule for All Major Project Components detailing the general payment
commencement dates, end dates, and per annum amounts for Prepaid Construction Rent/Base

Rent and Construction Rent for the entire Project for each lease year. Additionally, Composite
Attachment 3 sets forth the circumstances (i) for transitioning from the payment of Prepaid
Construction Rent/Base Rent to the payment of Construction Rent, (ii) for any credits to
Flagstone of Prepaid Construction Rent/Base Rent, (iii) for no credits to Flagstone of Prepaid
Construction Rent, (iv) for any acceleration of time for Construction Rent payments, and (v)
any overlaps of Construction Rent with Option Payments and with Base Rent payments.
(b) Each ground lease for a Major Project Component shall pay its Pro-Rata Share of
the Prepaid Construction Rent and the Construction Rent as set forth in Composite Attachment
3; provided, however, that, (subject to Subsection 5.2(c) below concerning special
circumstances applicable if the Marina Component Ground Lease is executed and the Marina
Component so developed), until ground leases have been signed for all Major Project
Components, the total payment amounts set forth for each lease year in Section II of Composite
Attachment 3 shall be paid by the Lessee(s) who have previously signed Ground Leases so that
in all cases the City shall receive in total the aggregate amount required to be paid per annum.
(c) Composite Attachment 3, particularly in Sections III, IV and V, also sets forth
option exercise and payment provisions, commencement dates, end dates, and per annum
amounts for two (2) option period of 5 years each for particular lease years related to
construction of the Hotel(s) Component(s) of the Project. Additionally, Composite Attachment
3 sets forth the circumstances (i) for transitioning from the Section I General Construction
Schedule for All Major Components to the construction schedules for one or both Hotel(s)
Components, and (ii) for the related overlapping payments of Construction Rent, Option
payments, and Base Rent.

(d) Composite Attachment 3, Sections VI and VII also set forth (i) certain provisions
relating to Prepaid Construction Rent/Base Rent and Construction Rent payments for the Marina
Component, and (ii) for certain lump sum payment circumstances due to the construction
schedule for the Marina Component.
(e) Monthly Installments: All Prepaid Construction Rent/Base Rent, Construction Rent,
and Option payments to the City are to be paid in equal monthly installments in advance on the
first day of the month.
(f) Potential Construction Rent Payment Schedule Acceleration; Potential Option
Payment Schedule Acceleration. Composite Attachment 3 sets forth circumstances under which
Construction Rent payment schedules and Option payment schedules may be accelerated.
Section 5.2 Application of Composite Attachment 3 to Base Rent. In Sections II and
IV of Composite Attachment 3, the parties have set forth the details regarding payment
commencement dates, end dates, and per annum amounts for Base Rent for the entire Project for
each lease year. Additionally, Composite Attachment 3 sets forth the circumstances (i) for
transitioning from the payment of Prepaid Construction Rent/Base Rent and Construction Rent to
the payment of Base Rent, (ii) for any increases in Base Rent due to certain construction
circumstances, (iii) for any acceleration of time for Base Rent payments, and (iv) any overlaps of
Construction Rent with Option Payments and with Base Rent payments.
(a) Each ground lease for a Major Project Component shall pay its Pro-Rata Share of the
Base Rent as set forth in Composite Attachment 3; provided, however, that subject to Subsection
5.2(c) below concerning special circumstances applicable if the Marina Component Ground
Lease is executed and the Marina Component so developed) until ground leases have been
signed for all Major Project Components, the total payment amounts set forth for each lease year

in Section II of Composite Attachment 3 shall be paid by the Lessee(s) who have previously
signed ground leases so that in all cases the City shall receive in total the aggregate amount
required to be paid per annum.
(b) Monthly Installments: All Base Rent payments to the City are to be paid in equal
monthly installments in advance on the first day of the month in accordance with Composite
Attachment 3; provided, however, that if the Possession Date occurs on a day other than the first
(1st) day of the month, Lessee shall, on the Possession Date pay to Lessor the pro rata portion of
Base Rent due for any partial month in which the Possession Date occurs.
(c) CPI Adjustment. For purposes hereof:
(i) Consumer Price Index means the monthly index published by the
Bureau of Labor Statistics of the United States Department of Labor as The Consumer Price
Index for All Items, Miami-Ft. Lauderdale (Base Year 1982-84 = 100) or its successor;
provided, however, that if such index is discontinued during the Lease Term and there is no
successor index, Consumer Price Index shall mean such other index as the parties shall
mutually agree as reasonably replacing such index.
(ii) Reference Year Base Rent means the per annum Base Rent amount for
the twelve (12) month period commencing on the Possession Date.
(d) CPI Adjustment. Commencing on the first anniversary of the
Possession Date, and on each anniversary thereafter during the Lease Term, the per annum Base
Rent amount shall be adjusted to an amount equal to the product of the Reference Year Base
Rent multiplied by a fraction, the numerator of which is the Consumer Price Index number as of
three (3) months prior to the beginning of the applicable adjustment date, and the denominator of
which is the Consumer Price Index number as of three (3) months prior to the Possession Date.

(e) Floor and Cap. In no event shall any such annual adjustment to the Base Rent
result in an increase which is less than One Percent (1%), or more than Five Percent (5%), of the
Base Rent amount immediately prior to the effective date of such adjustment.
(f) Notice of CPI Adjustment. If any such Consumer Price Index adjustment is to be
made, then Lessor shall notify Lessee in writing of the amount of the increased Base Rent for the
twelve (12) month period commencing on the date of the adjustment, and if Lessor fails to so
notify Lessee prior to the commencement of such twelve (12) month period, Lessee shall
continue paying the previously applicable Base Rent installments until such time as Lessee is
notified in writing of the appropriate increase in Base Rent, and within thirty (30) days
thereafter, Lessee shall pay Lessor any deficiency in the Base Rent installments otherwise paid
by Lessee prior to such notification.
Section 5.3 Percentage Rent In addition to the Base Rent above, Lessee shall pay
Percentage Rent to Lessor as follows:
(a) Gross Revenues Other Than from the Sale of Approved Time Share Licenses.
Lessee shall pay to Lessor Percentage Rent in an amount equal to one percent (1%) of Gross
Revenues (except for Gross Revenues from the sale of Approved Time Share Licenses as
described in subparagraph (b) below) earned during the period from and after the third (3rd)
anniversary of the Possession Date(the Percentage Rent Commencement Date) and
continuing thereafter throughout the Lease Term. Such Percentage Rent shall be payable in
monthly installments, in arrears, on the first (1 st) day of each month, commencing on the first
(1st) day of the month which is two months after the Percentage Rent Commencement Date.
Each such monthly installment shall be in an amount equal to the Percentage Rent payable under

this Section 5.3(a) for the month which is two (2) months before the due date of such installment
(e.g., an installment due on July 1 shall be for the Percentage Rent for the preceding May).
(b) Gross Revenues from the First Sale of Approved Time Share Licenses.
(i) Defined Term. For purposes hereof, the term First Sale means the
closing (i.e., delivery of evidence of ownership by Lessee or the applicable Major Subtenant to
the licensee thereof, as opposed to entering into a contract for sale, taking reservations or
deposits, etc.) of the sale or transfer of any Approved Time Share License at either Hotel A,
Hotel B or the Marina to the first licensee thereof (it being understood that such term shall not
apply to, and no Percentage Rent shall be payable with respect to, any subsequent re-sales or
transfers of the same Approved Time Share License).
(ii) Percentage Rent. In addition to the Percentage Rent specified in Section
5.3(a) above, Lessee shall pay to Lessor Percentage Rent in an amount equal to Two and One-
Half Percent (2.5%) of Gross Revenues with respect to the First Sale of each Approved Time
Share License (as such Gross Revenues are defined and described in Exhibit G) earned during
the period from and after the date such First Sales commence. Such Percentage Rent shall be
payable in monthly installments, in arrears (in the same manner as provided for by Section
5.3(a) above), on the first (1st) day of each month, commencing on the first day of the month
which is two (2) months after the month in which such First Sales commence.
(iii) Penalty Fee: Should the Time Share component of the project not be
constructed by the Lessee, then the Lessee shall pay to the Lessor a penalty fee in an amount
equal to Three Million Seven Hundred Fifty Thousand Dollars ($3,750,000.00), which amount is
pursuant to Flagstone Island Gardens response to the RFP issued by the City of Miami, within

thirty (30) days upon the completion of the Hotel Option periods or at such time as Flagstone
notifies the City of its intent not to construct the Hotel Components whichever comes first.
(c) Statements Concerning Percentage Rent. Together with each installment of
Percentage Rent, Lessee shall provide Lessor with a statement of its Gross Revenues for the
applicable month signed by the managing member or any duly elected officer of Lessee. Such
statement shall show Gross Revenues and an itemization of any exclusions or deductions
therefrom for such month, as well as year-to-date amounts for the current calendar year. Within
one hundred twenty (120) days after the end of each calendar year, Lessee shall deliver to Lessor
audited statements of the Gross Revenues for the preceding calendar year prepared by a
nationally recognized accounting firm reasonably acceptable to the City Manager, along with the
additional amount of Percentage Rent, if any, which is due from Lessee to Lessor for that
preceding calendar year. In the event that the statement of Gross Revenues for the preceding
calendar year indicates that the estimated Percentage Rent paid by Lessee for the preceding
calendar year is greater than the actual Percentage Rent due Lessor, then the Parties shall
reconcile the estimated Percentage Rent paid and the actual Percentage Rent due in the form of a
credit to Lessee against next accruing monthly Rent installments due hereunder (or a refund if
there are no more monthly Rent installments due hereunder).
(d) Major Subleases. Each Major Sublease shall require that the applicable Major
Subtenant furnish similar statements to Lessee in the same manner as provided for by
subparagraph (c) above. Upon Lessees receipt of such statements, Lessee shall promptly
furnish copies thereof to Lessor.
Section 5.4 Security Deposit.

(a) Security Deposits for the Security Rent/Base Rent. Prior to the execution of this
Amended and Restated Ground Lease, Flagstone shall continue the Security Rent Deposit
payments, as indicated below, either by (a) delivering the amount equal to one years
Construction Rent/Base Rent to the Escrow Agent, or (b) provide to City, at Flagstones sole cost
and expense, a Letter of Credit in the amount equal to one years Construction Rent/Base Rent as
defined herein. Notwithstanding the foregoing, Flagstone shall be permitted to utilize any
combination of cash or Letter of Credit so long as the Security Deposit for the Pre-Paid
Construction Rent/Base Rent equals the amounts defined in the aggregate. The Security Deposit
for the Construction Rent/Base Rent, shall herein after be referred to as the Security Rent
Deposit and shall provide security for the faithful performance by Flagstone of all rent payment
provisions in full of this Amended and Restated Ground Lease to be performed or observed by
Flagstone. During the periods outlined below, Flagstone shall deliver the Security Deposits as
defined below:
Commencing Annual Amount Required for Security

Deposit Rent
October 1, 2010 $300,000
October 1, 2011 $500,000
October 1, 2012 $750,000
October 1, 2013 $1,000,000
October 1, 2014 $1,000,000
October 1, 2015 $1,000,000
October 1, 2016 $1,500,000
October 1, 2017 $1,675,000

October 1, 2018 $2,000,000
Any LOC Deposit held by the Lessor or Cash Deposit held by Escrow Agent, as defined in the
Agreement to Enter between the Parties (having an effective date of February 1, 2010) as
security under such Agreement to Enter may be credited toward the following years Security
Rent Deposit, beginning on October 1, 2010. The annual amount due on October 1, 2018 of
TWO MILLION DOLLARS ($2,000,000) shall remain in effect for the life of the Agreement.
Flagstone shall have a 10-day grace period beyond the first of the month to increase the annual
payment as set forth in this Section 5.4. If an Event of Lessees Default for non-payment of rent
occurs hereunder, Lessor may, at its option and without prejudice to any other right or remedy
that Lessor may have hereunder, apply or require distribution of all or any portion of the Security
Deposit Rent for the payment of any sum to which Lessor may become entitled by reason of
such Event of Lessees Default, including, without limitation, reasonable attorneys fees and
costs which Lessor may incur in connection therewith. If Lessor so applies or requires the
distribution to Lessor of all or any portion of the Security Deposit Rent, Lessee shall, within
thirty (30) days after written demand therefor, deposit cash with Lessor in an amount sufficient
to restore any such deficiency or amend or replace any LOC Deposit, whichever is applicable, to
the full amount thereof, and Lessees failure to do so shall, at Lessors option, constitute an
Event of Lessees Default hereunder. In the event Lessor applies or requires distribution of all or
any portion of an LOC Deposit where no Event of Lessees Default then existed, Lessor shall be
deemed to have improperly requested and received such application or distribution, and Lessee
shall be entitled to recover from Lessor the amount which was improperly requested and
received, or to reduce the Security Deposit by an equivalent amount.

(b) Security for the Easements. Prior to the execution and delivery of the new
Amended and Restated Agreement to Enter, and for the term of all Ground Leases for so long as
any and all such easements are in effect, Flagstone shall either (a) deliver the amount of Thirty-
Five Thousand and No/100 Dollars ($35,000.00) (the Easement Deposit) to Escrow Agent or
(b) provide to City, at Flagstones sole cost and expense, a Letter of Credit in the amount of
Thirty-Five Thousand and No/I00 ($35,000.00) (the Easement Security LOC).
Notwithstanding the foregoing, Flagstone shall be permitted to utilize any combination of cash or
Letter of Credit so long as the easement deposit equals Thirty-Five Thousand and No/100
Dollars ($35,000.00) in the aggregate. The Easement Deposit or the Easement Security LOC, as
applicable, shall hereinafter be referred to as the Easement Security and shall provide security
for the faithful performance by Flagstone of all of the provisions of the Easements to be
performed or observed by Flagstone.
(c) Security for Hold Harmless and Indemnification and Security Provisions
under Attachment 3. Flagstone shall also comply with the provisions of Section IX of
Composite Attachment 3 hereto, and Section 9.3 of the Amended and Restated Agreement to
Enter regarding Security Deposit(s) required regarding any lawsuits, pending against the City
relating to any Lien(s) on the subject Property and Section 14.18 hereof.
(d) Deposits; Letters of Credit. Any Security Deposit held by Escrow Agent shall
be held in accordance with the Escrow Agreement, in form and substance as set forth in the
Amended and Restated Agreement to Enter in Exhibit 5.3 (the Escrow Agreement), which
Escrow Agreement shall be executed by City, Flagstone and Escrow Agent simultaneously with
the execution of the this Amended and Restated Agreement to Enter which shall remain in effect
for so long as any Ground Lease Remains in effect, in connection with the Easements and shall

continue for Additional Security to be deposited under the Escrow Agreement upon the
execution of the first Ground Lease and then thereafter any subsequent Ground Lease(s) and any
additional security deposits required thereunder. Any Letter of Credit elected by Flagstone
pursuant to the provisions of this ARTICLE 5 in the Amended and Restated Agreement to Enter
(or a replacement thereof satisfactory to City) shall remain in effect throughout the term of the
related Ground Lease(s), unless the Easements and the related Ground Lease(s) are otherwise
terminated.
(e) Release. Upon termination of the applicable Ground Lease, Lessor shall, within
fifteen (15) days after written request of Lessee, return and/or release the applicable amount of
the Security Deposits currently held by Lessor to Lessee (less such portion thereof as Lessor may
have appropriated and applied in accordance with the provisions of this Section 5.4, Composite
Attachment 3 and Composite Attachment 5), whereupon no further or other security deposits
shall be required hereunder.
Section 5.5 Place Of Payment. Lessee shall pay all Rent to Lessor in lawful money of
the United States of America at a place Lessor shall from time to time designate by written
notice to Lessee, and in the absence of such designation, at the office of the Finance Director of
the City at the address set forth in Section 37.1.
Section 5.6 Default Interest. If any Rent or other sums due from Lessee to Lessor
hereunder are not paid when due and payable, then such unpaid Rent or other sums shall bear
interest at the Default Rate from and after the date when same became due and payable until the
date paid. Such interest payment shall be deemed to be additional Rent and shall not be deemed
a consent by Lessor to late payments, nor a waiver of Lessors right to insist upon timely

payments at any time, nor a waiver of any remedies to which Lessor is entitled as a result of the
late payment.
Section 5.7 Late Charge. If any Rent or other sums due from Lessee to Lessor
hereunder are not paid when due and payable, and Lessee thereafter fails to cure such default
within the applicable cure period hereunder (such that an Event of Lessees Default occurs on
account thereof), then, on each such occasion, Lessee shall pay to Lessor a late fee equal to Four
Percent (4%) of the past due sum, as compensation to Lessor for the inconvenience of the
collection and processing of each such late payment. Such late fee shall be in addition to any
interest payable under Section 5.6. Such late fee shall be deemed to be additional Rent and shall
not be deemed a consent by Lessor to late payments, nor a waiver of Lessors right to insist upon
timely payments at any time, nor a waiver of any remedies to which Lessor is entitled as a result
of the late payment.
Section 5.8 Rent To Be Without Deduction. This Amended and Restated Ground
Lease shall be deemed and construed to be a triple net lease, and Lessor shall receive all Rent,
and all other payments to be made by Lessee, free from any charges, assessments, Impositions,
expenses, defenses, set-offs or deductions of any nature, except as may be otherwise specifically
provided for herein (including, but not limited to, Lessees set-off rights described in Section
25.3(b)(iv) and Section 26.1(c) below). Lessor shall not be called upon to make any expenditure
for the maintenance, repair or preservation of all or any portion of the Property.
ARTICLE VI
LEASEHOLD AND SUBLEASEHOLD MORTGAGES
Section 6.1 Definition of Terms. For purposes of this Article VI, the following terms
shall have the meanings attributed to them in this Section:
(a) Approved Initial Construction Lender means the initial Construction Lender approved

pursuant to the terms of this Amended and Restated Ground Lease..
(b) Approved Leasehold Mortgage means any mortgage, deed of trust or similar
security instrument (as same may be supplemented, extended, split, consolidated, or otherwise
amended or modified from time to time, all without Lessors consent) encumbering the
Leasehold Estate and/or Leasehold Improvements or any portion thereof, so long as:
(i) such instrument does not encumber the Citys fee simple estate;
(ii) such instrument secures an Approved Construction Loan or an Approved
Permanent Loan or Approved Mezzanine Financing;
(iii) the funding availability pursuant to any Approved Construction Loan,
together with the funding availability pursuant to any Approved Mezzanine Financing, will not
result in the Initial Equity Requirement not being satisfied;
(iv) the funding availability pursuant to any Approved Permanent Loan,
cause the Maximum Project Debt to Value Ratio to be exceeded. For purposes of clauses (iii)
and (iv) above, the term funding availability shall not include any provision for a future
advance which is entirely within the lenders discretion to make, and any such future advance
shall be treated as a separate loan for such purposes. Notwithstanding the foregoing, the term
Approved Leasehold Mortgage shall also include any other such mortgage, deed of trust or
security instrument approved in writing by the City Manager pursuant to the terms hereof.
(c) Approved Leasehold Mortgagee means the holder of an Approved Leasehold
Mortgage.
(d) Approved Major Subleasehold Mortgage means any mortgage, deed of trust or
similar security instrument (as same may be supplemented, extended, split, consolidated, or

otherwise amended or modified from time to time, all without Lessors consent) encumbering
any Major Subleasehold Estate or any portion thereof, so long as:
(i) such instrument does not encumber the Citys fee simple estate;
(ii) such instrument secures an Approved Construction Loan or an Approved
Permanent Loan or any Approved Mezzanine Financing;
(iii) the funding availability pursuant to any Approved Construction Loan,
result in the Initial Equity Requirement not being satisfied; and
(iv) the funding availability pursuant to any Approved Permanent Loan,
cause the Maximum Project Component Debt to Value Ratio to be exceeded. For purposes of
clauses (iii) and (iv) above, the term funding availability shall not include any provision for a
future advance which is entirely within the lenders discretion to make, and any such future
advance shall be treated as a separate loan for such purposes.
(e) Approved Major Subleasehold Mortgagee means the holder of an Approved
Major Subleasehold Mortgage.
(f) Approved Mortgage means any Approved Leasehold Mortgage or Approved
Major Subleasehold Mortgage.
(g) Approved Mortgagee means any Approved Leasehold Mortgagee or Approved
Major Subleasehold Mortgagee.
(h) Approved Lender means any Person meeting any of the following criteria:
(i) any insurance company, bank or trust company, pension or

retirement fund or trust, governmental agency or fund, or other financial or lending institution or
other lender which is regulated by, or makes any loans which are regulated by, state or federal
laws of the United States, provided; however, that in the case of a first priority Approved
Leasehold Mortgage or a first priority Approved Major Subleasehold Mortgage, the Financial
Standards must be satisfied;
(ii) any similar type of foreign domiciled entity or institution or other lender
which is regulated by, or makes any loans which are regulated by, the country of its domicile
provided; however, that in the case of a first priority Approved Leasehold Mortgage or a first
priority Approved Major Subleasehold Mortgage, the Financial Standards must be satisfied;
(iii) any Person which is listed in the S&P 500 or the Fortune500, or any
Affiliate of such Person; any of the lenders listed in Exhibit K (whether or not they
independently satisfy the requirements of clauses (i), (ii) or (iii) above), provided that such
lender continues to satisfy the Financial Standards;
(iv) any other lender which may be approved in writing from time to time by
the City Manager as an Approved Lender;
(v) in the case of Mezzanine Financing, any Approved Mezzanine Financer;
(vi) any successor of any Person described in clauses (i) through (vi) above;
and
(vii) any assignee of any Person described in clauses (i) through (vi) above, so
long as such assignee independently meets any of the criteria set forth in clauses (i) through (vi)
above. Notwithstanding the foregoing, the criteria set forth in clauses (i) through (vi) above shall
not apply to: (A) any loan participants not in privity with or having direct legal rights with

respect to the borrower; or (B) any certificate holder or similar Person holding an interest from
time to time in a securitized loan, conduit loan or similar loan.
(i) Financial Standards means that, at the time any applicable loan is made, the lender
making such loan shall have assets in excess of $50,000,000,000 and shall have a credit rating of
not less than A; provided, however, that the foregoing requirements: (i) may be satisfied by
aggregating the assets of such lender with those of all of its Affiliates; and (ii) need not be
satisfied by any co-lenders, so long the lender (together with all of its Affiliates as described in
clause (i) above) designated by such co-lenders as the agent or lead lender or any similar
designation satisfies such requirements.
(j) Approved Construction Loan means any loan extended by an Approved Lender
to Lessee or any Major Subtenant for the primary purpose of the initial construction and
completion of the Project or any applicable Major Project Component or any other portion
thereof, which loan is secured by an Approved Leasehold Mortgage. The Approved
Construction Loan shall be submitted no later than 60 days prior to the Commission meeting date
for the consideration of the respective ground lease.
(k) Approved Mezzanine Financer means:
(i) any company, corporation, fund or other entity, whether public or private,
which: (A) has a portfolio of obligations similar in type or size to the applicable Mezzanine
Financing, which portfolio has a value in excess of $250,000,000 at the time such Mezzanine
Financing is made; (B) is prepared to front-end its commitments (i.e., make advances or place
funds into escrow for the purpose of funding initial or early Project costs); (C) is not named, and
has no controlling investor therein, named on any Terrorist List at the time of the making of such
Mezzanine Financing; and (D) has not had (nor has any controlling investor therein which has

had) any criminal felony convictions within the immediately preceding ten (10) years prior to the
making of such Mezzanine Financing; or
(ii) any other Person meeting the criteria for an Approved Lender as set forth
in the definition thereof.
(l) Approved Mezzanine Financing means any financing extended by an Approved
Mezzanine Financer to Lessee or any Major Subtenant with respect to the Project or any Major
Project Component(s), which financing:
(i) is secured primarily by assets other than the Property (such as a pledge or
hypothecation of shares or other interests in the borrowing entity), but may (in addition to being
secured by such collateral), be secured by a subordinate mortgage encumbering the Leasehold
Estate and/or Leasehold Improvements or any Major Subleasehold Estate, as applicable;
(ii) may include an equity participation (including any preferred equity or
other ownership interest in Lessee or the applicable Major Subtenant, as applicable), or a
participation in profits or other equity kicker.
(m) Approved Permanent Loan means any loan extended by an Approved Lender to
Lessor or any Major Subtenant after the initial construction and completion of the Project or any
applicable Major Project Component, which loan is secured by an Approved Leasehold
Mortgage, including, but not limited to:
(i) any permanent or mini-permanent loan (whether a new loan or a
conversion of any Approved Construction Loan);
(ii) any loan made in connection with any subsequent construction,
demolition, renovation and/or rehabilitation from time to time of any portion of the Leasehold
Improvements; and

(iii) if the Property is being developed on a component by component basis,
then each Approved Permanent Loan shall include the applicable, if any, additional terms and
conditions of Composite Attachment 3 attached to and incorporated by this Amended and
(n) Initial Equity Requirement means that:
(i) the Bayraktar Family Equity Contribution shall have been made; and
i. Lessee, either directly or through one or more Investors (as defined in
Section 8.1), shall have contributed not less than ONE HUNDRED
AND TWELVE MILLION DOLLARS AND NO/100 ($112,000,000)
(with the amount of the Bayraktar Family Equity Contribution being
counted toward such sum) in equity into the Project; provided,
however, that in the event that the budgeted Project cost exceeds
THREE HUNDRED AND TWENTY MILLION DOLLARS AND
NO/100 ($320,000,000), such required equity contribution by Lessee
shall be an amount not less than Thirty-Five Percent (35%) of such
budgeted Project cost. The foregoing equity contribution amounts
shall include all demonstrable hard costs and soft costs reasonably
related to the Project expended or reimbursed by Lessee and/or the
Bayraktar Family prior to or after the date hereof. In no event shall the
required Bayraktar Family Equity Contribution amount be affected by
any increase in Project costs. Notwithstanding the foregoing, in the
event the Project is developed on a component by component basis,
the Initial Equity Requirement shall be calculated using the same

formula that is used for calculation of the Security Deposit as stated in
this Amended and Restated Ground Lease. In other words, the amount
of the Initial Equity Requirement at any given time shall be equal to
the product obtained by multiplying ONE HUNDRED AND
TWELVE MILLION DOLLARS AND NO CENTS ($112,000,000) or
the amount that is Thirty-Five Percent (35%) of the budgeted Project
cost, as applicable, by the percentage that the Projected Development
Cost of all Major Project Components under construction at that time
bears to the Projected Development Cost of the total Project. The
Projected Development Cost shall be determined by Lessee and
subject to approval by the City Manager, after review of such financial
information as shall be satisfactory to the City Manager, and shall be
contained in the development budgets submitted to Lessor pursuant to
the Agreement to Enter.
(o) Maximum Project Debt to Value Ratio means that:
(i) the aggregate principal indebtedness of all Approved Permanent Loans
secured by Approved Leasehold Mortgages, and all Approved Permanent
Loans secured by Approved Major Subleasehold Mortgages, shall not exceed
(exclusive of advances to protect security and overdue and default interest)
Seventy Five Percent (75%) of the Fair Market Value of the Project; and
(ii) the aggregate principal indebtedness of all Approved Permanent Loans and
Approved Mezzanine Financings secured by Approved Leasehold Mortgages
and all Approved Permanent Loans and Approved Mezzanine Financings

secured by Approved Major Subleasehold Mortgages shall not exceed
(exclusive of advances to protect security and overdue and default interest)
Eighty Five Percent (85%) of the Fair Market Value of the Project, unless the
prospective Debt Service Coverage Ratio for all such Approved Permanent
Loans and Approved Mezzanine Financings combined will, based on
reasonable pro formas, be less than 1.3, in which case such percentage shall be
Seventy Five Percent (75%) instead of Eighty Five Percent (85%).
(p) Maximum Project Component Debt to Value Ratio means, with respect to any
applicable Major Project Component, that:
(i) the aggregate principal indebtedness of all Approved Permanent Loans
secured by Approved Major Subleasehold Mortgages with respect to such Major Project
Component shall not exceed (exclusive of advances to protect security and overdue and default
interest) Seventy Five Percent (75%) of the Fair Market Value of such Major Project
Component; and
(ii) the aggregate principal indebtedness of all Approved Permanent Loans
and Approved Mezzanine Financings secured by Approved Major Subleasehold Mortgages with
respect to such Major Project Component shall not exceed (exclusive of advances to protect
security and overdue and default interest) Eighty Five Percent (85%) of the Fair Market Value of
such Major Project Component, unless the prospective Debt Service Coverage Ratio for all such
Approved Permanent Loans and Approved Mezzanine Financings combined will, based on
reasonable pro formas, be less than 1.3, in which case such percentage shall be Seventy Five
Percent (75%) instead of Eighty Five Percent (85%).

(q) Fair Market Value means the fair market value of the Project or any Major
Project Component, as applicable, based on the most current as-built appraisal, prepared by an
MAI appraiser licensed to perform appraisal services within the State of Florida, obtained by an
Approved Mortgagee as a condition to making any loan or advance (including any future
advance) by such Approved Mortgagee secured or to be secured by an Approved Mortgage. In
the event that the most current appraisal is more than two (2) years old, either Party may require
a new appraisal or an update and recertification of the prior appraisal. The cost of such new or
recertified appraisal shall be the responsibility of Lessee, but any such new or recertified
appraisal shall be certified to Lessor as well as to Lessee.
(r) Foreclosure Transfer means a foreclosure sale with respect to an Approved
Leasehold Mortgage or Approved Major Subleasehold Mortgage or as a result of the assignment
or transfer of the Leasehold Estate or applicable Major Subleasehold Estate in lieu of foreclosure
or other similar transaction, which foreclosure sale transfer shall also be subject, if the Property
is being developed on a component by component basis, to the applicable, if any, additional
terms and conditions of Composite Attachment 3 attached to and incorporated by this Amended
and Restated Ground Lease.
(s) Approved Foreclosure Transferee means any Person (including, but not limited
to, any Approved Lender or any Affiliate, designee, nominee or assignee thereof) acquiring the
Leasehold Estate or any Major Subleasehold Estate pursuant to a Foreclosure Transfer; provided,
however, that such Person must:
(i) not appear on a Terrorist List at the time of such Foreclosure Transfer;

(ii) not have had (or be controlled by a Person who has had) any criminal
felony convictions within the immediately preceding ten (10) years prior to such Foreclosure
Transfer;
(iii) have substantial experience in owning or operating projects which are
comparable to the Project or the applicable Major Project Component, or retain, within a
reasonable period of time, an operator having such experience to operate the Project or the
applicable Major Project Component; and
(iv) assume in writing all of the obligations of Lessee hereunder, or all of the
obligations of any applicable Major Subtenant under the applicable Major Sublease, accruing
from and after the effective date of such Foreclosure Transfer, and provide a copy of such
assumption agreement to the City Manager within ten (10) days after the effective date of such
Foreclosure Transfer.
(t) Approved Subsequent Foreclosure Purchaser means any Person acquiring the
Leasehold Estate or any Major Subleasehold Estate from an Approved Foreclosure Transferee,
provided that such Person must:
(i) not appear on a Terrorist List at the time of such acquisition;
(ii) not have had (or be controlled by a Person who has had) any criminal
felony convictions within the immediately preceding ten (10) years prior to such
acquisition;
(iii) have substantial experience in owning or operating projects which are
comparable to the Project or the applicable Major Project Component, or retain, within a
reasonable period of time, an operator having such experience to operate the Project or
the applicable Major Project Component; and

(iv) assume in writing all of the obligations of Lessee hereunder, or all of the
obligations of any applicable Major Subtenant under the applicable Major Sublease,
accruing from and after the effective date of such acquisition, and provide a copy of such
assumption agreement to the City Manager within ten (10) days after the effective date of
such acquisition.
Section 6.2 Prohibited Mortgages.
(a) Leasehold Estate. Other than pursuant to an Approved Leasehold Mortgage,
Lessee may not mortgage, pledge or otherwise encumber all or any part of Lessees interest in
the Leasehold Estate and/or the Leasehold Improvements (and no such mortgage, pledge or other
encumbrance shall be valid or effective) without Lessors prior written consent, which may be
withheld in its sole and absolute discretion.
(b) Major Subleasehold Estate. Other than pursuant to an Approved Major Subleasehold
Mortgage, no Major Subtenant may mortgage, pledge or otherwise encumber all or any part of
such Major Subtenants interest in its Major Subleasehold Estate (and no such mortgage, pledge
or other encumbrance shall be valid or effective), without Lessors prior written consent, which
may be withheld in its sole and absolute discretion.
Section 6.3 Permitted Mortgages.
(a) Leasehold Estate. Lessee is freely permitted to grant any and all Approved Leasehold
Mortgages.
(b) Major Subleasehold Estates. Each Major Sublessee is freely permitted to grant
any and all Approved Major Subleasehold Mortgages.
(c) Mortgages Encumbering Space Leasehold Estates. Nothing contained herein
shall be deemed to prevent: (i) any Space Tenant from granting any mortgage, deed of trust or
other similar security instrument encumbering its right, title and interest in, to and under the

applicable Space Lease; or (ii) any holder of any such mortgage, deed of trust or other instrument
from foreclosing upon such instrument or accepting an assignment or transfer in lieu thereof and
thereafter assigning or transferring the collateral under such instrument to another Person, all
subject to and in accordance with the terms and conditions of the applicable Space Lease.
(d) Amendments. Upon the request of any actual or prospective Approved Leasehold
Mortgagee or Approved Major Subleasehold Mortgagee or any Approved Mezzanine Financer,
Lessor and Lessee shall enter into a modification or amendment of this Amended and Restated
Ground Lease to incorporate such commercially reasonable modifications, additions or deletions
to this Amended and Restated Ground Lease as such party may reasonably request so as to
render this Amended and Restated Ground Lease and any applicable Major Sublease
financeable based on criteria for financeability typically imposed in comparable
transactions, provided that such modification or amendment does not: (i) affect the business and
financial terms of this Amended and Restated Ground Lease; (ii) constitute a material deviation
from the Watson Island RFP and the Island Gardens Proposal; or (iii) significantly impair the
protections afforded to Lessor pursuant to this Amended and Restated Ground Lease and the
Subordination, Non-Disturbance and Attornment Agreements described below, or (iv) impose
any add itional material burdens on Lessor.
Section 6.4 Notification of Lessor. Notwithstanding any actual or constructive notice that
Lessor may have of an Approved Leasehold Mortgage or an Approved Major Subleasehold Mortgage, no
such Approved Leasehold Mortgagee, Approved Major Subleasehold Mortgagee or other Approved
Lender shall have the rights or benefits described in this Article, nor shall the provisions of this Article be
binding upon Lessor with respect to any such mortgage or any assignment thereof, unless or until such
Approved Leasehold Mortgagee, Approved Major Subleasehold Mortgagee or other Approved Lender
shall deliver to Lessor a copy of such applicable Approved Leasehold Mortgage or Approved Major

Subleasehold Mortgage and/or any other applicable security documents encumbering the collateral
thereunder, together with an executed Subordination, Non-Disturbance and Attornment Agreement,
substantially in form and substance as that attached hereto as Exhibit L for Approved Leasehold
Mortgages and Exhibit M for Approved Major Subleasehold Mortgages; provided, however, that the City
Manager shall not unreasonably withhold his or her consent to any commercially reasonable
modifications to such forms as may be reasonably requested by the applicable Leasehold Mortgagee or
Major Subleasehold Mortgagee so as to render this Amended and Restated Ground Lease and any
applicable Major Sublease financeable based on criteria for financeability typically imposed in
comparable transactions, provided, that such modifications do not: (i) affect the business and financial
terms of this Amended and Restated Ground Lease; (ii) constitute a material deviation from the Watson
Island RFP and the Island Gardens Proposal; or (iii) significantly impair the protections afforded to
Lessor pursuant to this Amended and Restated Ground Lease and such Subordination, Non-Disturbance
and Attornment Agreements described above, or (iv) impose any additional material burdens on Lessor.
Nothing contained in any such mortgage or contained herein, whether express or implied, shall have the
effect of subordinating any interest or estate of Lessor in and to the Property, to the lien of such mortgage.
Section 6.5 Foreclosure.
(a) Leasehold Estate. Subject to and in accordance with the provisions of the applicable
Subordination, Non-Disturbance and Attornment Agreement, any Approved Foreclosure Transferee may
become the legal owner of the Leasehold Estate through a Foreclosure Transfer. Thereafter, such
Approved Foreclosure Transferee may freely assign or transfer the Leasehold Estate without Lessors
consent to any Approved Subsequent Foreclosure Purchaser; provided however, that subsequent
assignment or transfer thereof by such Approved Subsequent Foreclosure Purchaser to any other Person
must comply with the provisions of Article VIII hereof.
(b) Major Subleasehold Estate. Subject to and in accordance with the provisions of
the applicable Subordination, Non-Disturbance and Attornment Agreement, any Approved

Foreclosure Transferee may become the legal owner of the applicable Major Subleasehold Estate
through a Foreclosure Transfer. Thereafter, such Approved Foreclosure Transferee may freely
assign or transfer such Major Subleasehold Estate without Lessors consent to any Approved
Subsequent Foreclosure Purchaser; provided, however, that any subsequent assignment or
transfer thereof by such Approved Subsequent Foreclosure Purchaser to any other Person must
comply with the provisions of Article VIII hereof.
Section 6.6 New Lease.
(a) Leasehold Estate.
(i) Obtaining New Lease. If this Amended and Restated Ground Lease shall
(x) terminate for any reason other than an Event of Lessees Default on account of Lessees
failure, beyond the applicable cure period, to pay Pre-Paid Construction Rent/Base Rent,
Construction Rent, Option Payments, Base Rent, Percentage Rent, Impositions, any other Rents,
or the cost of insurance required hereunder, as to which Event of Lessees Default, the Approved
Mortgagee was provided notice and an opportunity to cure in accordance with this Agreement
and any applicable Subordination Non-Disturbance and Attornment Agreement and failed to so
cure within the time provided for therein, or (y) be rejected or disaffirmed pursuant to
bankruptcy law or other law affecting creditors rights, any Approved Leasehold Mortgagee or
Approved Foreclosure Transferee shall have the right, exercisable by written notice to Lessor
within thirty (30) days after the effective date of such termination, to enter into a new lease of the
Property with Lessor (the New Lease), provided that such Approved Leasehold Mortgagee or
Approved Foreclosure Transferee shall have remedied all defaults on the part of Lessee
involving the payment of money to Lessor, and shall continue to pay all Rent that would come
due under this Amended and Restated Ground Lease but for such termination. The term of the
New Lease shall begin on the date of the termination of this Amended and Restated Ground

Lease and shall continue for the remainder of the term of the Lease Term, including any
Extension Terms. Such New Lease shall otherwise contain the same terms and conditions as
those set forth herein, except for requirements which are no longer applicable or have already
been performed; provided, however, that: (i) such New Lease shall require the lessee thereunder
promptly to commence, and expeditiously to continue, to remedy all other defaults on the part of
the Lessee hereunder to the extent reasonably susceptible of being remedied; and (ii) such New
Lease shall permit such Approved Leasehold Mortgagee or Approved Foreclosure Transferee to
assign the New Lease to an Approved Subsequent Foreclosure Purchaser without Lessees
consent; provided however, that any subsequent assignment or transfer thereof by such
Approved Subsequent Foreclosure Purchaser to any other Person must comply with the
provisions of Article VIII hereof. The Person obtaining such New Lease shall be subrogated to
the rights of Lessor against Lessee as to any monetary defaults of Lessee which are cured by
such Person as a condition to obtaining such New Lease, and any other defaults which are
remedied by such Person as provided by clause (i) above (but not as to any other matters). It is
the intention of the parties hereto that such New Lease shall have the same priority relative to
other rights or interests to or in the Property as this Amended and Restated Ground Lease. The
provisions of this Section shall survive the termination of this Amended and Restated Ground
Lease and shall continue in full force and effect thereafter to the same extent as if this Section
were a separate and independent contract among Lessor, Lessee and the Approved Leasehold
Mortgagee. From the date on which any Approved Leasehold Mortgagee or any Approved
Foreclosure Transferee shall serve upon Lessor the aforesaid notice of the exercise of its rights to
a New Lease, such Approved Leasehold Mortgagee or Approved Foreclosure Transferee may

use and enjoy the Property without hindrance by Lessor but subject to compliance with the terms
of this Amended and Restated Ground Lease as aforesaid.
(ii) Execution of Other Documents. Simultaneously with the making of such
New Lease, the party obtaining such New Lease, Lessor, all Major Subtenants, all Approved
Major Subleasehold Mortgagees, the holders of any and all Approved Time Share Licenses
(through their duly appointed agent) and their respective lenders, and any Space Tenants (to the
extent such Space Tenants are entitled to enter into Subordination, Non-Disturbance and
Attornment Agreements pursuant to Section 33.5(d), and have done so) and their respective
lenders shall execute, acknowledge and deliver such new instruments, including new mortgages
and other security documents, new Major Subleases, new Approved Time Share Licenses, new
Space Leases, and new Subordination, Non-Disturbance and Attornment Agreements, as the case
may be, and shall make such payments and adjustments among themselves, as shall be necessary
and proper for the purpose of restoring to each of such parties as nearly as reasonably possible,
the respective interests and status with respect to the Property which was possessed by the
respective parties prior to the termination of this Amended and Restated Ground Lease
(including, but not limited to, any rights and obligations under any applicable Subordination,
Non-Disturbance and Attornment Agreements entered into pursuant to the provisions of this
Amended and Restated Ground Lease.
(iii) No Termination by Lessee of any Major Sublease or Space Lease.
Between the date of termination of this Amended and Restated Ground Lease and the date of
execution and delivery of the New Lease, if the Approved Leasehold Mortgagee or Approved
Foreclosure Transferee shall have requested such New Lease as provided for in this Section 6.6,
Lessee shall not cancel or terminate any Major Sublease or Space Lease or accept any

cancellation, termination or surrender thereof (unless such termination shall be effective as a
matter of law on the termination of this Amended and Restated Ground Lease) without the prior
written consent of such Approved Leasehold Mortgagee or Approved Foreclosure Transferee.
(iv) No Condition to Cure Uncurable Defaults. Nothing contained in this
Amended and Restated Ground Lease shall require any Approved Leasehold Mortgagee or
Approved Foreclosure Transferee as a condition to its exercise of its right to enter into a New
Lease to cure any default of Lessee or any Major Subtenant not reasonably susceptible of being
cured by such Approved Leasehold Mortgagee or Approved Foreclosure Transferee, in order to
comply with the provisions of Section 6.6.
Section 6.7 Subordination, Non-Disturbance and Attornment Agreement. The
Subordination, Non-Disturbance and Attornment described in Exhibit L shall include provisions
addressing other matters concerning any New Lease, among other things: (a) the disclaimer of
any representation or warranty by Lessor as to title to, the condition of, or other matters with
respect to the Property and/or the Leasehold Improvements, to the extent provided for herein; (b)
the responsibility of the applicable Approved Leasehold Mortgagee to remove Lessee from
possession with Lessors cooperation; (c) procedures for obtaining a New Lease where more
than one Approved Leasehold Mortgagee requests same.
Section 6.8 Major Subleasehold Estates. Lessee agrees (and Lessor acknowledges)
that each Major Sublease shall contain provisions therein comparable to those set forth in
Section 6.6 for the benefit of each Approved Major Subleasehold Mortgagee.
Section 6.9 Liability of Approved Mortgagee.
(a) Leasehold Estate. No Approved Leasehold Mortgagee (or any assignee, designee
or nominee thereof) or Approved Foreclosure Transferee shall become liable for the performance
or observance of any covenants or conditions to be performed or observed by Lessee, unless and

until such Approved Leasehold Mortgagee (or any assignee, designee or nominee thereof) or
Approved Foreclosure Transferee acquires possession of the Leasehold Estate, becomes the
owner of the Lessees interest hereunder, or enters into a New Lease with Lessor pursuant to
Section 6.6 above. Thereafter, such Approved Leasehold Mortgagee (or any assignee, designee
or nominee thereof) or Approved Foreclosure Transferee shall be liable for the performance and
observance of those covenants and conditions only for so long as such Approved Leasehold
Mortgagee (or any assignee, designee or nominee thereof) or Approved Foreclosure Transferee
remains in possession, owns such interest or is lessee under such New Lease (and thereafter to
the extent of any proceeds from the transfer or conveyance of such interest, but only as to any
such covenants and conditions accruing to the date of such transfer or conveyance).
(b) Major Subleasehold Estate. No Approved Major Subleasehold Mortgagee (or any
assignee, designee or nominee thereof) or Approved Foreclosure Transferee shall become liable
for the performance or observance of any covenants or conditions to be performed or observed
by the applicable Major Subtenant, unless and until such Approved Major Subleasehold
Mortgagee (or any assignee, designee or nominee thereof) or Approved Foreclosure Transferee
acquires possession of the applicable Major Subleasehold Estate, becomes the owner of the
Major Subtenants interest under the applicable Major Sublease, or enters into a new sublease
pursuant to provisions in the applicable Major Sublease described in Section 6.7 above.
Thereafter, such Approved Major Subleasehold Mortgagee (or any assignee, designee or
nominee thereof) or Approved Foreclosure Transferee shall be liable for the performance and
observance of those covenants and conditions only for so long as such Approved Major
Subleasehold Mortgagee (or any assignee, designee or nominee thereof) or Approved
Foreclosure Transferee owns such interest or is sublessee under such new sublease (and

thereafter to the extent of any proceeds from the transfer or conveyance of such interest, but only
as to any such covenants and conditions accruing to the date of such transfer or conveyance).
Section 6.10 Assignment of Development Plans and Project Approvals.
(a) Grant of Right to Use. Lessee hereby grants Lessor the right to use the
Development Plans and the ability to grant to other professionals the right to use the
Development Plans (subject to the rights of the architect(s) and engineer(s) who prepared the
Development Plans and to the rights of any Approved Mortgagees therein) and all Project
Approvals. Lessor agrees not to enforce such use right until after the occurrence and during the
continuance of an Event of Lessees Default. Furthermore, such use right shall be subject,
subordinate and inferior to any rights with respect to the Development Plans and the Project
Approvals which are granted to any Approved Leasehold Mortgagee or Approved Major
Subleasehold Mortgagee as security for any applicable loan. If required by any Approved
Mortgagee, Lessor shall join in any pledge of such rights as security for any Approved Leasehold
Mortgage or Approved Major Subleasehold Mortgage solely to subordinate Lessors interest in
the same to the interest of such Approved Leasehold Mortgage or Approved Major Subleasehold
Mortgage.
(b) Ownership Upon Termination of Lease. In the event of termination of this
Amended and Restated Ground Lease on account of an Event of Lessees Default, Lessor shall
be entitled to the full, complete and unconditional use and ownership of the Development Plans
and the ability to grant to other professionals the right to use the Development Plans (subject to
the rights of the architect(s) and engineer(s) who prepared the Development Plans), and full,
complete and unconditional ownership of the Project Approvals, without payment of any
consideration therefor by Lessor to Lessee, provided that these rights shall be subject,

subordinate and inferior to the rights therein of any Approved Leasehold Mortgage or Approved
Major Subleasehold Mortgage (or any applicable Approved Foreclosure Transferee), to the
extent that a New Lease is entered into pursuant to Section 6.6 or a new Major Sublease is
entered into pursuant to the comparable provisions of any Major Sublease.
(c) Comparable Assignment in Major Subleases. Lessee covenants that each Major
Sublease shall include an assignment (which assignment shall be comparable to that set forth in
subparagraph (b) above) of such Major Subtenants rights in and to any portion of the
Development Plans and the Project Approvals, as the same pertain to the Major Sublease, such
that the rights granted by Lessee herein shall include Lessees rights to use any such
Development Plans and Project Approvals which were prepared in connection with such Major
Subleasehold Estate.
(d) Survival. The provisions of this Section 6.9 shall survive any termination of this
Section 6.11 Mezzanine Financing.
(a) Secured By Approved Mortgage. Any Approved Mezzanine Financing may be
secured in whole or in part by an Approved Mortgage. In such case, the applicable Approved
Mezzanine Financer shall be deemed to be an Approved Mortgagee and entitled to all the rights
and benefits hereunder of an Approved Mortgagee.
(b) Secured by a Pledge. Any Approved Mezzanine Financing made by an Approved
Mezzanine Financer may be secured in whole or in part by a pledge or hypothecation of, or any
other security interest in, any membership interests, shares or other ownership and/or voting
interests in or rights of Lessee or any applicable Major Subtenant. Any Approved Mezzanine
Financing made by an Approved Mezzanine Financer, and any such pledge, hypothecation or

other granting of any such security interest, may be made freely and without Lessors consent;
provided that if such Approved Mezzanine Financing is secured by an Approved Mortgage, it
shall be in compliance with the applicable provisions of this Article VI. Furthermore, subject to
subparagraph (c) below, any Approved Mezzanine Financer or Approved Lender (or any
assignee who meets the criteria for an Approved Mezzanine Financer or Approved Lender, and
any nominee or designee of an Approved Mezzanine Financer or Approved Lender) may, at any
time, without Lessors consent: (i) realize upon any such pledge, hypothecation or security
interest in accordance with the terms of any applicable security agreements or instruments (or
accept an assignment, conveyance or transfer in lieu thereof) and become the owner and holder
of the applicable membership interests, shares or other ownership and/or voting interests in or
rights of Lessee or any applicable Major Subtenant (collectively, a Realization Upon
Mezzanine Collateral); and (ii) thereafter sell, convey, assign or transfer same to any other
Person(s), provided that: (A) such Person(s) or Investors (as defined in Section 8.1) therein
satisfy the requirements of Section 8.14 and Section 8.15; and (B) such sale, conveyance,
assignment or transfer does not violate the terms and conditions of Section 8.2.
(c) Transfer of Control Upon Realization of Collateral. In the case of any Realization
Upon Mezzanine Collateral which results in a Lessee Transfer of Control or a Major Subtenant
Transfer of Control, as applicable (as such terms are defined in Section 8.1): (i) such event shall
deemed a Foreclosure Transfer (even if the applicable Approved Mezzanine Financing is not
secured by an Approved Mortgage, or if the Approved Mezzanine Financer holds an Approved
Mortgage but elects not to exercise its rights and remedies thereunder), and any Person which
obtains Voting and Operational Control of Lessee or the applicable Major Subtenant, as
applicable, shall be deemed an Approved Foreclosure Transferee (provided that such Person

satisfies the requirements of clauses (i), (ii), (iii), and (iv) in the definition of an Approved
Foreclosure Transferee), and such Person shall thereupon be entitled to all of the rights and
benefits afforded hereunder to an Approved Foreclosure Transferee, including, without
limitation, the right to transfer its interest in Lessee or the applicable Major Subtenant to an
Approved Subsequent Foreclosure Purchaser; provided however, that any subsequent assignment
or transfer by such Approved Subsequent Foreclosure Purchaser to any other Person must
comply with the provisions of Article VIII hereof.
(d) Absolute Grant of Equity As a Condition to Approved Mezzanine Financing. In
the event any Approved Mezzanine Financer requires, as a condition to extending any Approved
Mezzanine Financing, that Lessee or any applicable Major Subtenant, as applicable, grant to
such Approved Mezzanine Financer an absolute ownership or equity interest, direct or indirect,
in Lessee or any applicable Major Subtenant (i.e., where such grant does not serve as collateral
or security for any Approved Mezzanine Financing), such grant may be made, provided that such
grant of ownership does not violate the terms and conditions of
Article VIII (it being understood, however, that such Approved Mezzanine Financer shall be
deemed to be a Non-Disclosed Investor, as defined in Section 8.1).
Section 6.12 Purchase Money Financing. Notwithstanding anything to the contrary
contained herein: (i) Lessee shall have the right to take back a purchase money mortgage in
connection with any Leasehold Estate Transfer (as defined in Article VIII) and to exercise all of
its rights and remedies thereunder, but subject to the superior rights of any Approved Mortgagee;
and (ii) any Major Subtenant shall have the right to take back a purchase money mortgage in
connection with any Major Subleasehold Estate Transfer (as defined in Article VIII) and to
exercise all of its rights and remedies thereunder, but subject to the superior rights of any

Approved Mortgagee. The indebtedness secured by any such purchase money mortgage
encumbering the Leasehold Estate and/or Leasehold Improvements and the indebtedness secured
by any such purchase money mortgage encumbering any Major Subleasehold Estate shall be
included in any calculation of the Maximum Project Debt to Value Ratio. The indebtedness
secured by any such purchase money mortgage encumbering any Major Subleasehold Estate
shall be included in any calculation of the Maximum Project Component Debt to Value Ratio
with respect to such Major Subleasehold Estate. No such purchase money mortgage may be
assigned by the holder thereof to another Person unless such other Person qualifies as an
Approved Lender under the criteria set forth in the definition thereof in Section 6.1.
ARTICLE VII
USE OF SUBJECT PROPERTY
Section 7.1 Certain Conditions Of Leasing. Lessee shall be subject to and bound by
the covenants and agreements set forth in this Article VII. Such covenants and agreements shall
run with the Leasehold Estate and burden any interests subordinate thereto.
Section 7.2 Major Subleases and Space Leases.
(a) Comparable Covenants in Major Subleases and Direct Space Leases. Lessee shall
require that each Major Sublease and Direct Space Lease include covenants on the part of the
applicable Major Subtenant and Direct Space Tenant which are comparable to those covenants
set forth in Section 7.3(a) and Section 7.4 through Section 7.12. Lessee shall use reasonable,
good faith efforts to enforce such covenants. Nothing contained herein shall be deemed to
prevent Lessee from imposing more stringent requirements on any such Major Subtenant and/or
Direct Space Tenant.

(b) Comparable Covenants in Other Space Leases. Each Major Sublease shall
provide for each Major Subtenant to: (i) include in each of its Space Leases covenants on the part
of the applicable Space Tenant which are comparable to those covenants set forth in Section
7.3(a) and Section 7.4 through Section 7.12; and (ii) use reasonable, good faith efforts to enforce
such covenants. Nothing contained herein shall be deemed to prevent any Major Subtenant from
imposing more stringent requirements on any of its Space Tenants, or to prevent Lessee from
requiring any Major Subtenant to impose such more stringent requirements.
(c) Compliance. So long as Lessee complies with the provisions of subparagraphs (a)
and (b) above, Lessee shall not be deemed to have breached any of the covenants set forth in this
Section 7.3(a) and Section 7.4 through Section 7.12 on account of any breach thereof by any
Space Tenant.
Section 7.3 Permitted Uses; Long-Term Changes.
(a) Permitted Uses. The Property shall be used solely for the Permitted Uses and no
other use whatsoever (subject, however, to the provisions of Section 7.12 below), unless the City
Manager, in his or her sole discretion, approves in writing in advance any additional or other
uses and such uses are lawful and have received all necessary approvals from applicable
Governmental Authorities.
(b) Changes As to Hotels Where There is Another Hotel on Watson Island.
Notwithstanding the foregoing, in the event that Lessor, at any time during the Lease Term,
enters into a lease agreement or other agreement for the construction and/or operation of another
hotel on Watson Island, or Lessor (in either its proprietary or municipal capacity) otherwise
authorizes, permits or causes the construction and/or operation of any such hotel on Watson
Island, Lessee may make a request in writing to the City Manager to change any of the Permitted

Uses with respect to either or both of the Hotels. Provided that any such change in the Permitted
Uses: (A) receives all necessary approvals from applicable Governmental Authorities (including
the City in its municipal capacity); and (B) complies with Applicable Law (including, but not
limited to, passage of a public referendum, if then required by Applicable Law), the City
Manager shall approve or disapprove such change in writing in advance in accordance with the
City Manager Approval Procedures; subject, however, to any appropriate adjustment in Base
Rent and/or Percentage Rent on account of any such change in the Permitted Uses as the Parties
shall mutually agree upon (with each Party acting reasonably and in good faith). For purposes of
this provision, the reasonable discretion of the City Manager shall include such policy
considerations as are deemed appropriate by the Mayor and/or the City Commission at such
time.
Section 7.4 No Discrimination. Lessee shall not discriminate in violation of any
Applicable Laws upon the basis of race, color, religion, sex, disability, marital status, or national
origin in the sale, lease or rental, or in the use or occupancy, of the Property or the Leasehold
Improvements.
Section 7.5 Use of the Property. Lessee shall not use or occupy the Property at any
time or do anything on the Property, or permit anything to be done in, brought into or kept on the
Property, which: (i) violates any insurance policies required to be maintained hereunder; (ii)
causes or is likely to cause injury to the Property; or (iii) constitutes a common law or statutory
nuisance, public or private.
Section 7.6 Leasehold Improvements to be Open to Public. As a general matter, the
Project is intended to be open to the public as much as practical. Accordingly, during the
Lease Term, the Project shall be open to the general public without discrimination, subject to

reasonable operational rules, regulations and restrictions typically imposed by operators of mixed
uses projects similar to the Project; provided, however, that: (i) the businesses operating on the
Property may charge fees for goods, commodities or services (including, without limitation,
Marina slips and guest rooms at the Hotels, whether or not subject to an Approved Time Share
License program) as they may establish from time to time, so long as such services are made
available to the general public on a nondiscriminatory basis upon the payment of such fees; (ii)
Lessee may operate or allow the operation of membership clubs (unless they are specifically
listed herein as Prohibited Uses) which may charge membership fees, so long as such clubs are
made available to the general public on a nondiscriminatory basis upon the payment of such
membership fees; and (iii) nothing contained herein shall be deemed to require public access to
any vessels at the Marina except as specifically required by clauses (i) and (ii) above, or to any
areas not typically made available to the public (e.g., service areas, storage areas, back of the
house areas, etc.).
Section 7.7 Safety. Lessee shall take commercially reasonable actions to ensure that
the Property is a safe environment for the general public. Lessor, as owner of the Property, shall
have no responsibility for, or liability whatsoever to Lessee, the Major Subtenants, the Space
Tenants, Direct Space Tenants, Approved Leasehold Mortgagees, Approved Subleasehold
Mortgagees, Approved Mezzanine Financer, Approved Foreclosure Purchaser, Approved
Subsequent Foreclosure Purchaser, the Bayraktar Family, Investors, Disclosed Investor, Non-
Disclosed Investors, Time Share Licensee, and any other Person(s) having any interest in the
Leasehold Estate and in any Major Subleasehold Estate in connection with provision of security
services to the Property.

Section 7.8 Continuous Operation. Subject to any interruptions or closures on account
of any Force Majeure Events, emergencies or other exigent circumstances or on account of any
repairs or alterations required or permitted hereunder, and depending on which Major Project
Components have received temporary certificates of occupancy or certificates of occupancy, as
applicable, Lessee shall at all times during the Lease Term: (i) operate the Property in such
manner as will, in Lessees good faith reasonable business judgment, be reasonably likely to
maximize the Gross Revenues produced by the Project; and (ii) keep the Project open for
business on a continual basis during the usual days and hours for such business as are customary
for the applicable type of use (it being understood, however, that certain businesses and activities
are seasonal in nature and therefore may be closed or operate for fewer days or hours during
certain periods of the year). The foregoing provisions shall not be deemed to require Lessee to
ensure that all of the available facilities at the Property are open or leased to third parties at all
times, inasmuch as: (A) there will need to be occasional adjustments of usage of facilities; and
(B) there will be some portion of space that will be remain vacant from time to time given then-
existing market conditions and turnover of Space Tenants. Furthermore, Lessor acknowledges
and agrees that it is likely that most (if not all) of the businesses operating on the Property will be
operated by Persons other than Lessee.
Section 7.9 Compliance with Laws.
(a) Compliance. Lessee shall throughout the Lease Term, at Lessees sole expense,
promptly comply in all material respects with all Applicable Laws now in effect or that may
hereafter be adopted by any Governmental Authority (including, without limitation, the Minority
and Women Business Affairs and Procurement Program Ordinance of the City of Miami).
Specifically, but without limitation, Lessee shall construct and maintain the Leasehold

Improvements to accommodate the disabled and comply in all material respects with the
applicable requirements of the Americans with Disabilities Act of 1990, as amended, as well as
other Applicable Laws pertaining to handicapped access, including, without limitation, the
Americans with Disabilities Act Accessibility Guidelines for Buildings and Facilities.
(b) Notice. Lessee agrees to give Lessor prompt notice of the receipt by Lessee of
any written complaints related to any material violation of any Applicable Law and of the
commencement of any proceedings or investigations which relate to compliance with any
Applicable Law.
(c) Right to Contest Compliance. Lessee shall have the right in good faith to contest
by appropriate legal proceeding and without cost or expense to Lessor, the validity of any
Applicable Law. If compliance with any Applicable Law may legally be held in abeyance (i)
without the incidence of any lien, charge or liability of any kind against the title to the Property,
the Leasehold Improvements or the Leasehold Estate (unless Lessee transfers such lien to bond
or delivers an appropriate indemnity to Lessor), and (ii) without subjecting Lessee or Lessor to
any liability of whatsoever nature for failure so to comply, Lessee may postpone compliance
until the final determination of any proceedings, provided that all proceedings shall be
prosecuted with all due diligence and dispatch.
Section 7.10 Compliance with Insurance Requirements. Lessee shall observe and
comply in all material respects with the requirements of all policies of public liability, fire and
other insurance in force with respect to the Leasehold Improvements.
Section 7.11 Prohibited Uses. Notwithstanding anything contained herein to the
contrary, Lessee hereby agrees that the Property shall not be used for any of the uses set forth on

Exhibit N attached hereto (collectively, the Prohibited Uses) without the City Managers
express prior written consent, which may be withheld in his or her sole discretion.
Section 7.12 Casino Gambling. In the event that casino gambling or other forms of
gambling or games of chance, including but not limited to Gambling Boats either on or off site,
which are presently illegal in the City of Miami shall in the future become legal for similar
properties, and Lessee or any Major Subtenant or Affiliate desires to offer the same on any
portion of the Project either on or off-site: (i) Lessee.Major Subtenant, or such Affiliate (or the
applicable casino or other operator) shall be entitled to make application for a license therefor in
the same manner as similarly situated parties in conjunction with properties that are not leased by
the City; (ii) any such application by Lessee, Major Subtenant, or such Affiliate (or the
applicable casino operator or other operator) for any such license or approval required by the
City (in its municipal capacity) shall be considered by the City on the same basis as the City shall
consider comparable proposals for properties in which the City is not a ground lessor; (iii) in the
Citys role as ground lessor of the Project, the City shall not object to Hotel A and Hotel B, at
Lessees option, being treated as a single hotel (e.g., for requirements as to the minimum number
of hotel rooms or keys or units); provided, however, that this clause (iii) shall not prevent the
City from refraining from according such treatment to the two Hotels in the Citys role (in its
municipal capacity) in licensing, approving or overseeing gaming activity; and (iv) in its role as
Lessor hereunder, the City may condition any approval of such gaming activities on receiving,
over and above the Base Rent and Percentage Rent payable under this Amended and Restated
Ground Lease or any such sublease as may be entered into by the Lessee, the Casino Rent (as
hereinafter defined).

(a) Casino Rent. For purposes hereof, the term Casino Rent means the fair market
rent attributable to the operation of casino gaming, including but not limited to Gambling Boats,
or other games of chance on the Property, taking into consideration the rent payable on account
of comparable gaming activities at those properties within the United States which are most
comparable to the Project, but with any appropriate adjustments for regional differences, as
determined in accordance with the procedure set forth in subparagraph (b) below. Casino Rent
shall not be treated as or be in lieu of a tax or levy by a municipal body on gaming activity.
(b) Procedure for Determining Casino Rent. The procedure for determining the
Casino Rent shall be as follows:
(i) Selection of Lessors Expert and Lessees Expert. Lessor shall select an
expert who shall be paid by Lessor (Lessors Expert), and Lessee shall select an expert who
shall be paid by Lessee (Lessees Expert). Each expert shall be reasonably experienced or
have consultants who are reasonably experienced with appraisal considerations involving casino
operations.
(ii) Selection of Third Expert. A third expert (the Third Expert) shall be
jointly selected by Lessors Expert and Lessees Expert. The cost of the Third Expert shall be
evenly split between Lessee and Lessor. If Lessors Expert and Lessees Expert fail to agree on
the Third Expert within thirty (30) days after their appointment, the Third Expert shall be
appointed by the President of the American Institute of Real Estate Appraisers (AIREA) on the
application of either Lessees Expert or Lessors Expert. Such application shall be made by
Lessors Expert or Lessees Expert, as applicable, on fifteen (15) days prior written notice to the
other. The Third Expert appointed by the President of the AIREA may or may not be a member
of the AIREA, in the discretion of such President, but in any event shall, in the judgment of such

President, have appropriate experience for such appointment and shall not have undue
connections or influence with either Lessor or Lessee.
(iii) Procedure if Either Party Fails to Select Expert. If either Lessor or Lessee
shall fail to appoint an expert within forty-five (45) days after demand from the other to make the
appointment, then the expert appointed by the party making the demand shall appoint the second
expert, and the two experts so appointed shall appoint the Third Expert. If the first two experts so
appointed shall fail to agree on such third expert within thirty (30) days after their appointment,
the Third Expert shall be appointed by the President of AIRWA in the same manner provided in
clause (ii) above.
(iv) Proposals. Within thirty (30) days after appointment of all three (3)
experts, Lessees Expert and Lessors Expert shall each prepare and submit a proposal for Casino
Rent, together with written evidence supporting such proposal, to the Third Expert.
(v) Selection of One Proposal. The Third Expert shall have fifteen (15) days
to discuss the respective proposals with each submitting expert and an additional thirty (30) days
thereafter to select between the two (2) proposals; it being understood that the Third Expert may
only select one (1) experts proposal or the other and may not select portions of both or attempt
to combine proposals. The proposal for Casino Rent selected by the Third Expert shall be
binding and conclusive on Lessor and Lessee.
(vi) Extension of Time Frames. Notwithstanding anything contained herein to
the contrary, either Lessor or Lessee shall be entitled to extend any of the timeframes set forth in
subparagraphs (ii) through (v) above for up to an additional thirty (30) day period if deemed
necessary or desirable by either Party.
Section 7.13 Signage.

(a) Lessees Installation of Signage on Property. Lessee, at its sole cost and expense,
shall be permitted to install signage within the Property (including, but not limited to, any
signage required by any franchisors or licensors with respect to the Hotels), subject to: (i) the
prior written approval of the City Manager pursuant to the City Manager Approval Procedures as
to design, location, size and materials of any exterior signage; and (ii) Lessees obtaining all
applicable permits from the applicable Governmental Authorities as may be required in
connection therewith.
(b) Lessees Installation of Signage Outside Property. Any request to install signage
outside of the Property, including, without limitation, any request to the State of Florida
Department of Transportation (FDOT) for signage in State rights-of-way, must be approved in
advance in writing by the City Manager pursuant to the City Manager Approval Procedures.
Such signage shall, to the extent permissible by FDOT, be consistent as to design, location, size
and materials with other signage approved by Lessor for Watson Island.
(c) Participation in Cost of Watson Island Pathfinder Signage System. Lessee shall
participate in and pay, no later than thirty (30) days after receipt of a written invoice(s) from
Lessor therefor, Lessees proportionate share of the reasonable cost of an island-wide pathfinder
signage system to provide uniform and efficient direction to all destinations on Watson Island.
(d) MUSP. The exact form of all signage shall be subject to and in compliance with
the requirements of the Major Use Special Permit for the Project.
Section 7.14 Cure of Defaults Under Approved Leasehold Mortgages and Approved
Major Subleasehold Mortgages.
(e) Approved Leasehold Mortgages. Upon receiving written notice from any
Approved Leasehold Mortgagee of any material default under any its Approved Leasehold

Mortgage(s), Lessee shall use diligent efforts to cure such default in the manner and to the
extent required by such Approved Leasehold Mortgage.
(f) Approved Major Subleasehold Mortgages. Including any applicable additional
terms and conditions of Composite Attachment 3 attached to and incorporated by this Amended
and Restated Ground Lease regarding certain provisions if the Property is developed on a
component by component basis, Lessee shall require each Major Subtenant to require each of
such Major Subtenants Approved Major Subleasehold Mortgagees to send a copy to Lessee of
any written notice of a material default under the applicable Approved Major Subleasehold
Mortgage. Upon Lessees receipt of any such written notice, Lessee shall use diligent efforts to
cause such default to be cured in the manner and to the extent required by such Approved Major
Subleasehold Mortgage; provided, however, that Lessee shall not be required to cure any such
default which cannot reasonably be cured by Lessee or cannot be cured without having
possession of the applicable Major Project Component.
(g) No Third Party Beneficiaries. The Parties specifically acknowledge and agree
that no Approved Mortgagees, Major Subtenants or other Persons shall be third-party
beneficiaries of the provisions of this Section 7.14.
Section 7.15 Enforceability. It is intended and agreed hereby that the restrictive
covenants contained in this Article VII shall be binding upon the Parties and their successors in
interest and assigns, as covenants running with the land and shall be for the benefit and in favor
of, and enforceable by, either Lessor and/or Lessee; provided however, that such covenants shall
be binding on Lessor and Lessee, and their respective successors in interests and assigns, only
for such period as each shall have (i) fee title to the Property, as to the City, and (ii) the
Leasehold Estate, as to Lessee.

ARTICLE VIII
RESTRICTIONS ON TRANSFERS AND APPROVAL OF INVESTORS
Section 8.1 Definition of Terms. For purposes of this Article VIII, the following
terms shall have the meanings attributed to them in this Section 8.1:
(a) As to Leasehold Estate.
(i) Leasehold Estate Transfer means any direct or indirect, voluntary or
involuntary, sale, transfer, or assignment of any right, title or interest in and to this Amended and
Restated Ground Lease, the Leasehold Improvements and/or the Leasehold Estate.
(ii) Lessee Interest Assignment means: (A) any direct or indirect, voluntary
or involuntary, sale, assignment or transfer of any legal or beneficial interest in, or any grant of a
security interest with respect to, Lessee; (B) any direct or indirect, voluntary or involuntary, sale,
assignment or transfer of all or substantially all of the assets of Lessee; or (C) any merger or
consolidation with or of, or recapitalization or other similar transaction with respect to, Lessee or
any Person having any legal or beneficial interest in Lessee.
(iii) Lessee Transfer of Control means any Lessee Interest Assignment
which results in a change in Voting and Operational Control of Lessee.
(b) As to Major Subleasehold Estates:
(i) Major Subleasehold Estate Transfer means any direct or indirect,
voluntary or involuntary, sale, transfer, or assignment of any right, title or interest in and to any
Major Sublease or any Major Subleasehold Estate.
(ii) Major Subtenant Interest Assignment means: (A) any direct or indirect,
voluntary or involuntary, sale, assignment or transfer of any legal or beneficial interest in, or any
grant of a security interest with respect to, any Major Subtenant; (B) any direct or indirect,

voluntary or involuntary, sale, assignment or transfer of all or substantially all of the assets of
such Major Subtenant; or (C) any merger or consolidation with or of, or recapitalization or other
similar transaction with respect to, such Major Subtenant or any Person having any legal or
beneficial interest in such Major Subtenant.
(iii) Major Subtenant Transfer of Control means any Major Subtenant
Interest Assignment which results in a change in Voting and Operational Control of the
applicable Major Subtenant.
(c) Other Terms.
(i) Bayraktar Permitted Transfer Date means for each Major Project
Component, three (3) years after the Completion Date with respect to such Major Project
Component.
(d) Major Sublease Unrestricted Transfer Date means the date on which: (i) the
Project shall have achieved a trailing Debt Service Coverage Ratio of 1.3 with respect to all
applicable Approved Leasehold Mortgages; and (ii) the applicable Major Project Component
shall have achieved a trailing Debt Service Coverage Ratio of 1.3 with respect to all applicable
Approved Major Subleasehold Mortgages encumbering the Major Subleasehold Estate with
respect to such Major Project Component.
(e) Allocated Rent means: (i) the total Base Rent payable by Lessee to Lessor
hereunder during any applicable calendar year, multiplied by a fraction, the numerator of which
is the total acreage of the Property subleased pursuant to any applicable Major Sublease, and the
denominator of which is the total acreage of the Property; and (ii) the total Percentage Rent
payable by Lessee to Lessor hereunder during any calendar year which is attributable to the
Major Project Component operated pursuant to such Major Sublease and (iii) the total of any

other Rent(s) payable by Lessee to Lessor hereunder during any applicable calendar year, which
is attributable to the Major Project Component operated pursuant to such related Major Sublease.
The foregoing definition of Allocated Rent shall not bind the City Manager in the approval of
any Major Sublease hereunder.
(f) Lessees Net Worth means the net worth of Lessee, taking into account the
Major Sublease Rent Present Value and such other assets as Lessee may then have.
(g) Major Sublease Rent Present Value means the present value (based on a
commercially reasonable interest factor agreed upon by the Parties) of the estimated aggregate
rental stream (including Base Rent Percentage Rent and all other Rents) required to be paid to
Lessee under all of the Major Subleases during the then remaining balance of the respective
terms thereof.
(h) Ground Lease Rent Present Value means the present value (based on a
commercially reasonably interest factor agreed upon by the Parties) of the total estimated
Prepaid Construction Rent/Base Rent (and credit related thereto), Construction Rent, Option
Payments, Base Rent, Percentage Rent and all other Rents payable from Lessee to Lessor during
the then remaining balance of the Lease Term.
(i) Sufficient Lessee Economic Interest means that either of the following
requirements is met: (A) the aggregate rental stream (including Base Rent, Percentage Rent and
all other Rents) required to be paid to Lessee under each Major Sublease during each calendar
year of the term thereof exceeds, by Twenty Percent (20%) or more, the Allocated Rent with
respect to such Major Sublease which is payable by Lessee to Lessor hereunder during such
calendar year; or (B) Lessees Net Worth exceeds, by Twenty Percent (20%) or more, the
Ground Lease Rent Present Value.

(j) Existing Investment Fund means any existing, widely recognized investment
vehicle (such as a widely recognized mutual fund, real estate investment trust, pension fund,
insurance company or other investment fund) which has or obtains any direct or indirect legal or
beneficial interest in the Project, which investment vehicle: (i) also invests in investments other
than the Project and/or other projects which are owned and/or operated by the Bayraktar Family;
and (ii) was not formed for the specific purpose of investing in the Project.
(k) Investors means: (i) all Persons now or hereafter having an equity interest in the
Project; (ii) any direct or indirect legal or beneficial owners of interests in all of the equity
investors in the Project; and (iii) holders of any note, debenture, mortgage or other security
instrument encumbering any Major Project Component(s) and/or any interest in Lessee, other
than any Approved Mortgagee.
(l) Non-Disclosed Investors means those Investors: (i) whose investments in the
Project are made through an Existing Investment Fund; or (ii) who are or will become Investors
on account of any transaction described in Section 8.8.
(m) Disclosed Investors means all Investors other than Non-Disclosed Investors.
(n) Financial Advisor means any financial advisor for the Project designated by
Lessee. Such financial advisor initially shall be The Greenwich Group International LLC.
Any replacement thereof shall be subject to the City Managers prior written approval in
accordance with the City Manager Approval Procedures, but the City Manager shall approve any
such financial advisor which is: (i) not a Disqualified Person; and (ii) is listed in Exhibit O or
otherwise has a level of business experience and expertise comparable to that of HSBC (U.S.)
Securities Inc.

(o) Investor Questionnaire means a questionnaire prepared by the Financial
Advisor as part of the initial screening process for Disclosed Investors, the form of which shall
have been mutually agreed upon by the Financial Advisor, the City Manager and Lessee.
Section 8.2 Bayraktar Interests.
(a) All Transfers by Bayraktar Prohibited PRIOR TO Bayraktar Permitted Transfer
Date. Lessee recognizes and agrees that: (i) the experience of Lessee and Mehmet Bayraktar was
given special consideration by Lessor in the selection process which resulted in the award of this
Amended and Restated Ground Lease; (ii) the qualifications and identity of Lessee and Mehmet
Bayraktar are of particular concern to the community and Lessor; and (iii) it is partially because
of such qualifications and identity that Lessor is entering into this Amended and Restated
Ground Lease. Accordingly, at all times prior to the Bayraktar Permitted Transfer Date: (A) the
Bayraktar Family Equity Contribution shall be maintained; (B) Mehmet Bayraktar shall retain
Voting and Operational Control of Lessee; (C) Mehmet Bayraktar or Lessee shall retain Voting
and Operational Control of each Major Subtenant then in existence; and (D) Lessee shall own
more than Fifty Percent (50%) of the ownership interests in each Major Subtenant then in
existence. Furthermore, at all times prior to the Bayraktar Permitted Transfer Date, there shall be
no Leasehold Estate Transfer, Lessee Transfer of Control or Major Subleasehold Estate Transfer.
Any waiver of the foregoing requirement shall require the City Managers prior written consent,
which may be granted or withheld in his or her sole and absolute discretion. Lessee agrees to pay
Lessor an amount equal to the greater of ten percent (10%) of Net Sale Proceeds, as hereinafter
defined, or six percent (6%) 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 Lessees business in
connection with any such Transfer, or in connection with the sale of fifteen percent (15%) or

more of Lessees stock (the Transfer Fee). The Lessee shall pay to the Lessor the Transfer Fee
at the time the Transfer becomes effective, or in the case of the sale of the Lessees stock at the
time the shares of stock are sold.
(b) Transfers by Bayraktar Permitted AFTER Bayraktar Permitted Transfer Date.
From and after the Bayraktar Permitted Transfer Date: (i) the Bayraktar Family may divest itself
of any and all equity it has in the Project; and (ii) Mehmet Bayraktar may divest himself of
Voting and Operational Control of Lessee and/or any Major Subtenant. Any such actions shall
require Lessors prior written consent; provided, however, that: (i) any such action shall be in
compliance with the provisions of Section 8.14; (ii) any such action which results in a Leasehold
Estate Transfer, a Lessee Transfer of Control, a Major Subleasehold Estate Transfer or a Major
Subtenant Transfer of Control shall comply with the applicable provisions of this Article VIII.
Lessee agrees to pay Lessor 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 Lessees business in connection with any such Transfer, or in connection with the sale
of fifteen percent (15%) or more of Lessees stock (the Transfer Fee). The Lessee shall pay to
the Lessor the Transfer Fee at the time the Transfer becomes effective, or in the case of the sale
of the Lessees stock at the time the shares of stock are sold.
For purposes hereof, Net Sale Proceeds shall mean the net proceeds to Lessee, 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 8.3 Leasehold and Major Subleasehold Estates.
(a) Leasehold Estate Transfer or Lessee Transfer of Control AFTER Bayraktar
Permitted Transfer Date. From and after the Bayraktar Permitted Transfer Date, any Leasehold
Estate Transfer or Lessee Transfer of Control shall be permitted, provided that:
(i) Approval. The City Manager shall have given, in accordance with the
Transfer Review Procedures (as defined in Section 8.4), his or her prior written approval of: (i)
the new Lessee, in the case of a Leasehold Estate Transfer; or (ii) the Person obtaining or having
Voting and Operational Control of Lessee, in the case of any Lessee Transfer of Control;
(ii) Assumption. In the case of a Leasehold Estate Transfer, the new Lessee
shall assume, by written instrument in recordable form and reasonably satisfactory to the City
Attorney, all of the obligations of Lessee under this Amended and Restated Ground Lease;
(iii) Voting and Operational Control. At least one Person shall have Voting
and Operational Control of the new Lessee (in the case of a Leasehold Estate Transfer) or of
Lessee (in the case of a Lessee Transfer of Control), and such Person shall have (or shall have
retained an operator having) not less than ten (10) years of experience in owning or operating
projects which are comparable to the Project;
(iv) No Disqualified Person. The new Lessee (in the case of a Leasehold
Estate Transfer) or the Person acquiring Voting and Operational Control of Lessee (in the case of
a Lessee Transfer of Control) shall not be a Disqualified Person; and
(v) Investors. The requirements of Section 8.14 shall be satisfied as to all
Investors in the new Lessee (in the case of a Leasehold Estate Transfer) or all new Investors in
Lessee (in the case of a Lessee Transfer of Control).

(b) Major Subleasehold Estate Transfer or Major Subtenant Transfer of Control
AFTER Bayraktar Permitted Transfer Date and BEFORE the Major Sublease Unrestricted
Transfer Date. During any period from and after the Bayraktar Permitted Transfer Date and
before the Major Sublease Unrestricted Transfer Date, any Major Subleasehold Estate Transfer
or Major Subtenant Transfer of Control shall be permitted, provided that:
Transfer Review Procedures, his or her prior written approval of: (i) the new Major Subtenant, in
the case of a Major Subleasehold Estate Transfer; or (ii) the Person obtaining or having Voting
and Operational Control of the applicable Major Subtenant, in the case of any Major Subtenant
Transfer of Control (provided, however, that notwithstanding anything contained to the contrary
in the Transfer Review Procedures, the City Manager may grant or withhold his or her approval
of a proposed transferee under this Section 8.3(b) in his or her sole and absolute discretion);
(ii) Assumption. In the case of a Major Subleasehold Estate Transfer, the new
Major Subtenant shall assume, by written instrument in recordable form and reasonably
satisfactory to the City Attorney, all of the obligations of the applicable Major Subtenant under
the applicable Major Sublease;
and Operational Control of the new Major Subtenant (in the case of a Major Subleasehold Estate
Transfer) or of the applicable Major Subtenant (in the case of a Major Subtenant Transfer of
Control), and shall have (or shall have retained an operator having) not less than ten (10) years of
experience in owning or operating large scale projects which are comparable to the applicable
Major Project Component;

(iv) Sufficient Lessee Economic Interest. There exists a Sufficient Lessee
Economic Interest with respect to such Major Sublease;
(v) No Disqualified Person. The new Major Subtenant (in the case of a
Major Subleasehold Estate Transfer) or the Person acquiring Voting and Operational Control of
the applicable Major Subtenant (in the case of a Major Subtenant Transfer of Control) shall not
be a Disqualified Person; and
(vi) Investors. The requirements of Section 8.14 shall be satisfied as to all
Investors in the new Major Subtenant (in the case of a Major Subleasehold Estate Transfer) or all
new Investors in the applicable Major Subtenant (in the case of a Major Subtenant Transfer of
Control).
(c) Major Subleasehold Estate Transfer or Major Subtenant Transfer of Control
AFTER Bayraktar Permitted Transfer and also AFTER Major Sublease Unrestricted Transfer
Date. From and after the Major Sublease Unrestricted Transfer Date, any Major Subleasehold
Estate Transfer or Major Subtenant Transfer of Control shall be permitted, provided that:
Transfer Review Procedures, his or her prior written approval of: (i) the new Major Subtenant, in
the case of a Major Subleasehold Estate Transfer; or (ii) the Person obtaining or having Voting
and Operational Control of the applicable Major Subtenant, in the case of any Major Subtenant
Transfer of Control;
(ii) Assumption. In the case of a Major Subleasehold Estate Transfer, the new
Major Subtenant shall assume, by written instrument in recordable form and reasonably
satisfactory to the City Attorney, all of the obligations of the applicable Major Subtenant under
the applicable Major Sublease;

and Operational Control of the new Major Subtenant (in the case of a Major Subleasehold Estate
Transfer) or of the applicable Major Subtenant (in the case of a Major Subtenant Transfer of
Control), and shall have (or shall have retained an operator having) not less than ten (10) years of
experience in owning or operating large scale projects which are comparable to the applicable
Major Project Component;
(iv) Sufficient Lessee Economic Interest. There exists a Sufficient Lessee
Economic Interest with respect to such Major Sublease;
(v) No Disqualified Person. The new Major Subtenant (in the case of a
Major Subleasehold Estate Transfer) or the Person acquiring Voting and Operational Control of
the applicable Major Subtenant (in the case of a Major Subtenant Transfer of Control) shall not
be a Disqualified Person; and
(d) Investors. The requirements of Section 8.14 shall be satisfied as to all Investors in
the new Major Subtenant (in the case of a Major Subleasehold Estate Transfer) or all new
Investors in the applicable Major Subtenant (in the case of a Major Subtenant Transfer of
Control).
Section 8.4 City Manager Review and Approval Procedures. In the event of a
proposed Leasehold Estate Transfer or Lessee Transfer of Control described in Section 8.3(a) or
any Major Subleasehold Estate Transfer or Major Subtenant Transfer of Control described in
Section 8.3(b) or Section 8.3(c), the following procedures (collectively, the Transfer Review
Procedures) shall apply:
(a) Notice to City Manager. Not less than forty-five (45) days prior to any such
proposed transaction, Lessee shall give or cause to be given to the City Manager written notice

of (and request from the City Managers written approval of) the applicable Person described in
Section 8.3(a)(i), Section 8.3 (b)(i) or Section 8.3(c)(i), as applicable (the Proposed
Transferee) of which Lessee or its officers shall have knowledge, together with the following
information: (i) the name and address of the Proposed Transferee; (ii) a description of the nature
and character of the experience and business operations of the Proposed Transferee; (iii)
disclosure of the ownership of such Proposed Transferee (with back up third-party written
information, if possible); (iv) a proposed form of any assignment and assumption agreement, if
required pursuant to Section 8.3(a)(ii), Section 8.3(b)(ii) or Section 8.3(c)(ii); and (v) banking
references and/or financial information with respect to the Proposed Transferee reasonably
sufficient to enable the City Manager to determine the financial responsibility of the Proposed
Transferee. Such notice and information shall also be accompanied by an administrative fee of
One Thousand Dollars ($1,000.00) paid to Lessor in order to reimburse Lessor for all of its
internal costs and expenses, including, without limitation, reasonable costs incurred in
connection with the review of financial materials, meetings with representatives of the Proposed
Transferee, and review and approval of the required assignment documents.
(b) Response by City Manager. Within thirty (30) days of the City Managers receipt
of the written notice and information described in subparagraph (a) above, the City Manager
shall give Lessee written notice either: (i) that the City Manager has approved the Proposed
Transferee; or (ii) the City Manager is refusing to approve the Proposed Transferee, in which
case the City Manager shall, as part of such written notice, include a statement (with specificity
and reasonable back up information for his or her conclusion and as to which of the five (5)
criteria described in clauses (i) through (v) of subparagraph (a) above are not satisfied and why)
of the reasons for such refusal to approve the Proposed Transferee. If the City Manager fails to

timely give such written approval, he or she shall be deemed to have approved the Proposed
Transferee. The City Managers determination shall be made reasonably and in good faith
solely on the basis of such five (5) criteria (except as otherwise provided in Section 8.3(b)(i)).
Any such approval shall not waive any of Lessors rights to approve any subsequent Proposed
Transferee for which approval is required under this Article VIII.
(c) Payment of All Sums Then Due. All Rent, Impositions, insurance, permitting and
other charges due and owing as of the date of the transaction and required to be paid by Lessee
under this Amended and Restated Ground Lease shall have been paid by Lessee and all other
covenants and agreements to be kept and performed by Lessee shall have been complied with as
of the date of the transaction (but for purposes of satisfying the foregoing requirement, the
Proposed Transferee may rely upon an estoppel certificate from Lessor given pursuant to Section
30.2).
(d) Assumption of Obligations. If applicable pursuant to Section 8.3(a)(i), Section
8.3(b)(i) or Section 8.3(c)(i), the Proposed Transferee shall, for itself and its successors and
assigns, and especially for the benefit of Lessor, by written instrument in recordable form and
reasonably satisfactory to the City Attorney, expressly assume all of the obligations of Lessee
under this Amended and Restated Ground Lease, or all obligations of the Major Subtenant under
any applicable Major Sublease, as applicable. The Proposed Transfer shall deliver to Lessor, or
shall cause to be delivered to Lessor, within thirty (30) days after the effective date of the
transfer, true and correct copies of all of the instruments effectuating the transfer, including any
applicable instrument of assignment and assumption.
Section 8.5 Release from Liability. Upon compliance with any applicable provisions
of Section 8.3 and/or Section 8.4, the applicable transferor shall, in the case of a Leasehold

Estate Transfer or a Major Subleasehold Estate Transfer, be released from all liability under this
Amended and Restated Ground Lease or the applicable Major Sublease, as applicable, for
actions or obligations arising or accruing subsequent to such transfer.
Section 8.6 City Managers Consent Required for Affiliate or Related Party Transfer.
Notwithstanding anything to the contrary contained herein, any Lessee Interest Assignment or
Major Subtenant Interest Assignment: (i) resulting from the death of any Person, provided that
such Persons interest is transferred to any spouse, sibling(s) and/or lineal descendant(s)
(collectively, Permitted Relatives) of the deceased Person or to one or more trusts or legal
entities for the benefit of any of the Permitted Relatives; (ii) made by any Person to one or more
trusts or legal entities for the benefit of such Persons Permitted Relatives, provided that the
transferring Person (prior to his or her death) has control over the management and decision
making of such trusts or legal entities; or (iii) made by any Person to Affiliate(s) of such Person,
may be completed at any time with the City Managers consent, provided that:
(a) Notice. Lessee or the applicable Major Subtenant shall give the City Manager
prior written notice thereof (or in the case of clause (i), prompt written notice thereof);
(b) No Release. Any Person liable for the obligations of Lessee under this Amended
and Restated Ground Lease or the obligations of any Major Subtenant under any Major Sublease
(or in the case of clause (i), such Persons estate) shall not be released from such liability on
account of any such Lessee Interest Assignment or Major Subtenant Interest Assignment;
(c) No Change in Voting and Operational Control. Such Lessee Interest Assignment
or Major Subtenant Interest Assignment shall not result in any change in the Person(s) having
Voting and Operational Control of Lessee or the applicable Major Subtenant (except in the case
of the death of any natural Person(s) who has Voting and Operational Control), although such

Voting and Operational Control may be exercised through different or additional intermediary
Person(s);
(d) No Disqualified Person. Any applicable transferee shall not be a Disqualified
Person; and
(e) Investors. The provisions of Section 8.14 below shall apply to any new Investors
on account of any such Lessee Interest Assignment or Major Subtenant Interest Assignment.
In connection with any such Lessee Interest Assignment or Major Subtenant Interest
Assignment, nothing contained herein shall be deemed to prevent Lessee or any Major Subtenant
from complying, if it so elects, with the applicable provisions of Section 8.4, in which case the
transferor (provided that the City Manager approves the Proposed Transfer pursuant to the
Transfer Review Procedures) shall be released from liability as provided for by Section 8.5.
Section 8.7 Approved Leasehold Mortgages, Leases and Subleases. The provisions of
this Article VIII shall not apply to or prohibit: (i) any Approved Leasehold Mortgages,
Foreclosure Transfers (including any such Foreclosure Transfer described in Section 6.11(c)
above), transfers to Approved Subsequent Foreclosure Purchasers (including any such transfer
described in Section 6.11(c) above) or any other transactions governed by this Article VI; or (ii)
any Major Subleases, Space Leases or other leasing or subleasing transactions governed by
Article XXXIII (except that Section 8.14 shall be applicable to any Investors in any Major
Subtenants).
Section 8.8 Going Public. Notwithstanding anything to the contrary contained herein,
the City Managers consent shall be required for, and the provisions of this Article VIII shall
apply to: (i) the public offering of securities by any Person which is effected pursuant to a
registration statement filed with the Securities & Exchange Commission under the Securities Act

of 1933 or any successor act (or pursuant to any comparable or similar procedure used outside
the United States); provided, however, that if such public offering with respect to Lessee or any
Major Subtenant occurs prior to the Bayraktar Permitted Transfer Date, Mehmet Bayraktar must
retain Voting and Operational Control of Lessee or such Major Subtenant, as applicable; and (ii)
any subsequent transaction in which such securities are publicly traded.
Section 8.9 Other Transactions for Which Consent Is Required. Except for the
procedures as to Investors set forth in Section 8.14, any Lessee Interest Transfer or Major
Subtenant Interest Transfer or other transaction not constituting a Lessee Transfer of Control or a
Major Subtenant Transfer of Control (including, but not necessarily limited to, any transfer or
conveyance of any portion of the Leasehold Improvements which is subject to any Direct Space
Lease) shall require consent by Lessor pursuant to this Article VIII.
Section 8.10 Violation. Any Leasehold Estate Transfer, Lessee Transfer of Control,
Subleasehold Estate Transfer or Major Subtenant Transfer of Control made in violation of the
terms of this Article is strictly prohibited and shall be null and void and no force and effect and
shall be deemed an Event of Lessees Default hereunder.
Section 8.11 Acceptance of Rent from Transferee. The acceptance by Lessor of the
payment of Rent following any Leasehold Estate Transfer, Lessee Transfer of Control, Major
Subleasehold Estate Transfer or Major Subtenant Transfer of Control prohibited by this Article
VIII shall not be deemed to be a consent by Lessor to any of the foregoing for which such
consent is required, nor shall the same be deemed to be a waiver of any right or remedy of Lessor
hereunder.
Section 8.12 Lessors Participation In Proceeds.

(a) Leasehold Estate Transfer or Lessee Transfer of Control. Upon the first time that
there occurs either a Leasehold Estate Transfer or a Lessee Transfer of Control (whether
occurring in a single transaction or in a series of transactions over a five (5) year period), Lessor
shall be entitled to receive, within five (5) Business Days thereafter, a sum equal to One Tenth of
One Percent (0.1%) of the total purchase price payable in consideration of such Leasehold Estate
Transfer or Lessee Transfer of Control.
(b) Major Subleasehold Estate Transfer or Major Subtenant Transfer of Control. With
respect to each Major Project Component, upon the first time that there occurs either a Major
Subleasehold Estate Transfer with respect to such Major Project Component or a Major
Subtenant Transfer of Control (whether occurring in a single transaction or in a series of
transactions over a five (5) year period) with respect to the Major Subtenant for such Major
Project Component, Lessor shall be entitled to receive, within five (5) Business Days thereafter,
a sum equal to One Tenth of One Percent (0.1%) of the total purchase price payable in
consideration of such Major Subleasehold Estate Transfer or Major Subtenant Transfer of
Control.
(c) Excluded Transactions. Notwithstanding the provisions of subparagraphs (a) and
(b) above, no such sum described therein shall be due and payable in connection with: (i) any of
the transactions or events described in Section 8.7 or (ii) any public offering described in
Section 8.8 where the securities being offered constitute debt and the proceeds from the sale of
such securities are used to retire indebtedness secured by one or more Approved Leasehold
Mortgages.
(d) No Double Counting. Notwithstanding the provisions of subparagraph (a) and (b)
above: (i) the sum described in subparagraph (b) shall not be payable with respect to any Major

Project Component if the sum described in paragraph (a) has been previously paid with respect
to the entire Project; and (ii) to the extent any sum described in subparagraph (b) has been paid
as to any particular Major Project Component, such sum shall be deducted from any amount
thereafter payable under subparagraph (a) with respect to the entire Project.
Section 8.13 Organizational Documents of Lessee. As of the Possession Date, the
documents listed in Exhibit P attached hereto constitute all of the organizational documents of
Lessee, including, without limitation, any operating and/or voting agreements among the
members thereof (collectively, the Organizational Documents), and Lessee hereby represents
and warrants to Lessor that Lessee has provided to Lessor true, correct and complete copies of all
such Organizational Documents. Lessee shall promptly provide Lessor with written notice of
any amendments, modifications, additions or terminations of the Organizational Documents,
together with written copies thereof. Prior to the Bayraktar Permitted Transfer Date, the
member(s) or other Investor(s) of Lessee shall not enter into any voting agreements, the effect of
which would cause Mehmet Bayraktar to relinquish Voting and Operational Control of Lessee.
Section 8.14 Investors.
(a) Non-Disclosed Investors. Lessee shall be required to disclose and provide to the
City the identity of or any documents or other information (including, but not limited to,
financial statements or other information) concerning Non-Disclosed Investors.
(b) Disclosed Investors.
(i) Information to be Provided to City Manager. With respect to each initial
Disclosed Investor and each proposed subsequent Disclosed Investor, Lessee shall deliver or
cause to be delivered to the City Manager the following information: (A) the name and address
of the Investor; and (B) the Social Security Number or U.S. Federal Taxpayer Identification

Number of the Investor, if one exists (or in the case of foreign investors who do not have a Social
Security Number or U.S. Federal Taxpayer Identification Number, any similar identification
number (if one exists) provided for in the country of their primary residence or domicile).
Disclosed Investors shall not be required to provide any financial statements or information to
Lessor.
(ii) Investment Questionnaire. Lessee shall cause the Financial Advisor to
require each Disclosed Investor to complete the Investment Questionnaire. Based on the
responses to the questions in the Investor Questionnaire and such other due diligence the
Financial Advisor may perform in the normal course of its fiduciary duties, the Financial
Advisor shall determine, in its good faith, commercially reasonable judgment, whether or not
such Disclosed Investor is a Disqualified Person. The Financial Advisor shall not propose to
Lessee (and Lessee shall not allow) any Disclosed Investor which the Financial Advisor has
concluded is a Disqualified Person. The Parties acknowledge and agree that no Disqualified
Person shall hold a legal or beneficial interest in the Project.
(c) City Managers Right to Object. Notwithstanding anything to the contrary
contained in this Article VIII, the City Manager shall have the right to object to any Disclosed
Investor (and therefore require that such Disclosed Investor not have any equity investment in
the Project), if such Person is a Disqualified Person. Any such objection shall be made by a
written notice given by the City Manager to Lessee within twenty (20) days after Lessee (and, if
applicable, the Financial Advisor) provides the information required by Section 8.14(b)(i) above.
Such notice shall state the specific basis for the objection.

Section 8.15 Transfers of the Citys Interest.
(i) Conveyance of Interest. During the Lease Term, Lessor may convey its
fee and reversionary interest in the Property or its interest in this Amended and Restated Ground
Lease to another Person or Persons, provided that: (i) Lessor gives Lessee prior written notice
thereof; (ii) such other Person or Persons shall assume in writing all of Lessors obligations
hereunder; (iii) if more than one Person acquires any such interest, only one such Person shall be
irrevocably designated in writing by all such Persons to take any actions which shall be binding
of all such Persons as Lessor hereunder; and (iv) in the event such other Person is not a
Governmental Authority, the provisions set forth in Exhibit Q shall no longer be applicable.
(ii) Subject to this Amended and Restated Ground Lease. Any conveyance or
transfer by Lessor of its fee or reversionary interest shall be made subject to the terms and
conditions set forth in this Amended and Restated Ground Lease and the rights of Lessee and any
Person claiming by, through or under Lessee; provided, however that, any approvals to be made
by the City Manager hereunder shall be made by the transferee of Lessors interest hereunder
in the same manner as described in Section 38.7. The Person to which Lessor assigns or
conveys such fee or reversionary interest shall, for itself and its successors and assigns and
especially for the benefit of Lessee, by written instrument in recordable form, expressly assume
all of the obligations of Lessor under this Amended and Restated Ground Lease arising and
accruing after the date of the transfer and agree to be subject to all terms and conditions hereof to
which Lessor is subject.
(iii) Mortgage of Fee Interest. The lien, operation and effect of any mortgage
encumbering Lessors fee simple estate or other interest in the Property or any portion thereof
shall, at all times and for purposes, be subject, subordinate and inferior to this Amended and

Restated Ground Lease (including all of the terms, covenants, conditions and provisions hereof)
and the Leasehold Estate and all rights of Lessee hereunder and any Major Subtenant, Space
Tenant or other Person claiming by, through or under Lessee, including, without limitation,
holders of Approved Time Share Licenses and their respective lenders.
ARTICLE IX
EASEMENTS AND LICENSES
Section 9.1 Utility Easements.
(a) In Favor of Lessor. Lessee agrees to grant to Lessor and/or any public utility
company, pursuant to separate instruments, non-exclusive perpetual easements for the
installation, operation, maintenance, repair, replacement, relocation, and removal of utility lines
and facilities (together with access incidental thereto) such as water lines, fire lines, gas mains,
electrical power lines, telephone lines, storm and sanitary sewers and other utility lines and
facilities (collectively, Utility Facilities), and such other easements as Lessor and/or such
public utility companies may reasonably require from time to time. All such easements shall be
over, under and/or across: (i) those portions of the Property shown on the approved Construction
Plans and Specifications; or (ii) such other locations on the Property as may be requested by
Lessor or such public utility companies from time to time, so long as such locations are
reasonably acceptable to Lessee, considering, among other things, whether such locations cause
unreasonable interference with the construction, use and operation of the Project or undue
expense to Lessee. The instruments granting such easements shall provide, among other things,
that the grantee(s) thereunder shall not exercise their rights thereunder in such a manner as would
cause unreasonable interference with the construction, use and operation of the Project or undue
expense to Lessee. Any such easement instrument in favor of Lessor shall include an appropriate

indemnification from Lessor and insurance obligations on the part of Lessor with respect to any
Persons entering onto the Property and/or the Leasehold Improvements pursuant to the easement
rights granted therein.
(b) For the Benefit of Lessee. Subject to the rights of adjacent property owners (other
than Lessor) and other lessees of property on Watson Island (and to the condition that the same
shall not cause any undue expense or interference to such parties), Lessor agrees to grant unto
any applicable provider of Utility Facilities servicing the Property and/or the Leasehold
Improvements, and such providers employees, contractors or agents and their respective
successors and assigns, the non-exclusive right and easement to install, operate, maintain, repair,
relocate, replace and remove Utility Facilities underground within all portions of Watson Island
owned by Lessor, provided that such Utility Facilities are shown on the approved Construction
Plans and Specifications, or are located at such other locations as may be requested by Lessee
and approved by Lessor from time to time during the Lease Term.
Section 9.2 Easements in Favor of Lessee. In order to facilitate the construction, use
and operation of the Project consistent with the Watson Island RFP and the Island Gardens
Proposal, Lessor agrees to consider in good faith granting to Lessee, any Major Subtenant, any
Space Tenant and their respective employees, agents, contractors, invitees, licensees, guests, and
customers, and their respective successors and assigns, such other easements and access rights as
Lessee may reasonably require from time to time, all subject to and in accordance with such
terms, covenants and conditions as may be reasonably imposed by Lessor and in accordance with
Applicable Laws.
Section 9.3 Access Easement in favor of the Public. Lessor shall execute and deliver
and cause to be recorded in the Public Records of Miami-Dade County, Florida an instrument, in

form and substance mutually satisfactory to Lessor and Lessee, pursuant to which Lessor shall
grant an easement in favor of the public over, across and upon the waters (the Adjacent
Waters) above the submerged land adjacent to the Marina which is owned by the City (the
Adjacent Submerged Land), for the purpose of affording to marine vessels using the Marina:
(i) ingress and egress to and from the Marina; and (ii) the ability to turn around and otherwise
maneuver in connection with entering and exiting and docking at the Marina, all so as to
facilitate the proper use and operation of the Marina consistent with the Watson Island RFP and
the Island Gardens Proposal.
Section 9.4 Duration of Easements. Unless a shorter term is provided, each of the
rights and easements granted or reserved in this Article shall be for the Lease Term.
Section 9.5 Dredging to Facilitate Safe Passage of Vessels. Lessee shall obtain any
permits from applicable Governmental Authorities which are required to complete such dredging
of the Adjacent Submerged Land as may be required to facilitate the safe passage of marine
vessels arriving at and departing from the Marina over, across and upon the Adjacent Waters.
All such dredging shall be completed in accordance with such permits and Applicable Laws.
Lessor shall reasonably cooperate with Lessee in conjunction with Lessees obtaining all such
permits, and shall not object to Lessees completion of such dredging in accordance with such
permits and Applicable Laws.
Section 9.6 Confirmatory Instruments. Each Party covenants and agrees that from
time to time at the request of the other Party, it shall execute and deliver such additional
documents or instruments confirming the rights and easements granted and reserved in this
Article, or more precisely showing their location, as such requesting Party shall reasonably deem
to be necessary or desirable.

ARTICLE X
PAYMENT OF IMPOSITIONS
Section 10.1 Payment of Impositions. Lessee shall pay, or cause to be paid, all
Impositions before they become delinquent (i.e., before any penalty, fine or interest is added to
the amount due, but without any requirement that the amount due be paid by any date which will
take advantage of any discounts available for early payment). If by law any Imposition is
payable or may, at the option of the taxpayer, be paid in installments (whether or not interest
shall accrue on the unpaid balance of the Imposition), Lessee may pay the same (and any accrued
interest on the unpaid balance of the Imposition) in installments, but same shall in all events be
paid before they become delinquent. Any Imposition relating to a fiscal period of the taxing
authority, a part of which period is included before the Possession Date and a part of which is
included after the Possession Date shall be adjusted as between Lessor and Lessee as of the
Possession Date, so that Lessee shall pay (before same becomes delinquent) that proportion of
the Imposition attributable to that part of the fiscal period included in the Lease Term, and
Lessor shall pay the remainder, if applicable. Any Imposition relating to a fiscal period of the
taxing authority, a part of which is included within the Lease Term and a part of which is
included in a period of time after the Lease Term, shall be adjusted as between Lessor and
Lessee as of the expiration or sooner termination of this Amended and Restated Ground Lease,
so that Lessee shall pay that proportion of the Imposition attributable to that part of the fiscal
period included in the Lease Term, and Lessor shall pay the remainder, if applicable.
Section 10.2 Taxes on Lessor. Any sales, excise, transaction, use or privilege tax now
or hereafter imposed by any Governmental Authority upon Lessor, the Property or the Leasehold
Improvements on account of, attributed to, or measured by Rent or other charges payable by

Lessee shall be paid by Lessee to Lessor as additional Rent, even though the taxing statute or
ordinance may purport to impose such tax against Lessor. Nothing herein contained shall require
Lessee to pay municipal, state or federal income taxes assessed against Lessor, or corporate
excess profits or franchise taxes imposed upon Lessor unless the method of taxation prevailing at
the commencement of the term hereof shall be altered so that such taxes shall be assessed in lieu
of or as a substitute for the whole or any part of the Impositions, in which event, such income,
profits or franchise taxes shall be included within the term Impositions for purposes hereof,
and Lessee shall pay and discharge the same as herein provided.
Section 10.3 Lessees Right to Contest Impositions. Notwithstanding anything to the
contrary contained herein, Lessee shall have and retain the right to contest in good faith by legal
proceedings, diligently pursued, any Imposition, or any valuation in connection therewith,
provided that: (i) to the extent required by Applicable Laws, Lessee shall first make all contested
payments under protest; (ii) Lessee shall pursue such action in accordance with Applicable Laws
such that neither the Property nor the Leasehold Improvements nor any part thereof or interest
therein would be in any danger of being sold, forfeited, lost or interfered with; and (iii) all
expenses incurred in connection with such proceedings shall be paid by Lessee. Such legal
proceedings may include appropriate proceedings to review tax assessments and appeals from
orders in connection therewith and appeals from any judgments, decrees or orders.
Section 10.4 Proof of Payment. Lessee shall furnish (or arrange for an outside service
to furnish) to Lessor, within thirty (30) days after the date when any Imposition is paid by or on
behalf of Lessee, official receipts of the appropriate taxing authority, photocopies thereof or
other proof of payment satisfactory to Lessor.
ARTICLE XI

INSURANCE
Section 11.1 Insurance on the Leasehold Improvements. Beginning on the Possession
Date and at all times during the Lease Term, Lessee shall, at Lessees sole cost and expense but
for the benefit of Lessor and Lessee as their interests may appear, maintain the following
insurance:
(a) Property Insurance. All risk property insurance with extended coverage against
loss or damage by earthquake, mudslide, windstorm, flood with an endorsement for amended
coverage, vandalism, malicious mischief, sprinkler leakage and special coverage, including
flammable materials used for cooking.
(i) Amounts. Such coverage shall be in the following amounts: (A) as to
windstorm, $100,000,000; (B) as to flood, $12,500,000; and (C) as to all other perils, One
Hundred Percent (100%) of the replacement cost of the Leasehold Improvements (exclusive of
foundation and excavation costs), Lessees 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, the Insured Property) on the Property.
(ii) Deductibles. The maximum deductibles for such coverage shall be as
follows: (A) as to flood and windstorm, Five Percent (5%) of the completed building value; and
(B) as to all other perils, One Percent (1%) of the insured value.
(iii) Loss Payees and Insureds. Lessor, Lessee and any Approved Leasehold
Mortgagee shall be named as loss payees. Lessee shall be the first named insured, and Lessor and
any Approved Mortgagee shall be named as additional insureds.
(iv) Special Considerations for Casualty and Windstorm Insurance.
Notwithstanding the foregoing, the Parties acknowledge and agree that coastal properties are

often precluded from being insured by private insurers and that any casualty and windstorm
insurance may have to be written through the Florida Joint Underwriters Association and/or
another governmental or other insurance pool which may include certain prohibitions such as no
replacement cost coverage.
(v) Determination of Replacement Cost. Unless expressly waived in writing
by the City Manager, the replacement cost of the Insured Property shall be determined every
seven (7) years during the Lease Term by an insurance appraiser selected and paid for by Lessee,
provided that Lessee shall obtain Lessors approval (which approval shall not be unreasonably
withheld) of the appraiser before commencement of the appraisal. The appraiser selected by
Lessee shall submit to Lessor and Lessee a written report of the appraised replacement cost. If
Lessor or Lessee is not satisfied with such report, the dissatisfied party shall serve upon the other
a notice of dissatisfaction within thirty (30) days after receipt of the report, and the Parties shall
in good faith attempt to resolve any disputes concerning the appraised replacement cost. During
this period of the dispute, Lessee shall continue to maintain insurance in an amount equal to that
maintained before the dispute arose. Promptly upon receipt of the appraisers report and
resolution of any such dispute, Lessee shall procure and deliver to Lessor written confirmation
from the insurer(s) evidencing the adjustment in insurance amounts which may be required
pursuant to this clause (v).
(b) Business Interruption Insurance. Business interruption insurance with limits not
less than an amount equal to the sum of: (i) the Base Rent for a twelve (12) month period; plus
(ii) an amount equal to the average annual Percentage Rent payable during the three (3) year
period immediately preceding the issuance or renewal of such insurance (or, in the case of each
of the first (3) three years from and after the date on which Percentage Rent is first payable

hereunder, the amount of annual Percentage Rent estimated by Lessee in good faith which will
be payable during such year). Lessor, Lessee and any Approved Leasehold Mortgagee shall be
named as loss payees. Lessee shall be the first named insured.
(c) Boiler and Machinery Insurance. Boiler and machinery insurance covering repair
and replacement of all boilers and machinery serving or benefiting the Leasehold Improvements.
The policies of insurance shall be endorsed so as to provide use and occupancy coverage for the
Leasehold Improvements in such amount as may be reasonably acceptable to Lessor. Lessor,
Lessee and any Approved Leasehold Mortgagee shall be named as loss payees. Lessee shall be
the first named insured, and Lessor and any Approved Leasehold Mortgagee shall be named as
additional insureds.
Section 11.2 Other Insurance To Be Carried. Lessee shall also, at Lessees sole cost
and expense but for the mutual benefit of Lessee and Lessor (with Lessor being named as an
additional insured thereunder and with leasehold mortgage clauses for the benefit of any
Approved Mortgagee, which clauses shall be consistent with the terms of this Amended and
Restated Ground Lease), maintain the following insurance:
(a) CGL Insurance. Commercial General Liability insurance on a commercial
general liability coverage form with broad form coverage, or its equivalent, including
contractual liability, products and completed operations, personal injury, liquor legal liability,
garage keepers liability (which coverage shall not be required until the Parking Garage is
operating), and products and completed operations, personal injury, and premises coverage
against sums adjudicated to be payable by the insured on account of bodily injury, death or
property damage occurring in or about the Property (it being understood, however, that such
coverage does not extend to damage to property in the insureds care, custody and control).

(i) Amounts. The limits of such coverage shall not be less than One Million
Dollars ($1,000,000) per occurrence and Two Million Dollars ($2,000,000) aggregate single
limit for bodily injury and property damage. No deductible in excess of $50,000 will be carried
under this coverage without the City Managers prior written consent, which shall not be
unreasonably withheld.
(ii) Umbrella Policy. Lessee shall further maintain an excess liability
umbrella policy whose limits shall not be less than a combined single limit of Five Million
Dollars ($5,000,000).
(iii) Adjustments in Amounts. Such insured amounts as provided in clauses (i)
and (ii) above shall be adjusted as of the fourth (4 th) anniversary of the January 1 following the
Possession Date, and every three (3) years thereafter, by any increase and/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 (as defined in Section 5.2) from the Possession Date to the date on
which the adjustment is to be made.
(b) Builders Risk. During any periods of: (i) excavation and/or construction; (ii)
alteration; (iii) restoration in the event of damage or destruction or condemnation; or (iv) razing
or demolition, at, in or on the Property, the Leasehold Improvements or any part of it, an all risk
Builders Risk policy (including extended coverage for fire, lightning, earth movement, flood,
collapse, business interruption, hurricane, boiler and machinery) covering the interests of Lessor
and Lessee. Such policy shall insure that portion of the Leasehold Improvements which is
affected by such activities for not less than One Hundred Percent (100%) replacement cost on a
completed value basis (including foundations and pilings), and shall include coverage for the
increased cost of construction due to the enforcement of any laws, as well as the contingent

liability from the operation of buildings, and coverage for the demolition cost of undamaged
portions of buildings.
(i) E & O Coverage. In addition, Lessee shall cause all of the key or primary
professionals retained by it in connection with any construction (e.g., architects and engineers) to
procure errors and omission coverage reasonably satisfactory to Lessee for Lessees and Lessors
benefit, in such amounts as are customarily carried by such professionals in Miami-Dade
County, Florida.
(ii) Wrap-Up Policy. Lessor acknowledges and agrees that the coverage
required by this subparagraph (b) and any other coverages required hereunder may be obtained
through a so-called wrap-up policy.
(c) Pollution/Environmental Impairment Liability. Pollution/Environmental
Impairment Liability Insurance coverage on a claims made basis with limits of One Million
Dollars ($1,000,000) per occurrence (with the policy period extending at least six (6) years from
and after the expiration or sooner termination of this Amended and Restated Ground Lease),
providing coverage for the damage caused by spillage of any fuel, petroleum, products or any
other hazardous substances, hazardous materials or toxic substances (as defined in any and
all Applicable Laws), whether those substances are solid, liquid or gaseous. Such policy of
insurance shall also provide coverage for the cost of cleanup of the affected area and for the
removal, transportation and safe disposal of any contaminated area. Lessor and Lessee shall be
named as loss payees. Lessee shall be the first named insured, and Lessor and any Approved
Leasehold Mortgagee shall be named as additional insureds.
(d) Workers Compensation. Workers compensation and occupational disease
coverage in the amounts and types required by Chapter 440, F.S., or any successor thereto. Only
Lessee shall be named as an insured.
(e) Automobile Liability. Automobile liability insurance covering all owned, non-
owned and hired vehicles used in conjunction with operations covered by this Amended and
Restated Ground Lease. The policy or policies of insurance shall contain such limits as may be
reasonably requested by Lessor from time to time but not less than Five Hundred Thousand
Dollars ($500,000). Such insured amount shall be increased as of the fourth (4 th) anniversary of
the January 1 following the Possession Date, and every three (3) years thereafter, by any increase
in the Consumer Price Index from the Possession Date to the date on which the adjustment is to
be made.
(f) Other Coverage. In the event that any other type of legislation may be enacted
imposing special liability upon Lessor or Lessee by virtue of its use for any special purposes,
before Lessee shall so use the Property and/or the Leasehold Improvements or any part of it for
such purposes, Lessee shall provide insurance in form and substance, and with insurers and
limits reasonably satisfactory to Lessor and meeting commercial standards insuring the interests
of Lessor and Lessee and naming Lessor as additional insured.
Section 11.3 Policies Obtained by Independent Contractors. Lessee may cause its
independent contractors to provide some or all of the insurance coverages required hereunder.
To the extent that such independent contractors carry such coverages, Lessee shall not be
required to carry such coverages, so long as the coverages obtained by Lessee and such
independent contractors together satisfy the requirements of this Article XI. Lessor, Lessee and
any Approved Mortgagees shall be named as additional insureds as to any such coverages
obtained by Lessees independent contractors.
Section 11.4 Policies Obtained by Major Subtenants. Lessee may, at its option, include
provisions in any Major Sublease (or Direct Space Lease) requiring the applicable Major
Subtenant (or Direct Space Tenant) to carry insurance coverages as to the applicable Major
Project Component (or premises covered by such Direct Space Lease) corresponding to those
required to be obtained hereunder by Lessee. To the extent that Major Subtenants (or their Space
Tenants) carry such coverages, Lessee shall not be required to carry such coverages as to such
Major Project Component (or premises covered by such Direct Space Lease), so long as the
coverages obtained by all of the Major Subtenants, Space Tenants and Lessee together satisfy the
requirements of this Article XI. Lessor, Lessee and any Approved Mortgagees shall be named
as additional insureds as to any such coverages obtained by Major Subtenants or Space Tenants.
Section 11.5 Delivery of Insurance Policies. All public liability and workers
compensation policies shall be retained by Lessee. Subject to the rights of any Approved
Mortgagee, all other policies of insurance required to be furnished pursuant to this Article XI
shall be held jointly by Lessor and Lessee. Insurance company certificates evidencing the
existence of all of these policies of insurance shall be delivered to Lessor.
(a) Required Policy Provisions. All policies of insurance required to be provided and
obtained pursuant to this Article XI shall provide that they shall not be amended or canceled on
less than thirty (30) days prior written notice to Lessor and all insureds and beneficiaries of the
policies; provided, however, that if thirty (30) days notice is ever commercially unavailable,
then the required number of days notice shall be reduced to such number as is commercially
available. All such policies shall contain waiver of subrogation rights endorsements as required
below. Lessor shall have no obligation to pay premiums or make contributions to the insuring
company or any other Person or satisfy any deductible.
(b) Delivery. On or before the Possession Date and then not less than thirty (30) days
prior to the expiration date of any policy required to be carried pursuant to this Article XI,
Lessee shall deliver to Lessor and any Approved Leasehold Mortgagee the applicable respective
policies and insurance company certificates evidencing all policies of insurance and renewals
required to be furnished hereunder. Receipt of any documentation of insurance by Lessor or by
any of its representatives which indicates less coverage than required shall not constitute a
waiver by Lessor of Lessees obligation to fulfill the insurance requirements herein.
Section 11.6 Lessors Right to Obtain. If Lessee fails to pay insurance premiums when
due or to comply with other insurance requirements set forth in this Amended and Restated
Ground Lease, Lessor shall have the right, at its option, to order insurance policies and to
advance such sums as are required to maintain or procure such insurance, and to the extent of the
money so advanced, Lessor shall be entitled to reimbursement by Lessee pursuant to Article XV
hereof. Unless there would ensue a lapse of coverage, Lessor shall, before making any such
advance, provide Lessee with ten (10) days prior written notice and the opportunity to obtain the
required policies.
Section 11.7 Insurer To Be Approved; Premium Receipts. All policies of insurance of
the character described in Sections 11.1 and Section 11.2 shall be effected under policies issued
by insurers permitted to do business in the State of Florida and rated in Bests Insurance Guide,
or any successor thereto (or, if there is none, an organization having a national reputation for
rating insurance companies) as having a general policyholder rating of A and a financial rating
of at least VII. On written request by Lessor, Lessee shall provide photocopies of receipts
showing the payment of premiums for all insurance policies required to be maintained by this
Section 11.8 Waiver of Subrogation.
(a) Mutual Waiver. Each Party waives all rights to recover against the other Party for
any damage arising from any cause covered by any insurance required to be carried by the
waiving Party, or any insurance actually carried by the waiving Party; provided, however, that
such waiver shall apply only to the extent the applicable insurers issue the appropriate waiver of
subrogation rights endorsements described in subparagraph (b) below.
(b) Endorsements. Each Party shall cause its insurer(s) to issue appropriate waiver of
subrogation rights endorsements to all policies of insurance carried in connection with the
Property.
(c) Major Subtenants. Lessee shall require each Major Subtenants to execute and
deliver to Lessor, and Lessor shall execute and deliver to each Major Subtenant, a waiver of
claims comparable to the waiver in subparagraph (a) above. In addition, Lessee shall cause each
Major Subtenant to obtain, and Lessor shall obtain in favor of each Major Subtenant, waivers of
subrogation rights endorsements comparable to those described in subparagraph (b) above.
ARTICLE XII
RECORDS AND AUDITING
Section 12.1 Records of Sales.
(a) Maintenance of Records. During the Lease Term, Lessee shall maintain and
keep, or cause to be maintained and kept, at the Property, a full, complete and accurate record
and account of all Gross Revenues (on an accrual basis) arising or accruing by virtue of the
operations conducted at or from the Property, for each day of the Lease Term, together with
audited annual financial statements, federal and state (if applicable) income tax returns, Florida
sales tax returns and other returns or evidence reasonably acceptable to Lessor of the payment of
all other required Impositions, statements of revenues and fees charged, agreements entered into
by Lessee with respect to the Project, bank statements and deposit slips, cash receipt journals,
general ledgers and any other appropriate documentation as may be reasonably required by
generally accepted accounting practices for the applicable industry(ies).
(b) Availability of Records for Inspection. At all times during the Lease Term, upon
providing fourteen (14) days prior written notice to Lessee, all then existing records and
accounts and all other supporting records which are located at the Property pursuant to this
Section 12.1 shall be available for inspection and audit by Lessor and its duly authorized agents
or representatives during the hours of 8:00 a.m. to 5:00 p.m., Monday through Friday each
Business Day. All such records and accounts shall be in accordance with generally accepted
accounting principles.
(c) Accounting Control Equipment. Lessee must provide point of sale machines or
such other cash registers or accounting control equipment reasonably necessary for proper
control of cash and payments, whether such transaction is a cash or credit transaction.
(d) Required Period for Preserving Records. Lessee shall keep and preserve, or cause
to be kept and preserved, the records described in subsection (a) above for not less than sixty
(60) months after the payment of the Percentage Rent due under the terms hereof to which such
records relate. For the same period of time, Lessee shall also retain copies of all sales and tax
returns covering its operations at the Property, and any other governmental tax or other returns
which show Lessees sales therein, and shall, upon demand, deliver photographic copies or
computer disks thereof to Lessor at no cost to Lessor.
(e) Cooperation. Lessee shall cooperate with Lessors internal auditors (or such other
auditors designated by Lessor) in order to facilitate Lessors examination of records and
accounts. Lessee shall allow Lessor or Lessors auditors to inspect all or any part of the
compilation procedures for such records and accounts. Such inspection shall be reasonable but
may be made at the sole discretion of Lessor.
Section 12.2 Audit.
(a) Audit by Lessee. Lessee shall deliver or cause to be delivered within one hundred
twenty (120) days after the end of each calendar year to Lessors Office of Asset Management,
currently located at 444 SW 2 Avenue, Suite 325, Miami, FL 33130, audited financial statements
for such calendar year, prepared and certified by a nationally recognized auditor employed at
Lessees sole cost and expense (the Auditor). Such Auditor shall certify that: (i) it made a
complete examination of the books, state sales tax returns, and federal income tax returns of
Lessee, all Major Subtenants and all Direct Space Tenants which are Affiliates of Lessee; and (ii)
such statement is prepared in accordance with generally accepted accounting principles and
practices and represents the Gross Revenues of Lessee, the Major Subtenants and such Direct
Space Tenants for the period indicated therein (on an accrual basis). Within twenty (20) days
after the delivery of such audited statements, Lessee shall pay to Lessor any unpaid balance of
the Rent or underpayment of Percentage Rent, if any, and Lessor shall credit any overpayments,
if any, towards next accruing Rent installments.
(b) Lessors Remedies for Failure to Deliver Audit. In the event Lessee fails to
prepare or deliver the required audited financial statements to Lessor within the time set forth in
subparagraph (a) above, Lessor, upon thirty (30) days written notice to Lessee, may elect to
exercise either or both of the following remedies: (i) to treat any continuing omission as a default
of this Amended and Restated Ground Lease, subject to applicable notice and cure periods
specified in Section 25.1(k); and/or (ii) to cause an audit and/or accounting pursuant to the
provisions of this Amended and Restated Ground Lease to be made by any auditor of Lessors
choosing at the sole cost and expense of Lessee. Such audit shall be binding on Lessee. Lessee
shall pay the reasonable cost of such audit within thirty (30) days of receipt of an invoice for
same.
(c) Audit by Lessor. In addition to the audit rights specified in subparagraph (b)
above, Lessor shall have the right, upon fifteen (15) days prior written notice to Lessee, to cause
a complete audit by a nationally recognized auditor to be made of the accounting records of
Lessee, the Major Subtenants, and any Direct Space Tenants which are Affiliates of Lessee, in
connection with the sales on, from or related to the Property for the period covered by any
Percentage Rent statement furnished by Lessee to Lessor. Any such audit shall be made at
Lessors sole cost and expense and must be completed within sixty (60) months of Lessees
delivery of such applicable Percentage Rent statement to Lessor. If such audit shall disclose an
underpayment of Rent, Lessee shall pay Lessor any unpaid balance within thirty (30) days of
receipt of notice from Lessor that such balance is due. If such audit shall disclose an
overpayment, Lessor shall credit such overpayment towards next accruing Rent installments.
(d) Continuing Right to Examine. The acceptance by Lessor of payments of
Percentage Rent shall be without prejudice to Lessors right to conduct an examination of
Lessees books and records of its Gross Revenues and inventories of merchandise on the
Property in order to verify the amount of annual Gross Revenues made by Lessee in and from the
Property. Neither the receipt by Lessor of any statement or any payment of Percentage Rent for
any period, nor the failure of Lessor to make any audit for any such period shall bind Lessor as to
the correctness of any statement or payment, nor bar Lessor from collecting at any time
thereafter the correct Percentage Rent due for such period. Notwithstanding the foregoing,
Lessor shall not re-examine an accounting period which has previously been audited, unless it
has reasonable cause to do so, and Lessor shall in no event go back further than sixty (60)
months from Lessees delivery of any applicable Percentage Rent statement.
(e) Major Subleases and Space Leases.
(i) Major Subleases and Non-Direct Space Leases. In each Major Sublease,
Lessee shall include comparable provisions which shall require that the applicable Major
Subtenant comply with the provisions of this Article XXII or require, as to any portion of the
applicable Major Project Component covered by Space Leases, that all of such Major
Subtenants Spaces Tenants comply with same. So long as Lessee is using good faith efforts to
enforce such compliance by Major Subtenants, Lessee shall be relieved from any making or
keeping any duplicative reports or otherwise complying with any duplicative procedures.
(ii) Direct Space Leases. In each Direct Space Lease, Lessee shall include
comparable provisions which shall require that the applicable Direct Space Tenant comply with
the foregoing reporting and auditing procedures. So long as Lessee is using good faith efforts to
enforce such compliance by such Direct Space Tenants, Lessee shall be relieved from any
making or keeping any duplicative reports or otherwise complying with any duplicative
procedures.
(iii) Affiliates. Notwithstanding the foregoing, in the case of Major Subtenants
or Direct Space Tenants which are Affiliates of Lessee, only actual compliance by such Major
Subtenants or Direct Space Tenants shall relieve Lessee from any making or keeping any
duplicative reports or otherwise complying with any duplicative procedures.
ARTICLE XIII
REPRESENTATIONS AND COVENANTS
Section 13.1 Limited Representations by Lessor. Lessor makes the following
representations, covenants and warranties, which shall survive the execution of this Amended
and Restated Ground Lease and the taking of possession of the Property by Lessee:
(a) Marketable Title. Lessor is indefeasibly seized of marketable, fee simple title to
the Property, and is the sole owner of and has good right, title and authority to convey and
transfer the Leasehold Estate to Lessee, free and clear of all liens and encumbrances other than
the Permitted Title Exceptions and subject to the terms and conditions of the Partial Modification
of Restrictions. From and after the Possession Date, Lessor shall take no action and shall record
no documents in the Public Records which would materially impair Lessees estate, rights or
interest in and to the Leasehold Estate or otherwise be binding on Lessee or run with the
Leasehold Estate, without the prior written consent of Lessee.
(b) No Parties in Possession. No party except Lessee shall, on the Possession Date,
be in or have any right to possession of the Property.
(c) No Pending Litigation. There is no suit, action, claim, audit, arbitration, or legal,
administrative, judicial or other proceeding (including, without limitation, any of the foregoing
relating to violations of any Applicable Law), litigation, investigation or proceeding pending, or,
to the knowledge or belief of Lessor, threatened, which relates to, affects, or involves the
Property, or which would impair or otherwise adversely affect Lessors ability to perform its
obligations under this Amended and Restated Ground Lease, any of which would have a material
adverse effect on the Property or the Project, or which is or could become a lien upon the
Property.
(d) Compliance with Laws. The execution and delivery of this Amended and
Restated Ground Lease has been duly authorized and is in accordance with and pursuant to all
Applicable Laws (including, without limitation, those of Lessor in its municipal capacity) and
the Constitution of the State of Florida.
Section 13.2 Authority. Each Party represents to the other that: (i) such Party has, and
has exercised, the applicable legal requirements necessary to adopt, execute and deliver this
Amended and Restated Ground Lease and perform its obligations hereunder; and (ii) this
Amended and Restated Ground Lease has been duly executed and delivered by such Party and
constitutes a valid and binding obligation of such Party, enforceable in accordance with its terms,
conditions and provisions.
Section 13.3 Lessees Representations and Covenants.
(a) Funding of Project. To the best of Lessees knowledge: (i) Lessee has access to
sufficient funds to satisfy the Initial Equity Requirement (as defined in Section 6.1); (ii) as of the
Possession Date, Lessee will have closed upon an Approved Construction Loan regarding one or
more Major Project Components (as defined in Section 6.1); and (iii) the total of such sums will
be sufficient to carry out the development and construction of the relevant Major Project
Component and to operate that Major Project Component and comply with the terms and
conditions of this Amended and Restated Ground Lease.
(b) Due Diligence. Lessee has done such studies and has made such evaluations as it
deems appropriate regarding the tourism and local markets in the area surrounding Watson
Island and has deemed it desirable to invest in the Project, recognizing the risks inherent therein.
(c) No Liability for Municipal Actions. Lessee acknowledges that Lessor shall not be
liable under this Agreement for any actions taken by the City, acting in its municipal capacity,
including, without limitation, any actions which may adversely impact tourism, crime, the local
economy, the success of the Project, etc., and that in no event shall any actions taken by the City
in its municipal capacity be the basis for any cause of action or defense of any obligation by
Lessee hereunder.
(d) No Other Business Activities. Lessee covenants that at all times during the Lease
Term, Lessee shall not engage in any business activities unrelated to the development,
construction, use and operation of the Project as contemplated by this Amended and Restated
Ground Lease.
Section 13.4 Disclaimer of Lessors Representations.
(a) As Is Condition. Lessee acknowledges that it has examined the Property, and
hereby accepts the Property in its present AS-IS, WHERE-IS condition and without any
additional representations or warranties of any kind or nature by Lessor whatsoever, express or
implied, as to the Property, the condition thereof, or the accuracy of any information furnished to
Lessee with respect thereto. Lessee assumes the sole responsibility for the condition and
demolition of the present improvements and other structures located on the Property in order that
Lessee may construct, operate, maintain and manage the Leasehold Improvements upon the
Property; and Lessor shall not be required at any time to make any repairs, replacements,
changes (structural or otherwise), additions or alterations to the Property, the Leasehold
Improvements and/or any other property of any kind demised by this Amended and Restated
Ground Lease.
(b) No Other Representations. Lessee hereby expressly acknowledges and agrees
that except as and to the extent expressly provided to the contrary in Section 13.1 and Section
13.2 or in the Agreement to Enter into Ground Lease between the Parties having an effective
date of January 1, 2003 or in the Amended and Restated Agreement to Enter Into Ground Lease
having an effective date of February 1, 2010: (i) Lessor makes and has made no warranty or
representation whatsoever as to the condition or suitability of any portion of the Property for
Lessees purposes; (ii) Lessor makes and has made no warranty, express or implied, with regard
to the accuracy of any information furnished to Lessee, and Lessor shall not be bound by any
statement of any broker, employee, agent or other representative of Lessor; (iii) Lessee has made
a complete and thorough independent examination and inspection of all portions of the Property
utilizing such experts and consultants as Lessee deemed appropriate and, on the basis of its
inspection, Lessee is thoroughly familiar with all portions of the Property (including, without
limitation, whether or not hazardous or toxic materials are or have heretofore been located on or
under or generated from any portion of the Property), and all other matters relevant to Lessee;
(iv) Lessee has determined that the condition of all portions of the Property is satisfactory to
Lessee; and (v) Lessor makes and has made no warranty, express or implied, concerning any
portion of the Property, its condition, the use to which it may be put, any environmental matters,
or any other thing or matter directly or indirectly related thereto or hereto, including, without
limitation, NO WARRANTY OF MERCHANTABILITY, OR FITNESS FOR ANY
PARTICULAR PURPOSE, OR RELATING TO THE ABSENCE OF LATENT OR OTHER
DEFECTS.
Section 13.5 Survival. The provisions of this Article XIII shall survive the expiration
or sooner termination of this Amended and Restated Ground Lease.
ARTICLE XIV
DEVELOPMENT AND CONSTRUCTION;
REPAIRS, MAINTENANCE, ALTERATIONS AND IMPROVEMENTS
Section 14.1 Construction of Project Components. Lessee shall cause the Project Components,
or the applicable Major Project Component, as the case may be, to be constructed on the
Property, pursuant to and substantially in accordance with all of the terms and conditions of the
Construction Plans and Specifications (which shall be subject to the review and approval of the
City Manager in accordance with the City Manager Approval Procedures) and all Applicable
Laws, including, without limitation, the Project Approvals (as amended from time to time). All
of the Project Components, or the applicable Major Project Component, as the case may be, shall
be constructed, maintained and operated in accordance with all Applicable Laws, including,
without limitation, Environmental Laws. The Marina Component shall include the construction,
maintenance, and operation of the public promenade in accordance with Exhibit H. Additionally,
the Master Declaration for the Project Development shall set forth in detail the responsibilities of
each Major Project Component for the construction, maintenance, and operations of all other
public areas so no public area is without those responsibilities being covered by one or more
Major Project Components.
The City has approved Flagstone Development Corporation, a Delaware corporation, as the
Construction Manager(s) for the applicable Major Project Component (collectively, the
Construction Manager(s)). Lessee may replace such Construction Manager(s) but: (i) such
replacement shall have qualifications, experience and reputation which are comparable to or
better than the respective individual(s) or entity(ies) being replaced; and (ii) the City Manager
shall have provided his or her prior written approval thereto. Any such approval shall: (i) be
given or withheld reasonably and in good faith; (ii) be delivered within fourteen (14) days after
Lessee makes a written request for approval (with a legend thereon advising City of required
turnaround time) together with information as to qualifications, background, experience and
reputation of such proposed replacement; and (iii) be deemed to have been given if Lessor does
not respond within the stated time. If the City Manager disapproves such replacement pursuant to
the foregoing procedures, the City Manager shall provide a written statement setting forth with
particularity all reasons for disapproval. The Construction Manager(s) may subcontract with
individual contractors, subcontractors and/or vendors as it deems reasonably necessary or
beneficial in connection with different components and subcomponents.
Section 14.2 Commencement and Completion of Construction.
(a) Subject to Unavoidable Delay, construction of the applicable Major Project
Components shall commence in accordance with the construction schedule set forth in
Composite Attachment 3.
(b) Once started, construction on such Major Project Component shall be diligently and
continuously pursued by Lessee until completion, subject to Unavoidable Delays. Lessee agrees
that construction of each Major Project Component shall be substantially completed in a good
and workmanlike manner and in accordance with good construction practices no later than the
dates set forth in Composite Attachment 3, subject to Unavoidable Delays (the Completion
Date). For purposes of this Agreement, each Major Project Component shall be considered
substantially completed on the date that all of the following conditions are satisfied: (i) the Major
Project Component is sufficiently completed so that the Lessee or the Major Subtenant therefor
can legally occupy and utilize such Major Project Component for its intended use; (ii) all
applicable governmental agencies having jurisdiction over the Work, as applicable, have issued a
final Certificate of Occupancy (with no unreasonable conditions), with respect thereto, including
as applicable landscaping and common areas; and (iii) completion of the Work has been
approved by the Ombudsman or the Consultant (as hereinafter defined), which approval shall be
given or withheld in good faith and shall not be unreasonably withheld, delayed or conditioned.
To the extent that the Retail and/or Parking Components share common foundations or other
construction or infrastructure with either Hotel Component, commencement of construction of
the Retail and/or Parking Components shall not be deemed commencement of construction of
either Hotel Component. However, the utilities for the Hotel Components are to be constructed
in connection with the completion of the Rtail/Parking Components as per Composite
Attachment 3.
Section 14.3 Ombudsman and Consultant.
(a) Lessor shall appoint an internal representative who is experienced and qualified to
(i) report directly to the City Manager, and (ii) have authority to coordinate, expedite and
respond for the City on behalf of the City Manager through the final permitting process (the
Ombudsman). Among other things, the Ombudsman shall (i) lead and set schedules for the
internal City review process with respect to Construction Plans and Specifications, (ii) expedite
and help deliver construction inspection approvals (including building and fire department
approvals), (iii) monitor and inspect the development and construction process on Lessors
behalf, and (iv) otherwise represent and assist the City in coordinating the Citys roles and
responses and approvals.
(b) In addition to the Ombudsman, Lessor shall, at Lessees request, retain on
Lessors behalf outside, qualified construction development and fire and building consultant(s) to
coordinate and assist in the development process and advise the Ombudsman and the City
Manager in connection therewith (collectively, the Consultant). The person(s) selected as the
Consultant shall be mutually acceptable to Lessor and Lessee. The fees and costs charged by the
Consultant (the amount of which shall be mutually acceptable to the Parties) shall be paid for by
Lessee, and Lessor shall have no responsibility or liability for same; provided, however, that the
arrangements for payment of the fees and costs and the amounts thereof shall be subject to
Lessees prior written approval before the Consultant begins any work. Responsibilities of the
Consultant shall include reviewing plans and development issues, permitting and inspection
issues during the construction and development process and making recommendations directly to
the City Manager and the Ombudsman. Lessee shall provide on-site desk, telephone and storage
space to the Consultant. The Consultant shall not serve any role in connection with the Citys
capacity as a governmental body.
(c) Lessee shall cooperate fully with the Ombudsman and the Consultant, and shall
promptly forward to same complete copies of draw requests and other reports and information
customarily provided to an institutional mortgage lender, and such other information and
materials as may be reasonably requested by the Ombudsman, the Consultant or Lessor. Lessee
agrees to provide the Ombudsman and the Consultant with access to all portions of the Property,
including, without limitation, access to inspect the Project Components, including, without
limitation, review of the preparation work and work in progress. No such inspection by the
Ombudsman and the Consultant shall impose upon Lessor responsibility or liability for any
failure by Lessee to observe any requirements or safety practices in connection with such
construction work, or constitute an acceptance of any work which does not comply with the
provisions of this Section. The Ombudsman and the Consultant shall provide copies to Lessee of
all reports and records concerning construction inspections.
Section 14.4 Landscaping and Roadways.
Lessee shall be required to install landscaping on the Property and roadways, if any, as
set forth in the Construction Plans and Specifications related to the applicable Major Project
Component. If the Project is constructed on a component by component basis, then the Master
Declaration for all Major Project Components shall set forth which Major Project Components
are responsible for the construction, maintenance, and operation of areas for landscaping and
roadways and for the traffic control of the roadways. The landscaping and roadways shall be
completed by Lessee with respect to those portions of the Property abutting the applicable Major
Project Components by no later than the date of issuance of a final Certificate of Occupancy for
such Project Components. The roadways, if any, shall be completed by the time such roadways
are needed for the particular Major Project Component(s) to Open for Business.
(a) Coordination of Horizontal Control. Final horizontal control elevation
(Horizontal Control) shall mean the lowest occupiable elevation of any Project Component,
including loading dock. Lessor acknowledges and agrees that Horizontal Control shall be
reasonably acceptable to Lessee, based on (i) reasonable and competitively priced insurance
availability, (ii) regulatory agencies approvals, (iii) financing entities approvals, (iv) feasibility
of accommodating direct connections to basement back of house of each individual component,
or in the case of the Marina, a direct access to the lower of the proposed two level marina pier,
and (v) feasibility of accommodating reasonable and customary east-west directional pedestrian
slopes at ground floors and entry and exit roadways, without the need of stairs or handicapped
ramps, in order to accommodate sheet drainage flow. Subject to applicable permitting
requirements, Lessee shall provide transition features such as drainage culverts, pumps, and/or
utility modifications, if required, at north-south transitions to roadways on the perimeter of the
Property. Such features may be located within the roadways or on adjacent City owned property.
Section 14.5 Pre-Construction Maintenance. At all times prior to construction of any
Project Components, the Property on which such Project Components are located shall be
maintained in a reasonably neat manner (taking into account the work being performed).
Section 14.6 Maintenance of Construction Site. Lessee shall maintain its construction
site in a safe condition and a reasonably orderly manner and shall, as reasonably necessary,
remove all major debris on a regular basis (including debris that has accumulated on adjacent
lands, parcels or streets if created by Lessee; it being understood that in no event shall the same
be deemed to be permission to store debris on any such adjacent lands, parcels or streets) and
store all equipment in a neat manner when not in use.
Section 14.7 Construction Traffic; Coordination.
(a) Lessee shall keep driving lanes or extension roads and pedestrian access
walkways located on or near the Property relating to the applicable Major Project Component
free from storage of equipment, building materials and dirt. Lessee may relocate roads and
walkways and barriers located within the Property to other reasonable locations with three (3)
days advance notice to the Ombudsman and the Consultant Inspector.
(b) If so requested by Lessee, Lessor may, in its discretion and for a fee to be
determined by Lessor, provide Lessee with a nonexclusive, temporary license to use other
property within Watson Island, if available (i.e., such property is not being leased by any party or
otherwise being used by Lessor) for Lessees construction-related storage or parking. Parking of
vehicles for workers within the Project shall be in accordance with Applicable Laws, and if such
parking will be on roadways, it must be done in such a manner as will not interfere with the
safety and passage of others. The surface of the public streets must be kept reasonably clean of
mud and dust brought onto the streets during construction. During the construction of the Project
Components, Lessee shall take reasonable and customary action to coordinate traffic to and from
the Property for the applicable Major Project Component, materials delivery, scheduling and
temporary access, storage and utilities.
Section 14.8 Avoidance of Nuisance. To the extent practical in connection with a
Project of this size and scope, Lessee shall take such precautions as may be reasonably necessary
to minimize the impact of noise, dust, truck traffic, nuisances and other consequences of
construction activities. Lessor may, at Lessees sole cost and expense, install a barrier or fence
around attractive nuisances if Lessee fails to do so within ten (10) days after Lessors demand
therefor. Such construction fence may be relocated by Lessee from time to time, at Lessees
expense. Initially, such construction fence will (i) extend north from the wall of Childrens
Museum along the FDOT right-of-way to the Intracoastal, and (ii) be an eight (8) feet high chain
link fence, in order to minimize resistance and avoid the necessity of removal during hurricane
warnings; provided that such fence shall have a decorative cover which shall shield the
construction site from view from the MacArthur Causeway. Such cover must be detached during
a hurricane warning.
Section 14.9 Other Construction. Lessee expects Lessor, to the extent it has the legal
right to do so, to assist in causing other developments and construction on Watson Island to be
accommodating when necessary for Lessees development and construction. Lessee
acknowledges, recognizes and agrees, however, that: (a) the development and construction of
other projects on Watson Island may occur simultaneously with the development and
construction of the Project, and the development and construction of the Project will not
materially interfere with other projects on Watson Island; (b) the cooperation and coordination
among Lessee, Lessor and the developers of other projects on Watson Island shall be necessary
with respect to site access, temporary and permanent utility delivery and other construction-
related activities; (c) Lessee shall comply with all schedules and procedures established by
Lessee and Lessor with respect to the foregoing; and (d) occasional delays with respect to site
access, temporary and permanent utility delivery and other services may occur from time to time
during the development and construction of the various projects on Watson Island (although
same may constitute Unavoidable Delays subject to and in accordance with the terms and
conditions of the Lease). Lessee shall be responsible for compliance with all of the foregoing
requirements and for ensuring that all of its contractors, subcontractors, agents, employees and
workers comply with the same.
Section 14.10 Payment and Performance Bond. If Lessee fails to commence and/or
complete construction timely and perform all other construction obligations in accordance with
the terms of this Section, Lessor may (in its good faith, reasonable judgment and not thereby
waiving any other remedies hereunder), subject to the rights of all Approved Mortgagees, elect to
make effective all or any portion of the Payment and Performance Bond (as defined in the
Amended and Restated Agreement to Enter into Ground Lease between the Parties having an
effective date of February 1, 2010) applicable to that Major Project Component as satisfaction of
Lessees failure to perform its obligations hereunder. Upon completion of Construction of each
Major Project Component substantially in accordance with the Construction Plans and
Specifications, and performance by Lessee of all other construction obligations hereunder for
that Major Project Component, the Payment and Performance Bond (or such remaining lesser
portion thereof) applicable to that Major Project Component shall be returned to Lessee. Use of
a Payment and Performance Bond by Lessor shall be in addition to all other remedies of Lessor
hereunder, which remedies are cumulative and non-exclusive.
Section 14.11 Damage to Other Improvements; Interference. Construction and other
activities conducted by Lessee shall not result in any damage to any improvements constructed
by Lessor or other private developers on Watson Island, and shall not unreasonably interfere
with adjacent parties rights of access to and from their developments. Lessee shall indemnify,
defend and hold harmless Lessor, other private developers on Watson Island and all Lessor
Indemnified Parties from and against any and all claims, damages, expenses (including
reasonable attorneys fees and court costs) and liabilities of any nature whatsoever asserted
against, or incurred by the same, in connection with any damage to improvements constructed by
Lessor or other private developers on Watson Island on account of such construction and other
activities conducted by Lessee.
Section 14.12 Underground Utilities. Lessee shall cause, at its sole cost and expense, the
utility lines on the south side of Watson Island pertaining to the Property to be installed
underground (whether or not such utility lines are located within or outside of the Property
boundaries) up to FDOT right-of-way and to the north wall of the Childrens Museum (this line
continuing west to point of intersection with the Visitors Center). In the event that the Lessor
relocates any existing above-ground utility lines on the south side of Watson Island pertaining to
the Property underground prior to the execution of the Lease and same are pre-approved in
writing by Lessee (including, but not limited to, all necessary drawings, budgets, schedules, etc.),
then upon terms to be agreed upon prior to such relocation, Lessee shall reimburse the Lessor for
the costs incurred by Lessor in connection with such underground relocation. Lessor shall
cooperate with Lessee to the extent Lessee can obtain or deliver the aforesaid facilities at a cost
saving to Lessee and with no adverse effect to Lessor.
Section 14.13 Liability. Lessor shall not be responsible or liable in damages (whether
direct, indirect, consequential or otherwise) to any Person arising out of or in connection with
any defects in the Construction Plans and Specifications or any revisions thereto approved in
accordance with the City Manager Approval Procedures, any loss or any damage to any Person
arising out of the approval or disapproval of the Construction Plans and Specifications, any loss
or damage arising from non-compliance of the Construction Plans and Specifications with any
Applicable Laws, or any defects in construction of the Project Components on the Property by
Lessee. The City Managers approval of the Construction Plans and Specifications shall not be
considered to be permission to encroach on any other parcel or to interfere with another property
owners or occupants right to use and enjoy other parcels not within the Property. Unless
caused by Lessors own gross negligence or willful misconduct, Lessor shall not be responsible
for any injury or damage to any property or to any Person happening on, in or about the Property,
nor for any injury or damage to the Property or the Project Components, and Lessor shall not in
any event be responsible for damages to vehicles and their contents, belonging to Lessee or any
other Person or for damages suffered by merchandise, furniture, improvements or other things of
value found on or in the vicinity of the Property.
Section 14.14 Entrance Road. Lessee agrees to design, construct and maintain, at
Lessees sole cost and expense, an entrance road for the Project across a portion of Watson
Island. The configuration of such entrance road shall be substantially as shown in Exhibit 14.14.
Prior to commencing the construction of such entrance road, Lessee shall prepare Construction
Plans and Specifications for such entrance road, which Construction Plans and Specifications
shall be subject to Lessors prior written approval in accordance with the terms hereof. Lessor
shall grant to Lessee such temporary easement over (or otherwise permit Lessee to have access
to) such areas of Watson Island as are reasonably required by Lessee to complete the
construction of such entrance road. The construction of the Entrance Road shall be completed by
the Completion Date of the first Major Project Component. Upon the completion of such
construction, Lessor shall, in accordance with Applicable Laws, elect either: (i) to cause such
entrance road to be dedicated (by deed of conveyance) to the perpetual use of the public; or (ii)
to grant to Lessee, all Major Subtenants, all Space Tenants, all holders of Approved Time Share
Licenses and other occupants and users of the Property and/or the Leasehold Improvements, and
all of their guests, invitees, employees, agents, contractors (and other Persons typically granted
such rights), as appropriate, together with the successors and assigns of all such Persons, an
easement over, across and upon such entrance road for ingress and egress to and from the
Property and the Leasehold Improvements, and an easement over, across and upon such entrance
road and areas adjacent thereto for the maintenance and repair of such entrance road from time to
time.
Section 14.15 Joinders. Provided that Lessor does not incur any liability or expense of
account thereof, Lessor agrees to give its reasonable cooperation to Lessee with respect to (and if
necessary or appropriate, join in and consent to) any applications for Project Approvals or other
licenses, authorizations or permits from any Governmental Authorities requested by Lessee from
time to time.
Section 14.16 Maintenance and Repair.
(a) Maintenance. Throughout the Lease Term, Lessee shall, at Lessees sole cost and
expense, maintain or cause to be maintained in a first-class, good, clean, safe and orderly
condition and repair the Property and the Leasehold Improvements relating to the applicable
Major Project Component(s) as set forth in the Master Declaration. Such maintenance for the
Marina Component shall include, without limitation, maintenance of the docks, seawalls and
submerged areas, subject to Lessees obtaining such permits, approvals and authorizations from
all applicable Governmental Authorities as are necessary to perform such maintenance of such
docks, seawalls and submerged areas.
(b) Repairs. Throughout the Lease Term, Lessee shall, at Lessees sole cost and
expense, promptly make or cause to be made to the Leasehold Improvements, relating to the
applicable Major Project Component(s) as set forth in the Master Declaration, all necessary
repairs, renewals and replacements, interior and exterior, structural and nonstructural, whether
made necessary or caused by fire or other casualty (but subject to the provisions of Article XVI),
or by ordinary wear and tear. All repairs, renewals and replacements shall be of good quality
sufficient for the proper maintenance and operation of the Leasehold Improvements relating to
the applicable Major Project Component(s) as set forth in the Master Declarationand shall be
constructed and installed in compliance with all Applicable Laws.
(c) Removal of Dangerous Condition. Promptly after receiving written notice from
Lessor or any other Person of any dangerous condition from time to time existing on the Property
relating to the applicable Major Project Component(s) as set forth in the Master
Declaration,Lessee shall, at Lessees sole cost and expense, do or cause to be done all things
necessary to remove such condition, including, but not limited to, taking appropriate measures to
prevent or repair any erosion, collapse or other unstable condition on the Property.
(d) Accumulation of Debris. Lessee shall not permit the accumulation of waste, dirt,
rubbish, debris or refuse matter upon the Property or the Leasehold Improvements relating to the
applicable Major Project Component(s) as set forth in the Master Declaration.
(e) Insurance. Lessee shall not permit anything to be done upon the Property or the
Leasehold Improvements relating to the applicable Major Project Component(s) as set forth in
the Master Declaration., which would invalidate or prevent the procurement of all insurance
policies required pursuant to the provisions of Article XI.
(f) No Lessor Repair or Maintenance Obligations. Nothing contained in the Lease
shall impose on Lessor the obligation to make any repairs or expend any monies for the
maintenance of the Property, or the renewal, replacement or repair of the Leasehold
Improvements; provided, however that if Lessee fails to do any of the foregoing in accordance
with the terms of this Amended and Restated Ground Lease, then Lessor, upon reasonable prior
written notice to Lessee, may elect, in its sole discretion, to perform or cause the same to be
performed on Lessees behalf, and all of the costs and expenses reasonably incurred by Lessor in
connection with the same shall be deemed to be additional Rent due from Lessee to Lessor
hereunder.
Section 14.17 Alteration and Modification to Leasehold Improvements After Completion
of Leasehold Improvements.
(a) Definition of Terms. For purposes of this Section 14.17, the following terms
shall have the meanings attributed to them below:
(i) Exterior Alterations means any alteration or addition to any Project
Component (from that which was originally constructed pursuant to the Development Plans)
which: (i) results in a material change to the original exterior elevation, design or overall
appearance of such Project Component (including the basic landscaping scheme thereof); and (ii)
is visible from the MacArthur Causeway; provided, however, that such term shall not include
periodic maintenance activities such as replanting, repainting exteriors and replacing damaged,
worn or obsolete fixtures.
(ii) Major Interior Alterations means any alteration or addition to any
Project Component (whether done as a single project or as a series of projects within a twelve
(12) month period) whose cost exceeds ten percent (10%) of the Fair Market Value (as defined in
Section 6.1) of such Major Project Component immediately prior to the commencement of such
alteration or addition.
(b) City Manager Approval. Lessee shall not make or permit any Exterior Alterations
or Major Interior Alterations to be made unless and until detailed plans and specifications for
same have been approved in writing by the City Manager, in accordance with the City Manager
Approval Procedures.
14.18 Removal of Liens.
(a) With respect to the liens listed on Exhibit 9.2.1 attached hereto as of the Effective
Date of this Agreement (collectively, the Existing Liens), Flagstone shall either discharge all
existing liens and alleged liens, judgments and garnishments as required by Attachment 3,
Section IX, Section 9 herein, and Section 2(c) of the Amended and Partial Modification or
deliver to the Miami-Dade County Clerk of Courts Registry, to be held in an escrow account as
follows: (a) under Section 2(c) under the Amended Partial Modification an amount not less than
one hundred twenty five percent (125%) of all judgments not previously discharged on or before
January 17, 2012; and (b) under Section IX of Attachment 3, an amount not less than the total
remaining outstanding balance of all liens, garnishments and judgments not previously
discharged within one hundred and twenty (120) days from September 15, 2011, as set forth in
Composite Attachment 3. If Flagstone elects to discharge all existing and alleged liens,
judgments and garnishments prior to the execution of this Agreement, Flagstone shall provide
satisfactory evidence of such discharges to the City prior to this Agreement being executed. The
escrow amount shall remain until the first Ground Lease is executed. Such escrow deposit
amount shall be incremented as and if necessary to cover any alleged additional liens, claims of
liens, judgments, and garnishments.
(b) After the Effective Date of the Amended and Restated Agreement to Enter
(except as provided in 9.2.1 thereof for Existing Liens) and during the term thereafter of this
Amended and Restated Ground Lease, if any Lien shall at any time be filed against the Property,
or any part thereof, within forty-five (45) days after notice of filing thereof, Flagstone shall cause
the same to be discharged, removed, or transferred to bond in accordance with the requirements
of law. If Flagstone fails to cause such Lien to be discharged or transferred to bond within such
forty-five (45) day period, then City may, but shall not be obligated to, discharge the same either
by paying the amount claimed to be due or by procuring the discharge of such Lien by deposit or
by bonding proceedings, or by any other manner permitted by law (provided, however, that
before City pays any amounts on behalf of Flagstone in connection herewith, City shall provide
Flagstone five (5) days prior written notice of its intent to so do so hereunder). Any amount so
paid by City and all costs and expenses incurred by City in connection with the discharge of such
Lien shall be reimbursed to City by Flagstone, together with interest thereon at the highest lawful
rate permitted by law from the date of Citys making of any such payment or incurring of any
such costs and expenses until paid in full. City shall notify Flagstone in writing of the dates and
amounts of any such payments and related interest rates thereon, and Flagstone shall reimburse
City within seven (7) calendar days following receipt of such notification.
(c) As required by City Commission Resolution No. 10-0144 adopted March 25, 2010,
Flagstone has provided the Hold Harmless and Indemnification Agreement attached hereto and
incorporated hereby as Exhibit 14.18. Any default by Flagstone under the Hold Harmless and
Indemnification Agreement shall be an Event of Flagstones Default under the Amended and Restated
Agreement to Enter and an Event of Lessees Default under the related Ground Lease(s).
ARTICLE XV
LESSORS RIGHT TO PERFORM LESSEES COVENANTS; REIMBURSEMENT OF
LESSOR FOR AMOUNTS SO EXPENDED
Section 15.1 Performance of Lessees Covenants to Pay Money. Lessee covenants that
if it shall at any time default in the payment of any Impositions pursuant to the provisions of
Article X, or shall fail to make any other payment to any third party required to be paid
hereunder, and any such failure shall continue for thirty (30) days after written notice by Lessor
to Lessee (Notice of Non-Payment of Imposition), then Lessor may, but shall not be
obligated to, and without further notice to or demand upon Lessee and without waiving or
releasing Lessee from any obligations of Lessee set forth in this Amended and Restated Ground
Lease, pay any such Imposition or make any other payment which Lessee has improperly failed
to pay as set forth in the Notice of Non-Payment of Imposition. No such action shall be taken,
however, if Lessee is duly contesting the payment of same as permitted by the provisions hereof,
including, but not necessarily limited to, contests pursuant to Section 7.1, Section 10.3 and
Section 18.6.
Section 15.2 Lessors Right to Cure Lessees Default. Notwithstanding anything herein
to the contrary, if there shall be any default by Lessee, beyond notice and any applicable cure
period, under this Amended and Restated Ground Lease, any Approved Mortgage or any Major
Sublease (including, but not limited to, any default involving Lessees failure to keep the
Leasehold Improvements in good condition and repair, to make any renewals or replacements or
to remove any dangerous condition, all in accordance with any applicable requirements set forth
in this Amended and Restated Ground Lease), then upon prior written notice to Lessee, Lessor
may, but shall have no obligation to, cure any such default in addition to any and all of Lessors
other remedies hereunder.
Section 15.3 Reimbursement of Lessor and Lessee. All sums advanced by Lessor
pursuant to the provisions of Sections 15.1 and Section 15.2, and all necessary and incidental
costs, expenses and reasonable attorneys fees in connection with the performance of any acts
described therein, together with interest at the Default Rate from the date of the making of such
advances to the date reimbursed to Lessor by or behalf of Lessee, shall be deemed additional
Rent, and shall be promptly paid by Lessee, in the respective amounts so advanced, to Lessor.
Such reimbursement shall be made on demand, or, at the option of Lessor, may be added to any
Rent then due or becoming due under this Amended and Restated Ground Lease, and Lessee
covenants to pay the sum or sums with interest as provided above. In the event of nonpayment
of such reimbursement, Lessor shall have, in addition to any other right or remedy of Lessor, the
same rights and remedies as in the case of default by Lessee in the payment of any installment of
Rent (subject to the applicable notice and cure period hereunder for non-payment of Percentage
Rent).
ARTICLE XVI
DAMAGE OR DESTRUCTION
Section 16.1 Definitions of Terms. For the purposes of this Article XVI, the following words
(a) Casualty means any casualty to the Leasehold Improvements or any portion
thereof.
(b) Damage means any damage to the Leasehold Improvements or any portion
thereof on account of a Casualty.
(c) Net Insurance Proceeds means the actual amount of insurance proceeds paid
following a Casualty, less all costs and expenses, including reasonable attorneys fees incurred
by Lessee, any affected Major Subtenant and/or Lessor, with respect to the collection thereof.
(d) Restoration Work means the repair, restoration or replacement of that portion of
the Leasehold Improvements which has sustained Damage.
(e) Insurance Trustee means an insurance trustee mutually acceptable to Lessor,
Lessee, and any Approved Mortgagee having an interest in any Net Insurance Proceeds which
are to be used for completing any Restoration Work.
(f) Insurance Escrow Agreement means any escrow agreement among an
Insurance Trustee, Lessor, Lessee and any Approved Mortgagee having an interest in any Net
Insurance Proceeds which are to be used for completing any Restoration Work, which escrow
agreement provides for such Net Insurance Proceeds and any another funds deposited for the
purpose of completing such Restoration Work to be deposited in escrow with such Insurance
Trustee and to be disbursed to fund the completion of such Restoration Work, all under such
terms, conditions and procedures as are set forth therein.
(g) New Loan means any new Approved Permanent Loan obtained by Lessee or
any affected Major Subtenant from an Approved Lender for the purpose of completing any
Restoration Work.
Section 16.2 Net Insurance Proceeds; Obligation to Fund Restoration Work.
(a) Adjustment of Net Insurance Proceeds. Upon the occurrence of any Damage,
Lessee shall promptly and diligently pursue the adjustment of any applicable insurance and take
reasonable measures to require any affected Major Subtenant to do the same, to the end that all
applicable Net Insurance Proceeds shall be made available to complete the applicable
Restoration Work.
(b) Rights of Approved Mortgagees. If any Approved Leasehold Mortgagee or
affected Approved Major Subleasehold Mortgagee shall have entered into a Subordination, Non-
Disturbance and Attornment Agreement, or comparable agreement, with Lessor, providing for
rights to receive and/or control the disbursement of such Net Insurance Proceeds, such rights
shall control over the provisions of this Amended and Restated Ground Lease. In such event, to
the extent that any such Approved Leasehold Mortgagee or Approved Major Subleasehold
Mortgagee agrees to permit such Net Insurance Proceeds to be used for such Restoration Work,
all such sums shall be deposited with an Insurance Trustee pursuant to an Insurance Escrow
Agreement.
(c) Insurance Trustee. The Insurance Trustee may (but shall not be required to) be an
Approved Mortgagee. Each Approved Leasehold Mortgagee may elect to be the Insurance
Trustee in the order of the priority of the applicable Approved Leasehold Mortgages. If no such
Approved Leasehold Mortgagee elects to be the Insurance Trustee, then each affected Approved
Major Subleasehold Mortgagee may elect to be the Insurance Trustee in the order of the priority
of the applicable Approved Major Subleasehold Mortgages.
(d) New Loan. If any Approved Leasehold Mortgagee or Approved Major
Subleasehold Mortgagee does not permit all or any portion of the Net Insurance Proceeds to be
applied to the Restoration Work, Lessee or the affected Major Subtenant shall nonetheless be
required to cause the Restoration Work to be performed and shall deposit funds adequate to fund
the Restoration Work with an Insurance Trustee pursuant to an Insurance Escrow Agreement;
provided, however, that Lessee or such Major Subtenant may elect to obtain a New Loan for
such purposes, in which event Lessee or such Major Subtenant shall use prompt and diligent
efforts to obtain such New Loan.
(e) Other Shortfalls. To the extent that the Net Insurance Proceeds are inadequate in
amount to fund the completion of such Restoration Work for reasons other than those described
in subparagraph (d) above, Lessee or any affected Major Subtenant shall be required to fund such
shortfall, including, without limitation, a shortfall related to a deductible in the applicable
insurance policy. Such shortfall shall be deposited with an Insurance Trustee pursuant to the
applicable Insurance Escrow Agreement within sixty (60) days of the date of adjustment of Net
Insurance Proceeds, unless the parties thereto agree to any alternative mechanism for funding
such shortfall.
Section 16.3 Restoration Work.
(a) Plans. Lessee shall diligently proceed to cause plans and specifications for the
Restoration Work, together with a proposed construction schedule, to be prepared and submitted
to the City Manager. Such plans and specifications shall be designed to restore the Property to
substantially the condition prior to such Damage, or as similar as is practicable and reasonable.
Unless such plans and specifications are materially different from original Construction Plans
and Specifications applicable to the portion of the Leasehold Improvements to be restored, the
City Manager shall have no approval rights with respect to such plans and specifications. If such
plans and specifications are materially different from such original Construction Plans and
Specifications, then same shall be subject to the City Managers approval in accordance with the
City Manager Approval Procedures.
(b) Completion of Restoration Work.
(i) After: (A) such submission and approval, if applicable, of such plans and
specifications; (B) the applicable Insurance Escrow Agreement has been entered into and the
applicable Net Insurance Proceeds and other funds deposited have been deposited with the
applicable Insurance Trustee or otherwise made available for disbursement in accordance with
such Insurance Escrow Agreement; and (C) any necessary permits have been obtained from
applicable Governmental Authorities (which permits Lessee or any affected Major Subtenant
shall use diligent efforts to obtain), Lessee or such affected Major Subtenant shall complete such
Restoration Work, all subject to and in accordance with such requirements and conditions as an
applicable Approved Leasehold Mortgagees and Approved Major Subleasehold Mortgagees, if
any, may impose in accordance with the applicable Approved Leasehold Mortgages and
Approved Major Subleasehold Mortgages and the Insurance Escrow Agreement.
(ii) Lessee or the affected Major Subtenant shall commence the Restoration
Work on such date (the Restoration Commencement Date) as the Insurance Trustee or any
Approved Lender making the New Loan, if applicable, first begins disbursing portions of such
Net Insurance Proceeds or loan proceeds to Lessee for such purpose (it being understood that
such disbursement may be conditioned upon such requirements as any such Approved Leasehold
Mortgage or Approved Major Subleasehold Mortgagee may be entitled to impose).
(iii) The Insurance Escrow Agreement shall provide, among other things, that
the applicable Insurance Trustee shall, with written notice thereof to all parties thereto, disburse
the Net Insurance Proceeds and other available funds as the Restoration Work progresses upon
certificates of the architect or engineer supervising the Restoration Work that the disbursements
then requested, plus all previous disbursements, do not exceed the cost of the Restoration Work
already completed and paid for, and that the balance in the escrow fund, plus any amounts to be
contributed by Lessee, is sufficient to pay for the reasonably estimated cost of completing the
Restoration Work; provided, however, that the foregoing funds in balance requirement may be
superseded by any similar requirement which any Approved Mortgagee is entitled to impose.
(iv) Subject to Unavoidable Delays, Lessee shall, from and after the
Restoration Commencement Date, diligently and in good faith prosecute such Restoration Work
to completion.
(v) Subject to the rights of any Approved Mortgagee, any Net Insurance
Proceeds remaining after completion of and payment for such Restoration Work shall be
disbursed to and be the sole property of Lessee.
Section 16.4 Termination. Notwithstanding the provisions of Section 16.3, if any
Damage occurs with ten (10) years of the end of the then applicable Lease Term and the budget
for the Restoration Work is, as to any particular Major Project Component, greater than Three
Percent (3%) of the replacement cost for such Major Project Component, Lessee may, by giving
written notice thereof to Lessor with ninety (90) of the adjustment of any applicable insurance,
terminate this Amended and Restated Ground Lease, effective as of the date of the Casualty;
provided, however, that any such termination shall be subject to the prior written consent of any
Approved Leasehold Mortgage. Upon any such termination of this Amended and Restated
Ground Lease: (i) Lessee shall remain obligated to pay to Lessor all Base Rent, Percentage Rent
and other sums accruing under this Amended and Restated Ground Lease to (but not including)
the date of the Casualty; (ii) the Parties shall be relieved of all further obligations under this
Amended and Restated Ground Lease, other than those obligations which expressly survive such
termination; and (iii) any applicable Net Insurance Proceeds shall be applied as follows: (A)
first, to pay any principal, interest and other sums owed to each and every Approved Leasehold
Mortgagee and any affected Approved Major Subleasehold Mortgagee; (B) second, to pay for
the cost for debris removal; and (C) third, to pay any accrued and unpaid liabilities of Lessee
under this Amended and Restated Ground Lease to the date of termination. The remaining
balance of such Net Insurance Proceeds shall be allocated between Lessor and Lessee in
accordance with their respective interests in the Project.
Section 16.5 No Other Right to Terminate. Except for Lessees right to terminate this
Amended and Restated Ground Lease pursuant to Section 16.4 above, Lessee waives the
provisions of any Applicable Law which may grant Lessee the right to terminate this Amended
and Restated Ground Lease in the event of a Casualty.
Section 16.6 Rights of Approved Leasehold Mortgagee. The provisions of this Article
XVI shall be subject to the rights of any Approved Leasehold Mortgagee and to the provisions of
any Approved Leasehold Mortgage, and in the event of any conflict between the provisions of
this Article and the provisions of any Approved Leasehold Mortgage, the provisions of the
Approved Leasehold Mortgage shall control.
Section 16.7 Major Subleases. Lessee shall cause each Major Sublease to contain
comparable casualty provisions as those set forth in this Article XVI with respect to each Major
Project Component; provided, however, that each such Major Sublease may, but shall not be
required to, have provisions comparable to Section 6.8 below. Lessor agrees that any such
comparable provisions shall be binding upon Lessor.
Section 16.8 Deferral of Base Rent. No Abatement of Base Rent or Percentage Rent.
Lessees obligations with respect to the payment of Base Rent and/or Percentage Rent shall in no
event be abated on account of any Casualty, but Base Rent and Percentage Rent, as to any
portion of the Leasehold Improvements which has sustained Damage, shall be deferred upon the
terms and conditions set forth in subparagraph (b) below.
(a) Deferral of Base Rent and Percentage Rent. If, during any period from and after
the occurrence of a Casualty and until the applicable Restoration Work has been completed and
the applicable portion of the Leasehold Improvements once again Opens for Business: (i) Lessor
does not receive sufficient insurance proceeds under any business interruption insurance policy
to cover the Base Rent and/or Percentage Rent payable during such period; and (ii) any failure by
Lessor to receive such insurance proceeds is not due to Lessees failure to maintain same in
accordance with Section 11.1(b), Lessee shall be entitled, during the Deferral Period (as
hereinafter defined) to defer the payment of Base Rent and Percentage Rent not covered by such
business interruption insurance proceeds. In addition, Lessee shall not be required to pay any
Base Rent and/or Percentage Rent to the extent Lessor receives business interruption insurance
proceeds covering same. The term Deferral Period shall mean the period of time
commencing when the Casualty occurs and ending on the date when the applicable Restoration
Work has been completed and the applicable portion of the Leasehold Improvements once again
Opens for Business, or on such earlier date as Lessee shall have received any written notice from
any applicable insurance company in the form of a pleading or similar document whereby such
insurance company specifically rejects Lessees claim for such insurance. The amount of Base
Rent and Percentage Rent so deferred during the Deferral Period is hereinafter collectively
referred to as the Deferred Amount.
(b) Resumption of Payments. Once the Deferral Period ends, Lessee shall pay each
month, together with the Base Rent and Percentage Rent then due and payable, an amount equal
to fifty percent (50%) of a fraction, the numerator of which is the total Deferred Amount and the
denominator of which is the number of months of the Deferral Period. Such monthly
installments of the Deferred Amount shall continue until the Deferred Amount is paid in full.
ARTICLE XVII
ARBITRATION
Section 17.1 Binding Arbitration. Any controversy, dispute or breach arising out of or
related to this Amended and Restated Ground Lease (including all monetary and non-monetary
matters) shall be submitted to binding arbitration in accordance with the provisions of this
Article XVII; provided, however, that no such controversy, dispute or breach with respect to the
payment of Base Rent or Percentage Rent shall be submitted to binding arbitration. The matters
to be submitted to binding arbitration in accordance with this Article XVII shall include, without
limitation: (i) whether Lessor or Lessees actions hereunder are reasonable where this
Amended and Restated Ground Lease requires such actions to be reasonable; and (ii) whether
either Party has complied with any provisions hereof requiring that any approval by such Party
"shall not be unreasonably withheld or delayed".
Section 17.2 Procedures. Any binding arbitration pursuant to this Article XVII shall
be governed by the following procedures:
(a) Demand. Either Party (the Demanding Party) may make written demand upon
the other Party (the Non-Demanding Party) to commence arbitration. Such demand shall
include a statement of the question to be arbitrated.
(b) Selection of Proposed Arbitrators. Upon any such demand being made by either
Party, the Demanding Party shall, within five (5) Business Days thereafter, make a written
request to the President of the Florida Chapter of the American Arbitration Association that he or
she independently provide, within thirty (30) days after such request is made, a list (the List of
Proposed Arbitrators) with the names and addresses of eleven (11) proposed arbitrators (the
Proposed Arbitrators). The Non-Demanding Party shall be copied on any such written
request.
(c) Qualifications. Every Proposed Arbitrator must be a member of the American
Arbitration Association or any successor organization and be neutral and independent of the
Parties, and no Proposed Arbitrator shall: (i) be a person who is or has been an employee of
either Lessor or Lessee during the five (5) year period immediately preceding his or her
appointment; (ii) be affiliated with either Parties' auditors; (iii) be affiliated with any contractor
of Lessee; or (iv) have a conflict of interest with either Party or any bias towards or against either
Party.
(d) Selection of Arbitrator. Within three (3) Business Days after its receipt of the List
of Proposed Arbitrators, the Non-Demanding Party shall give written notice to the Demanding
Party of three (3) Proposed Arbitrators that the Non-Demanding Party strikes from the List of
Proposed Arbitrators. Within three (3) Business Days after its receipt of such written notice, the
Demanding Party shall send written notice to the Demanding Party of three (3) additional
Proposed Arbitrators that the Demanding Party strikes from the List of Proposed Arbitrators.
Commencing with the Non-Demanding Party, each Party shall thereafter have successive one (1)
Business Day periods in which to strike one (1) additional Proposed Arbitrator from the List of
Proposed Arbitrators, until there is only one (1) Proposed Arbitrator remaining on the List of
Proposed Arbitrators. The remaining Proposed Arbitrator shall constitute the sole arbitrator
hereunder (the Arbitrator). Neither Party shall be required to have or provide a reason for
striking a particular Proposed Arbitrator. If either Party fails to strike a Proposed Arbitrator
within the time specified above, then the other Party may exercise the unused strike or strikes
prior to its next strike or strikes.
(e) Code of Ethics. The Arbitrator 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.
(f) Hearing. Within thirty (30) days following the selection of the Arbitrator, the
Arbitrator shall commence a hearing in accordance with the following procedures:
(i) All actions, hearings and decisions of the Arbitrator shall be conducted,
based upon and made in accordance with the Commercial Arbitration Rules (or in the case of
construction related issues, the Construction Industry Rules) of the American Arbitration
Association or any successor organization, or any other rules then prevailing in substitution of
such rules.
(ii) The Parties shall be entitled to such pre-hearing discovery as they may
agree upon, or as otherwise determined by the Arbitrator.
(iii) Each Party shall make a good faith effort to cooperate with the other in all
respects in connection with the exchange of documents relevant to the matter being arbitrated.
(iv) To the extent that either Party would be required to make confidential
information available to the other Party, an agreement or an order shall be entered in the
proceeding protecting the confidentiality of and limiting access to such information before such
Party is required to produce such information. Information produced by either Party shall be
used exclusively in the arbitration or litigation that may arise, and shall not otherwise be
disclosed.
(v) A court reporter shall make a transcript of the hearing.
(vi) The hearing shall be held in the City of Miami at a place designated by the
Arbitrator.
(vii) The Parties and the Arbitrator shall use their best efforts to conclude the
hearing within ten (10) days of its commencement.
(viii) Each Party shall have the right to be represented by counsel, to call
witnesses and to cross-examine witnesses on the question at issue, and to submit evidence.
(ix) The Arbitrator shall have the right to question witnesses at the hearing, but
not to call witnesses.
(x) Each Party shall be entitled to one (1) continuance for up to a maximum
fifteen (15) days as a matter of right.
(xi) No additional request for continuance may be made in any manner to the
Arbitrator unless there has been consent given in writing by the other Party.
(xii) The Arbitrator shall not grant any continuance without a request from a
Party in compliance with this subparagraph (f).
(xiii) The Arbitrator 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
on the terms and on the schedule set by the Arbitrator, but in no event later than forty-five (45)
days following the commencement of the hearing.
(xiv) The Arbitrator shall render a determination within thirty (30) days from
the conclusion of the hearing, or in the event briefs are submitted, within thirty (30) days after
receipt of such briefs.
(xv) In determining any matter before him or her, the Arbitrator shall apply the
terms and provisions of this Amended and Restated Ground Lease, and shall not have the power
to vary, modify or reform any such terms and provisions in any respect.
(xvi) The Arbitrator shall not be authorized to make an award of consequential,
punitive or exemplary damages.
(xvii) Each Party shall bear its own fees and costs and those of the Arbitrator.
(xviii) The Arbitrator shall provide a written explanation of the basis for the
Arbitrators decision.
(xix) The Arbitrators decision shall be final and binding on the Parties and may
be enforced according to the laws of the State of Florida, and judgment upon the award rendered
by the Arbitrator shall be entered in any court having jurisdiction thereof.
Section 17.3 No Delay in Completion of Work. There shall be no interruption of Work
pending the completion of any arbitration proceeding hereunder, unless the dispute or matter
which is subject to arbitration involves the nature of the Work or whether the Work was required
by Article 14 hereof (in which case Lessee may suspend the Work until the dispute is resolved,
and same shall be deemed an Unavoidable Delay).
Section 17.4 Right of Approved Mortgage to Participate. Notwithstanding anything to
the contrary contained herein, a copy of each notice given under this Article XVII shall be given
to each and every Approved Leasehold Mortgagee, and each and every Approved Major
Subleasehold Mortgagee to the extent the matter being arbitrated involves the Major Project
Component encumbered thereby, and each such Approved Mortgagee shall have the right, upon
providing written notice to both Parties at any time prior to the commencement of the
Arbitrators hearing, to participate in the hearing and to have all rights afforded to each Party
with respect thereto. In addition, to the extent that any applicable Approved Mortgage provides
for consent rights on the part of any such Approved Mortgagee as to the selection of the
Arbitrator, Lessee shall not exercise its rights to strike any Proposed Arbitrator from the List of
Arbitrators without such Approved Mortgagees consent in accordance with the provisions of
such Approved Mortgage.
ARTICLE XVIII
MECHANICS LIENS
Section 18.1 Definition. For purposes of this Article XVIII, the term Mechanics
Lien means any mechanics, laborers, vendors, materialmans, construction or other similar
statutory lien, whether pursuant to Chapter 713, F.S., or otherwise.
Section 18.2 No Consent by Lessor. Nothing in this Amended and Restated Ground
Lease shall be construed as: (i) constituting the consent by Lessor, express or implied, by
inference or otherwise, to (or the request by Lessor for) any contractor, subcontractor, laborer or
materialman for the performance of any labor or the furnishing of any materials for any specific
improvement, alteration or repair of or to the Property or the Leasehold Improvements or any
part thereof; or (ii) giving Lessee any right, power or authority to contract for or permit the
rendering of any services or the furnishing of any materials, which, in the case of either clause (i)
or clause (ii) above, would give rise to the filing of any Mechanics Lien against Lessors fee
simple interest in the Property or any part thereof, the assets of Lessor, or Lessors interest in any
Rent.
Section 18.3 Notice of No Liability of Lessor. Notice is hereby given, and Lessee shall
cause all construction agreements, Major Subleases and Space Leases to provide, that to the
extent enforceable under Florida law: (i) Lessor shall not be liable for any work performed or to
be performed at or on the Property or the Leasehold Improvements or any part thereof for
Lessee, any Major Subtenant or any Space Tenant, or for any materials furnished or to be
furnished to the Property or the Leasehold Improvements or any part thereof for any of the
foregoing; and (ii) no Mechanics Lien for such work or materials shall attach to or affect
Lessors fee simple interest in the Property or any part thereof or any assets of Lessor or Lessors
interest in any Rent.
Section 18.4 Inclusion in Memorandum of Lease. Any short form or memorandum of
this Amended and Restated Ground Lease shall include the foregoing prohibition on Mechanics
Liens for the purposes of giving constructive notice under Section 713.10, F.S., and a copy
thereof shall be conspicuously posted on the Property.
Section 18.5 Discharge of Mechanics Liens. Lessee shall not cause, suffer or permit
any Mechanics Liens to be filed against the fee simple title to the Property, or against the
Leasehold Estate or the Leasehold Improvements by reason of any labor, services or materials
supplied or claimed to have been supplied to Lessee, any Major Subtenant or any Space Tenant.
If any such Mechanics Lien is filed, Lessee shall cause it to be discharged of record by payment,
deposit, bond (including any notice of bond in the case of any work which is covered by a
payment and performance bond), order of a court of competent jurisdiction or otherwise, within
ninety (90) days after the date Lessee has knowledge of its filing. If Lessee shall fail to do so
within such ninety (90) day period, and such failure shall continue for an additional thirty (30)
days after written notice thereof by Lessor to Lessee, then in addition to any other right or
remedy available to Lessor hereunder, Lessor may, but shall not be obligated to, discharge such
Mechanics Lien, either by paying the amount claimed to be due or by procuring the discharge of
same by deposit in court or bonding. All such amounts paid by Lessor in connection therewith,
including, without limitation, interest, costs and allowances, shall constitute additional Rent due
and payable under this Amended and Restated Ground Lease and shall be repaid to Lessor by
Lessee immediately upon rendition of an invoice or bill by Lesor.
Section 18.6 Right to Contest. Notwithstanding the provisions of Section 18.5, Lessee
shall not be required to pay or discharge any Mechanics Lien so long as Lessee shall: (i) in good
faith and with diligence proceed to contest such Mechanics Lien by appropriate proceedings; (ii)
give Lessor written notice of its intention to contest the validity of such Mechanics Lien; and
(iii) upon written request of Lessor, furnish and keep in effect a surety bond of a responsible and
substantial surety company reasonably acceptable to Lessor or other security reasonably
satisfactory to Lessor in an amount sufficient to pay One Hundred Ten Percent (110%) of the
amount of the contested lien claim with all interest on it and costs and expenses, including
reasonable attorneys fees, to be incurred in connection with it (provided, however, that no such
bond shall be required if the amount contested is less than $25,000). If, despite Lessees efforts
to contest such Mechanics Lien, Lessor reasonably believes that a court judgment or order
foreclosing such lien is about to be entered or granted and so notifies Lessee in writing, Lessee
shall, within ten (10) days of notice to such effect from Lessor (but not later than three (3)
Business Days prior to the entry or granting of judgment or order of foreclosure), cause such
Mechanics Lien to be discharged of record. If Lessee fails to do so within such period, Lessor
may thereafter discharge such Mechanics Lien and look to the security furnished by Lessee for
reimbursement of Lessors cost in so doing. Nothing contained herein shall be deemed to
prevent Lessee from contesting any action or proceeding on account of any Work for which a
Mechanics Lien was filed and thereafter bonded off or transferred to security other than the
Property or the Leasehold Improvements pursuant to Applicable Laws.
Section 18.7. Releases. To the extent permitted under Florida law, Lessee shall obtain
releases or waivers of any contractor, subcontractors and any other Persons furnishing work and
materials discharging all liens and claims for all Work and materials furnished and similar
releases from the architect or other recipient in the case of payments out of the funds to the
architect or other recipient.
ARTICLE XIX
COVENANT AGAINST WASTE; INSPECTION
Section 19.1 Waste. Except as otherwise permitted by this Amended and Restated
Ground Lease, Lessee covenants not to allow any waste (as defined by any Applicable Law) with
respect to the Property or the Leasehold Improvements or any part thereof. The provisions of
this Section 19.1 shall not apply to any demolition or disfigurement required in connection with
repairs, renovations, upgrading or new construction, or to the deposit of clean fill at the Property
or the removal of fill from the Property for such purposes.
Section 19.2 Inspection of Property.
(a) Right of Inspection. Lessor, its agents, employees and authorized representatives
may enter the Property at any time in response to an emergency, and at reasonable times upon
reasonable prior written notice, as Lessor deems necessary to, incident to, or connected with the
performance of Lessors duties and obligations hereunder or in the exercise of its rights and
functions, including, without limitation, to inspect the operation, sanitation, safety, maintenance
and use of the same, or any portions of the same, and to assure itself that Lessee is in full
compliance with its obligations under this Amended and Restated Ground Lease (but Lessor
shall not thereby assume any responsibility for the performance of any of Lessees obligations
hereunder, nor any liability arising from the improper performance thereof). In furtherance and
not in limitation of the foregoing, Lessor and its agents, employees and authorized
representatives shall have the right of access to the Property, upon reasonable prior written
notice, to conduct from time to time an ADA inspection or audit of the Property or the Leasehold
Improvements, and Lessee agrees to cooperate in the conduct of such investigation or audit.
(b) Compliance. If any inspection or audit detects a violation of Lessees obligation
to comply and to keep the Property and/or the Leasehold Improvements in compliance with the
requirements of the Lease, then Lessee shall bear the cost and take whatever action is reasonably
necessary to comply, and bring the Property and/or the Leasehold Improvements into
compliance, with this Amended and Restated Ground Lease, and any reasonable fee or cost
incurred by Lessor for such investigation or audit shall be borne by Lessee and shall be paid by
Lessee as additional Rent under this Amended and Restated Ground Lease on demand by Lessor.
(c) Action by Lessor. If Lessee fails to keep the Property or the Leasehold
Improvements in compliance with the requirements of this Amended and Restated Ground Lease
(including, without limitation, the requirement that the Property and the Leasehold
Improvements be in compliance in all material respects with the ADA) and an Event of Lessees
Default has occurred and is continuing on account thereof, then Lessor, upon reasonable prior
written notice to Lessee, may take whatever action is reasonably necessary to bring the Property
and/or the Leasehold Improvements into compliance, to the extent required by Applicable Laws.
Lessee agrees to provide Lessor access to the Property and the Leasehold Improvements and pay,
as additional Rent, all costs reasonably incurred by Lessor in bringing the Property and/or the
Leasehold Improvements into such compliance. Lessor, however, shall have no affirmative
obligation to bring the Property or the Leasehold Improvements into compliance and nothing
herein shall be construed as creating such an obligation on Lessor.
(d) Minimizing Interference with Business Operations. Any inspection or audit
described in this Section 19.2 shall be done in such a manner so as to reasonably minimize any
interference with any business operations on the Property.
set forth in this Article XIX. Lessee shall use reasonable, good faith efforts to enforce such
covenants. Nothing contained herein shall be deemed to prevent Lessee from imposing more
stringent requirements on any such Major Subtenant and/or Direct Space Tenant.
of the applicable Space Tenant which are comparable to covenants on the part of the applicable
Space Tenant as those covenants set forth in this Article XIX; and (ii) use reasonable, good faith
efforts to enforce such covenants. Nothing contained herein shall be deemed to prevent any
Major Subtenant from imposing more stringent requirements of any of its Space Tenants, or to
prevent Lessee from requiring any Major Subtenant to impose such more stringent requirements.
Article XIX on account of any breach thereof by any Major Subtenant or Space Tenant.
ARTICLE XX
ENVIRONMENTAL LIABILITY
Section 20.1 Definition of Terms. For purposes of this Article XX, the following terms
(a) Hazardous Materials means (i) petroleum and its constituents; (ii) radon gas,
asbestos in any form which is or could become friable, urea formaldehyde, foam insulation,
transformers or other materials which contain dielectric fluid containing levels of
polychlorinated biphenyls in excess of federal, state or local safety guidelines, whichever are
more stringent; (iii) any substance, gas, material or chemical which is or may hereafter be
defined as or included in the definition of hazardous substances, hazardous materials,
hazardous wastes, pollutants or contaminants, solid wastes or words of similar import
under any Environmental Law; and (iv) any other chemical, material, gas or substance, the
exposure to or release of which is regulated by any Governmental Authority.
(b) Environmental Laws means all applicable requirements relating to the
protection of human health or the Environment, including, without limitation, requirements
relating to reporting, licensing, permitting, investigation and remediation of any Release or
Threat of Release of Hazardous Materials, into the Environment, or relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous
Materials or pertaining to the protection of the health and safety of employees or the public, as
such requirements are contained in all applicable federal, state and local environmental, public
health, and safety laws, regulations, orders, permits, licenses, approvals, ordinances and
directives, now or hereafter in effect, including, but not limited to, all applicable requirements of
the Clean Air Act (42 U.S.C. 401 et seq.); the Clean Water Act; the Resource Conservation, and
Recovery Act, as amended by the hazardous and Solid Waste Amendments of 1984 (42 U.S.C.
901 et seq.); the Safe Drinking Water Act; the Comprehensive Environmental Response,
Compensation and Liability Act, as amended by the Superfund Amendments and
Reauthorization Act of 1986 (42 U.S.C. 061 et seq.); the Hazardous Materials Transportation
Act (49 U.S.C. 801 et seq.); the Occupational Health and Safety Act; the Toxic Substances
Control Act; the Federal Water Pollution Prevention and Removal Act, as amended (33 U.S.C.
251 et seq.); the Florida Pollutant Discharge Prevention and Removal Act (Florida Statutes,
Chapter 376); the Water Resources Restoration and Preservation Act; the Florida Air and Water
Pollution Control Act; the Florida Safe Drinking Water Act; Florida Environmental
Reorganization Act of 1975 (Florida Statutes, Chapter 403).
(c) Environment means soil, surface waters, groundwaters, land, stream sediments,
surface or subsurface strata and ambient air.
(d) Costs means all costs incurred in connection with correcting any violations of
any Environmental Laws and/or the Clean Up of Existing Contamination, including the Original
Phase I and II Assessments, if applicable.
(e) Existing Contamination means any Hazardous Materials revealed by the
Original Phase I and II Assessments, if applicable.
(f) Original Phase I and II Assessments means the environmental investigation and
testing on the Property undertaken by Lessee, as may be applicable, pursuant to the Access and
Indemnification Agreement between the Parties, and the Agreement to Enter into Ground Lease
between the Parties having an effective date of January 1, 2003.
(g) Release means any releasing, seeping, spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching, disposing, or dumping into the
Environment.
(h) Threat of Release means a substantial likelihood (as determined by an
environmental consultant selected by Lessee and reasonably acceptable to Lessor) of a Release
which requires action to prevent or mitigate damage to the Environment which may result from
such Release.
(i) Clean Up means any remediation and/or disposal of Hazardous Materials at or
from the Property which is ordered by any federal, state, or local environmental regulatory
agency, if necessary, to avoid injury to persons or property in connection with the Existing
Contamination, if any.
Section 20.2 Environmental Obligations of Lessee. Lessee hereby covenants and
agrees that during the Lease Term it shall not: (a) cause or permit any Hazardous Materials to be
generated, produced, brought, used, stored, treated, discharged, released, spilled or disposed of
upon, in, under or about the Property or Watson Island by Lessee or any of Lessees Affiliates, or
by any Major Subtenants or Space Tenants, or by any subsidiaries, assignees or invitees thereof,
or by any of the employees, agents, contractors or subcontractors of any of the foregoing (all the
foregoing collectively, Related Parties), which activity is, in any case, in violation of the
Environmental Laws, or (b) otherwise cause or permit the violation of any Environmental Law in
connection with the Property. Upon termination or expiration of the Lease, Lessee shall, at its
sole cost and expense, cause all Hazardous Materials, including their storage devices, placed in
or about the Property by Lessee or its Related Parties, or, at their direction, to be removed from
the Property and transported for use, storage or disposal in accordance and compliance with all
applicable Environmental Laws.
Section 20.3 Lessees Liability for Contamination During Lease Term. Lessee shall
undertake, at Lessees sole cost and expense, any necessary action, including any remediation
and/or disposal reasonably required, as determined by Lessee in good faith, as a result of a
Release of a Hazardous Material occurring on or from the Property in connection with any
activity or acts of Lessee or any of its Related Parties, during the Lease Term.
Section 20.4 Indemnity. Lessee shall defend, indemnify, and hold harmless Lessor and
its agents, officials, and employees, to the fullest extent permitted by law, from and against all
expenses of remediation, disposal or other similar type of clean up or action necessary for
compliance with the Environmental Laws, and any and all claims, causes of action, or demands,
in law or in equity, including, but not limited to, all lien claims, administrative claims, claims for
injunctive relief, claims of property damage, natural resources damages, environmental response
and clean up costs, fines, penalties, and expenses (including, without limitation, counsel fees,
consultant fees and expert fees, costs and expenses incurred in investigation and defending
against the assertion of such liabilities), which may be sustained, suffered or incurred by Lessee,
its agents, officials or employees in connection with failure by Lessee or its Related Parties to
fully comply with the provisions of this Article. The Parties acknowledge and agree that the
indemnification provided above in this Section is conditioned upon the failure of Lessee to fully
comply with the provisions of this Article and that such indemnification does not cover any
Costs of clean-up required by the presence of any Hazardous Materials on the Property or other
portions of Watson Island resulting solely from the acts or negligence of any third party or
parties other than Lessee or Lessees Related Parties.
Section 20.5 Notices. If Lessee or Lessor receives any written notice of a Release,
Threat of Release or environmental condition at the Property or a written notice with regard to
air emissions, water discharges, noise emissions, recycling, or any violation of any
Environmental Law (any such notice, an Environmental Complaint) independently or by
notice from any Governmental Authority, or with respect to any litigation regarding
environmental conditions at or about the Property, then such Party shall give prompt written
notice of the same to the other Party detailing all relevant facts and circumstances.
Section 20.6 Lessors Remedies. Promptly after becoming aware of any violation of
any Environmental Law at the Property, Lessee shall commence to remediate in accordance with
its obligations hereunder and thereafter diligently pursue the completion thereof in a reasonable
time (and in any event in accordance with Environmental Laws). If Lessee fails to do so, Lessor
may give written notice of such failure to Lessee, and if such failure continues for five (5) days
after Lessee receives such notice, Lessor shall have the right, but not the obligation, to enter onto
the Property and to take such action as it reasonably deems necessary or advisable to clean up,
remove, resolve or minimize the impact of or otherwise deal with any Hazardous Materials,
Release, Threat of Release or Environmental Complaint upon its obtaining knowledge of such
matters independently or by receipt of any notice from any Person or Governmental Authority,
and all of the reasonable costs and expenses of Lessor in connection therewith shall be deemed to
be additional Rent due from Lessee to Lessor hereunder.
Section 20.7 Phase I Environmental Assessment at End of Lease Term.
(a) End-Term Audit. At any time within the twelve (12) months before the expiration
or earlier termination of the Lease Term, upon written request by Lessor, Lessee, at Lessees sole
cost and expense, shall cause a Phase I environmental audit (the End-Term Audit) of the
Property and the Leasehold Improvements to be completed by a professional environmental
consultant approved by the City Manager. If practicable, such consultant shall be the same firm
which completed the Original Phase I and II Audits or its successor. If the End-Term Audit
indicates the presence of Hazardous Materials which were either (i) not present as indicated in
either the Original Phase I and II Assessments or (ii) if present as indicated in either or both of
such Original Phase I and II Assessments, were previously subject to and satisfied by all Clean-
Up requirements, it shall first be determined whether the presence of such contamination is due
to the acts or negligence of Lessee, Lessor, or a third party. If it is determined that the presence
of such contamination is due to the acts, omissions or negligence of Lessee and/or its Related
Parties, Lessee shall pay or cause to be paid all reasonable Costs associated with the required
remediation and clean-up.
(b) Cooperation. In the event that it is determined that neither Lessor, nor Lessee
and/or its Related Parties, is responsible for the presence of such contamination, but that the
presence of such new Hazardous Materials was caused by the acts or negligence of a third party,
Lessor and Lessee shall reasonably cooperate with each other in all matters relating to the
identification and clean-up responsibilities of such third party contaminator and its Clean-Up
responsibilities; provided, however, that such obligation to cooperate shall not be deemed to
impose on either Party the obligation to expend any funds.
set forth in this Article XX. Lessee shall use reasonable, good faith efforts to enforce such
covenants. Nothing contained herein shall be deemed to prevent Lessee from imposing more
stringent requirements on any such Major Subtenant and/or Direct Space Tenant.
of the applicable Space Tenant which are comparable to covenants on the part of the applicable
Space Tenant as those covenants set forth in this Article XX; and (ii) use reasonable, good faith
efforts to enforce such covenants. Nothing contained herein shall be deemed to prevent any
Major Subtenant from imposing more stringent requirements of any of its Space Tenants, or to
prevent Lessee from requiring any Major Subtenant to impose such more stringent requirements.
Article XX on account of any breach thereof by any Major Subtenant or Space Tenant.
Section 20.9 Survival of Lessees Obligations. The respective rights and obligations of
Lessor and Lessee under this Article XX shall survive the expiration or termination of this
ARTICLE XXI
PUBLIC UTILITY CHARGES
Section 21.1 Lessee to Provide and Pay for Utilities. Lessee shall pay, or cause to be
paid, all proper charges, including connection and tapping fees, for the use of gas, electricity,
light, heat, water, sewer, storm sewer, power, fire lines, television, cable, telephone, protective
services 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 applicable Major
Project Component on the Property and the related Leasehold Improvements or any part thereof,
at any time during the Lease Term (or its proportionate share of any such charges for any such
services supplied both to the applicable Major Project Component on the Property and the related
Leasehold Improvements and to other properties and/or improvements).
Section 21.2 Compliance with Utility Services. Lessee shall, at its sole cost and
expense, comply with all contracts relating to any utility services and do all other things required
for the maintenance and continuance of all utility services as are necessary for the proper
maintenance and operation of the Property and the Leasehold Improvements.
Section 21.3 Permits. Lessee shall, at its sole cost and expense, procure any and all
necessary permits, licenses or other authorizations required for the lawful and proper installation
and maintenance upon the Property of wires, pipes, conduits, tubes and other equipment and
appliances for use in supplying any such utility services or substitutes to the Property and the
Leasehold Improvements. Lessor shall, at no cost to Lessor, cooperate with and assist Lessee in
such endeavor.
Section 21.4 No Obligation for Utilities not on Property. In no event shall Lessee be
responsible for the installation, upgrading or alteration of any utility lines or facilities located or
to be located on any portions of Watson Island other than the Property or for the Major Project
Components it does not construct except as provided in Composite Attachment 3.
Section 21.5 Notice and Disclaimer as to Utility Services and Other Services. Lessor
(in its proprietary capacity only) shall not be required to supply any services or utilities
whatsoever to the Property or the Leasehold Improvements. However, Lessor and its successors,
assignees or franchisees may enter into contracts for the provision of services to Watson Island,
including, but not necessarily limited to, water supply, sewer, gas, electric current, cable,
television or telephone services. Neither Lessor nor any operator or concessionaire, as provider
of such service (a Service Provider), guarantees or warrants, expressly or impliedly, the
merchantability or fitness for use, or the quality of any such services. Lessee acknowledges that
neither Lessor nor any Service Provider nor any successor, assignee or franchisee thereof shall
be responsible or liable for losses, injuries or deaths resulting from such services or the failure or
interruption of such services, except to the extent any of the foregoing is caused by or arises out
of the gross negligence of Lessor or any of its agents, servants and employees. Notwithstanding
anything contained herein to the contrary, the failure of such services at any time or from time to
time shall in no event be deemed to be a defense to an Event of Lessees Default hereunder
unless the same is deemed to be in connection with a Force Majeure Event hereunder.
ARTICLE XXII
INDEMNIFICATION AND RELEASE OF LESSOR
Section 22.1 General Indemnification of Lessor Without Limitation of Any Other
Indemnity Given Hereunder. Lessee shall indemnify, defend and save harmless Lessor and
Lessors successors, permitted assigns, officials, employees and agents (the Lessor
Indemnified Parties) from and against any and all claims, actions, proceedings, damages,
losses, liabilities, costs and expenses (including, without limitation, reasonable attorneys fees
and costs) by or on behalf of any Person, arising out of, resulting from, or in any way connected
to: (i) any development, construction or other work in or about the Property and/or the Leasehold
Improvements; (ii) a hazardous condition of or present on the Leasehold Improvements and/or
Property (it being understood, however, that the matters related to Hazardous Materials shall be
governed by Article XX); (iii) any breach or default on the part of Lessee in the performance of
any of Lessees obligations pursuant to the terms of this Amended and Restated Ground Lease;
(iv) any act or negligence of Lessee or any of its officers, employees, agents, servants,
representatives, contractors, invitees, or licensees; or (v) any accident, injury, or damage caused
to any Person occurring during the Lease Term in or on the Property; provided, however, that
Lessor shall not be indemnified, defended or held harmless from any of the foregoing to the
extent caused by Lessors intentional acts or gross or wanton negligence upon the Property
(collectively, the Indemnified Matters).
Section 22.2 Defense. In case any action or proceeding is brought against Lessor by
reason of any of the Indemnified Matters, Lessee, upon sixty (60) days written notice from
Lessor, shall, at its expense, resist or defend the action or proceeding by counsel reasonably
satisfactory to Lessor.
Section 22.3 Lessors Participation. If Lessee is required to defend any action or
proceeding pursuant to this Article XXII to which action or proceeding Lessor is made a party,
Lessor shall also be entitled to appear, defend, or otherwise take part in the matter involved, at its
election, and at the sole expense of Lessor by counsel located within Miami-Dade County,
Florida of its own choosing, provided that: (i) such action by Lessor shall not limit or make void
any liability of any insurer of Lessor or Lessee with respect to the claim or matter in question;
and (ii) Lessor shall not, without Lessees prior written consent, settle any such action or
proceeding or interfere with Lessees defense or prosecution of such action or proceeding.
Section 22.4 No Limitation. The foregoing agreements of indemnity are in addition to
and not by way of limitation of any other covenants in this Amended and Restated Ground Lease
to indemnify Lessor.
Section 22.5 Challenges to Lease. Lessee acknowledges and agrees that the Watson
Island RFP, the Island Gardens Proposal, the Agreement to Enter Into Ground Lease between the
Parties having an effective date of January 1, 2003, and this Ground Lease may be challenged by
private third parties for various reasons. Lessee further acknowledges and agrees that: (i) Lessor
shall have no liability whatsoever to Lessee or any Investors (as defined in Article VIII) in
Lessee and/or the Project in connection with any such challenge, and Lessee hereby forever
waives and releases Lessor from any such liability, now or hereafter arising; and (ii) Lessee
shall, at its expense, undertake the defense of (but not indemnify Lessor against) any action
brought against Lessor seeking to set aside or invalidate this Amended and Restated Ground
Lease on the theory that this Amended and Restated Ground Lease constitutes a material
deviation from the Watson Island RFP and/or the Island Gardens Proposal. Lessor may
participate in any such defense, but neither Party shall settle or compromise any such action
without the prior written consent of the other Party.
Section 22.6 Survival. The provisions of this Article XXII shall survive the expiration
or sooner termination of this Amended and Restated Ground Lease.
ARTICLE XXIII
LIEN FOR RENT AND OTHER CHARGES
Section 23.1 Lien for Rent. Subject to the limitations set forth in Section 23.3, the
whole amount of the Rent, and each and every installment, and the amount of all taxes,
assessments, water rates, insurance premiums and other charges and Impositions paid by Lessor
under the provisions of this Amended and Restated Ground Lease, and all costs and reasonable
attorneys fees which may be incurred by Lessor in enforcing the provisions of this Amended
and Restated Ground Lease or in carrying out any of the provisions of this Amended and
Restated Ground Lease, shall be and are deemed to constitute a valid lien upon the Leasehold
Improvements and the Leasehold Estate, which lien may be enforced by all remedies available at
law and in equity.
Section 23.2 Other Liens. Subject to the limitations set forth in Section 23.3, Lessor
shall be entitled to have and enforce any and all common law, statutory or other liens for non-
payment of Rent or other sums due hereunder. To the extent that any such liens would not
otherwise be subject to the limitations set forth in Section 23.3, Lessor hereby irrevocably
waives same.
Section 23.3 Limitations. All of the liens described in this Article XXXIIIIXXIII shall
be subject to the following limitations: (i) each such lien shall, for all purposes and in all
respects, be subject and subordinate to the lien, operation, effect, terms and provisions of any
Approved Mortgage and to the rights of any Approved Mortgagee, and no such lien may be
enforced against any portion of the Leasehold Improvements or the Leasehold Estate at any time
such portion is encumbered by any Approved Mortgage without the applicable Approved
Mortgagees prior written consent in its sole discretion; (ii) no such lien shall attach to or be
enforceable against any portion of the Project subject to any Approved Time Share Licenses; (iii)
no such lien shall attach to or be enforceable against any Personal Property which is owned by an
equipment lessor or other third party lessor of Personal Property and leased to Lessee, any Major
Subtenant, any Space Tenant or any other Person; (v) each such lien shall, for all purposes and in
all respects, be subject and subordinate to the lien and security interest of any third party
providing financing secured by Personal Property owned by Lessee, any Major Subtenant or any
Direct Space Tenant which is an Affiliate of Lessee, and without the prior written consent of
such third party in its sole discretion, no such lien may be enforced against any such Personal
Property unless and until such lien and security interest is fully released; and (v) no such lien
shall attach to or be enforceable against any other Personal Property, including any Personal
Property owned by any other Space Tenant. Upon the request of any such third party lessor of
Personal Property or third party providing financing secured by Personal Property, Lessor shall
execute any documentation reasonably required by such third party consistent with the foregoing
limitations (it being understood that nothing contained herein shall be deemed to prohibit or
impair any such leasing or financing with respect to Personal Property).
ARTICLE XXIV
CONDEMNATION
Section 24.1 Definition of Terms. For purposes of this Article, the following words
(a) Condemnation means the acquisition by a governmental or quasi-governmental
agency with the power of eminent domain, by the exercise of that power, of title to all or part of
the Property and/or Leasehold Improvements, or other conveyance of the Property and/or
Leasehold Improvements in lieu of eminent domain. The term Condemnation shall also
include any case of inverse condemnation as may be determined by a court of competent
jurisdiction. A Condemnation shall not be deemed a Leasehold Estate Transfer or Major
Subleasehold Estate Transfer (as defined in Section 8.1).
(b) Total Taking means the Condemnation of the entirety of the Property. The term
Total Taking shall also include the Condemnation of a portion of the Property and Leasehold
Improvements that renders restoration of the remaining Property and Leasehold Improvements
for continued use economically unfeasible in the sole and reasonable opinion of Lessee.
(c) Partial Taking means the Condemnation of a portion of the Property and/or the
Leasehold Improvements where it is economically feasible in the sole and reasonable opinion of
Lessee to effect restoration of the balance of the Property and Leasehold Improvements for
continued use.
(d) Temporary Taking means a Total Taking or Partial Taking for a period of time
less than the remainder of the Lease Term as of the Date of Taking.
(e) Date of Taking means the date upon which title to any of the Property and/or
Leasehold Improvements transfers to the governmental or quasi-governmental agency which is
Condemning the Property.
(f) Condemnation Award means the actual amount paid for the Property and/or the
Leasehold Improvements, or portion thereof, which is taken by Condemnation, including, but not
limited to, the decline in value of any Property and/or Leasehold Improvements not taken, if any.
In the event of Condemnation by the United States Government, or other Governmental
Authority where reasonable attorneys fees and costs are not paid in addition to the
Condemnation Award, Condemnation Award shall mean such actual amount paid, less all
reasonable attorneys fees and costs incurred in connection with securing such award.
(g) Fee Value means the present value of the Base Rent and Percentage Rent
payable pursuant to this Amended and Restated Ground Lease for the remaining balance of the
Lease Term, and the fair market value of Lessors reversionary interest in the Property and the
Leasehold Improvements, both as of the Date of Taking. The Parties stipulate and agree that for
purposes of the foregoing, the Percentage Rent payable pursuant to this Amended and Restated
Ground Lease for the remaining balance of the Lease Term shall be deemed to be an amount
equal to the average annual Percentage Rent payable during the three (3) year period
immediately preceding the Date of Taking, multiplied by the number of years (including any
portion thereof) left for the remaining balance of the Lease Term.
(h) Leasehold Value means the fee simple fair market value of the Property and
Leasehold Improvements as of the Date of Taking, less the Fee Value.
Section 24.2 Entire Property Taken by Condemnation. In the event of a Total Taking:
(a) Termination. This Amended and Restated Ground Lease shall be deemed
terminated as of the Date of Taking;
(b) Remaining Obligations. Lessee shall remain obligated to pay to Lessor all Base
Rent, Percentage Rent and other sums accruing under this Amended and Restated Ground Lease
to (but not including) the Date of Taking, and the Parties shall be relieved of all further
obligations under this Amended and Restated Ground Lease, other than those obligations which
expressly survive such termination; and
(c) Apportionment of Condemnation Award. Unless otherwise agreed to in writing
by Lessor and Lessee (with the prior written consent of any Approved Leasehold Mortgagee),
the Condemnation Award shall be apportioned by a court of competent jurisdiction based on
Lessors and Lessees property rights as set forth herein. Specifically,
(i) Lessor shall be entitled to receive the Fee Value (which sum shall be paid
directly to Lessor and shall not be required to be held in escrow); and
(ii) Lessee shall be entitled to the remainder of any Condemnation Award not
payable to Lessor, including, but not necessarily limited to, the Leasehold Value; provided,
however, that to the extent that any Approved Leasehold Mortgagee has any rights under any
Subordination, Non-Disturbance and Attornment Agreement described herein to receive and/or
control the disbursement of such sums, such rights shall control over any provisions of this
Section 24.3 Part of Property Taken by Condemnation
In the event of a Partial Taking:
(a) Continuation of Lease; Reduction of Base Rent. This Amended and Restated
Ground Lease shall remain in full force and effect as to all of the Property not taken by
Condemnation, except that the Base Rent, after the Date of Taking, shall be reduced on an
equitable basis for the remainder of the Lease Term (it being understood that after the Date of
Taking, Percentage Rent shall continue to be payable subject to and in accordance with the terms
and conditions of this Amended and Restated Ground Lease for that portion of the Property not
included in the Condemnation); and
(b) Apportionment of Condemnation Award. Unless otherwise agreed to in writing
by Lessor and Lessee (with the prior written consent of any Approved Leasehold Mortgagee),
the Condemnation Award shall be apportioned by a court of competent jurisdiction based on
Lessors and Lessees property rights as set forth herein. Specifically,
(i) Lessee shall receive and be obligated to apply the amount necessary to
restore the balance of the Project to as new a condition as existed immediately prior to the
Taking; and
(ii) the balance of the Condemnation Award shall be divided among Lessor
and Lessee based upon their proportionate shares and remaining interests in this Amended and
Restated Ground Lease, the Leasehold Improvements taken, the fee interest, the remainder
interest, and the diminution in value of the Project; provided, however, that to the extent that any
Approved Leasehold Mortgagee has any rights under any applicable Subordination, Non-
Disturbance and Attornment Agreement described herein to receive and/or control the
disbursement of such sums, such rights shall control over any provisions of this Amended and
Section 24.4 Takings for Temporary Period. Where the Condemnation is for a
temporary period of time, the provisions of this Section shall apply:
(a) No Termination; Force Majeure. In the event of a Temporary Taking, this
Amended and Restated Ground Lease shall not terminate and Lessee shall continue to perform
and observe all of its obligations (including, but not limited to, payment of Base Rent and
Percentage Rent as provided throughout this Amended and Restated Ground Lease without
adjustment) as though the Temporary Taking had not occurred and Lessee shall be entitled to the
entirety of the Condemnation Award for the Temporary Taking; provided, however, that to the
extent Lessee may be prevented from performing its obligations (excluding payment of Base
Rent and Percentage Rent as provided throughout this Amended and Restated Ground Lease
without adjustment) by the terms of the Condemnation or by the conditions resulting from the
Condemnation, including Lessees use of all or any part of the Property, same shall be deemed to
constitute an Event of Force Majeure.
(b) Temporary Taking For Same Period As Lease Term. In the event of a Total
Taking or Partial Taking for a period of time which extends for exactly the remainder of the
Lease Term as of the Date of Taking, Lessor and Lessee shall each receive that portion of the
award as though the Condemnation had not been for a limited period of time, all subject to and in
accordance with the provisions of Section 24.2 or Section 24.3, as applicable.
(c) Temporary Taking For Period Beyond Lease Term. In the event of a Total
Taking or Partial Taking for a period of time which extends beyond the remainder of the Lease
Term as of the Date of Taking, Lessee shall be entitled to that portion of the Condemnation
Award equal to what Lessee would have received had the Condemnation not been for a limited
period of time, all subject to and in accordance with the provisions of Section 24.2 or Section
24.3, as applicable; provided, however, that Lessee shall not be entitled to any monies awardable
for any time period after the Lease Term would otherwise have ended.
Section 24.5 Event of Lessees Default. Notwithstanding any provisions contained
herein to the contrary, in the Event of Lessees Default described in Section 25.1(a), Section
25.1(b) or Section 25.1(c) (subject to an Approved Mortgagees exercise of any applicable cure
rights therefor) prior to or at the time of a final judgment or other determination as to the amount
of the Condemnation Award, or payment of the Condemnation Award, Lessor shall be entitled to
receive such portion of the Condemnation Award as is necessary to cure such Event of Lessees
Default, in addition to such other portion of the Condemnation Award to which Lessor is
otherwise entitled under this Article XXIV.
Section 24.6 Rights of Approved Leasehold Mortgagee.
(a) Consent and Participation Rights. Lessor and Lessee shall not settle or
compromise the amount or division of any Condemnation Award in any Condemnation
proceeding without any Approved Leasehold Mortgagees prior written consent. Any such
Approved Leasehold Mortgagee shall be entitled to appear in any such Condemnation
proceeding and make claim for the share of any award to which Lessee is entitled by the terms of
this Article XXIV.
(b) Assignment. Lessee may assign to any Approved Leasehold Mortgagee any and
all rights of Lessee with respect to Condemnation Awards and proceedings.
(c) Provisions of Approved Leasehold Mortgage. The provisions of this Article
XXIV shall be subject to the rights of any Approved Leasehold Mortgagee pursuant to anany
Subordination, Non-Disturbance and Attornment Agreement described herein.
Section 24.7 Major Subleases. Lessee shall cause each Major Sublease to contain
comparable condemnation provisions as those set forth in this Article XXIV with respect to each
Major Project Component.
ARTICLE XXV
DEFAULT PROVISIONS
Section 25.1 Events of Default by Lessee. Each of the following events is defined as an
Event of Lessees Default:
(a) Base Rent. If Lessee shall fail to pay any installment of Base Rent when and as
due and payable, and such failure shall continue for a period of fifteen (15) days after written
notice from Lessor to Lessee;
(b) Percentage Rent. If Lessee shall fail to pay any installment of Percentage Rent
when and as due and payable, and such failure shall continue for a period of thirty (30) days after
written notice from Lessor to Lessee;
(c) Other Sums of Money. If Lessee shall fail to pay any other sums of money due
hereunder when and as due and payable, and such failure shall continue for a period of forty five
(45) days after written notice from Lessor to Lessee;
(d) Voluntary Bankruptcy. If, at any time during the Lease Term, Lessee shall file:
(i) a consent to or petition for the appointment of a receiver, trustee or liquidator of itself or all its
assets; (ii) a voluntary petition in bankruptcy or a pleading, memorandum, affidavit or other
paper in any court of record admitting in writing its inability to pay its debts as they come due;
(iii) a general assignment for the benefit of creditors; or (iv) an answer admitting the material
allegations of, or its consenting to, or defaulting in answering, a petition filed against it in any
bankruptcy proceeding;
(e) Involuntary Bankruptcy. If, at any time during the Lease Term, there shall be
filed against Lessee or any of its constituent entities, in any court of competent jurisdiction
pursuant to any statute of the United States or of any State, a petition in bankruptcy or
insolvency, or for reorganization, or for the appointment of a receiver or trustee of all or a
portion of Lessees or any of Lessees constituent entities property, including, without
limitation, the Leasehold Estate or the Leasehold Improvements, and any such proceeding
against Lessee or any of its constituent entities shall not be dismissed within ninety (90) days
following the commencement thereof (which period may be extended up to an additional sixty
(60) days so long as Lessee is diligently pursuing such dismissal);
(f) Seizure. If the Leasehold Estate or the Leasehold Improvements thereon shall be
seized under any levy, execution, attachment or other process of court where the same shall not
be vacated or stayed on appeal or otherwise within sixty (60) days thereafter, or if the Leasehold
Estate or the Leasehold Improvements thereon are sold by judicial sale and such sale is not
vacated, set aside or stayed on appeal or otherwise within any period for vacating, setting aside,
staying or appealing same, if any such period is applicable;
(g) Certain Defaults Under Major Subleases. If: (i) a Major Subtenant of the Leased
Property defaults in the performance of or otherwise breaches any covenant under its Major
Sublease which is specifically required by the provisions of this Amended and Restated Ground
Lease to be included in such Major Sublease (including, but not limited to, those covenants
described in Article VII hereof), or which is otherwise a material provision of such Major
Sublease; (ii) such Major Subtenant fails to cure such default within the applicable notice and
cure period for same under such Major Sublease; and (iii) Lessee fails to cause such default to be
cured within forty five (45) days after the expiration of such notice and/or cure period, or if such
default is not reasonably capable of being cured within such forty five (45) day period, Lessee
shall have failed to commence to cure such default within such forty five (45) day period or
thereafter failed to continue diligently prosecuting all action reasonably necessary to cure the
default (it being understood that if legally authorized possession of the applicable Major Project
Component is required in order to cure such default, such forty five (45) day cure period shall
not be deemed to have commenced until Lessee is able, through diligent efforts, to obtain such
possession);
(h) Certain Defaults Under Operating Agreements. If: (i) Lessee or any Major
Subtenant defaults under any applicable Operating Agreement for the operation and management
on the Leasehold Estate hereunder of the applicable Major Project Component on the Leasehold
Estate hereunder; (ii) such Operating Agreement is properly terminated by any such operator or
manager on account of such default; and (iii) an Operating Agreement with a replacement
operator approved by the City Manager pursuant to the City Manager Approval Procedures is not
executed and delivered within ninety (90) days after Lessee or any Approved Mortgagee or
Approved Foreclosure Transferee is able to take possession of such Major Project Component;
and
(i) Certain Cross Defaults under Composite Attachment 3 .To the extent and for the
time periods set forth in Section VII of Composite Attachment 3, there shall be cross-default provisions
among the Amended and Restated Ground Leases for the Major Project Components; and
(j) Unpermitted Transfer. If any Leasehold Estate Transfer or Lessee Transfer of
Control of Lessee under this Amended and Restated Ground Lease shall be made in violation of
the provisions of Article VIII, or if Lessee consents in writing to any Major Subleasehold Estate
Transfer or Major Subtenant Transfer of Control under this Amended and Restated Ground
Lease as to which any approval or consent of the City Manager is required under the provisions
of Article VIII, without Lessees having first obtained such approval or consent of the City
Manager, and any such transaction is not unwound or nullified within thirty (30) days after its
occurrence;
(k) Insurance. If any insurance required to be maintained by Lessee hereunder lapses
or is cancelled, and the same is not replaced within five (5) Business Days after Lessee receives
written notice thereof from Lessor; provided, however, that no such Event of Lessees Default
shall give rise to any right on the part of Lessor to terminate this Amended and Restated Ground
Lease or Lessees possession of the Property; or
(l) Other Defaults. If Lessee shall fail to perform any of the other covenants,
conditions and agreements of this Amended and Restated Ground Lease on the part of Lessee to
be performed (other than those described in subparagraphs (a) through (j) above), and such
failure shall continue for a period of sixty (60) days after written notice from Lessor to Lessee
(stating with particularity the respects in which Lessor contends that Lessee has failed to perform
any such covenants, conditions and agreements), or if such default is not reasonably capable of
being cured within such sixty (60) day period, Lessee shall have failed to commence to cure such
default within such sixty (60) day period or thereafter failed to continue diligently prosecuting all
action reasonably necessary to cure the default (it being understood that if legally authorized
possession of the applicable Major Project Component is required in order to cure such default,
such sixty (60) day cure period shall not be deemed to have commenced until Lessee is able,
through diligent efforts, to obtain such possession).
Section 25.2 Remedies in Event of Lessees Default. Lessor may treat any one or more
of the Event(s) of Lessees Default as a breach of this Amended and Restated Ground Lease, and
thereupon at its option, by serving written notice on Lessee and any and all Approved
Mortgagees of the Event of Lessees Default, Lessor shall have, in addition to every other right
or remedy existing at law or equity (to the extent consistent with any limitations on remedies
specified herein), any one or more of the following remedies:
(a) Completion of Work. During the development or construction of the Leasehold
Improvements, Lessor shall have the right, but not the obligation, to carry out or complete any
applicable Work on behalf of Lessee without terminating this Amended and Restated Ground
Lease, utilizing the proceeds of any applicable payment and performance bonds for the benefit of
Lessor. In connection with the foregoing, Lessee hereby grants to Lessor an exclusive license to
occupy the Premises in order to perform such Work. Notwithstanding the foregoing, all rights of
Lessor under this subparagraph (a) shall be subject and subordinate in all respects to the rights of
any Approved Mortgagee with respect to completing the Work and the proceeds of any payment
and performance bonds.
(b) Termination of Right to Possession; Termination of Lease. After use of
appropriate summary process or other legal process, Lessor may either: (i) terminate this
Amended and Restated Ground Lease; or (ii) terminate Lessees right to possession of the
Property and the Leasehold Improvements (without terminating this Amended and Restated
Ground Lease) and re-enter the Property and the Leasehold Improvements and without further
demand or notice, remove all persons and all or any property therefrom, by summary eviction
proceedings or by any suitable action or proceeding at law, without being liable to indictment,
prosecution or damages therefor, and repossess and enjoy the Property and the Leasehold
Improvements. If Lessor elects to terminate the right of possession (without terminating this
Amended and Restated Ground Lease), thereafter, Lessor may make such alterations and repairs
as may be necessary in order to relet the Property or the Leasehold Improvements and relet the
Property or the Leasehold Improvements. Lessor shall not be liable in any way whatsoever for
failure to relet the Property or the Leasehold Improvements or, in the event that the Property or
the Leasehold Improvements or any part or parts thereof are relet, for failure to collect the rent
thereof under such reletting. In connection with any such reletting, Lessee, for Lessee and
Lessees successors and assigns, hereby irrevocably constitutes and appoints Lessor as Lessees
and their agent to collect the Rents due and to become due under all Major Subleases or Space
Leases or any parts thereof. Notwithstanding any such reletting without termination, Lessor may
at any time thereafter elect to terminate this Amended and Restated Ground Lease for such
previous breach.
(i) Lessees Right to Cure. Notwithstanding the foregoing, Lessee shall have
the right to cure any Event of Lessees Default at any time prior to the issuance of a final order or
judgment granting Lessor possession of the Property (subject to any pending appeal brought
within the applicable appeals period), so long as Lessee also pays to Lessor any applicable
interest due on previously unpaid sums at the Default Rate for the period from the due date
thereof until the date paid in full, and all reasonable court costs and attorneys fees.
(ii) No Acceleration of Rent. The Parties specifically acknowledge and agree
that Lessor shall not be entitled to accelerate any Rent due hereunder on account of an Event of
Lessees Default.
(c) Demand On Major Subtenants. Subject to the rights of any Approved Leasehold
Mortgage or Approved Major Subleasehold Mortgagee, Lessor may demand that the applicable
Major Subtenant and the applicable Direct Space Tenant pay the applicable rent due under such
Major Sublease or Direct Space Lease directly to Lessor, and to exercise any and all of Lessees
rights and remedies thereunder if such Major Subtenant or Direct Space Tenant, as applicable,
fails to pay rent directly to Lessor or otherwise comply with the terms of such Major Sublease or
Direct Space Lease. Each Major Sublease and Direct Space Lease shall include a provision
whereby the applicable Major Subtenant or Direct Space Tenant acknowledges and agrees that
Lessor has the rights described in this subparagraph (c).
(d) Injunctive Relief. Lessor may seek injunctive relief against, or a court order
restraining, any affirmative violation of any of Lessees covenants hereunder.
(e) Damages. Lessor shall have the right to seek recovery from Lessee of all actual
damages to Lessor proximately caused by any Event of Lessees Default for which Lessor has
terminated Lessees right to possession of the Property and the Leasehold Improvements or
terminated this Amended and Restated Ground Lease in accordance with the provisions of this
Article XXV. In no event shall Lessor be entitled to recover consequential or punitive damages
from Lessee.
(f) Other Remedies. No remedy conferred upon or reserved to Lessor shall be
considered exclusive of any other remedy, but shall be cumulative and in addition to every other
remedy given under this Amended and Restated Ground Lease or existing at law or in equity or
by statute, and every power and remedy given by this Amended and Restated Ground Lease to
Lessor may be exercised from to time and as often as occasion may arise, or as may be deemed
expedient by Lessor; provided, however, all such remedies shall be consistent with the
limitations of Lessors rights with respect to termination of this Amended and Restated Ground
Lease and any other limitations set forth in this Article XXV.
(g) SNDAs. Lessor acknowledges and agrees that certain rights and remedies of
Lessor specified herein will, in certain respects, be limited by the provisions of any applicable
Subordination, Non-Disturbance and Attornment Agreements entered into by Lessor with respect
to the Project as contemplated herein, including any such agreements with Approved Leasehold
Mortgagees, Approved Major Subleasehold Mortgages, Major Subtenants, Space Tenants and
holders of Approved Time Share Licenses.
Section 25.3 Events of Default Lessor.
(a) Events of Lessors Default. An Event of Lessors Default shall be deemed to
have occurred upon the failure of Lessor to perform any of the covenants, conditions and
agreements of this Amended and Restated Ground Lease which are to be performed by Lessor
and the continuance of such failure for a period of thirty (30) days after notice thereof in writing
from Lessee to Lessor (which notice shall specify the respects in which Lessee contends that
Lessor has failed to perform any of such covenants, conditions and agreements); provided,
however, that if such default is one which cannot be cured within thirty (30) days, no such Event
of Lessors Default shall be deemed to have occurred if Lessor shall have commenced such cure
within such thirty (30) day period and thereafter shall have continued diligently to prosecute all
actions necessary to cure such default.
(b) Lessees Remedies in Event of Lessors Default. If an Event of Lessors Default
shall occur, Lessee may treat same as a breach of this Amended and Restated Ground Lease, and
thereupon at its option, by serving written notice on Lessor, Lessee shall have, in addition to
every other right or remedy existing at law or equity, one or more of the following remedies:
(i) Termination. The right and option to terminate this Amended and
Restated Ground Lease and all of its obligations hereunder upon prior written notice to Lessor
(except those which specifically survive termination of this Amended and Restated Ground
Lease);
(ii) Injunctive or Other Relief. The right to specific performance, injunction
or other similar relief available to it under applicable law against Lessor (including any or all of
the members of its governing body, and its officers, agents or representatives); and
(iii) Damages. The right to obtain actual damages resulting from such default,
but only to the extent that any such damages are not first or cannot be redressed through the
relief described in clause (ii) above. Notwithstanding the foregoing, in no event shall: (i) any
member of such governing body or any of its officers, agents or representatives be personally
liable for any of the Citys obligations to Lessee hereunder; or (ii) Lessee be entitled to recover
consequential or punitive damages from Lessor. To the maximum extent permitted by
Applicable Laws, Lessor hereby waives the right to raise any defense to Lessees seeking or
obtaining such damages, or otherwise to claim that Lessee is not entitled to seek or obtain such
damages, based on the principle of sovereign immunity or any similar principle or requirement
of Applicable Law.
(iv) Setoff. Notwithstanding anything to the contrary contained herein, Lessee
shall be entitled to set off against next accruing Rent payments the amount of any such damages
awarded to Lessee payable by Lessor pursuant to any judgment or order by a court of competent
jurisdiction, which judgment or order is no longer appealable.
Section 25.4 Mitigation. Lessor and Lessee hereby expressly acknowledge and agree
that each shall have an affirmative obligation to reasonably mitigate their respective damages as
a consequence of a default by the other.
ARTICLE XXVI
COVENANTS OF LESSOR AND LESSEE
Section 26.1 Partial Modification of Restrictions.
(a) Lessors and Lessees Compliance. Lessor and Lessee shall comply with all the
terms and conditions of the Partial Modification of Restrictions.
(b) Proof of Payments. (i) Upon written request of Lessee from time to time, Lessor
shall provide Lessee and any Approved Mortgagee with adequate proof that any payments
required to be made by Lessor thereunder are being made in a timely manner; (ii) Upon written
request of Lessor from time to time, Lessee shall provide Lessor and any Approved Mortgagee
with adequate proof that any payments required to be made by Lessee thereunder are being made
in a timely manner.
(c) Right to Make Payments. Lessor and Lessee shall use reasonable good faith
efforts to obtain from the Trustees (or other applicable Governmental Authority) written
confirmation that the Trustees (or such other applicable Governmental Authority) shall provide
to Lessor or Lessee, as applicable, written notice of any failure by Lessor or Lessee, as
applicable, to make any payments when due as required pursuant to such Partial Modification of
Restrictions and a reasonable period of time within which to afford Lessor or Lessee, as
applicable, (or any Approved Leasehold Mortgagee on Lessees behalf) the opportunity to cure
such default; provided, however, that if the Trustees do not agree to the same: (i) Lessor or
Lessee, as applicable, shall not be deemed to be in default under this Amended and Restated
Ground Lease in connection therewith; and (ii) Lessor or Lessee, as applicable, shall use
reasonable good faith efforts to promptly provide copies to Lessor or Lessee, as applicable, of
any such written notices it receives from the Trustees. If Lessor or Lessee, as applicable, fails to
make any such payments when due, then Lessor or Lessee or any Approved Mortgagee may
make the payment, in which case Lessor or Lessee, as applicable, may set off or add to, as
applicable, the amount of such payment against the next accruing Rent payments due. If Lessor
or Lessee, as applicable, anticipates not making the payment to the Trustees when due, Lessor or
Lessee, as applicable, shall notify Lessor or Lessee and any Approved Mortgagee thirty (30)
days prior to the applicable due date (it being understood that Lessor or Lessees, as applicable,
failure to make any such payment shall be deemed a default by Lessor or Lessee, as applicable,
hereunder, subject to the applicable cure periods hereunder and under the Partial Modification of
Restrictions, as applicable). If Lessor, Lessee or any Approved Mortgagee, as applicable, makes
the payment to the Trustees, then, at Lessor or Lessees option or any Approved Mortgagees
option and upon providing advance written notice to Lessor, Lessee or any Approved Mortgagee
may continue to make the annual payments to the Trustees, in which case Lessee may deduct or
the Lessor may add to, as applicable, the amount of the payments made to the Trustees from the
next accruing Rent payments upon submitting proof of such payment to the reasonable
satisfaction of Lessor or Lessee, as applicable.
Section 26.2 Civic Arts Endowment Trust. (Not applicable to Marina Component)
(a) Creation. Lessee shall create a Civic Arts Endowment Trust for the Project (the
Trust). Creation of the Trust, and conditions or restrictions applicable to the Trust, shall be set
forth in and governed by a separate written agreement in form and substance reasonably
acceptable to Lessor and Lessee. Such agreement shall be entered into prior to the Possession
Date.
(b) Control. Lessee shall retain control of the Trust, but the Trusts managing board
shall include, but not necessarily be limited to, a member from each of the City, Fairchild
Tropical Garden and The Historical Museum of South Florida.
(c) Funding. Lessee shall fund the Trust in accordance with the provisions of
Exhibit R.
(d) Investment of Funds. Funds contributed to the Trust shall be invested in such
manner as is directed by the managing board of the Trust.
(e) Use of Income. The income earned from the investment of the funds in the Trust
(but not the corpus of the Trust) shall be used for operations, maintenance and repair of all civic
spaces within the Project, which shall deemed to include all areas of the Project open to the
public other than the Parking Garage, the Retail Space, rooms within the Hotels, and other areas
of the Project which are subject to membership or user fees, such as spa and fitness facilities.
Such income shall be used, among other things, to maintain the gardens and reflecting pools and
the sculptures and other physical objects of art located within the public spaces within the Project
in good condition and repair, which art shall be more specifically described on Exhibit E-1
attached hereto (the Public Art), and for public-art related purposes within the Project, such
as visual or performance related art and/or art related festivals or functions. Notwithstanding
anything contained herein to the contrary, in no event shall any funds from the Trust be used for
the maintenance of areas of the Project which do not constitute civic spaces (as described above)
nor shall such funds in any way reduce or be credited against the Rent and other obligations
hereunder.
ARTICLE XXVII
QUIET ENJOYMENT
Lessor represents, warrants and covenants that Lessee, upon paying the Rent and all
Impositions and other charges, and performing all the covenants and conditions of this Amended
and Restated Ground Lease, shall lawfully and quietly hold, occupy and enjoy the Property
during the Lease Term without hindrance or molestation by Lessor (solely in its proprietary
capacity) or any Persons claiming, by, through or under Lessor (solely in its proprietary
capacity).
ARTICLE XXVIII
LESSEE NOT TO ENCUMBER LESSORS INTEREST
Lessee shall have no right or power to, and shall not in any way encumber the title of
Lessor in and to the Property, or the title of Lessors remainder or residual interest in the
Leasehold Improvements. The fee simple estate of Lessor in the Property and the residual
interest of Lessor in the Leasehold Improvements shall not be in any way subject to any claim by
way of lien or otherwise, whether claimed by operation of law or by virtue or any express or
implied lease or contract or other instrument made by Lessee and any claim by way of lien or
otherwise upon the Property or in the Leasehold Improvements arising from any act or omission
of Lessee shall accrue only against Lessees interest in the Leasehold Improvements.
ARTICLE XXIX
LIMITATION OF LIABILITY
Section 29.1 Limitation of Liability of Lessee.
(a) General Limitation on Liability. It is expressly understood and agreed by and
between the Parties, anything herein to the contrary notwithstanding, that each and all of the
representations, covenants, undertakings and agreements herein made on the part of Lessee are
made and intended not as personal representations, covenants, undertakings and agreements by
the members, officers, agents and investors of Lessee or any officers, agents, shareholders,
directors, members, partners, investors or any other Person of any of Lessees constituent entities
or for the purpose or with the intention of binding any of the foregoing personally; but are made
and intended for the purpose of binding Lessee and the Leasehold Estate and Leasehold
Improvements only.
(b) Limited Carve-out. Notwithstanding the foregoing, in the event of: (i) an actual
and intentional fraud committed by any of Lessees members or officers in any written document
prepared by Lessee and submitted to Lessor; or (ii) any misappropriation of Net Insurance
Proceeds or Condemnation Awards by Lessee (should same be paid directly to Lessee), any such
members or officers committing the fraud or causing such misappropriation shall have personal
liability to the extent of any actual damages sustained to Lessor proximately caused by such
fraud or misappropriation, and the property and assets of such member or officer committing the
fraud or causing the misappropriation shall be subject to levy of execution or enforcement
procedure for the satisfaction of Lessors remedies hereunder, but only to the extent that Lessor
is unable to look to the Leasehold Improvements for recovery of such damages. The provisions
of this subparagraph (b) shall not apply to any Approved Foreclosure Transferee or any
Approved Subsequent Foreclosure Purchaser.
Section 29.2 Limitation of Liability of Lessor. It is expressly understood and agreed by
and between the Parties, anything herein to the contrary notwithstanding, that each and all of the
representations, covenants, undertakings and agreements herein made on the part of Lessor while
in form purporting to be the representations, covenants, undertakings and agreements of Lessor
are nevertheless, each and every one of them, made and intended not as personal representations,
covenants, undertakings and agreements by Lessor, or any commission member, employee,
official, representative, attorney or agent of Lessor or for the purpose or with the intention of
binding any of the foregoing personally; but are made and intended for the purpose of binding
the Lessors fee simple interest in the Property only. NOTWITHSTANDING ANYTHING TO
THE CONTRARY IN THIS AMENDED AND RESTATED GROUND LEASE, NEITHER
LESSOR NOR ANY COMMISSION MEMBER, EMPLOYEE, OFFICIAL,
REPRESENTATIVE, ATTORNEY OR AGENT OF LESSOR, SHALL BE PERSONALLY
LIABLE, DIRECTLY OR INDIRECTLY, UNDER OR IN CONNECTION WITH THIS
AMENDED AND RESTATED GROUND LEASE, OR ANY DOCUMENT, INSTRUMENT
OR CERTIFICATE SECURING OR OTHERWISE EXECUTED IN CONNECTION WITH
THIS AMENDED AND RESTATED GROUND LEASE, OR ANY AMENDMENTS OR
MODIFICATIONS TO ANY OF THE FOREGOING MADE AT ANY TIME OR TIMES,
HERETOFORE OR HEREAFTER, OR IN RESPECT OF ANY MATTER, CONDITION,
INJURY OR LOSS RELATED TO THIS AMENDED AND RESTATED GROUND LEASE
OR THE PROPERTY AND ONLY LESSORS INTEREST IN THE PROPERTY (OR
PROCEEDS THEREOF) SHALL BE AVAILABLE TO SATISFY ANY CLAIMS AGAINST
LESSOR; AND LESSEE AND EACH OF ITS SUCCESSORS AND ASSIGNEES WAIVES
AND DOES HEREBY WAIVE ANY SUCH PERSONAL LIABILITY. As used in this
Amended and Restated Ground Lease, the term Lessor means only the current owner or
owners of the fee title to the Property. Each lessor is obligated to perform the obligations of
Lessor under this Amended and Restated Ground Lease only during the time such lessor owns
such interest or title. Any lessor who transfers its title or interest is relieved of all liability with
respect to the obligations of Lessor under this Amended and Restated Ground Lease to be
performed on or after the date of transfer. However, each lessor shall deliver to its transferee all
funds previously paid by Lessee if such funds have not yet been applied under the terms of this
ARTICLE XXX
ESTOPPEL CERTIFICATES
Section 30.1Estoppel Certificates from Lessee. Lessee shall, at any time and from time
to time, so long as this Amended and Restated Ground Lease shall remain in effect, upon not less
than fifteen (15) and not more than (30) days prior written request by Lessor, execute,
acknowledge and deliver to Lessor, or any other Person specified by Lessor, a written statement
(which may be relied on by such Person) (a) certifying that (i) this Amended and Restated
Ground Lease is unmodified and in full force and effect (or if there have been modifications, that
it is in full force and effect as modified, stating the modifications and if so requested, that the
annexed copy of the Lease is a true, correct and complete copy of the Lease) and (ii) the date to
which the Rent and other charges have been paid, if any, and (b) stating (i) whether Lessee has
given Lessor written notice of any default, or any event that, with the giving of notice or the
passage of time, or both, would constitute a default, by Lessor in the performance of any
covenant, agreement, obligation or condition contained in this Amended and Restated Ground
Lease, and (ii) whether, to the actual knowledge of Lessee (but without independent inquiry),
Lessor is in default in the performance of any covenant, agreement, obligation or condition
contained in this Amended and Restated Ground Lease, and, if so, specifying in detail each such
default.
Section 30.2 Certificates from Lessor. Lessor shall, at any time and from time to time, so
long as this Amended and Restated Ground Lease shall remain in effect, upon not less than
fifteen (15) and not more than thirty (30) days prior written request by Lessee, execute,
acknowledge and deliver to Lessee, and/or any other Person(s) specified by Lessee (including,
but not limited to, any Approved Mortgagee or Approved Foreclosure Transferee and any
Approved Subsequent Foreclosure Purchaser or other proposed transferee of the Leasehold
Estate, Leasehold Improvements or any Major Subleasehold Estate), a written statement
addressed to Lessee and such other Person(s) (which may be relied on by such Person(s)) (a)
certifying that (i) this Amended and Restated Ground Lease is unmodified and in full force and
effect (or if there have been modifications, that it is in full force and effect as modified, stating
the modifications and if so requested, that the annexed copy of the Lease is a true, correct and
complete copy of the Lease) and (ii) the date to which the Rent and other charges have been paid
in advance, if any, and (b) stating (i) whether an Event of Lessees Default has occurred or
whether Lessor has given Lessee notice of any event that, with the giving of notice or the
passage of time, or both, would constitute an Event of Lessees Default, and (ii) whether, to the
actual knowledge of Lessor (but without independent inquiry), Lessee is in default in the
performance of any covenant, agreement, obligation or condition contained in this Amended and
Restated Ground Lease, and, if so, specifying in detail each such default or Event of Lessees
Default.
ARTICLE XXXI
NO WAIVER
Section 31.1 Delays in Exercising Rights. No delay or omission of Lessor or Lessee to
exercise any right or power arising from any default shall impair any such right or power, nor
shall it be construed to be a waiver of any default or any acquiescence in it.
Section 31.2Waivers to be in Writing. No waiver of any breach or violation of any of the
covenants or conditions contained in this Amended and Restated Ground Lease shall be implied
but must be evidenced by a written instrument signed by the waiving Party, and no waiver of any
breach of any of the covenants or conditions of this Amended and Restated Ground Lease shall
be construed to be a waiver of any other breach or to be a waiver of, acquiescence in, or consent
to, any further or succeeding breach of the same or similar covenant or condition. No failure on
the part of Lessor to enforce any covenant or provision contained in this Amended and Restated
Ground Lease, and no waiver of any right under this Amended and Restated Ground Lease by
Lessor, shall discharge or invalidate such covenant or provision or affect the right of Lessor to
enforce same in the event of a subsequent breach or default, except to the extent Lessor has
specifically waived same in writing.
Section 31.3 Receipt of Rent. The receipt of Rent by Lessor, with knowledge of any
breach of this Amended and Restated Ground Lease by Lessee or of any default on the part of
Lessee in the observance or performance of any of the conditions, agreements or covenants of
this Amended and Restated Ground Lease, shall not be deemed to be a waiver of any provision
of this Amended and Restated Ground Lease. The receipt by Lessor of any Rent or any other
sum of money or any other consideration paid by Lessee after the termination of this Amended
and Restated Ground Lease or the entry of a judgment granting possession of the Property to
Lessor, shall not reinstate or continue the Lease Term unless so agreed to in writing and signed
by the City Manager and Lessee.
Section 31.4 Consents. Consent of Lessor to any act or matter must be in writing and
shall apply only with respect to the particular act or matter to which the consent is given and
shall not relieve Lessee from the obligation, wherever required under this Amended and Restated
Ground Lease, to obtain the consent of Lessor to any other act or matter.
ARTICLE XXXII
SURRENDER AND HOLDING OVER
Section 32.1 Surrender at End of Term.
(a) Delivery of Property. Upon the expiration or sooner termination of this Amended
and Restated Ground Lease, Lessee shall peaceably and quietly leave, surrender and deliver to
Lessor, in their as is condition, the entire Property in accordance with Section 2.2, together
with the following items: (i) the Leasehold Improvements; (ii) all alterations, changes, additions
and other improvements made upon the Property; and (iii) any and all Personal Property owned
by Lessee or any Major Subtenant or Affiliate of either, but only to the extent such Personal
Property has been permanently affixed to the Property or the Leasehold Improvements for use in
connection with the operation and/or maintenance of the Property and the Leasehold
Improvements. In addition, Lessor shall have the right to assume, as of the expiration or sooner
termination of this Amended and Restated Ground Lease, all remaining lessee obligations under
any leases of Personal Property where Lessee or any Major Subtenant or any Affiliate of either is
the lessee of the Personal Property, but subject to any consent rights of the applicable Personal
Property lessor. Such assumption shall be made pursuant to written assumption agreement(s) in
form and substance mutually acceptable to Lessor and Lessee or the applicable Major Subtenant
or Affiliate, which assumption agreement(s) shall include, among other things, an appropriate
indemnity from Lessor for the period from and after the date of assumption.
(b) Delivery of Other Items. At the time of the surrender, Lessee shall also deliver to
Lessor all of the following to the extent within Lessees possession or immediate control (i.e., in
the possession of a manager for Lessee or similar Person having a contractual duty to supply
such documents to Lessee), all without representation, warranty or recourse: (i) Lessees original
executed counterparts, if available (and if not, then true and correct copies), of all Major
Subleases and Space Leases then in effect pursuant to Article XXXIII hereof; (ii) any and all
security deposits and rent advances under all Major Subleases and Direct Space Leases then in
effect pursuant to Article XXXIII hereof; (iii) any service and maintenance contracts then
affecting the Property or the Leasehold Improvements; (iv) recent maintenance records for the
Property and the Leasehold Improvements; (v) all currently effective original licenses and
permits then pertaining to the Property or the Leasehold Improvements; (vi) permanent or
temporary Certificates of Occupancy then in effect for the Property or the Leasehold
Improvements; (vii) all warranties and guarantees then in effect that Lessee shall have received
in connection with any work or services performed or building equipment installed on the
Property or in the Leasehold Improvements, together with a duly executed quit-claim assignment
thereof to Lessor in a recordable form approved by the City Attorney; and (viii) all financial
reports specifically required by this Amended and Restated Ground Lease which are less than
sixty (60) months old and which were not previously furnished to Lessor.
Section 32.2 Rights Upon Holding Over. At the expiration of the Lease Term, or any
earlier termination of this Amended and Restated Ground Lease, Lessee shall yield up immediate
possession of the Property and the Leasehold Improvements to Lessor. In the event that Lessee
fails to do so, Lessee shall pay to Lessor, for the whole time such possession is withheld beyond
the date of expiration or termination of this Amended and Restated Ground Lease, a sum per day
equal to Two Hundred Percent (200%) times 1/365th of the aggregate of the Rent paid or
payable to Lessor for the immediately preceding calendar year as set forth in Article V.
Section 32.3 No Waiver. The provisions of this Article shall not be held to be a waiver
by Lessor of any right of entry or reentry as set forth in this Amended and Restated Ground
Lease, nor shall the receipt of a sum, or any other act in apparent affirmance of the tenancy,
operate as a waiver of the right to terminate this Amended and Restated Ground Lease for any
breach of Lessee under this Amended and Restated Ground Lease (subject to any applicable
notice and/or cure periods).
Section 32.4 Survival. The provisions of this Article shall survive the expiration or
earlier termination of this Amended and Restated Ground Lease.
ARTICLE XXXIII
MAJOR SUBLEASES, SPACE LEASES AND APPROVED TIME SHARE LICENSES
Section 33.1Leasing and Subleasing. Except as provided by this Article XXXIII, Lessee
shall not sublease or license or grant any other use or occupancy rights with respect to the
Property, the Leasehold Improvements or the Leasehold Estate without the City Managers prior
written consent, which may be granted or withheld in the City Managers sole discretion.
Section 33.2Major Subtenant SNDAs. On Lessees request, Lessor shall enter into
Subordination, Non-Disturbance and Attornment Agreements with each Major Subtenant
substantially in form and substance attached hereto as Exhibit S; provided, however, that the
City Manager shall not unreasonably withhold his or her consent to any commercially reasonable
modifications to such form as may be requested by the applicable Major Subtenant, any
Approved Major Subleasehold Mortgagee or any Approved Mezzanine Financer providing
Approved Mezzanine Financing to such Major Subtenant.
Section 33.3 Major Subleases. Subject to the provisions of this Article XXXIII, Lessee
shall have the right at any time during the Lease Term to enter into a Major Sublease for each of
the five (5) Major Project Components with a Major Subtenant, provided that: (i) the provisions
of Article VIII are satisfied as to each such Major Subtenant; and (ii) each such Major Sublease
shall meet the requirements set forth in subparagraph (a) below.
(a) Requirements for Major Subleases. Lessee shall provide to Lessor copies of all
Major Subleases and amendments thereto. Each Major Sublease (as well as any material
modification or amendment thereof) shall be subject to the City Managers prior written approval
in accordance with the City Manager Approval Procedures. Each Major Sublease shall:
(i) Term. Be for a term equal to or less than the presently existing Lease
Term (i.e., which shall include any properly exercised Extension Options and shall not include
any unexercised Extension Options but may have corresponding Extension Options);
(ii) Covenants. Include the covenants required by the applicable Sections of
this Amended and Restated Ground Lease;
(iii) Subordination. Provide that such Major Sublease shall be subject and
subordinate to the terms of this Amended and Restated Ground Lease (but subject to the
provisions of any applicable Subordination, Non-Disturbance and Attornment Agreement
described in Section 33.2);
(iv) Bank and Records. Provide that the applicable Major Subtenant shall
maintain full and accurate books and records of such Major Subtenants business, operation or
enterprise, in accordance with the requirements under Article XII, and that Lessor shall have the
same rights, including, without limitation, the audit rights, set forth therein with respect to such
Major Subleases;
(v) Mortgagee Cure Rights. Include provisions permitting any Approved
Leasehold Mortgagee to cure defaults by Lessee thereunder, and any applicable Approved Major
Subleasehold Mortgagee to cure defaults by such Major Subtenant thereunder;
(vi) Lessor Cure Rights. Include provisions permitting Lessor to cure defaults
by Lessee thereunder;
(vii) No Action Causing Default under Lease. Provide that such Major
Subtenant shall not take any action (or fail to act) which would result in an Event of Lessees
Default hereunder;
(viii) Compliance With Laws and Insurance. Provide that such Major Subtenant
shall comply in all material respects with all Applicable Laws as to the applicable Major Project
Component, and any and all requirements of public liability, fire and other policies of insurance
which may be applicable to its operations, activities, rights and obligations under such Major
Sublease;
(ix) Maintenance of Insurance. Provide that such Major Subtenant shall
maintain the insurance coverages set forth in Article XI with respect to the applicable Major
Project Component governed by the Major Sublease;
(x) Casualty and Condemnation. Include casualty and condemnation
provisions with respect to the applicable Major Project Component which are substantially
similar to those contained in this Amended and Restated Ground Lease;
(xi) Use Restrictions. Include restrictions on Major Subtenant Transfers of
Control with respect to the applicable Major Subtenant and Major Subleasehold Estate Transfers
with respect to the applicable Major Subleasehold Estate which are substantially similar to those
contained in Article VIII;
(xii) Notice of Default under Operating Agreements. Include a provision
requiring Lessee and the applicable Major Subtenant to promptly provide to Lessor a copy of any
written notice(s) received or sent by Lessee and/or the applicable Major Subtenant which either:
(A) claims or alleges that any party to an Operating Agreement(s) (including, without limitation,
the applicable Major Subtenant) is in default under such Operating Agreement(s): or (B)
expresses an intention to terminate any such Operating Agreement(s) by any party to such
Operating Agreement(s);
(xiii) Notice of Default under Mortgages. Include a provision requiring Lessee
and the applicable Major Subtenant to promptly provide to Lessor copies of any written notice(s)
received by Lessee or the applicable Major Subtenant, which notice(s) claims or alleges that such
Major Subtenant is in default under any Approved Major Subleasehold Mortgage(s);
(xiv) Advance Rent. Provide that in no event shall Lessee be permitted to
accept more than two (2) months rent in advance of the then current month under any Major
Sublease. and
(xv) Rentals. Provide for such rentals as are necessary to maintain a Sufficient
Lessee Economic Interest (as defined in Section 8.1).
Section 33.4 No Cross-Defaults. Except as expressly set forth in Composite
Attachment 3, unless Lessee elects otherwise, (a) no default or Event of Lessees Default under
any Major Sublease, separate Major Project Component lease (if applicable) or the surviving
provisions of the Agreement to Enter (if applicable), shall constitute or give rise to a default
under any other Major Sublease., separate Major Project Component lease (if applicable) or the
surviving provisions of the Agreement to Enter (if applicable); and (b) no default or Event of
Lessees Default with regard to any Major Project Component shall constitute or give rise to a
default under any other Major Project Component.
` Section 33.5 Space Leases.
(a) Approval of Certain Space Leases. Any single Space Lease for more than 50,000
net rentable square feet shall require the prior written consent of the City Manager in accordance
with the City Manager Approval Procedures.
(b) Right to Enter into Space Leases. Lessee and/or any Major Subtenant shall have
the right to enter into any other Space Leases with respect to each of the Major Project
Components or any other Project Components without Lessors consent, provided that all such
Space Leases shall: (i) be for a Permitted Use and not for any Prohibited Use; (ii) be entered into
in a non-discriminatory fashion; (iii) be negotiated at arms length; (iv) have adequate security
deposits in the good faith judgment of Lessee or the applicable Major Subtenant; (v) be on lease
forms previously supplied to Lessor or on another form typically required by any national tenant
(but in each case with such modifications as shall have been negotiated with the applicable Space
Tenant); (vi) be within the tenant improvement guidelines prepared by Lessee reasonably and in
good faith and submitted by Lessee to Lessor from time to time (or as to Space Leases with
national tenants, as required by such national tenants); (vii) be within the rental rate guidelines
prepared by Lessee reasonably and in good faith and submitted by Lessee to Lessor from time to
time (it being understood that such guidelines shall generally provide for market rents to be
charged, unless specified circumstances or conditions are applicable to particular Space Leases
as agreed upon by Lessor and Lessee reasonably and in good faith); (viii) result in a
complementary tenant mix, including a variety of restaurants with varied price points; and (ix)
result in first-class operations befitting the Project.
(c) Assignment of Rents. As security for the prompt payment of Rent hereunder,
Lessee hereby: (i) assigns to Lessor all of its right, title and interest in and to any and all existing
and future Major Subleases and Space Leases and all rents due and to become due thereunder;
and (ii) grants to Lessor the right to collect such rents and apply same to the Rent due hereunder;
provided, however, that Lessee shall be entitled to collect and receive such rents in accordance
with the terms of such Major Sublease and Space Leases unless and until an Event of Lessees
Default has occurred and is continuing. Lessors rights under this subparagraph (c) shall be (and
are hereby made) subject, subordinate and inferior in all respects and for all purposes to any
right, title and interest of each and every Approved Mortgagee in and to all such Major Subleases
and Space Leases and all such rents due and to become due thereunder. Upon the written request
of any such Approved Mortgagee, Lessor shall execute such instruments as such Approved
Mortgagee may request for the purpose of confirming the foregoing subordination.
(d) Non-Disturbance. Upon Lessees request, Lessor shall enter into a Subordination,
Non-Disturbance and Attornment Agreement with any Space Tenant which meets one or more of
the following criteria: (i) such Space Tenant will occupy more than 50,000 net rentable square
feet; (ii) such Space Tenant will have a Space Lease having a term exceeding five (5) years; or
(iii) such Space Tenant is a national tenant which requires non-disturbance protection. The form
of such Subordination, Non-Disturbance and Attornment Agreement shall be comparable to the
form for Major Subtenants set forth in Exhibit S; provided, however, that the City Manager shall
not unreasonably withhold his or her consent to any commercially reasonable modifications to
such form as may be requested by the applicable Space Tenant (with due consideration to the
particular requirements of any national tenant).
Section 33.6 Approved Time Share Licenses.
(a) Acknowledgment. The Parties acknowledge and agree that Lessee or the
applicable Major Subtenant is entitled to create and sell Approved Time Share Licenses at the
Marina and/or within the Hotels (subject to the limitation of the number of keys allocated
therefor as described in the definitions of Hotel A and Hotel B and in Exhibit E).
(b) SNDAs. In order to assure the marketability and continued existence of all such
Approved Time Share Licenses at all times during the Lease Term, Lessor agrees that Lessor,
Lessee and any applicable Approved Mortgagees shall, upon Lessees request from time to time,
enter into one or more Subordination, Non-Disturbance and Attornment Agreements with the
holders of Approved Time Share Licenses and their respective lenders. Each such
Subordination, Non-Disturbance and Attornment Agreement shall: (i) be in form and substance
reasonably satisfactory to all of the parties thereto; (ii) be binding upon and inure to the benefit
of each holder of such Approved Time Share Licenses; (iii) provide, among other things, that for
the entire duration of the Lease Term, the possessory and other rights of each such holder of an
Approved Time Share License shall not be disturbed or impaired on account of any termination
of this Amended and Restated Ground Lease or any termination of any applicable Major
Sublease prior to the stated expiration date of the Lease Term.
(c) Lessor Protections. Subject to the provisions of clause (iii) of subparagraph (b)
above, the Parties acknowledge and agree that the Subordination, Non-Disturbance and
Attornment Agreements described in subparagraph (b) above shall in no event: (i) affect the
business and financial terms of this Amended and Restated Ground Lease; (ii) constitute a
material deviation from the Watson Island RFP and the Island Gardens Proposal; or (iii)
significantly impair the protections afforded to Lessor pursuant to this Amended and Restated
Ground Lease.
ARTICLE XXXIV
MINORITY AND WOMEN PARTICIPATION AND
EQUAL EMPLOYMENT OPPORTUNITIES
Section 34.1 First Source Hiring Agreement. Simultaneously with the execution hereof
by Lessee, Lessee shall enter into a First Source Hiring Agreement with the City, in form and
substance substantially as set forth in Exhibit T.
Section 34.2 Minority and Women Participation and Equal Employment Opportunity.
During the Lease Term, Lessee agrees that it will: (a) 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) take reasonable affirmative action to retain employees regardless of race, color, place
or 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; (e) monitor and review personnel practices to guarantee that equal opportunities are
being provided to all employees, regardless of race, color, place of birth, religion, national origin,
sex, age, marital status, veteran and disability status; (f) post in conspicuous places, available to
employees and applicants for employment, notices in a form to be provided by Lessor setting
forth provisions of this non-discrimination clause; (g) in all solicitations or advertisements for
employees placed by or on behalf of Lessee, state that all qualified applicants will receive
consideration for employment without regard to race, creed, color or national origin; and (h) send
to each labor union or representative of workers with which the construction contractor or other
operator within the Project has a collective bargaining agreement or other contract or
understanding a notice in a form to be provided by Lessor, advising the union or representative
of Lessees commitments and posting copies of the notice conspicuous places available to
employees and applicants for employment.
Section 34.3 Skills, Training and Employment Center. Lessee shall establish and
maintain a Skills Training Center during the construction of the Project and a Career Training
Center at all times during the Term to provide for training of the construction and operations
personnel associated with the Project at the Property or other location(s) within the City. The
Skills Training Center shall be run by a construction management team to be assembled by
Lessee and shall provide for the advancement of skills for the construction personnel at the
Project, which shall include, without limitation, a curriculum of safety, fundamental skills for
untrained workers, advance skills for trained workers, additional skills for certificates in alternate
trades and management of construction operations. Such Skills Training Center shall provide
opportunities for the chronically unemployed within Miami-Dade County, with priority (as a
general proposition) being given to residents of the City. The Career Training Center will
provide accredited courses for all employees of the Project (which shall be offered at no cost to
participants), including, without limitation, hospitality training, retail training, catering and
dining training, marina operations training, public space management, customer service training,
multiple language skills, historical ambassador training, botanical training, educational teaching
for cultural facilities and emergency services training (for immediate care prior to arrival of
professional emergency services).
Section 34.4 Tax Credits. To the extent available, Lessor agrees to cooperate with
Lessee, at no cost or expense to Lessor, in connection with Lessees efforts to obtain any tax
credit under Applicable Laws associated with employment, such as the State of Florida
Enterprise Zone program and/or the Miami-Dade County Empowerment Zone program. In
no event shall the foregoing agreement to cooperate be deemed to apply to any municipal
programs offered or operated by the City, but nothing contained herein shall be deemed to
prevent Lessee from submitting any applications to the City with respect to any such municipal
programs for which Lessee may be eligible.
Section 34.5 Labor Peace Agreement(s). The parties acknowledge that the Amended
and Restated Agreement to Enter and the Amended and Restated Ground Lease(s) are subject to
the requirements of City Commission Resolution No. 09-0263, adopted May 28, 2009 (attached
hereto and made a part hereof as Composite Attachment 4).
ARTICLE XXXV
OPERATING AGREEMENTS FOR HOTELS AND MARINA
Section 35.1 Approval. During the Lease Term, any operating and management
agreement entered into by Lessee or any Major Subtenant for the operation and management of
the Hotels and Marina (collectively, the Operating Agreements), and any material
amendments or modifications thereto, shall be subject to the prior written approval of Lessor in
accordance with the City Manager Approval Procedures (it being understood that the City
Manager shall not object to any terms and conditions which are customary in the industry and/or
are typically required by any nationally or internationally recognized operator or manager,
provided that such terms and conditions do not violate any City policies, legal or otherwise).
Section 35.2 Approved Operators. Any such Operating Agreement shall only be with a
member of the Operating Team approved in accordance with the provisions of Section 4.4 (the
Approved Operator(s)).
Section 35.3 Terms. Each such Operating Agreement shall: (i) be subject and
subordinate to the terms of this Amended and Restated Ground Lease; and (ii) be for a term
which is equal to or less than the presently existing Lease Term (i.e., which shall include any
properly exercised Extension Options and shall not include any unexercised Extension Options
but may have corresponding Extension Options).
Section 35.4 Non-Disturbance and Attornment Agreement. Upon Lessees request,
Lessor and the Approved Operator(s) shall enter into a Non-Disturbance and Attornment
Agreement in form and substance to be mutually acceptable to the parties thereto.
ARTICLE XXXVI
UNAVOIDABLE DELAY
Section 36.1 Unavoidable Delay(s). For the purpose of any of the provisions of this
Amended and Restated Ground Lease (except the payment of Rent), neither Lessor nor Lessee,
as the case may be, nor any successor in interest, shall be considered in breach of or in default of
any obligations under this Amended and Restated Ground Lease in the event of an Unavoidable
Delay(s), in accordance with the provisions of Section 36.2 below. In addition, each cure period
specified in Section 25.1 or elsewhere in this Amended and Restated Ground Lease shall be
extended on account of any Unavoidable Delays.
Section 36.2 Manner of Notice of Unavoidable Delay(s) and Conditions With Respect to
Performance of Obligations. In the event of Unavoidable Delay(s), the time for performance of
obligations, covenants, and/or agreements which are affected by the Unavoidable Delay(s) shall
be extended for the period of time of the Unavoidable Delay(s) or for such period of time as may
be necessary under the circumstances, provided that the Party seeking the benefit of the
provisions of this Section shall:
(a) Notice. As soon as reasonably possible, but no later than ten (10) days after such
Party shall have become aware of the Unavoidable Delay(s), give notice, in writing, to the other
Party of the Unavoidable Delay(s), which notice shall specify which of the obligations,
covenants, and/or agreements of this Amended and Restated Ground Lease the notifying Party is
unable to perform at the time of such notice and how the Unavoidable Delay(s) has affected the
Partys performance of such obligations, covenants, and/or agreements; and
(b) Performance. As soon as reasonably possible after the event or circumstance
giving rise to such Unavoidable Delay(s) ceases to exist, the Party claiming such Unavoidable
Delay(s) shall commence and shall diligently continue the performance of such obligations,
covenants, and/or agreements so delayed.
ARTICLE XXXVII
NOTICES
Section 37.1 Notices. All notices, consents, approvals and other communications under
this Amended and Restated Ground Lease shall be in writing and shall be deemed to have been
duly given or made: (i) upon delivery if hand delivered; (ii) one (1) Business Day after delivery
to any nationally recognized overnight courier service for next Business Day delivery, fee
prepaid; (iii) on the date of any facsimile transmission (if made before 5:00 p.m., Miami time,
otherwise on the next Business Day), with transmission verified and a hard copy of the
transmission promptly sent by U.S. Priority Mail; or (iv) three (3) Business Days after deposit
with the United States Postal Service as registered or certified mail, postage prepaid, and in each
case addressed as follows (or to such other addresses as either party may subsequently designate
in writing to the other):
If to Lessor, at: City Manager (City Manager), City of Miami, Florida

3500 Pan American Drive
Miami, FL 33133
with a copy to: Department of Public Facilities/Asset Management, City of Miami
444 SW 2 Avenue
Miami, FL 33130
with a copy to: City Attorney, City of Miami

444 SW 2 Avenue
Miami, FL 33130
All Rent payments shall be made to (unless otherwise designated in writing by Lessor):
Finance Director, City of Miami

444 SW 2 Avenue
Miami, FL 33130
if to Lessee, at: Flagstone Island Gardens, LLC

888 MacArthur Causeway
Miami, Florida 33132
Attn: Mehmet Bayraktar
with a copy to: Shutts & Bowen LLP

1500 Miami Center
201 South Biscayne Boulevard
Attn: Kevin D. Cowan, Esq.,
and Alexander I. Tachmes, Esq.
with a copy to: Latham & Watkins

885 Third Avenue
New York, New York 10022
Attn: Richard L. Chadakoff, Esq.
Each party from time to time may change its address or add addresses for purposes of
receiving declarations or notices by giving notice of the changed address, to become effective ten
(10) days following the giving of such notice.
Section 37.2 Notice to Approved Mortgagees. All notices, demands or requests which
may be required to be given by Lessor or Lessee to any Approved Mortgagee shall be sent in
writing, in the manner or manners set forth in Section 37.1 for the giving of notices, addressed to
the Approved Mortgagee at such place as the Approved Mortgagee may from time to time
designate in a written notice to Lessor and Lessee. Copies of all notices shall simultaneously be
sent to the other of Lessor or Lessee, as the case may be.
Section 37.3 Sufficiency of Service. Service of any demand or notice as provided for by
this Article XXXVII shall be sufficient for all purposes.
ARTICLE XXXVIII
MISCELLANEOUS PROVISIONS
Section 38.1 Captions. The captions of this Amended and Restated Ground Lease are for
convenience and reference only and in no way define, limit or describe the scope or intent of this
Amended and Restated Ground Lease, nor in any way affect this Amended and Restated Ground
Lease.
Section 38.2 Conditions and Covenants. All the provisions of this Amended and
Restated Ground Lease shall be deemed and construed to be conditions as well as covenants, as
though the words specifically expressing or importing covenants and conditions were used in
each separate provision.
Section 38.3 Entire Agreement. This Amended and Restated Ground Lease (together
with all of the Exhibits and other attachments (if any) hereto and any future easement agreements
or other documents contemplated hereby) and the Agreement to Enter collectively contain the
entire agreement between the Parties concerning the Property. This Amended and Restated
Ground Lease shall supersede and control over any and all prior agreements and negotiations
between the Parties, whether oral or in writing (which are hereby expressly merged into this
Amended and Restated Ground Lease), except for the Agreement to Enter. To the extent of any
conflict between this Amended and Restated Ground Lease and the Watson Island RFP and/or
the Island Gardens Proposal, this Amended and Restated Ground Lease shall control.
Section 38.4 Modification. None of the covenants, terms or conditions of this Amended
and Restated Ground Lease to be kept and performed by either party to this Amended and
Restated Ground Lease shall in any manner be waived, modified, changed or abandoned except
by a written instrument duly signed, acknowledged and delivered by both Lessor and Lessee.
Section 38.5 Time of Essence as to Covenants of Lease. Subject to any extensions
expressly provided with respect thereto, time is of the essence as to the performance of each and
every of the provisions of this Amended and Restated Ground Lease by Lessee and Lessor.
Section 38.6 Recording. The Parties shall, at the request of either Party, execute a short-
form lease or memorandum of lease and have it properly acknowledged for the purpose of
recording in the Public Records of Miami-Dade County, Florida. Such short-form lease or
memorandum of lease shall include those provisions hereof as may be reasonably requested by
either of the Parties, provided that the financial terms of this Amended and Restated Ground
Lease shall not be contained therein if Lessee so requests. Lessee shall bear the cost of any such
recordation thereof.
Section 38.7 City Manager Approval Procedures. Except for those circumstances in this
Amended and Restated Ground Lease which expressly provide to the contrary or specifically call
for an approval to be given or withheld in the sole discretion or sole and absolute discretion
of the City Manager, the following provisions shall apply to any matter for which approval is
required hereunder to be obtained from the City Manager (individually and collectively, an
Approval-Requiring Matter), and shall be deemed to be the City Manager Approval
Procedures:
(a) Standard of Approval. Approval shall not be unreasonably withheld, delayed or
conditioned and shall be considered by the City Manager in good faith;
(b) Disqualified Persons. Where approval of a particular Person is required, the City
Manager may withhold such approval if such Person is a Disqualified Person;
(c) Response Time. Response by the City Manager shall be given within fourteen
(14) days of submission to the City Manager of all information which is fundamentally required
in order to make a decision; provided, however, that in the case of any request for approval of the
Construction Plans and Specifications: (i) response as to any initial Construction Plans and
Specifications shall be given within twenty five (25) days of submission; (ii) response to any
changes, modifications, additions or supplements thereto and any additional details with respect
thereto which are required to be approved shall be given within ten (10) days of submission of
same, and shall be limited to a review of only such changes, modifications, additions,
supplements or additional detail, and the City Manager shall not raise any objections to any
matters or items previously approved in accordance with this Section 38.7 (except to the extent
that the City Manager learns that any such matter or item was approved contrary to the
requirements of Applicable Laws or the Major Special Use Permit for the Project).
(d) Request for Approval. Any submission for approval shall be accompanied by a
written request for approval which shall include a legend at the top of the first page in a typeface
larger than that used elsewhere in the request for approval indicating that Lessor is to provide
comments within fourteen (14) days (or other applicable period) pursuant to this Section, 38.7,
together with a copy of such submission to the Citys Ombudsman and the Citys Consultant (as
such terms are defined in Article 14 hereof); and
(e) Reasons for Denial, If Applicable. In the case of the denial of any request, such
denial shall be made with reasonably specific written comments as to why and as to what
alternatives might be acceptable (with the understanding that denial may be based on any
reasonable grounds).
(f) City Manager Approvals; Disclaimer.
(i) Notwithstanding anything to the contrary contained in this Amended and
Restated Ground Lease, Lessee acknowledges that any approvals by the City Manager of any
Approval-Requiring Matter shall in no event be deemed to be a guarantee of the approval of such
Approval-Requiring Matter by the City Commission or any other Governmental Authority. Any
approval by the City Manager of an Approval-Requiring Matter shall be made solely in the
Citys capacity as the owner of the Property and not in any governmental capacity, and Lessee
shall remain responsible for obtaining whatever permits, licenses and approvals may be
necessary to improve the Property in accordance with any such Approval-Requiring Matter, as
well as all Applicable Laws.
(ii) In addition, approval by the City Manager of any Approval-Requiring
Matter shall not constitute a warranty or representation by City that the Project Components meet
all building codes or other Applicable Laws, or that such plans, will, if followed, result in
properly designed or constructed Project Components, or that any Project Component built in
accordance therewith will be built in good or workmanlike manner.
(iii) Notwithstanding anything to the contrary contained in this Amended and
Restated Ground Lease, the Parties recognize and agree that certain provisions of this Amended
and Restated Ground Lease may require the City and/or its boards, departments or agencies,
acting in their governmental capacity, to consider certain changes in applicable City codes,
ordinances, plans, regulations or policies, as well as to consider other governmental actions. All
such considerations and actions shall be undertaken in accordance with established requirements
of state statute and City ordinances, in the exercise of the Citys jurisdiction under the police
power.
(iv) Nothing in this Amended and Restated Ground Lease is intended to limit
or restrict the powers and responsibilities of the City in acting on applications for MUSP
Approval and applications for other Project Approvals by virtue of the fact that the City may
have consented to such applications as a property owner hereunder. The Parties further
recognize and agree that these proceedings shall be conducted openly, fully, freely and fairly in
full accordance with law and with both procedural and substantive due process to be accorded
the applicant and any member of the public. Nothing contained in this Amended and Restated
Ground Lease shall entitle Lessee to compel the City to take any such actions, save and except
the consents to the filing of such applications for MUSP Approvals, land use approvals or the
required approvals, as more fully set forth herein, and to timely process such applications.
Section 38.8 Governing Law. This Amended and Restated Ground Lease shall be
construed and enforced in accordance with the laws of the State of Florida, without application
of its conflicts of law principles.
Section 38.9 Jurisdiction and Venue. The parties acknowledge that a substantial portion
of the negotiations, anticipated performance and execution of this Amended and Restated
Ground Lease occurred in Miami-Dade County, Florida. Except in connection with matters to be
resolved in accordance with Article XVII hereof, the Parties agree that any disputes, civil action
or legal proceeding arising out of or relating to this Amended and Restated Ground Lease shall
be brought in the courts of record of the State of Florida in Miami-Dade County, Florida or the
United States District Court, Southern District of Florida, Miami-Dade County Division. Each
Party consents to the jurisdiction of such courts in any such civil action or legal proceeding and
waives any objection to the laying of venue of any such civil action or legal proceeding in such
court. Service of any court paper may be effected on such Party by mail, as provided in this
Amended and Restated Ground Lease, or in such other manner as may be provided under
applicable laws, rules of procedure or local rules.
Section 38.10 Waiver of Jury Trial. The Parties hereby knowingly, irrevocably,
voluntarily and intentionally waive any right either may have to a trial by jury in respect of any
action, proceeding or counterclaim based on, or arising out of, under or in connection with this
Amended and Restated Ground Lease or any amendment or modification of this Amended and
Restated Ground Lease, or any other agreement executed by and between the parties in
connection with this Amended and Restated Ground Lease, or any course of conduct, course of
dealing, statements (whether verbal or written) or actions of any Party hereto. This waiver of
jury trial provision is a material inducement for Lessor and Lessee to enter into the subject
transaction.
Section 38.11 Conflict of Interest. Lessee agrees to comply with the conflict of interest
provisions of the Miami City Code, Miami-Dade County Code and the State of Florida. No
member, official, or employee of Lessor shall have any personal interest, direct or indirect, in
this Amended and Restated Ground Lease, nor shall any member, official, or employee
participate in any decision relating to this Amended and Restated Ground Lease which affects his
or her personal interests or the interests of any other Person in which he or she is, directly or
indirectly, interested. No member, official, or employee of Lessor shall be personally liable to
Lessee, its successors and assigns, or anyone claiming by, through or under Lessee or any
successor in interest to the Property, in the event of any default or breach by Lessor or for any
amount which may become due to Lessee, its successors and assigns, or any successor in interest
to the Property, or on any obligation under the terms of this Amended and Restated Ground
Lease.
Section 38.12 Covenants to Run with the Leasehold Estate. All covenants, agreements
conditions and undertakings in this Amended and Restated Ground Lease shall extend and inure
to the benefit of and be binding upon the successors and permitted assigns of each of the Parties
and be construed as covenants running with the Leasehold Estate and the Leasehold
Improvements. Subject to all provisions respecting the rights of assignment or subleasing, this
Amended and Restated Ground Lease shall be binding upon and inure to the benefit of the
respective successors and permitted assigns of the Parties. Wherever in this Amended and
Restated Ground Lease reference is made to any of the Parties, it shall (unless expressly provided
to the contrary in such reference) be held to include and apply to, wherever applicable, also the
successors and assigns of each Party.
Section 38.13 No Merger. Without the express written consent of all Approved
Mortgagees, there shall be no merger of this Amended and Restated Ground Lease or any
interest therein or of the Leasehold Estate, with the fee estate in the Property or any portion
thereof by reason of the fact that this Amended and Restated Ground Lease or such interest
therein or the Leasehold Estate may ever be held directly or indirectly by or for the account of
any Person who shall also hold the fee estate in the Property or any portion thereof or any
interest of Lessor under this Amended and Restated Ground Lease.
Section 38.14 Brokerage. Each Party represents and warrants to the other that it has not
dealt with any broker or finder in connection with the transactions contemplated and each Party
agrees to indemnify, defend and hold the other harmless of and from any and all manner of
claims, including, but not limited to, reasonable attorneys fees and expenses, incurred by the
other Party and arising out of any claim by any broker or finder if it is ultimately determined that
the indemnifying Party has breached the foregoing representation and warranty. The provisions
of this Section 38.14 shall survive the expiration or sooner termination of this Amended and
Section 38.15 Counterparts. This Amended and Restated Ground Lease may be executed
in any number of counterparts, each of which shall constitute an original of this Amended and
Restated Ground Lease, and all of which shall constitute but one Lease.
Section 38.16 No Third Party Beneficiaries. Nothing in this Amended and Restated
Ground Lease shall confer upon any person, other than the Parties hereto and their respective
successors and permitted assigns, any rights or remedies under or by reason of this Amended and
Restated Ground Lease; provided, however, that each Approved Mortgagee, Approved
Foreclosure Transferee and Approved Subsequent Foreclosure Purchaser shall be a third party
beneficiary hereunder to the extent such Persons are granted rights hereunder.
Section 38.17 Attorneys Fees and Expenses. In the event of any litigation between the
parties, all expenses, including reasonable attorneys fees and court costs at both the trial and
appellate levels, incurred by the prevailing party, shall be paid by the non-prevailing party. The
term attorneys fees, as used in this Amended and Restated Ground Lease, shall be deemed to
include, without limitation, any paraprofessional fees, investigative fees, administrative costs and
other charges billed by the attorney to the prevailing party (including any fees and costs
associated with collecting such amounts). The provisions of this Section 38.17 shall survive the
expiration or any sooner termination of this Amended and Restated Ground Lease.
Section 38.18 Invalidity of Provisions. If any provision of this Amended and Restated
Ground Lease or the application of it to any Person or circumstances shall to any extent be
finally determined by a court of competent jurisdiction to be invalid or unenforceable, the
remainder of this Amended and Restated Ground Lease, and the application of such provision to
Persons or circumstances other than those as to which it is invalid or unenforceable, shall not be
affected thereby, and each provision of this Amended and Restated Ground Lease shall be valid
and be enforced to the fullest extent permitted by law.
Section 38.19 No Conflicts of Interest. Flagstone agrees to comply with the
applicable conflict of interest provisions of the Code of the City of Miami, the Miami-Dade
County Code, and the laws of the State of Florida as such are amended from time to time. No
member, official, or employee of the City shall have any personal interest, direct or indirect, in
the Amended and Restated Agreement to Enter or the Amended and Restated Ground Lease(s),
nor shall any member, official, or employee participate in any decision relating to the Amended
and Restated Agreement to Enter or the Amended and Restated Ground Lease(s) which affects
his or her personal interests or the interests of any other Person (as defined in the form of
Amended and Restated Ground Lease(s)) in which he or she is, directly or indirectly, interested.
No member, official, or employee of the City shall be personally liable to Flagstone, its
successors or assigns, or anyone claiming by, through, or under Flagstone or any successor in
interest to the Property, in the event of any default or breach by the City or for any amount which
may become due to Flagstone, its successors, and assigns, or any successor in interest to the
Property, or on any obligation under the terms of the Amended and Restated Agreement to Enter
or under the Amended and Restated Ground Lease(s).
IN WITNESS WHEREOF, Lessor has caused this Amended and Restated Ground Lease
to be executed in its name and on its behalf by the City Manager of the City of Miami, Florida
and the City Clerk of the City of Miami, Florida, and Lessee has executed this Amended and
Restated Ground Lease, as of the date and year first above written.
Signed, sealed and delivered LESSOR:

in the presence of:
CITY OF MIAMI, a municipal corporation
________________________________ of the State of Florida
Name:___________________________
________________________________ By:
Name:___________________________ _______________________________________
Daniel J. Alfonso, City Manager
ATTEST:
_____________________________
Todd B. Hannon, City Clerk
APPROVED AS TO FORM AND
APPROVED AS TO INSURANCE CORRECTNESS:
REQUIREMENTS:
_________________________________
Anne-Marie Sharpe, Interim Director, ________________________________________
Division of Risk Management Victoria Mndez, City Attorney
Signed, sealed and delivered LESSEE:
in the presence of:
FLAGSTONE ISLAND GARDENS, LLC, a
Delaware limited liability company
By: Flagstone Miami Holdings, LLC, a

Delaware limited liability company, as its sole
and managing member
By: Flagstone Property Group, LLC, a

_____________________________ Delaware limited liability company, as its sole
Name:________________________ and managing member
_____________________________ By:
Name:________________________ _______________________________________
Name:__________________________________
Title:___________________________________
EXHIBIT A
SKETCH OF WATSON ISLAND
Aerial Photography - 2009 0 308 ft
This map was created on 10/26/2011 7:42:38 AM for reference purposes only.
Web Site 2002 Miami-Dade County. All rights reserved.
EXHIBIT B
UPLAND PARCEL
Commence at a point shown marked by an 5/8 diameter iron rod and Cap Stamped F.D.O.T.,
shown as P.T. Sta. 25+50 on the Official Map of Location and Survey of a portion of Section
8706, designated as part of State Road A-1-A in Dade county, Florida, prepared by the State
Road Department of the State of Florida, as recorded in Map Book 56, at Page 71 of the Public
Records of Dade County, Florida. Said point being the point of tangency of the original center
line of the Douglas MacArthur Causeway running Easterly and South Easterly from the Westerly
limits (West Bridge) of Watson Island as shown on Sheet 3 of the State Road Department Right-
of-Way Map, Section No. (8706-112) 87060-2117, revised March 25, 1959, said most Northerly
curve having a radius of 1432.69 feet and a central angle of 62? 00 00 seconds; thence South
59? 51 26 West departing radially from said centerline a distance of 987.36 feet to a projected
Bulkhead line; thence North 17? 12 21 West continuing along said bulkhead line a distance of
238.86 feet to the point and place of beginning; thence North 17? 12 21 West continuing along
said bulkhead line a distance of 924.70 feet to the Southerly right of way line of State Road A-1-
A Douglas MacArthur Causeway; thence along said Southerly right of way line the following
courses and distances; South 89? 10 55 East, a distance of 73.08 feet; thence North 86? 44
00 East, a distance of 67.09 feet to non-tangent curve concave to the Northeast whose radial line
bears North 39? 29 18 East having a radius of 160.00 feet and central angle of 22? 09 33;
thence along said curve an arc length of 61.88 feet; thence South 72? 40 15 East continuing
along said Southerly right of way line a distance of 276.49 feet; to a curve concave to the
Southwest having a radius of 600.00 feet and central angle of 46? 17 39 thence along said
curve an arc length of 484.79 feet to a point of tangency; thence South 26? 22 36 East
continuing along the southwesterly right of way line of State Road A-1-A, a distance of 196.59
feet; thence south 54? 07 39 West Departing Said right of way line, a distance of 532.16 feet;
thence North 35? 54 03 West, a distance of 132.74 feet; thence South 54? 07 39 West, a
distance of 150.14 feet to the point of beginning.
EXHIBIT C
SUBMERGED PARCEL
Commence at a point shown marked by an 5/8 diameter iron rod and Cap Stamped F.D.O.T.,
shown as P.T. Sta. 25+50 on the Official Map of Location and Survey of a portion of Section
8708, designated as part of State Road A-1-A in Dade County, Florida, prepared by the State
Road Department of the State of Florida, as recorded in Map Book 56, at Page 71 of the Public
Records of Dade County, Florida. Said point being the point of tangency of the original center
line of the Douglas MacArthur Causeway running Easterly and South Easterly from the Westerly
limits (West Bridge) of Watson Island as shown on Sheet 3 of the State Road Department Right-
of-Way Map, Section No. (8706-112) 87060-2117, revised March 25, 1959, said most Northerly
curve having a radius of 1432.69 feet and a central angle of 62? 00 00; thence South 59? 51
26 West departing radially from said centerline a distance of 987.36 feet to a projected bulkhead
line; thence North 17? 12 21 West along said bulkhead line a distance of 238.86 feet to the
point and place of beginning; thence South 49? 32 57 West departing said bulkhead line a
distance of 550.92 feet to a point of intersection of lines of turning basin limit as established by
U.S. Army Corps of engineers and position by coordinates North 527,878.62 feet, East
926135.22 feet (based on North American Datum 1983-NAC83); thence North 31? 03 50
West, along the limits of said turning basin a distance of 428.44 feet to a point of intersection
with the East right of way line of intracoastal waterway; thence North 03? 27 54 West along
said East right of way line a distance of 874.43 feet to a point of intersection with the Southerly
right of way line of said Douglas MacArthur Causeway, said point of intersection being a point
on a curve concave Southerly and having a radius of 10,716.59 feet, a radial line to said point
bears South 01? 15 15 East; thence run Easterly for 387.46 feet along the arc of said curve and
along said Southerly right of way line, through a central angle of 02? 04 17 to a point of
tangency; thence South 89? 10 55 East continuing Easterly along the said southerly right of
way line, a distance of 31.87 feet more or less to a point of intersection with an existing bulkhead
line; thence South 17? 12 21 East along said bulkhead line a distance of 924.70 feet to the
point of beginning.
EXHIBIT D
SURVEY
(To be provided upon document execution)
EXHIBIT E
DESCRIPTION OF PROJECT COMPONENTS AND AMENITIES
I. General Description.
1. The Major Project Components, consisting of the Marina, Hotel A, Hotel B, the
Retail Space and the Parking Garage.
2. A fish market (the Fish Market).
3. A Maritime Gallery containing a minimum of 4,000 square feet.
4. Areas of public access and assembly, as more particularly described in the Island
Gardens Proposal, which shall include, without limitation, the following:
a. a roof garden to contain not less than Five Percent (5%) less than the
proposed amount of square feet as described in the Island Gardens
Proposal with swimming pools, cabanas, and garden room for special
occasion rental, which shall supply the hospitality amenities for the Hotel
guests and be available to the public on a fee basis;
b. salt water gardens; and
c. a 100 setback to include a grand promenade along the sea wall (the 100
Setback)
5. Public Art as more particularly described in Exhibit E-1 attached hereto.
6. A boat basin for model boats adjacent to the entry boulevard for the Project.
7. Adequate facilities for passenger pick-up and drop-off by water taxi service
and/or ferry service.
8. Any and all other infrastructure, landscaping and improvements which are more
particularly described in the Island Gardens Proposal (it being understood,

however, that the details concerning such infrastructure, landscaping and
improvements, including any adjustments thereto, shall be as set forth in the
approved Construction Plans and Specifications).
II. Number of Hotel Units. (Not applicable to Marina Component)
1. For purposes hereof: (i) the term Time Share Units shall mean those
units in either or both Hotels which are allocated for Approved Time Share Licenses; (ii)
the term Time Share Users shall mean any person having an interest in any particular
Approved Time Share License, or in any entity holding a particular Approved Time
Share License; and (iii) the term Sharing Arrangements shall mean sharing
arrangements entered into by Time Share Users so as to permit the shared usage of any
Time Share Unit pursuant to any Approved Time Share License.
2. The total number of units in both Hotels (other than Time Share Units)
shall not exceed 500 plus 5% in the aggregate. The plans submitted with the application
for the Major Special Use Permit issued in connection with the Project show 120 units in
Hotel A and 380 units in Hotel B (other than Time Share Units). If such total number of
units in each Hotel (other than Time Share Units) is changed, and such change results in a
substantial modification under the Major Use Special Permit, such change shall be
subject to all required approvals of all applicable Governmental Authorities. City
Manager.
3. Lessee shall be obligated to have Time Share Units. The Time Share Units
shall be in addition to those units described in Paragraph II. 2 above. The total number of
Time Share Units in both Hotels shall not exceed 105 in the aggregate. Subject to the
foregoing maximum amount for both Hotels combined, Lessee shall have the right to

determine the number of Time Share Units in each Hotel, and shall have the right, if it so
elects, to have all the Time Share Units in one Hotel and no Time Share Units in the other
Hotel.
4. Each Time Share Unit shall be limited to a specified number of Approved
Time Share Licenses as determined by Lessee. The Approved Time Share Licenses shall
not be for overlapping periods of time (i.e., for any particular interval of time, there shall
be only one Approved Time Share License issued as to any particular Time Share Unit).
Furthermore, no locked off portions of the Time Share Units will be permitted to be
separately conveyed or rented out, and each Approved Time Share License shall be for
the entire applicable Time Share Unit; provided, however, that Time Share Users shall be
permitted to enter into Sharing Arrangements. By way of example, if a particular Time
Share Unit has a foyer and two wings, and certain Time Share Users want to use the Time
Share Unit on the same weekend, they may enter into a Sharing Arrangement to allow
some of the Time Share Users to use one wing while the other Time Share Users use the
other wing.
5. It is recognized that cabana, spa and fitness and other Hotel facilities and
amenities may or may not be located within the structure of the Hotels.
III. Marina.
The Marina Component shall be as described in Composite Attachment 3.
IV. 100 Setback.
Lessee may construct and operate within the 100 Setback such facilities and
improvements as are approved to be within the 100 Setback pursuant to the Major Use Special
Permit for the Project and any and all other applicable Project Approvals (including any such

Project Approvals required by the City in its municipal capacity). Such facilities and
improvements may be constructed and operated within the 100 Setback without the prior written
consent of Lessor (in its capacity as lessor under this Amended and Restated Ground Lease) or
the City Manager, subject only to the City Managers approval of specific Construction Plans
and Specifications for same in accordance with the City Manager Approval Procedures. The
Parties acknowledge and agree that in no event shall the foregoing waiver of Lessors right, in its
capacity as lessor under this Amended and Restated Ground Lease, to object or consent to the
construction and operation of such facilities and improvements within the 100 Setback be
deemed to be a waiver of any and all rights of Lessor (or any of its applicable planning boards or
agencies) to object to same in its municipal or regulatory capacity.
V. Measurement of Retail Space.
The 221,000 square feet of Retail Space shall be calculated based on Usable Area
within each store under the Standard Method for Measuring Floor Area in Office Buildings
(American National Standard) approved on June 7, 1996 by American National Standards
Institute, Inc. and the Building Owners and Managers Association International (ANSI/BOMA
Z65.1-1996); it being understood and agreed, however, that in addition to such 221,000 square
feet: (i) there may be common area factor (which shall mean any area outside of a store or
restaurant) of up to Twenty Five Percent (25%) of such 221,000 square feet; and (ii) such
Twenty Five Percent (25%) common area factor shall not be permitted to include common areas
not directly related to the Retail Space (i.e., it shall exclude general Project common areas).

EXHIBIT E-1
DESCRIPTION OF PUBLIC ART

EXHIBIT F
CONCEPTUAL SITE PLAN

EXHIBIT G
GROSS REVENUES
Gross Revenues, whether in cash or on credit, shall be accounted for on an accrual basis.
As used in this Lease, the term Gross Revenues shall have the respective meanings ascribed to
it in this Exhibit G with respect to the applicable Project Components described below, subject
in each case to: (i) the specific exclusions listed below with respect to each Project Component;
and (ii) the General Exclusions listed below (collectively, the Exclusions).
I. Hotels.
A. With respect to the Hotels, the term Gross Revenues shall mean all Hotel
Operational Revenues and all Hotel Space Lease Rents, as hereinafter defined. If a Hotel is not
subleased pursuant to a Major Sublease, then the term Gross Revenues shall refer, as to such
Hotel or portion thereof, to all such Hotel Operational Revenues and Hotel Space Lease Rents
received by Lessee. If a Hotel or any portion thereof is subleased pursuant to a Major Sublease,
then the term Gross Revenues shall refer, as to such Hotel or portion thereof, to all such Hotel
Operational Revenues and Hotel Space Lease Rents received by the applicable Major Subtenant.
B. The term Hotel Operational Revenues shall mean all receipts, revenues,
income, and proceeds of sale of every kind or nature derived directly or indirectly from the
operation of the Hotels (including all departments and parts thereof), and all services provided at
or from the Hotel and all facilities of the Hotel (other than such receipts, revenues, income and
proceeds attributable to the operation by Space Tenants of the Hotels of their respective
businesses), subject to the applicable Exclusions.
1. Such term shall include, but not necessarily be limited to, those Hotel
Operational Revenues received by Lessee or the applicable Major Subtenant, permitted licensees
or concessionaires, whether for cash or credit (whether collected or not) as applicable, from the
following (subject, in each case, to the applicable Exclusions) rentals of Hotel guest rooms

(including any Approved Time Share Licenses being operated as guest rooms) and all revenues
attributable to the operation of Approved Time Share Licenses as Hotel guest rooms including
but not limited to: food and beverage sales or operations; bar and lounge sales or operations;
rentals of meeting room facilities; mechanical or other vending machines; pay telephones; stamp
machines; music machines; or amusement machines; parking; wholesale and retail sales of
merchandise to include any orders taken on the Property although filled elsewhere and whether
made by store personnel, any lay-away sales or like transaction or otherwise involving the
extension of credit, shall be treated as a sale for the full price at the time of the transaction,
irrespective of the time of payment or when title passes; and service charges to Hotel guests and
patrons; proceeds from any business interruption, business income, use and occupancy or
other loss of income insurance with respect to Hotel Operational Revenues, to the extent not paid
over to Lessor; any amount recovered in any legal action or proceeding or settlement thereof
which arose out of the operation of the Hotel other than with respect to the Space Leases at the
Hotel, to the extent such amount is properly included in gross revenues pursuant to the Uniform
System; and any deposit not refunded.
2. Such term shall exclude, or if included shall be deducted therefrom (but
only to the extent they have been included), the following: (i) all taxes required by law to be
collected from guests or patrons of the Hotels or with respect to goods or services sold at or from
the Hotel, such as sales taxes or bed taxes (but only to the extent such taxes are actually
remitted to duly-constituted taxing authorities having jurisdiction); (ii) tips and gratuities
collected for payment to employees of the Hotels (but only to the extent such amounts are
actually paid to employees); and the other general exclusions described below.

C. The term Hotel Space Lease Rents shall mean all rents actually paid by Space
Tenants permitted licensees or concessionaires, whether for cash or credit (whether collected or
not) of the Hotels under their respective Space Leases to Lessee or the applicable Major
Subtenant, as applicable.
1. Such term shall include, but not necessarily be limited to: (i) base rents
and percentage rents payable under such Space Leases; (ii) proceeds from any business
interruption, business income, use and occupancy or other loss of income insurance with
respect to such Space Leases, to the extent not paid over to Lessor; (iii) any amount recovered in
any legal action or proceeding or settlement thereof in connection with such Space Leases, to the
extent such amount is properly included in gross revenues pursuant to the Uniform System; (iv)
income from mechanical or other vending machines, including but not limited to, pay telephones,
stamp machines, music machines, or amusement machines; and (iv) any deposits not refunded.
only to the extent they have been included), the following: (i) any amounts received by the
landlord under any applicable Space Lease as payment for real estate and personal property taxes
and assessments, common area and maintenance charges and insurance premiums, if same are
separately stated in such Space Lease (but only to the extent of the actual costs thereof paid by
the landlord thereunder); (ii) any reimbursements due to the landlord under any applicable Space
Lease for costs incurred or sums advanced by such landlord, whether or not same are designated
as additional rent; (iv) any taxes required by law to be collected from Space Tenants at the
Hotels on account of any Hotel Space Lease Rents or other rentals payable by such Space
Tenants; (v) any credit card commissions payable on account of any payment of rents made by

credit card provided such commissions will not provide a source of income revenue to the
operator; and (vi) to the extent applicable, the General Exclusions described below.
D. For purposes of the Gross Revenues definition for Hotels, the term Uniform
System refers to the latest edition (currently the Ninth Revised Edition) of the Uniform System
of Accounts for the Lodging Industry as adopted by the American Hotel and Lodging
Association, from time to time.
II. Approved Time Share Licenses.
With respect to Approved Time Share Licenses, the term Gross Revenues shall mean
all proceeds with respect to each First Sale (as defined in Section 5.3(b) of the Lease), after
deducting therefrom: (i) repayment of the allocated capital cost (including the required return);
and (ii) marketing program costs.
III. Marina.
A. With respect to the Marina, the term Gross Revenues shall mean all Marina
Operational Revenues and all Marina Space Lease Rents (if any), as hereinafter defined. If the
Marina or any portion thereof is not subleased pursuant to a Major Sublease, then the term
Gross Revenues shall refer, as to any portion of the Marina not so subleased, to all such
Marina Operational Revenues and Marina Space Lease Rents received by Lessee. If the Marina
or any portion thereof is subleased pursuant to a Major Sublease, then the term Gross
Revenues shall refer, as to any portion of the Marina so subleased, to all such Marina
Operational Revenues and Marina Space Lease Rents received by the applicable Major
Subtenant; provided, however, that if any Space Tenant with respect to the Marina is an Affiliate
of Lessee or such Major Subtenant, then, as to the area covered by the Space Lease for such

Space Tenant, the term Gross Revenues shall refer to the Marina Operational Revenues of
such Space Tenant.
B. The term Marina Operational Revenues shall mean all receipts, revenues,
income, and proceeds of sale of every kind or nature derived directly or indirectly from the
operation of the Marina (including all departments and parts thereof), and all services provided at
or from the Marina and all facilities of the Marina (other than such receipts, revenues, income
and proceeds attributable to the operation by Space Tenants, if any, of the Marina of their
respective businesses), subject to the applicable Exclusions.
1. Such term shall include, but not necessarily be limited to, those Marina
following (subject, in each case, to the applicable Exclusions): (i) rentals and revenues of all
kinds payable by non-commercial guests, licensees and/or occupants of boat slips, storage or
other space at the Marina (including any Approved Time Share Licenses at the Marina being
operated as guest facilities) to include by reason of orders taken at any location, whether on the
property or elsewhere and regardless of the location the order is filled and/or whether the order is
made by personnel or other mechanism or devices; (ii) profits attributable to the operation of
Approved Time Share Licenses as guest facilities in addition to the rental amounts described in
clause (i) above (i.e., any assessments, service charges or other charges, fees or income collected
from the owners of Approved Time Share Licenses, which exceed the total of: (A) common
expenses or other expenses attributable to the operation of such Approved Time Share Licenses
(similar to condominium assessments); and (B) other expenses attributable to the operation of
any such Approved Time Share Licenses as guest facilities pursuant to the generally accepted

accounting principles applied on a consistent basis (GAAP); (iii) gasoline sales; food and
beverage sales or operations; facilities or property rentals; income from mechanical or other
vending machines, including but not limited to, pay telephones, stamp machines, music
machines, or amusement machines; income from parking; wholesale and retail sales of
merchandise to include any orders taken on the Property although filled elsewhere and whether
made by personnel or vending machine, any lay-away sales or like transaction or otherwise
involving the extension of credit, shall be treated as a sales for the full price at the time of the
transaction, irrespective of the time of payment or when title passes; and service charges to
Marina guests and patrons; (iv) revenues from any Gambling Boats (as defined in Exhibit N)
operated directly by Lessee or a Major Subtenant or Direct Space Tenant which is an Affiliate of
Lessee; (v) proceeds from any business interruption, business income, use and occupancy
or other loss of income insurance with respect to Marina Operational Revenues, to the extent not
paid over to Lessor; (vi) any amount recovered in any legal action or proceeding or settlement
thereof which arose out of the operation of the Marina other than with respect to the Space
Leases at the Marina, to the extent such amount is properly included in as an income item under
GAAP; and (vii) any deposits not refunded.
collected from guests or patrons of the Marina or with respect to goods or services sold at or
from the Marina, such as sales taxes or bed taxes (but only to the extent such taxes are actually
remitted to duly-constituted taxing authorities having jurisdiction); (ii) tips, service charges and
gratuities collected for payment to employees of the Marina (but only to the extent such amounts
are actually paid to employees); (iii) proceeds from the sale or other disposition of capital assets

or other items not in the ordinary course of the Marinas business, provided the revenues
received from such disposition of items are not related to a special event, boat show, or other
type of revenue making event conducted on-site; (iv) proceeds of loans; (v) proceeds of
insurance, other than from any business interruption, business income, use and occupancy
or other loss of income insurance and provided such proceeds will not provide a source of
income revenue to the operator; (vi) credit card commissions provided such commissions will
not provide a source of income revenue to the operator; (vii) travel agency commissions
provided said commissions are not derived from any Lessee, its permitted licensees or
concessionaires and such commissions will not provide a source of income revenue to the
operator; (viii) interest received or accrued with respect to the funds in any reserve or operating
accounts of the Marina; and (ix) the General Exclusions described below.
C. The term Marina Space Lease Rents shall mean all rents actually paid by
Space Tenants permitted licensees or concessionaires, whether for cash or credit (whether
collected or not) of the Marina under their respective Space Leases to Lessee or the applicable
Major Subtenant, as applicable. For purposes hereof, such Space Leases shall include Space
Leases for any portion of the Marina on the Upland and any Space Leases for commercial
operations on the Submerged Land, including, but not necessarily limited to, Space Leases for
Gambling Boats (other than a Direct Space Lease with a Direct Space Tenant which is an
Affiliate of Lessee).
and percentage rents payable under such Space Leases; provided, however, that there shall be
deducted from each rental payment an amount equal to the cost of any tenant improvements paid
for by the landlord amortized over the then applicable term of the applicable Space Lease; (ii)

proceeds from any business interruption, business income, use and occupancy or other
loss of income insurance with respect to such Space Leases, to the extent not paid over to Lessor;
(iii) any amount recovered in any legal action or proceeding or settlement thereof in connection
with such Space Leases, to the extent such amount is properly included in income pursuant to
GAAP; (iv) income from mechanical or other vending machines, including but not limited to,
pay telephones, stamp machines, music machines, or amusement machines; and (iv) any deposits
not refunded.
as additional rent; (iii) any taxes required by law to be collected from Space Tenants at the
Marina on account of any Marina Space Lease Rents or other rentals payable by such Space
Tenants; (iv) any credit card commissions payable on account of any payment of rents made by
operator; and (v) to the extent applicable, the General Exclusions described below.
IV. Retail Space.
A. With respect to the Retail Space, the term Gross Revenues shall mean all
Retail Operational Revenues (if any) and all Retail Space Lease Rents, as hereinafter defined. If
the Retail Space or any portion thereof is not subleased pursuant to a Major Sublease, then the

term Gross Revenues shall refer, as to any portion of the Retail Space not so subleased, to all
such Retail Operational Revenues and Retail Space Lease Rents received by Lessee. If the
Retail Space or any portion thereof is subleased pursuant to a Major Sublease, then the term
Gross Revenues shall refer, as to any portion of the Retail Space so subleased, to all such
Retail Operational Revenues and Retail Space Lease Rents received by the applicable Major
Subtenant; provided, however, that if any Space Tenant with respect to the Retail Space is an
Affiliate of Lessee or such Major Subtenant, then, as to the area covered by the Space Lease for
such Space Tenant, the term Gross Revenues shall refer to the Retail Operational Revenues of
such Space Tenant.
B. The term Retail Operational Revenues shall mean all receipts, revenues,
income, and proceeds of sale, if any, of every kind or nature derived directly or indirectly from
the operation of the Retail Space (including all departments and parts thereof), and all services
provided at or from the Retail Space and all facilities of the Retail Space (other than such
receipts, revenues, income and proceeds attributable to the operation by Space Tenants, if any, of
the Retail Space of their respective businesses, subject, however, to the proviso in Paragraph
IV.A above as to Space Tenants which are Affiliates of Lessee or the Major Subtenant for the
Retail Space), subject to the applicable General Exclusions.
1. Such term shall include, but not necessarily be limited to, those Retail
following (subject, in each case, to the applicable General Exclusions): (i) food and beverage
sales or operations; facilities or property rentals; income from mechanical or other vending
machines, including but not limited to, pay telephones, stamp machines, music machines, or

amusement machines; income from parking; wholesale and retail sales of merchandise to include
any orders taken on the Property although filled wlsewhere and whether made by store personnel
or vending machine, any lay-away sales or like transaction or otherwise involving the
extension of credit, shall be treated as a sale for the full price at the time of the transaction
irrespective of the time of payment or when title passes; and service charges to Retail Space
patrons; (ii) proceeds from any business interruption, business income, use and occupancy
or other loss of income insurance with respect to Retail Space Operational Revenues, to the
extent not paid over to Lessor; (iii) any amount recovered in any legal action or proceeding or
settlement thereof which arose out of the operation of the Retail Space other than with respect to
the Space Leases within the Retail Space, to the extent such amount is properly included in as an
income item under GAAP; and (iv) any deposit not refunded.
collected from patrons of the Retail Space or with respect to goods or services sold at or from the
Retail Space, such as sales taxes (but only to the extent such taxes are actually remitted to duly-
constituted taxing authorities having jurisdiction); (ii) tips, service charges and gratuities
collected for payment to employees of the Retail Space (but only to the extent such amounts are
actually paid to employees); (iii) proceeds from the sale or other disposition of capital assets or
other items not in the ordinary course of the business of operating the Retail Space; (iv)
proceeds of loans provided such proceeds will not provide a source of income revenue to the
operator; (v) proceeds of insurance, other than from any business interruption, business
income, use and occupancy or other loss of income insurance and provided such proceeds
will not provide a source of income revenue to the operator; (vi) credit card commissions

provided such commissions will not provide a source of income revenue to the operator; and
(vii) the General Exclusions described below.
C. The term Retail Space Lease Rents shall mean all rents actually paid by Space
Tenants, permitted licensees or concessionaires, whether for cash or credit (whether collected or
not) of the Retail Space to the landlord under their respective Space Leases.
GAAP; and (iv) income from mechanical or other vending machines, including but not limited
to, pay telephones, stamp machines, music machines, or amusement machines; and (v) any
deposits not refunded.

as additional rent; (iii) any taxes required by law to be collected from Space Tenants within the
Retail Space on account of any Retail Space Lease Rents or other rentals payable by such Space
Tenants; (iv) any credit card commissions, provided such commissions will not provide a source
of income revenue to the operator, payable on account of any payment of rents made by credit
card; and (v) to the extent applicable, the General Exclusions described below.
V. Parking Garage.
A. With respect to the Parking Garage, the term Gross Revenues shall mean all
Parking Operational Revenues and all Parking Lease Rents, as hereinafter defined. If the
Parking Garage or any portion thereof is not subleased pursuant to a Major Sublease, then the
term Gross Revenues shall refer, as to any portion of the Parking Garage not so subleased, to
all such Parking Operational Revenues and Parking Lease Rents received by Lessee. If the
Parking Garage or any portion thereof is subleased pursuant to a Major Sublease, then the term
Gross Revenues shall refer, as to any portion of the Parking Garage so subleased, to all such
Parking Operational Revenues and Parking Lease Rents received by the applicable Major
Subtenant; provided, however, that if any Space Tenant with respect to the Parking Garage is an
Affiliate of Lessee or such Major Subtenant, then, as to the area covered by the Space Lease for
such Space Tenant, the term Gross Revenues shall refer to the Parking Operational Revenues
of such Space Tenant.
B. The term Parking Operational Revenues shall mean all receipts, revenues,
income, and proceeds of sale, if any, of every kind or nature derived directly or indirectly from
the operation of the Parking Garage, and all services provided at or from the Retail Space and all
facilities of the Parking Garage (other than such receipts, revenues, income and proceeds

attributable to the operation by Space Tenants, if any, within the Parking Garage of their
respective businesses), subject to the applicable Exclusions.
1. Such term shall include, but not necessarily be limited to, those Parking
following (subject, in each case, to the applicable Exclusions): (i) parking charges or fees and
service charges payable by patrons and users of parking spaces and other facilities within the
Parking Garage, pursuant to any subleases, licenses or other arrangements for the use of same,
regardless of the duration of the term of such sublease, license or other arrangement
(collectively, Parking Licenses), excluding, however, any portion of such charges or fees or
other sums collected by or paid over to any third-party manager or operator of the Parking
Garage or any portion thereof; facilities or property rentals; and income from vending machines,
including but not limited to, pay telephones, stamp machines, music machines, or amusement
machines; (ii) proceeds from any business interruption, business income, use and
occupancy or other loss of income insurance with respect to Parking Garage Operational
Revenues, to the extent not paid over to Lessor; (iii) any amount recovered in any legal action or
proceeding or settlement thereof which arose out of the operation of the Parking Garage other
than with respect to the Space Leases within the Parking Garage, to the extent such amount is
properly included in as an income item under GAAP; and (iv) any deposit not refunded.
collected from patrons or users of the Parking Garage or with respect to goods or services sold at
or from the Retail Space, such as sales taxes (but only to the extent such taxes are actually

remitted to duly-constituted taxing authorities having jurisdiction); (ii) tips, service charges and
gratuities collected for payment to employees of the Parking Garage (but only to the extent such
amounts are actually paid to employees); (iii) proceeds from the sale or other disposition of
capital assets or other items not in the ordinary course of the business of operating the Parking
Garage provided such sales will not provide a source of income revenue to the operator; (iv)
proceeds of loans provided such proceeds will not provide a source of income revenue to the
operator; (v) proceeds of insurance, other than from any business interruption, business
income, use and occupancy or other loss of income insurance and provided such proceeds
will not provide a source of income revenue to the operator; (vi) credit card commissions
provided such commissions will not provide a source of income revenue to the operator; and
(vii) the General Exclusions described below.
C. The term Parking Lease Rents shall mean all rents actually paid by Space
Tenants of the Parking Garage under their respective Space Leases to Lessee or the applicable
Major Subtenant permitted licensees or concessionaires, whether for cash or credit (whether
collected or not), as applicable. For purposes hereof, the term Space Lease includes, but is not
necessarily limited to, any sublease or other arrangement pursuant to which all or a portion of the
Parking Garage is leased by Lessee or the applicable Major Subtenant to another Person which
operates parking facilities within the Parking Garage. For purposes hereof, the term Space
Lease does not include any Parking License.

GAAP; and (iv) income from mechanical or other vending machines, including but not limited
to, pay telephones, stamp machines, music machines, or amusement machines; and (v) any
deposits not refunded.
as additional rent; (iii) any taxes required by law to be collected from Space Tenants within the
Parking Garage on account of any Parking Lease Rents or other rentals payable by such Space
Tenants; (iv) any credit card commissions payable on account of any payment of rents made by
operator; and (v) to the extent applicable, the General Exclusions described below.
VI. Other Project Components.
To the extent that there is any Project Component not included in the foregoing
categories, the calculation of Gross Revenues shall be treated in the same manner as the category

which is closest in character to the particular Project Component and with such modifications as
are appropriate, all as mutually agreed upon by Lessor and Lessee reasonably and in good faith.
VII. General Exclusions.
A. The term Gross Revenues shall in no event include any of the following items:
(i) exchanges of merchandise between different locations of Lessee or Major Subtenants or
Space Tenants where such exchanges are made solely for the operation of such Persons business
and not for the purpose of consummating a sale which has been made at, in, or on the Property;
(ii) returns to shippers and manufacturers for credit; (iii) sale of trade fixtures or operating
equipment after use thereof in the conduct of Lessees or any other Persons business on the
Property; (iv) all sums and credits received in settlement of claims for loss or damage to
merchandise and all credit company charges; (v) proceeds from any financing, sale or
assignment of the Leasehold Estate, any Major Subleasehold Estate, or any portion thereof or
interest therein, or any other similar transaction; (vi) collection of insurance proceeds; (vii)
collection of Condemnation Awards; (viii) monies that are collected for events that are done for
charities wherein the amounts collected are paid to the charitable sponsor or not-for-profit
organizations; and (ix) any rebates, tax credits (including, but not limited to, those described in
Section 34.4) or other credits, direct payments or other incentives of any kind given by any
Governmental Authority or otherwise authorized by Applicable Laws, including, but not limited
to, any of the foregoing authorized pursuant to the State of Florida Qualified Target Industry Tax
Refund program.
B. Gross Revenues shall be reduced by the following items: (i) amounts of any
refunds or allowances made on merchandise claimed to be defective or unsatisfactory, provided
that such amounts had been previously included as part of Gross Revenues (but if such refunds,

allowances or discounts are in the form of credits to customers, such credits shall be included in
Gross Revenues when issued); (ii) uncollectible credit accounts (those accounts which are more
than one hundred eighty (180) days delinquent), provided that such amounts are included in
Gross Revenues upon payment, if made; and (iii) all reasonable costs of collection associated
with collecting Gross Revenues.
VIII. Rentals.
As used in this Exhibit G, the term rents shall be deemed to include any lump-sum
payments or series of payments (regardless of whether the same is classified as rent or otherwise)
made in consideration of the opportunity to lease or enter into a concession or similar
arrangement.
IX. No Double Counting.
Lessee may from time to time establish facilities or perform services on the Property
(e.g., master laundry facilities) for which Major Subtenants, Space Tenants and/or customers,
guests, invitees and other users (collectively, Users) are charged. Such services and facilities
are hereinafter collectively referred to as Direct Lessee Services. The charges by Lessee for
such Direct Lessee Services are hereinafter referred to as Direct Lessee Charges. The Parties
acknowledge and agree that Major Subtenants, Space Tenants or other Persons may pass on the
cost of Direct Lessee Charges to other Persons, including other Space Tenants and Users, for
services and facilities which are the same or substantially the same as the Direct Lessee Services
(collectively, User Services), either with or without a surcharge or other additional charges.
The amounts charged for such User Services are hereinafter collectively referred to as User
Charges. In such cases, User Charges shall (to the extent they are covered by the definition of

Gross Revenues above) be included in the calculation of Percentage Rent, and the corresponding
Direct Lessee Charges shall be excluded from the calculation of Percentage Rent.

EXHIBIT H
DEFINITION OF MARINA; MARINA APPROVAL PROCEDURES
Definition of Marina Component: The Marina Component shall be constructed as

and shall provide the necessary services as other marinas accommodating the quality and
services of the proposed tenants of the mega-yacht facility and may include among other
things, fractional ownership provided that the same can be structured as an Approved
Time Share License in accordance with State law requirements; the Marina Component
must include (i) slips, dockage, or other accommodations for (in addition to other marine
vessels) water taxis, as well as amphibious aircraft, seaplanes, and other air-sea
amphibious craft (so long as such amphibious aircraft, seaplanes, and other air-sea
amphibious craft are not brought or allowed upon the Upland Parcel of the Property); and
(ii) the 100-foot Setback improvements constructed within the 100-foot Setback which
shall include only and be limited to a fish market and dock master facilities.
From Section 7. 7. Of the Amended and Restated Agreement to Enter:

Marina Approvals. Flagstone has obtained its required Marina Approvals from the
County and Flagstone shall use its best efforts (as such term is defined below) to
maintain in full force and effect throughout the term of Amended and Restated
Agreement to Enter related to the Marina Component and throughout the term of the
Amended and Related Ground Lease for the Marina Component all permits and
approvals from Governmental Authorities (collectively, the Mega-Yacht Marina
Permits) which are required to construct and operate a marina substantially similar in
size and capacity as the marina depicted in the Island Gardens Proposal (a Mega-Yacht
Marina). If deemed necessary or desirable by the City Manager, any applications for
renewals for Mega-Yacht Marina Permits shall be made with the City as the named
applicant or co-applicant, as required by law. In the event Flagstone is able to maintain in
full force and effect all of the Mega-Yacht Marina Permits as a condition precedent to
executing the Ground Lease for the Marina Component, then the term Marina as used
in the Ground Lease shall mean and refer to such Mega-Yacht Marina and the Marina
Component (as defined above and in Composite Attachment 3 hereto), and Flagstone
shall develop and operate such Mega-Yacht Marina subject to and in accordance with the
terms and conditions of the Ground Lease for the Marina Component.
7.7.1 Best Efforts. For purposes hereof, the term best efforts shall mean that
Flagstone shall take all of the following actions:
7.7.1.1 Flagstone has made and shall continue to make good faith
efforts, including expending commercially reasonable amounts of funds, and use all due
diligence (including retaining consultants, professionals and experts and taking their advice) in
pursuing and in continuing to maintain in full force and effect throughout the term of the
Amended and Restated Agreement to Enter relating to the Marina Component and throughout
the term of the Ground Lease related to the Marina Component, all necessary Mega-Yacht

Marina Permits (and specifically in taking all of the actions described in subsections 7.7.1.2
through 7.7.1.5 below).
7.7.1.2 Flagstone has diligently developed and shall continue to diligently

develop such detailed plans and specifications, drawings, schematics, sketches and other
documentation with respect to a Mega-Yacht Marina (as defined above) as may be necessary or
appropriate in connection with its good faith efforts in pursuing and in maintaining in full force
and effect the Mega-Yacht Marina Permits (collectively, the Mega-Yacht Marina Plans).
Should any of the Mega-Yacht Marina Permit for the Marina temporarily lapse, (i) such lapse
shall not be a reason to extend the Outside Dates for construction commencement of the Marina
Component, and (ii) such temporary lapse shall not constitute an Event of Flagstones Default as
long as Flagstone continues to use good faith efforts to reinstate any such lapsed Mega-Yacht
Marina Permit,as applicable.
7.7.1.3 Flagstone submitted the Mega-Yacht Marina Plans to the City

Manager for his or her approval in accordance with the City Manager Approval Procedures and
obtained such approval.
7.7.1.4 After approval of the Mega-Yacht Marina Plans by the City

Manager, with whatever modifications as were agreed upon at that time, all subject to and in
accordance with the City Manager Approval Procedures, Flagstone submitted the Mega-Yacht
Marina Plans to all necessary Governmental Authorities and obtained the Mega-Yacht Permits (it
being understood that the applicable Governmental Authorities include, but are not necessarily
limited to, the State of Florida Department of Environmental Protection, the Army Corps of
Engineers (the Corps), the South Florida Water Management District (SFWMD) and the
Miami-Dade County Department of Environmental Resources Management (DERM), after
responding to and accommodating, in a commercially reasonable manner, any reasonable
requests by such Governmental Authorities for modifications to the Mega-Yacht Marina Plans.
Flagstone informed the City Manager in writing of such modifications at that time. For any
future modifications, the City Manager shall be informed, in writing, of such modifications by
Flagstone, which shall include a legend at the top of the first page in a type face larger than that
used elsewhere in the notice indicating that City is to provide approval or denial with comments
within ten (10) business days pursuant to this Section 7.7.1.4. The City Manager shall have ten
(10) business days from the date of receipt of such notice to review the modifications and advise
Flagstone in writing that the modifications are disapproved. If notice of disapproval is not
delivered within the ten (10) Business Day period, Flagstone shall give a written reminder notice
to the City Manager. If notice of disapproval is not delivered within five (5) Business Days after
such reminder notice is given, the modifications shall be deemed approved. The notice to review
and the reminder notice shall each contain legends at the top of the first page, in a typeface larger
than that used elsewhere in the request, identifying the applicable required response time.
7.7.1.5 After Flagstone obtained consensus among the staff of the

applicable Governmental Authorities for the Mega-Yacht Marina Plans, Flagstone (a) submitted
the Mega-Yacht Marina Plans (as same may have been modified as described above) and an
application for a Class I Permit for the Mega-Yacht Marina (the Class I Permit Application)
to the Miami-Dade County Board of County Commissioners (the Board) for final approval for
the construction and operation of the Mega-Yacht Marina substantially in accordance with such

Mega-Yacht Marina Plans, and had its representatives attend the hearing before the Board
concerning same and persuaded the Board to approve same: and (b) submitted to the other
applicable Governmental Authorities, including the SFWMD and the Corps., the Mega Yacht
Marina Plans and the appropriate application(s) required for the issuance of the applicable Mega-
Yacht Marina Permits and Flagstone thereafter continued to follow up with such application(s)
including, but not limited to, appearing before the SFWMD Governing Board, until such Mega-
Yacht Marina Permit(s) were issued by such Governmental Authorities.
7.7.2 Notice and Meetings with City. Flagstone has in the past provided and from
the Effective Date of this Agreement shall continue to provide City with at least seven (7) days
prior written notice of any meeting with the staff of applicable Governmental Authorities. City
shall have the right to have a representative present (by telephone or in person) at each such
meeting. In addition, Flagstone shall provide City with copies of any written correspondence
between Flagstone and such Governmental Authorities in connection with the best efforts steps
described in Section 7.7.1 above for any future matters regarding the Mega-Yacht Marina.
7.7.2.1 Flagstone has in the past held and from the Effective Date of this
Agreement hereby agrees to continue to have monthly meetings with Citys designated
representatives to discuss the status of Flagstones best efforts regarding the Mega-Yacht
Marina, and to keep City regularly apprised through written updates as to what best efforts
have been and are being taken by Flagstone in order to satisfy its continuing obligations
regarding any future Governmental Approvals in Section 7.7.1 above and the status thereof. If,
after any such monthly meeting or after City receives any such written update, City believes,
reasonably and in good faith, that Flagstone is not using its best efforts as described in
subparagraph (c) above, City shall, within seven (7) Business Days after receiving any such
meeting or written update, give written notice to Flagstone stating with particularity Citys belief
and the specific basis for such belief. If City fails to give such written notice within such seven
(7) Business Day period, the actions by Flagstone which are described in such meeting or written
update shall be deemed to constitute best efforts as described in Section 7.7.1 above up to the
last step taken by Flagstone as described in such meeting or written update, and City shall not be
entitled to submit to arbitration the question of whether such actions by Flagstone constitute best
efforts.
7.7.2.2. Notwithstanding the foregoing, Flagstone shall not be required to

accept any unreasonable conditions for continued approval(s) or renewal(s) which would
compromise the feasibility of the proposed Mega-Yacht Marina or place unreasonable financial
or economic burdens on Flagstone (either in terms of increased costs or reduced income) or
unreasonable covenants, conditions and/or restrictions with respect to the development and
operation of the proposed Mega-Yacht Marina Component.
7.7.2.3 In the event Lessee is unable, after using such best efforts, to
obtain all of the Mega-Yacht Marina Permits, then Lessee shall provide written notice thereof to
Lessor. If Lessor agrees, reasonably and in good faith, that Lessee has used such best efforts and
that the MegaYacht Marina Permits cannot be obtained, then term Marina as used herein shall
mean such marina as Lessee is able to construct and operate based on the existing Marina
permits or such other permits and approvals from Governmental Authorities Lessee is able to

obtain. If Lessor does not agree that Lessee has used such best efforts to obtain the Mega-Yacht
Marina Permits, and Lessee disputes same, then no later than thirty (30) days after Lessors
receipt of written notice from Lessee, Lessor shall provide written notice to Lessee that Lessor is
submitting the matter to arbitration in accordance with subparagraph (i) below; provided,
however, that Lessor shall not be entitled to submit the matter to arbitration to the extent
subparagraph (f) provides otherwise.
7.7.2.4 If at any time (including, without limitation, at the time Lessee

provides written notice to Lessor that Lessee is unable to obtain the Megayacht Marina Permits)
Lessor believes, reasonably and in good faith, that Lessee has not or is not using best efforts to
obtain the Mega-Yacht Marina Permits, then Lessor shall refer such dispute to binding
arbitration in accordance with Article XVII. In determining whether Lessee has used its best
efforts as described in subparagraph (c) above, the Arbitrator may consider whether Lessee
should pursue any administrative appeals. In no event shall Lessee be required to pursue
litigation (although it may, at its option, elect to do so).
7.7.2.5 Nothing contained herein shall be deemed from preventing Lessee,

if Lessee is unable to obtain the Mega-Yacht Marina Permits after using its best efforts as
described herein, from later pursuing the Mega-Yacht Marina Permits, and if Lessee is thereafter
able to obtain the Mega-Yacht Marina Permits and elects to develop and operate the Mega Yacht
Marina, then the term Marina as used herein shall, from and after the date Lessee obtains the
last of the Mega-Yacht Marina Permits, mean and refer to the Mega-Yacht Marina, and Lessee
shall develop and operate such Mega-Yacht Marina subject and in accordance with the terms and
conditions of this Lease.

EXHIBIT I
[To be Updated]
PERMITTED TITLE EXCEPTIONS
1. Bulkhead line as shown on the plat recorded in Plat Book 74, Page 4.
2. Oil, gas and mineral reservations as set forth in that Deed from the Trustees of the
Internal Improvement Fund to the City of Miami, filed April 11, 1949 in Deed Book 3130, Page
257 under Clerks File No. Y-29610. Note: The right of entry has been released pursuant to [TO
BE FILLED IN].
3. Agreement for Water Facilities recorded March 13, 1998, in Official Records
Book 18016, Page 2892.
4. Agreement for Sanitary Sewage Facilities recorded April 14, 1998, in Official
Records Book 18058, Page 112.
5. Resolution No. 98-23, recorded January 19, 1999, in Official Records Book
18699, Page 1236.
6. Easement in favor of the United States of America set forth in that Grant of
Easement for Miami Harbor Turning Basin, recorded April 22, 1963, in Official Records Book
3622, Page 751.
7. Perpetual Easement in favor of Florida Department of Transportation recorded
March 13, 1998 in Official Records Book 18018, Page 1181.
NOTE: All recording references are as to the Public Records of Miami-Dade County,
Florida.

EXHIBIT J
LIST OF PRE-APPROVED HOTEL FRANCHISORS
Hilton group, including, but not limited to, Conrad Hotels

Starwood group, including, but not limited to, W Hotels, St. Regis Hotels, Starwood
Luxury Collection and Le Meridien
Rosewood Hotels
Hyatt group, including, but not limited to, Park Hyatt
Raffles Group, including, but not limited to, Raffles Hotels
Marriott group, including, but not limited to, Bulgari Hotels
The Peninsula Group
Four Seasons Group, including, but not limited to, The Regent hotels
The Rocco Forte group, including, but not limited to, RF Hotels
Kempinski Hotels & Resorts
Six Continents Hotels
Mandarin Oriental
Fairmont Hotels & Resorts
Orient Express Hotels
Shangri-La Hotels & Resorts
Kimpton Hotels
Morgans Hotel Group
Aman Resort
Rixos

EXHIBIT K
LIST OF PRE-APPROVED LENDERS
ABN Amro
Abu Dhabi International Bank
AEW Capital Management
American Realty Advisors
Apollo Real Estate
ARC Global Partners
Arcadia Investment Management
Bain Capital
Banco Santander
Bank of America Corp. Charlotte, N.C.
Bank of New York Mellon
Bank of Nova Scotia Halifax, Canada
Barclays PLC London
Barclays Global Investors
Bayerische Hypo-und Vereinsbanken AG (including HVB Real Estate) Munich
Bayerische Landesbank Girozentrale Munich
Blackacre Capital Management
Blackrock Realty Advisors
Blackstone Group
BNP Paribas Paris
BV Group Ventures
Canadian Imperial Bank of Commerce (CIBC) Toronto
Capmark
Cargill
Carlyle Group
CB Richard Ellis
Cigna
Citigroup Inc. New York
Colony Capital
Commerzbank Frankfurt
Cornerstone Real Estate Advisors
Crescent Real Estate
Credit Agricole
Credit Lyonnais Calyon
Credit Suisse Group Zurich
De Shaw & Company
Deutsche Bank Frankfurt
Dubai International Capital
First National Life Insurance Co.
Fortis
Fortress
Fremont
GE Capital
GMAC
Goldman Sachs
GSO Capital Partners
Harbourvest Partners

HSBC Holdings PLC London
ING Group (including Clarion Partners)
Investcorp
iStar Financial
Jamestown
J.P. Morgan Chase New York
John Hancock
KeyCorp Cleveland
Kumagai Gumi Co., Ltd.
Leucadia International
Lubert-Adler Partners
Marubeni Corporation
Mass Mutual
Metropolitan Life
Mitsubishi Corporation
Mitsui Fudoson America
Morgan Stanley
MSD Capital
Nationwide Life
New York Life Investment
Nippon Life Insurance Co.
Northwest Mutual
Oaktree Capital Management
Pacific Life Insurance Company
Pegasus Capital
Perry Capital
PNC Financial Services Corp. Pittsburgh
Prudential Financial
Royal Bank of Canada Toronto
Royal Bank of Scotland Group PLC (RBS) Edinburgh
RREEF
Societe Generale Paris
Soros
Stark Investments
Stanwood Capital
Sumitomo Corporation
Sumitomo Life Realty
SunTrust Bank Inc. Atlanta
TD Bank
Teachers Insurance
TIAA-CREF
UBS AG Zurich
US Bank
Vulcan Ventures
Wafra Investment Advisory Group
Walton Street Capital
Warburg Pincus
Wells Fargo & Co. San Francisco (including Wachovia)
Westdeutsche Landesbank Girozentrale Dusseldorf, Germany
Whitehall

EXHIBIT L
APPROVED LEASEHOLD MORTGAGEE SNDA
Prepared By and Return to
Andrew S. Robins, Esq.

Gunster, Yoakley & Stewart P.A.
500 E. Broward Blvd., Suite 1400
Ft. Lauderdale, Florida 33394
SPACE ABOVE THIS LINE FOR RECORDING DATA
SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT
THIS SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT

AGREEMENT (this Agreement) made as of the ____ day of _____________, 20__ by and
among THE CITY OF MIAMI, a municipal corporation of the State of Florida (Lessor),
FLAGSTONE ISLAND GARDENS, LLC, a Delaware limited liability company (Lessee),
and _________________________, a _________________________ (Leasehold Mortgagee).
WITNESSETH:
WHEREAS, Lessor is the owner in fee simple of certain real property more particularly
described in Exhibit A, attached hereto and incorporated herein by this reference (the
Property); and
WHEREAS, pursuant to that certain Ground Lease dated ____________, 200_ (the
Ground Lease), a memorandum of which was recorded in Official Records Book ______, at
Page _______, of the Public Records of Miami-Dade County, Florida, Lessor has leased the
Property to Lessee, subject to and in accordance with the terms and conditions of the Ground
Lease (unless otherwise defined herein, all capitalized terms used herein shall have the respective
meanings ascribed to them in the Ground Lease); and
WHEREAS, pursuant to the Ground Lease, Lessee is the owner and holder of the
Leasehold Estate during the Lease Term, and Lessee is and shall be, during the Lease Term, the
owner and holder of all Leasehold Improvements now or hereafter constructed on the Property;
and

WHEREAS, Leasehold Mortgagee has agreed to make a loan in the original face amount
of $___________________ to Lessee (as the same may be amended, modified, restated, renewed
or extended from time to time, the Loan); and
WHEREAS, the Loan will be evidenced by a mortgage note (as the same may be
amended, modified, restated, renewed, substituted or extended from time to time, the Note)
made by Lessee to the order of Leasehold Mortgagee and will be secured by, among other things,
a mortgage and other security documents more particularly described in Exhibit B, attached
hereto (as the same may be amended, modified, restated, renewed, substituted or extended from
time to time, collectively, the Leasehold Mortgage) made by Lessee to Leasehold Mortgagee,
which Leasehold Mortgage will encumber the Leasehold Estate and the Leasehold
Improvements (the Note, the Leasehold Mortgage and all other documents and instruments
which evidence, secure or are otherwise related to the Loan, as the same may be amended,
modified, restated, renewed, substituted or extended from time to time, are sometimes hereinafter
collectively referred to the Leasehold Loan Documents).
NOW, THEREFORE, the parties hereto, in consideration of the covenants contained

herein and other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, hereby agree as follows:
1. RECITALS. The foregoing recitals are true and correct and incorporated herein
by this reference.
2. LESSORS FEE ESTATE NOT ENCUMBERED BY LEASEHOLD

MORTGAGE. Leasehold Mortgagee hereby acknowledges and agrees that the leasehold
Mortgagee does not and shall not encumber or constitute a lien upon Lessors fee simple estate in
the Property.
3. LESSORS ACKNOWLEDGMENT OF LEASEHOLD MORTGAGE.

Pursuant to any and all applicable provisions of the Ground Lease, Lessor hereby irrevocably
and fully consents to the execution and delivery (and recordation, where applicable) of the
Leasehold Mortgage and other Leasehold Loan Documents. Lessor hereby further acknowledges
and agrees as follows: 1
(a) Approved Lender. Leasehold Mortgagee hereby is, and shall at all times
until all obligations secured by the Leasehold Mortgage have been paid in full or
the Leasehold Mortgage has been fully released and satisfied, whichever occurs
first, be deemed an Approved Lender, an Approved Leasehold Mortgagee and an
Approved Mortgagee, as such terms are defined, described and used in the
Ground Lease. As used herein, the term Leasehold Mortgagee shall include: (x)
each and every successor of Leasehold Mortgagee; and (y) each and every
assignee of Leasehold Mortgagee, so long as assignee independently meets the
1
As a condition to Lessors executing this Agreement, Lessor may require Lessee to provide such written representation or othe r
evidence as Lessor may reasonably require in order to confirm that the conditions set forth in the definitions of Approved Lender,
Approved Leasehold Mortgagee, Approved Mortgagee, Approved Leasehold Mortgagee, Approved Mortgage and Approved
Leasehold Mortgage, as defined in the Ground Lease are satisfied. This footnote will be deleted from the final form of this
Agreement before it is executed.

criteria set forth in clauses (i) through (vii) of the definition of Approved Lender
contained in the Ground Lease (subject to the last sentence of clause (viii) of such
definition).
(b) Approved Mortgage.
(i) General. The Leasehold Mortgage hereby is, and shall at all times
until all obligations secured by the Leasehold Mortgage have been
paid in full, or the Leasehold Mortgage has been fully released and
satisfied, whichever occurs first, be deemed an Approved
Mortgage and an Approved Leasehold Mortgage, as such terms are
defined, described, and used in the Ground Lease.
(ii) Optional Advances. Notwithstanding the provisions of

subparagraph (a) above, no Optional Advance (as hereinafter
defined) shall be deemed secured by an Approved Mortgage or an
Approved leasehold Mortgage unless and until the provisions of
clauses (iii) and (iv) of Section 6.1(b) of the Ground Lease are
independently satisfied as to such Optional Advance. Each such
Optional Advance shall be treated as a separate loan for purposes
of satisfying the provisions of clauses (iii) and (iv) of Section
6.1(b) of the Ground lease. Upon Leasehold Mortgagees request
and delivery of evidence reasonably satisfactory to Lessor that the
provisions of clauses (iii) and (iv) of Section 6.1(b) of the Ground
Lease are independently satisfied as to any such Optional Advance,
Lessor shall execute a written acknowledgement confirming that
such Optional Advance independently satisfies the requirements of
such clauses (iii) and (iv).
(iii) Definition of Optional Advances. The term Optional Advance

shall mean: (x) a future advance under the Leasehold Mortgage
which is entirely within Leasehold Mortgagees discretion to
make; or (y) any advance of additional funds pursuant to a future
modification of the Leasehold Mortgage; provided, however, that
in no event shall the term Optional Advance be deeded to
include any advances or disbursements for construction or other
purposes which are made upon the satisfaction or waiver of certain
terms and conditions specified in the leasehold Mortgage and/or
the other Leasehold Loan Documents, even if the Leasehold
Mortgage and/or the other Leasehold Loan Documents permit
Leasehold Mortgagee to determine in its sole discretion or
judgment whether to make such advances or disbursements if such
terms and conditions are not satisfied or if a default or event of
default under the Leasehold Mortgage and/or the other Leasehold
Loan Documents then exists. Moreover, the term Optional
Advance shall not include any advances for the purpose of paying

unpaid taxes, assessments or levies against the Property or unpaid
insurance premiums with respect to the Property, protecting the
Collateral (as hereinafter defined), preserving leasehold
Mortgagees lien upon and security interest in the Collateral,
curing defaults under the Leasehold Loan Documents and/or the
Ground lease and other protective, remedial and/or curative
advances.
(c) Rights and Benefits Under Ground Lease. All rights and benefits of an
approved Lender, Approved Leasehold Mortgagee and an approved
Mortgagee provided in the Ground Lease may be exercised and enjoyed
by Leasehold Mortgagee in accordance with the provisions of the Ground
Lease, including, but not limited to, those rights and benefits conferred by
Article VI (Leasehold and Subleasehold Mortgages), Section 8.7
(Approved Leasehold Mortgages, Leases and Subleases), Article XVI
(Damage or Destruction) and Article XXIV (Condemnation) of the
Ground Lease, and Lessor is and shall be bound by all provisions in the
Ground Lease applicable to Leasehold Mortgagee and the Leasehold
Mortgage.
(d) Conditions of Ground Lease Satisfied. Lessee hereby represents that it

has delivered to Lessor copies of the executed leasehold Mortgage and all
other Leasehold Loan Documents (as more particularly described in a
separate certificate signed by Lessee and delivered to Lessor), and that
same have not been modified or amended through the date hereof (except
as may be set forth in such certificate), Lessor hereby confirms that all
conditions of Section 6.4 of the Ground Lease have been fully satisfied
(and that this Agreement fully satisfies the requirements of Section 6.4 of
the Ground Lease concerning the execution and delivery of the
Subordination, Non-Disturbance and Attornment Agreement described
therein with respect to the leasehold Mortgage), such that Leasehold
Mortgagee shall have the rights and benefits described in Article VI of the
Ground Lease.
4. COLLATERAL FOR LEASEHOLD MORTGAGE. Until all obligations

secured by the Leasehold Mortgage have been paid in full or the Leasehold Mortgage has
been fully released and satisfied, whichever occurs first:
(a) Lien and Encumbrance. Lessor hereby acknowledges that the purpose
of the Leasehold Mortgage is to create a lien and encumbrance upon and security
interest in all of the collateral described in the Leasehold Mortgage and the other
Leasehold Loan Documents and all additions, replacements and substitutions
therefor and proceeds thereof (collectively, the Collateral), including, but not
limited to, the following items (except to the extent the Leasehold Loan
Documents specifically provide that same are not part of the Collateral):

(i) the Leasehold Estate (and related easements) and the Leasehold
Improvements;
(ii) all of Lessees right, title and interest in and to any and all
furniture, fixtures, equipment, machinery, goods, merchandise,
inventory and other tangible personal property of Lessee located
upon or within or connected to the Property;
(iii) all of Lessees right, title and interest in and to any and all
intangible personal property pertaining or related to or connected
with the Property, including, but not limited to, plans and
specifications, permits, licenses, service contracts and other
agreements, and intellectual property; and
(iv) all other tangible and intangible personal property of Lessee of any
kind or nature whatsoever, wherever located, now or hereafter
acquired, all as more particularly set forth in the Leasehold
Mortgage.
(b) No Ownership Rights of Lessor. At all times during the Lease Term
(and if a New Lease (as hereinafter defined) is entered into in accordance with the
terms of the Ground Lease and this Agreement, at all times during the term
thereof, including any extension options when and if exercised, and any period
between the termination of the Ground Lease and the commencement of the term
of such New Lease), but not after the expiration of the Lease Term or the term of
any such New Lease, as the case may be:
(i) Lessor is not, and shall not claim to be, the owner of the Collateral
or any part of the Collateral; and
(ii) All of the Collateral shall be conclusively presumed to be the

property of Lessee (subject to any rights therein of Leasehold
Mortgagee or any or any Persons claiming by, through or under
Leasehold Mortgagee), regardless of the nature of any item of the
Collateral or the manner in which it is or may become affixed to or
incorporated into the Property or otherwise acquired or obtained by
Lessee.
5. SUBORDINATION.
(a) Acknowledgment of Lessors Lien rights under Section 23.1 of

Ground Lease. Leasehold Mortgagee hereby acknowledges that pursuant
to Section 23.1 of the Ground Lease, Lessee has granted to Lessor a lien
upon the Leasehold Improvements and the Leasehold Estate to the extent
described therein.

(b) Lessors Lien.
(i) Definition. As used herein, the term Lessors Lien shall

collectively mean and refer to: (i) the lien granted to Lessor upon
the Leasehold Improvements and the leasehold Estate to the extent
described in Section 23.1 of the Ground Lease; and (ii) any and all
other claims, rights of distraint or levy, landlords lien or other
lien rights, or any other right, title or interest, if any, which Lessor
may have upon, in or to any portion of the Collateral from time to
time.
(ii) Subordination. Lessor acknowledges and agrees that each and

every Lessors Lien (to the extent same may exist) is and shall at
all times and for all purposes and in all respects, be subject,
subordinate and inferior to the lien, operation, effect, terms and
provisions of the leasehold Mortgage and other Leasehold Loan
Documents and the rights of Leasehold Mortgagee (and any
Approved Foreclosure Transferee and any Approved Subsequent
Foreclosure Purchaser) thereunder or otherwise in connection with
the Loan.
(iii) No Enforcement. Lessor acknowledges and agrees that without

Leasehold Mortgagees prior written consent, no Lessors Lien
may be enforced against any portion of the Leasehold
Improvements, the Leasehold Estate or any other portion of the
Collateral at the time such portion is encumbered by the Leasehold
Mortgage and/or the other Leasehold Loan Documents.
(iv) Lessors Lien Arising After Foreclosure Transfer.

Notwithstanding the provisions of subparagraphs 5(b)(ii) and
5(b)(iii) above, any Approved Foreclosure Transferee and
Approved Subsequent Foreclosure Purchaser shall take subject to
any Lessors Lien on account of any obligation arising after the
date of the Foreclosure Transfer by which such Approved
Foreclosure Transferee acquires title to the Collateral, and Lessor
may enforce such Lessors Lien as permitted by the provisions of
the Ground Lease.
(c) Development Plans.
(i) Use Rights. Leasehold Mortgagee hereby acknowledges that

Lessee has granted to Lessor the right to: (i) use the Development
Plans, to the extent set forth in Section 6.10 of the Ground Lease;
and (ii) grant to other professionals the right to use the
Development Plans (subject to the rights of the architect(s) and
engineer(s) who prepared the Development Plans and to the rights

of any Approved Mortgagees therein), to the extent set forth in
Section 6.10 of the Ground Lease. Lessor hereby agrees not to
enforce such rights except as provided by subparagraph (c)(iii)
below.
(ii) Subordination. Without limiting the generality of subparagraph

(b) above, Lessor hereby acknowledges and agrees that the rights
of Lessor described in clause (i) above are and shall, at all times
and for all purposes and in all respects, be subject, subordinate and
inferior to lien, operation, effect, terms and provisions of the
Leasehold Mortgage and the other Leasehold Loan Documents and
the rights of Leasehold Mortgagee (and any Approved Foreclosure
Transferee and any Approved Subsequent Foreclosure Purchaser)
thereunder with respect to the Development Plans and the Project
Approvals. If required by Leasehold Mortgagee, Lessor shall join
in any pledge of such rights as security for the Loan solely to
subordinate Lessors interest in the same to the interest therein of
Leasehold Mortgagee on the terms set forth herein.
(iii) Rights Upon Termination of Lease. In the event of termination

of the Ground Lease on account of an Event of Lessees Default,
Lessor shall be entitled to the full complete and unconditional use
and ownership of the Development Plans and the ability to grant to
other professionals the right to use the Development Plans (subject
to the rights of the architect(s) and engineer(s) who prepared the
Development Plans), and full, complete and unconditional
ownership of the Project Approvals, without payment of any
consideration therefor by Lessor to Lessee, provided that until the
expiration of the period within which Leasehold Mortgage or any
Approved Foreclosure Transferee or Approved Subsequent
Foreclosure Purchaser may enter into a New Lease pursuant to
Section 10 below, and thereafter if Leasehold Mortgagee or any
Foreclosure Purchaser does enter into a New Lease pursuant to
Section 10 below, such rights of Lessor therein shall, at all times
and for all purposes and in all respects, be subject, subordinate and
inferior, to the rights therein of Leasehold Mortgage or such
Foreclosure Purchaser.
6. NO SURRENDER, MODIFICATION, ETC. Until all obligations secured by the

Leasehold Mortgage have been paid in full or the Leasehold Mortgage has been fully released
and satisfied, whichever occurs first:2
2
Lessor agrees that this provision shall be modified, if Leasehold Mortgagee requires such modification, to prohibit Lessor an d
lessee from waiving any provision of the Ground Lease (which, in Lessors case, shall mean an express waiver in a writing
signed on behalf of Lessor) without Leasehold Mortgagees prior written consent, to the extent such waiver would have an

(a) No Termination of Ground Lease. Lessor shall not accept from Lessee, and
Lessee shall not offer to Lessor, any cancellation, surrender or termination of the
Ground Lease, and any purported cancellation, surrender or termination without
Leasehold Mortgagees prior written consent shall be null and void and of no
force or effect.
(b) No Amendment of Ground Lease. Lessor and Lessee shall not amend or
modify, and shall not agree to amend or modify, in any material respect, any
provision of the Ground Lease, without Leasehold Mortgagees prior written
consent. Any such amendment or modification without Leasehold Mortgagees
prior written consent shall be null and void and of no force or effect. 3
7. CERTAIN RIGHTS OF LEASEHOLD MORTGAGEE WITH RESPECT TO

GROUND LEASE. Until all obligations secured by the Leasehold Mortgagee have been paid in
full, or the Leasehold Mortgage has been fully released and satisfied, whichever occurs first,
Lessor shall have the obligations set forth below with respect to the Ground Lease, and
Leasehold Mortgagee shall have the rights, remedies and recourse set forth below with respect to
the Ground Lease:
(a) Insurance Policies. Lessor agrees that Leasehold Mortgagee shall, at Leasehold
Mortgagees option, be named as an additional insured and loss payee under any
and all insurance policies required to be carried by Lessee under the Ground
Lease.
(b) Casualty. In the event of any Casualty, Leasehold Mortgagee may, to the extent
provided for by Leasehold Mortgage, apply all or any portion of Net Insurance
Proceeds to any principal, interest or other sums due and payable to Leasehold
Mortgagee under the Leasehold Mortgage and the other Leasehold Loan
Documents. No such application shall relieve Lessee of its obligations under
Article XVI of the Ground Lease. To the extent there remain any Net Insurance
Proceeds, or to the extent there remain any Net Insurance Proceeds after such
application, the provisions of Article XVI of the Ground Lease shall govern the
collection and disbursement of such Net Insurance Proceeds and the use of such
Net Insurance Proceeds for the completion of Restoration work. Without limiting
the generality of the foregoing, to the extent provided for by Article XVI of the
adverse effect on Leasehold Mortgagees security for the Loan. Furthermore, Lessor agrees that in the case of a Leasehold
Mortgagee holding a first priority Leasehold Mortgage, this provision shall be modified, if such leasehold Mortgagee requires
such a modification, to prohibit Lessor from consenting to any matters under the Ground Lease for which Lessors consent is
required, without such Leasehold Mortgagees prior written consent. In the case of either such modification, there shall als o be
included language providing that where Leasehold Mortgagees consent is so required, such consent shall be deemed given if
leasehold Mortgagee fails to disapprove the proposed action in writing within ten (10) business days after leasehold Mortgage e
receives written notice requesting such consent. This footnote shall not appear in the final Agreement and shall also be deleted
from any proposed form submitted to Leasehold Mortgagee.
3
It is understood that Lessor may negotiate with Leasehold Mortgagee in good faith to permit certain types or classes of
amendments or modifications or waivers without Leasehold Mortgagees prior written consent to Leasehold Mortgagee, provided
that no changes shall be made to Section 6(b) hereof unless agreeable to Leasehold Mortgagee). This footnote shall not appear in
the final Agreement and neither this footnote nor the restriction set forth in subparagraph 6(b) shall be included in any propose d
form submitted to Leasehold Mortgagee.

Ground Lease, such Net Insurance Proceeds shall be deposited with an Insurance
Trustee pursuant to an Insurance Escrow Agreement as contemplated by Section
16.2(b) of the Ground Lease, provided that such Insurance Escrow Agreement is
satisfactory in form and content to Leasehold Mortgagee, Lessee and Lessor.
Leasehold Mortgagee may require that such Insurance Escrow Agreement
incorporate (by reference or otherwise) the provisions of the Leasehold Loan
Documents setting forth the terms and conditions for the disbursement and use of
Net Insurance Proceeds.
(c) Condemnation. In the event of any Condemnation, Leasehold Mortgagee may,

to the extent provided for by the Leasehold Mortgage, apply all or any portion of
the Condemnation Awards to any principal, interest or other sums due and
payable to Leasehold Mortgagee under the Leasehold Mortgage and the other
Leasehold Loan Documents. No such application shall relieve Lessee of its
obligations under Article XXIV of the Ground Lease. To the extent Leasehold
Mortgage does not so apply Condemnation Awards, or to the extent there remain
any Condemnation Awards after such application, the provisions of Article XXIV
of the Ground Lease shall govern the allocation and disbursement of such
Condemnation Awards and the use of such Condemnation Awards for restoring
any balance of the Project not taken (as contemplated by Section 24.3(b)(i) of the
Ground Lease); provided, however, that Leasehold Mortgagee may impose such
additional terms and conditions for such disbursement and use of such
Condemnation Awards as are set forth in the Leasehold Mortgage.
(d) Consent and Participation Rights. Lessor and Lessee shall not settle or
compromise the mount or division of any Condemnation award in any
Condemnation proceeding without Leasehold Mortgagee shall be entitled to
participate in any such Condemnation proceeding and make claim for the share of
any award to which Lessee is entitled by the terms of Article XXIV of the Ground
Lease.
(e) Renewal Options. Lessor shall give written notice to Leasehold Mortgagee of
Lessees failure to timely exercise any Extension Option (the Extension Option
Notice). Leasehold Mortgagee (or an Approved Foreclosure Transferee, if
applicable) may, at its option, and without limiting the availability of other
remedies under the Leasehold Loan Documents, exercise such Extension Option
on timely exercised by Lessee, and Lessor agreements to recognize and be bound
be the exercise of such Extension Option by Leasehold Mortgagee or such
Approved Foreclosure Transferee, provided that:
(i) No Material Uncured Lessees Default. No Material Uncured Lessees

Default then exists, other than a Material Uncured Lessees Default: (i) as
to which Leasehold Mortgagee or such Approved Foreclosure Transferee
is diligently pursuing a cure (including initiating actions to obtain
possession of and title to the Collateral in order to facilitate such cure) in

the manner and within the time afforded by Section 8 below; or (ii) which
is not susceptible to cure; and
(ii) Time to Exercise. Leasehold Mortgage or such Approved Foreclosure

Transferee exercises such Extension Option within thirty (30) days of
Leasehold Mortgagees receipt of the Extension Option Notice; provided,
however, that if at any time during such thirty (30) day period, there are
pending foreclosure proceedings with respect to the Leasehold Mortgage
or any pending bankruptcy (or insolvency or similar) proceedings as to
which an automatic stay or other similar order affecting any such
foreclosure proceedings has been or may thereafter be issued, then the
deadline within which Leasehold Mortgagee or such Approved
Foreclosure Transferee may exercise such Extension Option shall be
extended to the date which is six (6) months after the later of: (i) the
termination of such foreclosure proceedings or the completion of
Foreclosure Transfer with respect to the Leasehold Mortgage; or (ii) the
lifting in any bankruptcy (or insolvency or similar) proceedings of any
automatic stay or other similar order affecting Lessee.
8. NOTICE AND CURE RIGHTS. The term lender Party shall mean, as applicable: (i)
as to any period prior to a Foreclosure Transfer with respect to the Leasehold Mortgage,
Leasehold Mortgagee; (ii) as to any period after such Foreclosure Transfer, but only with respect
to Defaults occurring before such Foreclosure Transfer, any Approved foreclosure Transferee or
any Approved Subsequent foreclosure Purchaser, as applicable. Until all obligations secured by
the leasehold Mortgage have been paid in full or the Leasehold Mortgage is fully released and
satisfied, whichever occurs first, Lessor shall have the obligations, and the applicable Lender
Party shall be afforded the notice and cure rights and other rights, set forth in this Section 8,
provided that in the case of any Approved Foreclosure Transferee or Approved Subsequent
Foreclosure Purchaser, such Lender Party shall have given Lessor written notice of its name and
address.
(a) Notice of Default. Whenever Lessor sends or gives Lessee any written notice of
or other written communication (a Default Notice) from Lessor pertaining to a
default or any event which, if not remedied, would or could result in an Event of
Lessees Default (collectively, a Default), Lessor shall simultaneously send a
copy of such Default Notice to the applicable Lender Party. The applicable
Lender Party shall be afforded the applicable cure period with respect to such
Default as is specified in subparagraph (b) below.
(b) Leasehold Mortgagees right to Cure. Upon the applicable Lender Partys
receipt of a Default Notice, the applicable Lender Party shall have the same
period of time as is allowed to Lessee under the provisions of the Ground Lease,
plus an additional thirty (30) days, to cure the alleged Default or cause the same to
be cured, provided that such cure shall require payment of interest at the Default
Rate (as defined in Section 1.5(s) of the Ground Lease) on sums due pursuant to
the Ground Lease for the period commencing on the date on which such Lender

Party first received such Default Notice until the date payment is received by
Lessor. Notwithstanding the foregoing:
(i) Additional Notice and Cure Period for Certain Monetary Default. In
the case of an alleged Default on account of Lessees failure to pay Base
Rent, Percentage Rent, Impositions or the cost of insurance, which Default
is not cured by the applicable Lender Party within the additional thirty
(30) day cure period specified above, Lessor shall give the applicable
Lender Party a second written Default Notice with respect to such alleged
Default, which Default Notice shall state in boldface: Failure to cure the
Default(s) described herein within thirty (30) days from the date of this
Default Notice is given will entitle Lessor to terminate the Ground lease,
and in the event of such termination of the Ground Lease, you will not be
entitled to enter into a New Lease. The applicable Lender Party shall be
afforded thirty (30) days from its receipt of such second written Default
Notice within which it may cure any such alleged Default on account of
Lessees failure to pay Base Rent, Percentage Rent, Impositions or the
cost of insurance; and
(ii) Additional Cure Period to Cure Certain Defaults. In the case of an

alleged Default which is not reasonably susceptible to being cured within
such additional thirty (30) day period, the applicable Lender Party, with
the exercise of due diligence and in good faith, to cure such alleged
Default or cause same to be cured.
(c) Where Possession is Necessary: Foreclosure Proceedings.
(i) Additional Cure Period. Notwithstanding the provisions of

subparagraph (b) above, in the case of any alleged Default not involving
the failure to pay money, which Default is capable of being cured but is
not reasonably susceptible to cure without having possession of the
Property (a Curable Default), the applicable Lender Party shall have the
right to further extend the period of time within which to cure such
Curable Default for such reasonable additional period as will enable the
applicable Lender Party, with the exercise of due diligence and in good
faith, to institute foreclosure proceedings, cause the leasehold Estate to be
acquired and cause lessee to be removed from the property through a
Foreclosure Transfer, and at the earliest reasonable opportunity thereafter,
cure such curable Default (unless such Default has been previously cured,
including any cure by a receiver appointed in connection with such
foreclosure proceedings). Nothing contained in this Agreement or in the
Ground Lease shall: (i) require any Lender party to cure such Curable
Default prior to the time when such Lender Party has actually obtained
such possession, so long as the applicable Lender Party is actively seeking
to obtain such possession; or (ii) require any Lender party to cure any
Default which is not susceptible to cure.

(ii) Lessors Cooperation. Lessor agrees to cooperate in the prosecution of
any such foreclosure or other proceedings brought by any Lender Party to
obtain possession of the property; provided, however, that Lessor shall not
be obligated to incur any cost in connection with such cooperation unless
Lessor is reimbursed for any actual and reasonable cost so incurred by
Lessor.
(iii) Effect of Stay. Lessor agrees that if by reason of a bankruptcy,

insolvency or similar type proceeding, or by reason of any other judicial
order or legislative enactment, any Lender Party shall be stayed from
commencing (or if commenced, from continuing) foreclosure proceedings,
then such Lender Party shall be deemed to be prosecuting such
proceedings in the exercise of due diligence and in good faith so long as it
is in good faith attempting to obtain relief from any such stay.
(d) Acceptance of Cure. Lessee irrevocably directs that Lessor accept, and Lessor
hereby agrees to accept, any such cure of a Default made within the time periods
described in subparagraph (b), subparagraph (c)(i) and/or subparagraph (c)(iii)
above, as applicable, by or on behalf of any Lender Party, as if same had been
performed by Lessee.
(e) Nullification of any Termination. Any attempt by Lessor to terminate the

Ground Lease on account of any Default or Event of Lessees Default shall be
null and void and of no force or effect for so long as any applicable lender Party is
pursuing a cure thereof pursuant to, and within the time periods set forth in,
subparagraph (b), subparagraph (c)(i) and/or subparagraph (c)(iii) above, as
applicable.
9. LESSORS RIGHT TO TERMINATE.
(a) Notice of Intent to Terminate. If any Default described above (or any
Default occurring while any applicable Lender Party is exercising its cure
rights) is not cured within the applicable time period set forth in
subparagraph 8(b), subparagraph 8(c)(i) and/or subparagraph (c)(iii)
above, as applicable, Lessor may thereafter give the applicable Lender
Party written notice (by registered or certified mail, return receipt,
requested) of Lessors intent to terminate the Ground lease on account of
the failure to cure same in accordance with the Ground Lease on account
of the failure to cure same in accordance with the Ground Lease and this
Agreement.
(b) Termination. Such termination shall become effective if and only if the
applicable Lender Party shall fail to cure same within ten (10) days
thereafter in the case of a Default involving the payment of money due to
Lessor or thirty (30) days in the case of any other Default.

(c) Surrender of Possession. If Lessee or any Lender party is in possession
of the Property, either personally or by a receiver, the applicable party
shall, upon any such termination of the Ground Lease, quit and peacefully
surrender the property to Lessor. Notwithstanding the foregoing, if any
such Lender party requests a New Lease pursuant to Section 10 below
within the period provided for in Section 10(a) below, then such Lender
Party shall not be required to so surrender possession of the property so
long as such Lender Party requests and thereafter enters into such New
Lease pursuant to Section 10 below. If such Lender party fails to request a
New lease within the period provided by Section 10(a) below but then
fails to enter into such New Lease within the period provided for by
Section 10(a) below, then such Lender Party (if it is then in possession of
the Property) shall so surrender promptly after the expiration of such
period.
10. NEW LEASE.
(a) Right to Obtain a New Lease. If the Ground Lease shall (i) terminate for
any reason other than a Default on account of Lessees failure, beyond any
applicable cure period, to pay Base Rent, Percentage Rent, Impositions or
the cost of insurance, as to which Leasehold Mortgagee was provided
notice and an opportunity to cure in accordance with the Ground lease this
Agreement and failed to so cure within the time period provided for under
subparagraph 8(b), subparagraph 8(c)(i) and/or subparagraph (c)(iii)
above, as applicable), or (ii) be rejected or disaffirmed pursuant to
bankruptcy law or other law affecting creditors rights, any applicable
lender Party shall have the right, exercisable by written notice to Lessor
(the Exercise Notice) within thirty (30) days after such lender party
receives written notice of such termination, rejection or disaffirmation (as
applicable, a Termination) to enter a New Lease of the property,
provided that such Lender Party shall have remedied all Defaults on the
part of lessee involving the payment of money to Lessor, and shall
continue to pay all Rent that would come due under the Ground lease but
for such Termination. Lessor and such lender party shall use good faith
efforts to enter into the New lease as soon as practicable, but in no event
later than one hundred eighty (180) days after such lender party receives
such written notice of such Termination. From the date on which such
lender party shall serve the Exercise Notice upon Lessor until the New
Lease is entered into, such Lender Party may use and enjoy the Property
without hindrance by Lessor but subject to compliance with the terms of
the Ground Lease.
(b) Terms and conditions of New Lease. The term of the New Lease shall
begin on the date of the termination of the Ground lease and shall continue
for the remainder of the Lease Term, including any Extension Terms.

Such New Lease shall otherwise contain the same terms and conditions as
those set forth in the Ground lease (including, but not limited to, the
provisions of Section 13.4 of the Ground Lease), except for requirements
which are no longer applicable or have already been performed; provided,
however, that (i) such New Lease shall require the lessee thereunder
promptly to commence, and expeditiously to continue, to remedy all other
defaults on the part of the Lessee hereunder to the extent reasonably
susceptible of being remedied; and (ii) such New Lease, if entered into by
Leasehold Mortgagee or any Approved Foreclosure transferee, shall
permit such party to assign such New Lease to an Approved Subsequent
Foreclosure Purchaser without Lessors consent.
(c) Subrogation. The Lender Party obtaining such New Lease shall be
subrogated to the rights of Lessor against Lessee as to any monetary
defaults of Lessee which are cured by such Lender Party as a condition to
obtaining such New Lease, and any other Defaults which are remedied as
described in clause (i) of subparagraph (b) above (but not as to any other
matters).
(d) Priority of New Lease. It is the intention of the parties hereto that such
New lease shall have the same priority relative to other rights or interests
to or in the Property as the Ground Lease.
(e) Execution of Other Documents. Simultaneously with the making of

such New Lease, the Lender Party obtaining such New Lease and Lessor
(together with all other Persons described in Section 6.6(a)(ii) of the
Ground Lease, to the extent they are bound to do so pursuant to the
provisions of the Ground Lease or otherwise) shall execute, acknowledge
and deliver such new instruments (including new mortgages and other
security documents, new Major Subleases, new Approved Time Share
Licenses, new Space leases, new Subordination, Non-Disturbance and
Attornment Agreements and new easements which were previously
granted, as the case may be), and shall make such payments and
adjustments among themselves, as shall be necessary and property for the
purpose of restoring to each of such Persons as nearly as reasonably
possible, the respective interests and status with respect to the property
and the Leasehold Improvements which was possessed by the respective
persons prior to the termination of the Ground Lease (including, but not
limited to, any rights and obligations under this Agreement and any other
applicable subordination, Non-disturbance and Attornment Agreements
entered into pursuant to the provisions of the Ground Lease).
(f) No Termination by Lessee of any Major Sublease or Space Lease.

Between the date of termination of the Ground Lease and the date of
execution and delivery of the New Lease, if any applicable Lender Party
shall have requested such New Lease as provided for by subparagraph (a)

above, lessee shall not cancel or terminate any Major Sublease or Space
Lease or any Approved time Share License, or accept any cancellation,
termination or surrender thereof (unless such termination shall be effective
as a matter of law on the termination of the Ground lease), without the
prior written consent of such Lender Party.
(g) No Obligation to Cure Uncurable Defaults. Nothing contained herein or

in the Ground Lease shall require any applicable lender party, as a
condition to its exercise of its right to enter into a New Lease, to cure any
Default of lessee not reasonably susceptible of being cured by such Lender
Party.
(h) Priority as to Approved Leasehold Mortgages. If, within the time

period specified in subparagraph (a) above for any applicable Lender Party
to enter into a New Lease with Lessor, more than one request for a New
Lease shall have been received by Lessor by more than one holder of an
Approved Leasehold Mortgage (or any Approved Foreclosure Transferee
or Approved Subsequent Foreclosure Purchaser with respect thereto),
priority with respect to the right to enter into such New lease shall be
given (regardless of the order in which such requests shall have been made
or received) to such holders (or any Approved Foreclosure Transferees or
Approved Subsequent Foreclosure Purchasers with respect thereto) in the
same order of priority of the liens of the applicable Approved Leasehold
Mortgages.
(i) Liability. No Lender party (or any assignee, designee or nominee thereof)
shall become liable for the performance or observance of any covenants or
conditions to be performed or observed by lessee, unless and until such
Lender Party acquires possession of the Leasehold Estate becomes the
owner of the Lessees interest under the Ground Lease, or enters into a
New Lease with Lessor as provided above. Thereafter, such Lender Party
shall be liable for the performance and observance of those covenants and
conditions which arise during its possession and ownership as well as
those which predate such possession or ownership but as to which such
lender party is liable pursuant to the terms of this Agreement. Such
Lender Party shall not be liable for the performance or observance of any
covenants or conditions to be performed or observed by Lessee which
accrue after the transfer of such Lender Partys interest in the Leasehold
Estate.
(j) No Obligation to Cure. Nothing herein contained shall require any

applicable Lender party to cure any Default by Lessee or Event of
Lessees Default under the Ground Lease; provided, however, that if such
Lender party shall not: (i) cure same within the times provided by
subparagraph 8(b), subparagraph 8(c)(i) and/or subparagraph (c)(iii), as
applicable; or (ii) request and obtain a New Lease within the times

provided by subparagraph (a) of this Section 10, Lessor shall be permitted
to proceed with any rights or remedies under the Ground lease and/or
otherwise available at law or in equity (subject, however, to any prior
rights and remedies of such Lender party as to the Collateral, as provided
for by the Ground Lease, this Agreement and/or Applicable Laws).
(k) No Obligation as to Accelerated Rent or Damages. Whenever this

Agreement refers to any Lender Partys curing monetary Defaults or
Events of Lessees Default, such Lender Party shall not be required to pay
any accelerated sums or any damages, other than the payment of accrued
interest on monetary sums as required pursuant to Section 8(b) of this
Agreement, on account thereof which may otherwise be provided for by
the terms of the Ground Lease, and upon such cure by such Lender party,
any such acceleration by Lessor shall be deemed to be nullified and of no
force or effect.
(l) Survival. The provisions of this Section 10 shall survive the termination
of the Ground Lease and shall continue in full force and effect thereafter
to the same extent as if this Section were a separate and independent
contract among Lessor, lessee and the applicable Lender Party.
(m) References to Ground Lease. As of the date the New Lease becomes
effective, all references herein to the Ground lease shall be deemed
references to the New Lease.
11. ATTORNMENT. In the event any Lender Party succeeds to the rights of Lessee
under the Ground Lease through a Foreclosure Transfer or otherwise: (i) such Lender party shall
attorn to Lessor; (ii) Lessor shall accept such attornment; and (iii) such Lender party and Lessor
shall have the same rights and obligations toward one another which they would have had if the
Ground Lease had been entered into directly between them (subject, however, to the provisions
of this Agreement). Upon such attornment, the respective rights and obligations of Lessor and
such Lender Party shall, for the remaining balance of the Lease Term, be the same as set forth
therein, and the Ground Lease shall in accordance with its terms, remain in full force and effect
as a direct agreement between Lessor and such lender party with the same force and effect as if
originally entered into with Lessor (subject, however, to the provisions of this Agreement). The
foregoing provision shall be self-operative.
12. ASSIGNMENT OF GROUND LEASE. Notwithstanding anything to the

contrary contained in this Agreement or in the Ground Lease, in the event Leasehold Mortgagee
or any Approved Foreclosure Transferee with respect to the Ground Lease either succeeds to the
rights of Lessee under the Ground Lease through a Foreclosure Transfer or enters into a New
Lease pursuant to Section 10 above, Leasehold Mortgagee or such Approved Foreclosure
Transferee may freely assign or transfer, without Lessors consent, the leasehold Estate or any
portion thereof to any Approved Subsequent Foreclosure Purchaser. Any subsequent assignment

or transfer thereof by such Approved Foreclosure Purchaser to any other Person must comply
with the provisions of Article VIII of the Ground Lease.
13. NO MERGER. Lessor and Lessee acknowledge and agree that until all
obligations secured by Leasehold Mortgage have been paid in full or the Leasehold Mortgage
has been fully released and satisfied, whichever occurs first, unless Leasehold Mortgagee
expressly consents in writing, the fee title to the property will not merge with the leasehold
Estate but will always remain separate and distinct, notwithstanding the union of such estates in
Lessor, Lessee or a third party by purchase or otherwise. In the event Lessee acquires the fee
title or any other estate, title or interest in any part of the Property, the Leasehold Mortgage shall
attach to and cover and be a lien upon the fee title or other estate so acquired, and such fee title
and other estate will, without further assignment, mortgage or conveyance, become and be
subject to the lien of and covered by the Leasehold Mortgage.
14. OTHER APPROVED LEASHOLD MORTGAGEES. In the event Lessee

desires to encumber the Leasehold Estate with any Approved Leasehold Mortgage(s) in addition
to the Leasehold Mortgage from time to time (to the extent permitted by the Ground lease, the
Leasehold Mortgage and other Leasehold Loan Documents or otherwise approved in writing by
Lessor or Leasehold Mortgagee, as applicable), Lessor, Lessee, Leasehold Mortgagee and the
anticipated holder(s) of such Approved Leasehold Mortgage(s) shall enter into an agreement, in
form and substance reasonably acceptable to all such parties. Such agreement shall provide for
rights and obligations on the part of such holder(s) of Approved Leasehold Mortgage(s) which
are comparable to those set forth herein as to leasehold Mortgagee. Notwithstanding the
foregoing, such agreement shall fully recognize Leasehold Mortgagees first priority position and
shall contain such subordination and intercreditor provisions recognizing and preserving such
first priority position as are acceptable to Leasehold Mortgagee, provided that such provisions do
not: (i) affect the business and financial terms of the Ground lease; (ii) constitute a material
deviation from the Watson Island RFP and the Island Gardens Proposal; or (iii) significantly
impair the protections afforded to Lessor pursuant to the Ground lease and this Agreement or
impair the protections afforded to Lessor pursuant to the Ground Lease and this Agreement or
impose any additional material burdens on Lessor. Such provisions shall address, among other
things, priority as to lien rights and rights to receive payments, priority and timing as to cure
rights concerning Defaults, procedures for disbursing Condemnation Awards and Net Insurance
Proceeds consistent with the provisions of the Ground Lease and this Agreement, foreclosure
rights and standstill requirements.
15. OTHER SNDAS. Leasehold Mortgagee specifically recognizes that: (i) Major
Subleasehold Mortgagees, Major Subtenants, holders of Approved time Share Licenses, certain
Space Tenants and operators of the Hotels 4 are entitled to enter into Subordination, Non
Disturbance and Attornment Agreements as contemplated by the provisions of the Ground
Lease, each in the form previously submitted in writing to Leas34ehold Mortgagee; and (ii)
certain provisions of the Ground lease and such Subordination, Non-Disturbance and Attornment
Agreements grant or will grant certain possessory and/or other rights to such parties that will
survive any Foreclosures Transfer with respect to the Leasehold Mortgagee, the termination of
the Ground Lease, the granting of any New Lease and certain other events described therein.
4
This provision will be modified to add the Marina operator, if applicable.

16. LESSORS CURE RIGHTS. Leasehold Mortgagee hereby acknowledges that
Section 15.2 of the Ground Lease permits Lessor, upon prior written notice to Lessee, to cure
any default under the Leasehold Mortgage not cured by lessee within the applicable notice and
cure period thereunder. Leasehold Mortgagee may, but shall not be obligated, to accept any such
cure.
17. MODIFICATIONS, AMENDMENTS, ETC. No modification, amendment,

waiver or release of any provision of this Agreement or of any right, obligation, claim or cause
of action arising hereunder shall be valid or binding for any purpose whatsoever unless in writing
and duly executed by the parties against whom the same is sought and asserted.
18. NOTICES. All notices, demands and requests given or required to be given
hereunder or pursuant to the terms of the Ground Lease shall be in writing. All such notices,
demands and requests by Lessor to Leasehold Mortgagee shall be given by United States
Registered or Certified Mail, postage prepaid, by reputable overnight courier, addressed to:
Leasehold Mortgagee: ____________________________

____________________________
____________________________
Attn: _______________________
With a copy to: ____________________________

____________________________
Attn: _______________________
or to such other address as Leasehold Mortgagee may from time to time designated by written
notice to Lessor.
All such notices, demands and request by Leasehold Mortgagee to Lessor shall be given
by United States Registered or Certified Mail, postage prepaid, by reputable overnight courier,
addressed to:
Lessor: City Manager, City of Miami

Miami, FL 33133
With a copy to: Department of Public Facilities, City of Miami

444 SW 2 Avenue
Miami, FL 33130
With a copy to: City Attorney, City of Miami

444 SW 2 Avenue
Miami, FL 33130

19. SUCCESSORS AND ASSIGNS. This Agreement may not be assigned by
Lessee without Leasehold Mortgagees prior written consent, which may be granted or withheld
in Leasehold Mortgagees sole discretion. This Agreement shall inure to the benefit of and be
binding upon the parties hereto and their respective successors and permitted assigns.
20. GOVERNING LAW. This Agreement shall be construed in accordance with the
provisions of the laws of the State of Florida, without application of its conflict of law principles.
21. AUTHORITY. Each party to this Agreement represents to the other parties that:
(i) it is duly organized, validly existing and in good standing in its state of formation; and (ii) the
person executing this Agreement on its behalf is duly authorized to execute this Agreement and
to legally bind the party on whose behalf he is executing this Agreement.
22. FURTHER ASSURANCES. Upon Leasehold Mortgagees request, Lessor and

Lessee shall, each at its sole expense, execute, acknowledge and deliver such further instruments
and do such further acts as may, in the opinion of Leasehold Mortgagee, be necessary, desirable,
or proper to carry out more effectively the purpose of this Agreement.
23. SEVERABILITY. In case any one or more of the provisions contained in this
Agreement shall be invalid, illegal or unenforceable in any respect, the validity, legality or
enforceability of the remaining provisions contained herein or therein shall not in any way be
affected or impaired thereby.
24. CAPTIONS. The captions and headings contained in this Agreement are for
convenience of reference only and shall not be construed as limiting or defining in any way the
provisions of this Agreement.
25. RECORDING. At Leasehold Mortgagees option, this Agreement may be

recorded in the Public Records of Miami-Dade County, Florida.
26. WAIVER OF JURY TRIAL. The parties hereby knowingly, irrevocably,

voluntarily and intentionally waive any right any of them may have to a trial by jury in respect of
any action, proceeding or counterclaim based on, or arising out of, under or in connection with
this Agreement or any amendment or modification of this Agreement, or any other agreement
executed by and between the parties in connection with this Agreement, or any course of
conduct, course of dealing, statements (whether verbal or written) or actions of any party hereto.
This waiver of jury trial provision is a material inducement for each of the parties hereto to enter
into this Agreement and for Leasehold Mortgagee to make the Loan.
27. TERMINATION. This Agreement shall terminate at such time as all obligations
secured by the Leasehold Mortgage have been paid in full. Such obligations shall not be deemed
to have been paid in full (as such term is used herein) unless and until any period under any
bankruptcy or similar laws during which any payment to Leasehold Mortgagee may be required
to be rescinded, disgorged or returned shall have expired without any such payment being
required to be rescinded, disgorged or returned.

28. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which shall be deemed but one
agreement.
IN WITNESS WHEREOF, Lessor, Lessee and Leasehold Mortgagee have executed

this Agreement as of the day and date first written above.
Signed, sealed and delivered

in the presence of: THE CITY OF MIAMI, a municipal corporation
of the State of Florida
_____________________________
Name: _______________________
By: _______________________
_____________________________ Name: _______________________
Name: _______________________ Title: _______________________


Delaware limited liability company, as its
sole and managing member

Delaware limited liability company,
as its sole and managing member
By: _________________________
Mehmet Bayraktar, sole and
Managing member
____________________________
Name: _______________________
_____________________________
Name: _______________________
LEASEHOLD MORTGAGEE
________________________, a
_________________ ___________________
_____________________________

Name: _______________________
By: _______________________
_____________________________ Name: _______________________
Name: _______________________ Title: _______________________

ACKNOWLEDGMENT OF LESSOR
STATE OF FLORIDA )
)
COUNTY OF MIAMI-DADE )
The foregoing instrument was acknowledged before me this _____ day of

____________, 20__, by ___________________ as ___________________ of THE CITY OF
MIAMI, a political subdivision of The State of Florida, on behalf of that political subdivision.
Personally known to me _________________________

or produced I.D. _______________________________
________________________________
(type of I.D.)
Signature: ______________________
Name: [Print or type] ______________
Title: Notary Public
Serial No., if any: _______________________
My commission expires:

ACKNOWLEDGMENT OF LESSEE
STATE OF FLORIDA )
)
COUNTY OF )

____________, 20__, by Mehmet Bayraktar, as the sole and managing member of Flagstone
Property Group, LLC, a Delaware limited liability company, as the sole and managing member
of Flagstone Miami Holdings, LLC, a Delaware limited liability company, as the sole and
managing member of FLAGSTONE ISLAND GARDENS, LLC, a Delaware limited liability
company, on behalf of each company.

or produced I.D. _______________________________
________________________________
(type of I.D.)
Signature: ______________________
Serial No., if any: _______________________

ACKNOWLEDGMENT OF LEASEHOLD MORTGAGEE
STATE OF FLORIDA )
)
COUNTY OF )
The foregoing instrument was acknowledged before me this _____ day of ____________, 20__,
by ___________________ as ___________________ of ______________________, a
______________________, on behalf of that ____________________.

or produced I.D. _______________________________
________________________________
(type of I.D.)
Signature: ______________________
Serial No., if any: _______________________

EXHIBIT A
LEGAL DESCRIPTION OF LAND

EXHIBIT B
LEGAL DESCRIPTION OF SUBLEASED PROPERTY

EXHIBIT M
APPROVED MAJOR SUBLEASEHOLD MORTGAGEE SNDA
Prepared By and Return to


_______________________, a _____________________ (Major Subtenant), and
_________________________, a _________________________ (Subleasehold Mortgagee).
WITNESSETH:
Property); and
Property to Flagstone Island Gardens, LLC, a Delaware limited liability company (Lessee),
subject to and in accordance with the terms and conditions of the Ground Lease (unless
otherwise defined herein, all capitalized terms used herein shall have the respective meanings
ascribed to them in the Ground Lease); and
and

WHEREAS, pursuant to that certain Sublease dated _______________, 20___ (the
Sublease), a memorandum of which was recorded in Official Records Book _______, at Page
_____, of the Public Records of Miami-Dade County, Florida, Lessee has subleased to Major
Subtenant a portion of the Property as more particularly described in Exhibit B, attached
hereto and incorporated herein by this reference (the Sublease Property), subject to an in
accordance with the terms and conditions of the Sublease; and
WHEREAS, the Sublease provides for Major Subtenant to construct and operate certain
Leasehold Improvements on the Sublease Property (the Subleasehold Improvements), and
further provides that during the term of the Sublease (the Sublease Term), Major Subtenant is
and shall be the owner and holder of all such Subleasehold Improvements (with the ownership
thereof reverting to Lessee, subject to and in accordance with the terms and conditions of the
Ground lease and the Sublease, upon the expiration of the Sublease Term or the sooner
termination of the Sublease); and
WHEREAS, Subleasehold Mortgagee has agreed to make a loan in the original face
amount of $___________________ to Major Subtenant (as the same may be amended, modified,
restated, renewed or extended from time to time, the Loan); and
WHEREAS, the Loan will be evidenced by a mortgage note (as the same may be
amended, modified, restated, renewed, substituted or extended from time to time, the Note)
made by Major Subtenant to the order of Subleasehold Mortgagee and will be secured by, among
other things, a mortgage and other security documents more particularly described in Exhibit
C, attached hereto (as the same may be amended, modified, restated, renewed, substituted or
extended from time to time, collectively, the Subleasehold Mortgage) made by Major
Subtenant to Subleasehold Mortgagee, which Subleasehold Mortgage will encumber the Major
Subleasehold Estate with respect to the major Sublease (the Subleasehold Estate) and the
Subleasehold Improvements (the Note, the Subleasehold Mortgage and all other documents and
instruments which evidence, secure or are otherwise related to the Loan, as the same may be
amended, modified, restated, renewed, substituted or extended from time to time, are sometimes
hereinafter collectively referred to the Subleasehold Loan Documents).

1. Recitals. The foregoing recitals are true and correct and incorporated herein by
this reference.
2. Certain Defined Terms. As used herein, the following terms shall have the
respective meanings ascribed to them below:
(a) Ground Lease Termination shall mean the termination of the Ground
Lease for any reason, or the rejection or disaffirmation of the Ground
Lease in any bankruptcy, insolvency or other similar proceedings, if the

effect of such rejection or disaffirmation is to cause the Ground Lease to
terminate.
(b) Sublease Termination shall mean the termination of the Sublease for
any reason (including but not limited to, any such termination by operation
of law on account of a Ground Lease Termination), or the rejection or
disaffirmation of the Sublease in any bankruptcy, insolvency or other
similar proceedings, if the effect of such rejection or disaffirmation is to
cause the Sublease to terminate.
(c) New Lease shall mean any new ground lease hereafter entered into
between Lessor and a New Lessee pursuant to the terms of any Leasehold
Mortgage SNDA or Major Subtenant SNDA, subsequent to a Ground
Lease Termination.
(d) New Lessee shall mean any: (i) Approved Leasehold Mortgagee or any
other Person which enters into a New Lease with Lessor pursuant to the
terms of any Leasehold Mortgage SNDA; or (ii) Major Subtenant which
enters into a New Lease pursuant to the terms of any Major Subtenant
SNDA.
(e) New Sublease shall mean any new sublease hereafter entered into
between Lessee and Subleasehold Mortgagee (or any other Person entitled
to enter into same) pursuant to the terms of a lessee Subleasehold
Mortgage SNDA, subsequent to a Ground Lease Termination.
(f) Substitute Sublease shall mean either of the following, as applicable:

(i) a sublease entered into between a New Lessee, as sublessor, and any
Subleasehold Lender Party, as sublessee, pursuant to Section 10 below; or
(ii) a sublease entered into between a New Lessee, as sublessor, and Major
Subtenant, as sublessee, pursuant to the terms of the Major Subtenant
SNDA, in either case subsequent to a Ground Lease Termination.
(g) Direct Lease shall mean either of the following, as applicable; (i) a
direct lease entered into between Lessor, as lessor, and any Subleasehold
Lender Party, as lessee, pursuant to Section 10 below; or (ii) a direct lease
entered into between Lessor, as lessor, and major Subtenant, as lessee,
pursuant to the terms of the Major Subtenant SNDA, in either case
subsequent to a Ground Lease Termination.
(h) Leasehold Mortgage SNDA shall mean any Subordination, Non-

Disturbance and Attornment Agreement or other similar agreement now or
hereafter entered into among Lessor, lessee and an Approved Leasehold
Mortgagee with respect to the Ground Lease.

(i) Lessee Subleasehold Mortgage SNDA shall mean any Subordination,
Non-Disturbance and Attornment Agreement or other similar agreement
now or hereafter entered into among Lessee, Major Subtenant and
Subleasehold Mortgagee with respect to the Sublease.
(j) Major Subtenant SNDA shall mean any Subordination, Non-

Disturbance or other similar agreement now or hereafter entered into
between Lessor and Major Subtenant.
(k) Subleasehold Mortgagee shall include: (i) each and every successor of
Subleasehold Mortgagee; and (ii) each and every assignee of Subleasehold
Mortgagee, so long as such assignee independently meets the criteria set
forth in clauses (i) through (vii) of the definition of Approved Lender
contained in the Ground Lease (subject to the last sentence of clause (viii)
of such definition.
(l) Subleasehold Lender Party shall mean (i) as to any period prior to a
Foreclosure Transfer with respect to the Subleasehold Mortgage,
Subleasehold Mortgagee; and (ii) as to any period after such Foreclosure
Transfer, any Approved Foreclosure Transferee (with respect to the
Subleasehold Mortgage and the other Subleasehold Loan Documents), or
any Approved Subsequent Foreclosure Purchaser (with respect to the
Sublease Property, the Sublease Improvements and/or the Subleasehold
Estate or any portion thereof), as applicable.
(m) Default shall mean any default or any event which, if not remedied,
would or could result in an Event of Lessees Default under the Ground
Lease.
(n) Default Notice shall mean any written notice of other written
communication from Lessor to Lessee pertaining to an Event of Lessees
Default under the Ground Lease.
(o) Optional Advances shall mean: (i) a future advance under the
Subleasehold Mortgage which is entirely within Subleasehold
Mortgagees discretion to make; or (ii) any advance of additional funds
pursuant to a future modification of the Subleasehold Mortgage; provided,
however, that in no event shall the term Optional Advance be deemed to
include any advances or disbursements for construction or other purposes
which are made upon the satisfaction or waiver of certain terms and
conditions specified in the Subleasehold Loan Documents, even if the
Subleasehold Mortgage and/or the other Subleasehold Loan Documents
permit Subleasehold Mortgagee to determine in its sole discretion or
judgment whether to make such advances or disbursements if such terms
and conditions are not satisfied or if a default or event of default under the
Subleasehold Mortgage and/or the other Subleasehold Loan Documents
then exists. Moreover, the term Optional Advance shall not include any
advances for the purpose of paying unpaid taxes, assessments or levies
against the Sublease property or unpaid insurance premiums with respect
to the Sublease Property, protecting the Collateral (as hereinafter defined),
preserving Subleasehold Mortgagees lien upon and security interest in the
Collateral, curing defaults under the Subleasehold Loan Documents, the
Ground Lease and/or the Sublease and other protective, remedial and/or
curative advances.
(p) Lessors Lien shall collectively mean and refer to: (i) the lien granted
to Lessor upon the Leasehold Improvements and the Leasehold Estate to
the extent described in Section 23.1 of the Ground Lease; and (ii) any and
all other claims, rights of distraint or levy, landlord lien or other lien
rights, or any other right, title or interest, if any, which Lessor may have
upon, in or to any portion of the Collateral from time to time.
3. Lessors Fee Estate Not Encumbered by Subleasehold Mortgage;

Subordination.
(a) Lessors Fee Estate Not Encumbered. Subleasehold Mortgagee hereby

acknowledges and agrees that the Subleasehold Mortgage does not and
shall not encumber or constitute a lien upon Lessors fee simple estate in
the Property.
(b) Subordination. The Subleasehold Mortgage, and all of the Subleasehold

Mortgagees right, title and interest in and to the Sublease, the Sublease
Property, and the Subleasehold Improvements and all rights, remedies and
options of Subleasehold Mortgagee under the Subleasehold Loan
Documents, are and shall be unconditionally subject and subordinate to
the right, title and interest of Lessor in and to the property and the Ground
Lease, subject to the provisions of this Agreement.
4. Lessors Acknowledgement. Pursuant to any and all applicable provisions of the

Ground lease, Lessor hereby irrevocably and fully consents to the execution and delivery (and
recordation, where applicable) of the Subleasehold Mortgage and other Subleasehold Loan
Documents. Lessor hereby further acknowledges and agrees as follows. 5
(a) Approved Lender. Subleasehold Mortgagee hereby is, and shall at all
times until all obligations secured by the Subleasehold Mortgage have been paid
in full or the Subleasehold Mortgage has been fully released and satisfied
whichever occurs first, be deemed an Approved Lender, an Approved Major
5
As a condition to Lessors executing this Agreement, Lessor may require Major Subtenant to provide such written
representations or other evidence as Lessor may reasonably require in order to confirm that the conditions set forth in the
definitions of Approved Lender, Approved Major Subleasehold Mortgagee, Approved Mortgagee, Approved Major Subleasehold
Mortgage and Approved Mortgage, as defined in the Ground Lease, are satisfied. This footnote will be deleted from the final
form of this Agreement before it is executed.

Subleasehold Mortgagee and an Approved Mortgagee, as such terms are defined,
described and used in the Ground Lease.
(b) Approved Mortgage.
(i) General. The Subleasehold Mortgage hereby is, and shall at all
times until all obligations secured by the Subleasehold Mortgage
have been paid in full, or the Subleasehold Mortgage has been
fully released and satisfied, whichever occurs first, be deemed an
Approved Mortgage and an Approved Major Subleasehold
Mortgage, as such terms are defined, described, and used in the
Ground Lease.
(ii) Optional Advances. Notwithstanding the provisions of

subparagraph (a) above, no Optional Advance shall be deemed
secured by an Approved Mortgage or an Approved Subleasehold
Mortgage unless and until the provisions of clauses (iii) and (iv) of
Section 6.1(b) of the Ground Lease are independently satisfied as
to such Optional Advance. Each such Optional Advance shall be
treated as a separate loan for purposes of satisfying the provisions
of clauses (iii) and (iv) of Section 6.1(b) of the Ground Lease.
Upon Subleasehold Mortgagees request and delivery of evidence
reasonably satisfactory to Lessor that the provisions of clauses (iii)
and (iv) of Section 6.1(b) of the Ground Lease are independently
satisfied as to any such Optional Advance, Lessor shall execute a
written acknowledgement confirming that such Optional Advance
independently satisfies the requirements of such clauses (iii) and
(iv).
(c) Rights and Benefits Under Ground Lease. All rights and benefits of an
Approved Lender, Approved Major Subleasehold Mortgagee and an Approved
Mortgagee provided in the Ground Lease, insofar as the Sublease is concerned,
may be exercised and enjoyed by Subleasehold Mortgagee in accordance with the
provisions of the Ground Lease, including, but not limited to, those rights and
benefits conferred by Article VI (Leasehold and Subleasehold Mortgages),
Section 8.7 (Approved Leasehold Mortgages, Leases and Subleases), Article XVI
(Damage or Destruction) and Article XXIV (Condemnation) of the Ground Lease,
and Lessor is and shall be bound by all provisions in the Ground Lease applicable
to Subleasehold Mortgagee and the Subleasehold Mortgage.
(d) Conditions of Ground Lease Satisfied. Major Subtenant hereby

represents that it has delivered to Lessor copies of the executed Subleasehold
Mortgage and all other Subleasehold Loan Documents (as more particularly
described on a separate certificate signed by Major Subtenant and delivered to
Lessor), and that same have not been modified or amended through the date all
conditions of Section 6.4 of the Ground Lease have been fully satisfied (and that

this Agreement fully satisfies the requirements of Section 6.4 of the Ground Lease
concerning the execution and delivery of the Subordination, Non-Disturbance and
Attornment Agreement described therein with respect to the Subleasehold
Mortgage), such that Subleasehold Mortgagee shall have the rights and benefits
described in Article VI of the Ground Lease.
5. Collateral for Subleasehold Mortgage. Until all obligations secured by the

Subleasehold Mortgage have been paid in full or the Subleasehold Mortgage has been
fully released and satisfied, whichever occurs first:
(a) Lien and Encumbrance. Lessor hereby acknowledges that the purpose
of the Subleasehold Mortgage is to create a lien and encumbrance upon and
security interest in all of the collateral described in the Subleasehold Mortgage
and the other Subleasehold Loan Documents and all additions, replacements and
substitutions therefor and proceeds thereof (collectively, the Collateral),
including, but not limited to, the following items (except to the extent the
Subleasehold Loan Documents specifically provide that same are not part of the
Collateral):
(i) the Subleasehold Estate (and related easements) and the

Subleasehold Improvements;
(ii) all of Major Subtenants right, title and interest in and to any and all
furniture, fixtures, equipment, machinery, goods, merchandise,
inventory and other tangible personal property of Major Subtenant
located upon or within or connected to the Sublease Property;
(iii) all of Major Subtenants right, title and interest in and to any and all
intangible personal property pertaining or related to or connected
with the Sublease property, including, but not limited to, plans and
specifications, permits, licenses, service contracts and other
agreements, and intellectual property, and
(iv) all other tangible and intangible personal property of Major

Subtenant of any kind or nature whatsoever, wherever located, now
or hereafter acquired, all as more particularly set forth in the
Subleasehold Mortgage.
(b) No Ownership Rights of Lessor. At all times during the Sublease Term
(and if a Substitute Sublease, a Direct Lease or a New Sublease is entered into
pursuant to the Ground Lease, this Agreement or any Major Subtenant SNDA, at
all times during the term thereof, including any extension options when and if
exercised, and any period between the Ground lease Termination and the
commencement of the term of such Substitute Sublease, Direct Lease or New
Sublease, as applicable), but not after the expiration of the Sublease Term, or the

term of any such Substitute Sublease, Direct Lease or New Sublease, as the case
may be:
(i) Lessor is not, and shall not claim to be, the owner of the Collateral
or any part of the Collateral; and
(ii) all of the Collateral shall be conclusively presumed to be the

property of Subtenant (subject to any rights therein of Subleasehold
Mortgagee or any or any Persons claiming by, through or under
Subleasehold Mortgagee), regardless of the nature of any item of the
Collateral or the manner in which it is or may become affixed to or
incorporated into the Sublease Property or otherwise acquired or obtained
by Major Subtenant.
6. Lessors Lien.
(a) Acknowledgment. Subleasehold Mortgagee hereby acknowledges that

pursuant to Section 23.1 of the Ground Lease, Lessee has granted to Lessor a lien
upon the Leasehold Improvements and the Leasehold Estate to the extent
described therein.
(b) Subordination. Lessor acknowledges and agrees that each and every
Lessors Lien (to the extent same may exist) is and shall at all times and for all
purposes and in all respects, be subject, subordinate and inferior to the lien,
operation, effect, terms and provisions of the Subleasehold Mortgage and other
Subleasehold Loan Documents and the rights of Subleasehold Mortgagee (and
any Approved Foreclosure Transferee and any Approved Subsequent Foreclosure
Purchaser) thereunder or otherwise in connection with the Loan.
(c) No Enforcement. Lessor acknowledges and agrees that without

Subleasehold Mortgagees prior written consent, no Lessors Lien may be
enforced against any portion of the Subleasehold Improvements, the Subleasehold
Estate or any other portion of the Collateral at the time such portion is
encumbered by the Subleasehold Mortgage and/or the other Subleasehold Loan
Documents.
(d) Lessors Lien Arising After Foreclosure Transfer. Notwithstanding the

provisions of subparagraphs 5(b) and 5(c) above, any Subleasehold Lender Party
shall take subject to any .Lessors Lien on account of any obligation arising after
the date of the Foreclosure Transfer by which such Subleasehold Lender Party
acquires title to the Collateral, and Lessor may enforce such Lessors Lien as
permitted by the provisions of the Ground Lease.
(e) Development Plans.

(i) Use Rights. Subleasehold Mortgagee hereby acknowledges that
Lessee has granted to Lessor the right to: (i) use the Development Plans, to the
extent set forth in Section 6.10 of the Ground Lease; and (ii) grant to other
professionals the right to use the Development Plans (subject to the rights of the
architect(s) and engineer(s) who prepared the Development Plans and to the rights
of any Approved Mortgagees therein), to the extent set forth in Section 6.10 of the
Ground Lease. Lessor hereby agrees not to enforce such rights except as provided
by subparagraph (c)(iii) below.
(ii) Subordination. Without limiting the generality of subparagraph

(b) above, Lessor hereby acknowledges and agrees that the rights of Lessor
described in subparagraph (e)(i) above are and shall, at all times and for all
purposes and in all respects, be subject, subordinate and inferior to lien, operation,
effect, terms and provisions of the Subleasehold Mortgage and the other
Subleasehold Loan Documents and the rights of each Subleasehold Lender Party
thereunder with respect to the Development Plans and the Project Approvals
(insofar as same relate to the Sublease Property and Subleasehold Improvements).
If required by Subleasehold Mortgagee, Lessor shall join in any pledge of such
rights as security for the Loan solely to subordinate Lessors interest in the same
to the interest therein of each Subleasehold Lender Party on the terms set forth
herein.
(iii) Rights Upon Termination of Lease. In the event of termination

of the Ground Lease on account of an Event of Lessees Default, Lessor shall be
entitled to the full complete and unconditional use and ownership of such
Development Plans and the ability to grant to other professionals the right to use
such Development Plans (subject to the rights of the architect(s) and engineer(s)
who prepared the Development Plans), and full, complete and unconditional
ownership of such Project Approvals, without payment of any consideration
therefor by Lessor to Major Subtenant, provided that until the expiration of the
period within which a substitute Sublease, a Direct Lease or a New Sublease may
be entered into, such rights of Lessor therein shall, at all times and for all
purposes and in all respects, be subject, subordinate and inferior, to the rights
therein of any Person entering into any such Substitute Sublease, Direct Lease or
New Sublease.
7. Renewal Options. Until all obligations secured by the Subleasehold Mortgage

have been paid in full or the Subleasehold Mortgage has been fully released and satisfied,
whichever occurs first, Lessor shall give written notice to Subleasehold Mortgagee of Lessees
failure to timely exercise any Extension Option under the Ground lease (the Extension Option
Notice). If such extension option: (i) is not timely exercised by any Approved Leasehold
Mortgagee or any other Person entitled to exercise same pursuant to the terms of any Leasehold
Mortgage SNDA, and (ii) is not exercised by Major Subtenant pursuant to the terms of the Major
Subtenant SNDA with respect to the Subleased Property, then Subleasehold Mortgagee (or an
Approved Foreclosure Transferee with respect to the Subleasehold Mortgage, if applicable) may,
at its option, and without limiting the availability of other remedies under the Subleasehold Loan

Documents, exercise such Extension Option solely with respect to the Sublease Property, in
which event a Direct lease shall be entered into between Major Subtenant and lessor, in
accordance with the terms of Section 10 below, for the same period of time as set forth in such
Extension option, provided that:
(a) No Material Uncured Lessees Default. No Material Uncured Lessees Default

then exists, other than a Material Uncured Lessees Default: (i) as to which
Subleasehold Mortgagee or such Approved Foreclosure Transferee is diligently
pursuing a cure in the manner and within the time afforded by Section 8 below; or
(ii) which is not susceptible to cure; and
(b) Time to Exercise. Subleasehold Mortgage or such Approved Foreclosure

Transferee exercises such Extension Option within fifteen (15) days after the later
of: (i) the date on which same may be exercised by any Approved Leasehold
Mortgagee (or other Person entitled to exercise such Extension Option) pursuant
to the terms of any Leasehold Mortgage SNDA; or (ii) the date on which same
may be exercised by Major Subtenant pursuant to the terms of the Major
Subtenant SNDA. In the event any such Person described in clauses (i) and (ii)
above exercises such Extension Option, Lessor shall use reasonable efforts, within
two (2) business days thereafter, to give Subleasehold Mortgagee or such
approved Foreclosure Transferee, as applicable, written notice of such fact;
provided, however, that Lessor shall not have any liability for failure to provide
such written notice. Furthermore, Lessor agree to use reasonable efforts to
respond to any written inquiries by Subleasehold Mortgagee or such Approved
Foreclosure Transferee, as applicable, to the City Attorney of the City of Miami,
Florida (the City attorney) as to whether any of the Persons described in clauses
(i) and (ii) above have exercised such Extension Option.
8. Notice and Cure Rights. Until all obligations secured by the Subleasehold
Mortgagee have been paid in full, or the Subleasehold Mortgage is fully released and satisfied,
whichever occurs first, Lessor shall have the obligations and the applicable Subleasehold Lender
Party shall be afforded the notice and cure rights and other rights, set forth in Section 8 (unless
an Approved Leasehold Mortgagee or a Major Tenant has already cured the alleged Default),
provided that in the case of any Approved Foreclosure Transferee or Approved Subsequent
Foreclosure Purchaser, such Subleasehold Lender Party shall have given Lessor written notice of
its name and address.
(a) Notice of Default. Whenever Lessor sends or gives Lessee any Default
Notice, Lessor shall simultaneously send a copy of such Default Notice to
the applicable Subleasehold Lender Party. Furthermore, Lessor agrees to
use reasonable efforts to respond to any written inquiries by a
Subleasehold Lender Party to the City Attorney with respect to the status
of any such Event of Lessees Default or cure related thereto.
(b) Right to Cure. The applicable Subleasehold Lender Party shall be

afforded same period of time as is allowed to any Approved Leasehold

Mortgagee or other Person under the provisions of such Leasehold
Mortgage SNDA, plus an additional thirty (30) days, to cure the alleged
Default or cause the same to be cured, provided that such cure shall
require payment of interest at the Default Rate (as defined in Section
1.5(s) of the Ground Lease) on sums due pursuant to the Ground Lease for
the period commencing on the date on which such Subleasehold Lender
Party first received such Default Notice until the date payment is received
by Lessor. In the event an Approved Leasehold Mortgagee, Major
Subtenant or any other Person cure the alleged Default or causes same to
be cured, Lessor shall use reasonable efforts, within two (2) business days
thereafter, to give such Subleasehold Lender Party written notice of such
fact; provided, however that Lessor shall not have any liability for failure
to provide such written notice. Furthermore, Lessor agrees to use
reasonable efforts to respond to any written inquiries by such
Subleasehold Lender Party to the city Attorney as to whether an Approved
Leasehold Mortgagee, Major Subtenant or any other Person has cured the
alleged Default or caused same to be cured.
(c) Cooperation. In connection with any efforts by the applicable

Subleasehold Lender Party to cure the alleged Default or cause same to be
cured, Lessor agrees to cooperate in the prosecution of any foreclosure or
other proceedings brought by any Subleasehold Lender Party to obtain
possession of the Sublease Property (or if appropriate, the property);
provided, however, that; (i) notwithstanding the foregoing, Lessor shall
not be obligated to cooperate if Lessor determines in its sole and absolute
discretion that such cooperation may expose Lessor to liability; and (ii)
Lessor shall not be obligated to incur any cost in connection with such
cooperation unless Lessor is reimbursed for any actual and reasonable cost
so incurred by Lessor.
(d) Effect of Stay. Lessor agrees that if by reason of a bankruptcy,

insolvency or similar type proceeding, or by reason of any other judicial
order or legislative enactment, any Subleasehold Lender Party shall be
stayed from commencing (or if commenced, from continuing) foreclosure
proceedings which are necessary to enable the Subleasehold Lender Party
to cure such Event of Lessees Default, then for purposes of determining
whether such Subleasehold Lender Party is pursuing a cure of an alleged
Default within the time set forth in subparagraph 8(b) above, such
Subleasehold Lender Party shall be deemed to be prosecuting such
proceedings in the exercise of due diligence and in good faith so long as it
is in good faith attempting to obtain relief from any such stay.
(e) Acceptance of Cure. Lessor hereby agrees to accept, any such cure of a
Default made within the time periods described in subparagraph (b) above,
as applicable, by or on behalf of any Subleasehold Lender Party, as if
same had been performed by Lessee.

(f) Nullification of any Termination. Any attempt by Lessor to terminate
the Ground lease on account of any Default or Event of Lessees Default
shall be null and void and of no force or effect for so long as any
applicable Subleasehold Lender Party is pursuing a cure thereof pursuant
to this Section 8 within the time period set forth in subparagraph (b)
above.
9. Lessors Right to Terminate.
(a) Notice of Intent to Terminate. If (i) any Default described above (or any
Default occurring while any applicable Subleasehold Lender Party is
exercising its cure rights) is not cured within the applicable time period set
forth in subparagraph 8(b) above, and (ii) Lessor intends to terminate the
Ground Lease, Lessor shall give the applicable Subleasehold Lender Party
written notice in the manner provided by Section 37.2 of the Ground Lease of
Lessors intent to terminate the Ground lease on account of the failure to cure
same in accordance with the Ground lease and this Agreement (provided that
such Default is not timely cured pursuant to the terms of any Leasehold
Mortgage SNDA or the major Subtenant SNDA).
(b) Termination. Such termination shall become effective if and only if: (i) such
Default has not theretofore been cured pursuant to the terms of any Leasehold
Mortgage SNDA or Major Subtenant SNDA (or otherwise); and (ii) the
applicable Subleasehold Lender Party shall fail to cure same within ten (10)
days after the later of: (a) the date on which such Default may be cured
pursuant to the terms of any Leasehold Mortgage SNDA; or (b) the date on
which such Default may be cured pursuant to the terms of any Major
Subtenant SNDA. In the event an approved Leasehold Mortgagee Major
Subtenant or any other Person cures the alleged Default or causes same to
cured, Lessor shall use reasonable efforts to give within two (2) business days
thereafter, such Subleasehold Lender Party written notice of such fact;
provided, however, that Lessor shall not have any liability for failure to
provide such written notice. Furthermore, Lessor agrees to use reasonable
efforts to respond to any written inquiries by such Subleasehold Lender Party
to the City Attorney as to whether an Approved Leasehold Mortgagee, Major
Subtenant or any other Person has cured the alleged Default or caused same to
be cured.
10. Ground Lease Termination.
(a) Preservation of Sublease. Upon the occurrence of any Ground lease

Termination, the Sublease shall, unless it is deemed terminated by operation
of law, remain in full force and effect notwithstanding such Ground Lease
Termination and shall revert to Lessor as a Direct Lease between Lessor and
Major Subtenant, subject to the terms and conditions set forth in subsection

(b)(iii) below. If the Sublease remains in full force and effect notwithstanding
such Ground lease Termination and reverts to Lessor, then in the event a New
Lease is entered into between Lessor and any New Lessee pursuant to the
terms of the Ground lease and any applicable Leasehold Mortgage SNDA or
Major Subtenant SNDA, the Sublease shall be assigned and transferred,
without recourse, by Lessor to the New Lessee, and shall continue in full force
and effect as a Major Sublease under the New Lease.
(b) Direct Lease. If upon any Ground lease Termination: (i) the Sublease is
deemed terminated by operation of law; (ii) a Major Subtenant has not yet
entered into a New Lease or a Direct lease pursuant to the terms of any major
Subtenant SNDA; and (iii) an Approved Leasehold Mortgagee or any other
applicable person has not yet entered into a new Lease or a Direct lease
pursuant to the terms of any Leasehold Mortgage SNDA, the applicable
Subleasehold Lender Party shall, upon satisfying the conditions set forth
below, have the right (but not the obligation) to enter into a Direct lease with
Lessor, subject to the terms and conditions set forth in subsection (iii) below. 6
(i) Notice. Such Subleasehold Lender Party shall give Lessor written notice
of its election to enter into such Direct Lease (the Election Notice) within
thirty (30) days after the later of: (i) the last date on which a Major Subtenant
may elect to enter into a New Lease or a Direct lease pursuant to the terms of
any Major Subtenant SNDA; and (ii) the last date on which an Approved
Leasehold Mortgage or any other applicable Person may elect to enter into a
New Lease or a Direct lease pursuant to the terms of any Leasehold Mortgage
SNDA. Lessor and such Subleasehold Lender Party shall enter into such
Direct Lease within sixty (60) days after the Election Notice is given.
(ii) Cure of Defaults. As a condition to entering into such Direct lease, the
applicable Subleasehold Lender Party shall: (i) have remedied all Defaults on
the part of Lessee involving the payment of money to Lessor to the extent of
the Sublease Proportionate Amount (as hereinafter defined) for the period
such Default shall have existed (i.e., such monetary amount multiplied by
such Sublease proportionate Amount), and all other Defaults specifically
related to the Sublease property and/or the Subleasehold Improvements; and
(ii) continue to pay all Rent that would come due under the Ground lease but
for such Ground lease Termination to the extent of the Sublease proportionate
amount during the term of the Direct Lease (i.e., such Rent amount multiplied
by such Sublease proportionate amount), Lessor and such Subleasehold
Lender Party shall use good faith efforts to enter into the Direct lease as soon
as practicable. From the date on which such Subleasehold Lender Party shall
serve the election Notice upon Lessor until such Direct Lease is entered into,
such Lender Party may use and enjoy the Sublease property without hindrance
by Lessor but subject to compliance with the terms of the Sublease. The term
6
If required by Subleasehold Mortgagee, this provision will be modified to provide for the Sublease to be deemed automatically
converted to a Direct Lease where the conditions set forth in clauses (i), (ii) and (iii) have been met.

Sublease proportionate Amount shall mean, for any applicable period of
time, a fraction, the numerator of which is an amount equal to the base rent
and percentage rent payable under the Sublease during such period, and the
denominator of which is an amount equal to the aggregate base rent and
percentage rent payable under all Approved Major Subleases then in existence
(including the Sublease) during such period (plus any anticipated rents for any
Major project Component which is not then subject to a major Sublease).
(iii)Terms and Conditions of Direct Lease. The term of such Direct Lease
shall begin on the date of the Ground Lease Termination and shall continue
for the remainder of the Sublease Term, including any extension terms that
were previously exercised or may thereafter be exercised thereunder (it being
agreed that the lessee under the Direct Lease shall have the same rights to
renew the term of the Direct Lease as the Lessee had under the Ground Lease,,
provided that such rights are exercised by the lessee under the Direct Lease
within the original timeframes provided for in the Ground Lease,
notwithstanding the fact that the Ground Lease has been terminated, and
further provided that notwithstanding anything contained herein to the
contrary, in no event shall the term of the Direct Lease extend beyond the
maximum 75 year Lease Term). Such Direct Lease shall otherwise contain
the same terms and conditions as those set forth in the Sublease, except for
requirements which are no longer applicable or have already been performed;
provided, however, that:
(1) such Direct Lease shall require the lessee thereunder

promptly to commence, and expeditiously to continue, to remedy all then
existing Defaults on the part of the lessee (where such Defaults are
specifically related to the Sublease Property and/or the Subleasehold
Improvements) to the extent reasonably susceptible of being remedied;
(2) such Direct Lease, if entered into by Subleasehold

Mortgagee or any Approved Foreclosure Transferee with respect to the
Subleasehold Mortgage, shall permit such party to assign such Direct
Lease to an Approved Subsequent Foreclosure Purchaser without Lessors
consent;
(3) such Direct Lease shall include any changes which are
appropriate on account of the relationship between the parties being that of
lessor and lessee rather than sublessor and sublessee;
(4) such Direct Lease shall include at Lessors option in its sole
discretion, the remedies to which Lessor and lessee are entitled to under
Sections 25.2, 25.3 and/or 25.4 of the Ground Lease;

(5) such Direct lease shall provide that notwithstanding
anything in the Sublease to the contrary, Lessor, as lessor under the Direct
lease, shall not be:
(A) liable for any act or omission of, or breach or

default by, Lessee under the Sublease;
(B) subject to any offsets or defenses which Major

Subtenant or any Subleasehold Lender Party may have against
Lessee under the Sublease;
(C) bound by any rent or other payments, including

without limitation, common area maintenance charges, taxes
security deposits, etc., which Major Subtenant or any Subleasehold
Lender Party may have paid under the Sublease to Lessee or any
Person other than Lessor more than thirty (30) days in advance of
the applicable due date therefor under such Direct Lease;
(D) bound by any covenants and/or obligations to be

performed by or on behalf of Lessee, as Lessor under the Sublease,
including, without limitation, any obligation on the part of Lessee
to perform capital improvements and/or to repair and/or replace the
Sublease Property and/or Sublease Improvements due to casualty
or condemnation, other than the covenant of quiet enjoyment by
Lessor so long as no default exists under the Direct Lease, except
and to the extent that any such covenant and/or obligation is
expressly made or undertaken by Lesssor under the Ground lease;
and
(E) without limiting the foregoing subsections (A)

through (D) above, be liable for any indemnity made by Lessee to
Major Subtenant under the Sublease, including without limitation,
with respect to hazardous and toxic substances and/or materials.
(iv) No Cancellation of Space Leases or Approved time Share Licenses.

Between the date of any Ground Lease Termination and the date of execution
and delivery of such Direct Lease, Lessor shall not cancel or terminate any
Space Lease or any Approved Time Share License related to the Sublease
Property, or accept any cancellation, termination or surrender thereof (unless
such termination shall be effective as a matter of law upon the Ground Lease
Termination), without the prior written consent of the applicable Subleasehold
Lender Party.
(v) Approval by Lessor of Sublease. In connection with Lessors

agreement to grant a Direct Lease to the applicable parties provided herein on
the same terms and conditions of the Sublease, subject, however, to the

provisions of this Section 10, Lessee, Major Subtenant and Subleasehold
Mortgagee hereby acknowledge and agree that it shall be reasonable for the
City Manager to consider in its approval of the Sublease in accordance with
Section 33.3 of the Ground Lease the possibility that the Lessor will be
required to enter into a Direct Lease hereunder on the same terms and
conditions of such Sublease, as such terms may be modified by this Section
10.
(c) Substitute Sublease. If, after a Direct Lease has been entered into
pursuant to subparagraph 10(b) above, a new Ground Lease is entered into
between Lessor and a New Lessee pursuant to the terms of the Ground Lease and
any applicable Leasehold Mortgage SNDA or Major Subtenant SNDA, such New
Lessee and the Major Subtenant shall, without Lessors consent, enter into a
Substitute Sublease upon the same terms and conditions as those specified in the
Direct lease for the remainder of the term that was set forth in the Direct lease,
including any extension options, if applicable, whether exercised or remaining to
be exercised. In such event, such Substitute Sublease shall be deemed effective as
of the effective date of the New Lease, and such Direct Lease shall be deemed
terminated as of the effective date of the New Lease.
(d) Restoration of Positions. At the time of the execution and delivery of the
Direct Lease or the New Lease and the Substitute Sublease, as applicable, Lessor,
the New Lessee, Major Subtenant and all other parties having an interest in the
Sublease Property, including, but not limited to, any tenants under Subleases,
holders of Approved time Share Licenses and Approved Mortgagees shall
execute, acknowledge and deliver such new instruments (including new
mortgages and other security documents, new Major Subleases, new Approved
Time Share Licenses, new Space Leases, new Subordination, Non-Disturbance
and Attornment Agreements and new easements which were previously granted,
as the case may be), and shall make such payments and adjustments among
themselves, as shall be necessary and proper for the purpose of restoring to each
of such parties as nearly as reasonably possible, the respective interest and status
with respect to the Sublease Property which was possessed by the respective
parties prior to the Ground Lease Termination.
(e) Subrogation. The Subleasehold Lender Party obtaining any Direct Lease
shall be subrogated to the rights of Lessor against Lessee as to any monetary
defaults of Lessee which are cured by such Lender Party as a condition to
obtaining such Direct Lease, and any other Defaults which are remedied as
described in subparagraphs (b)(i) and (b)(ii) above (but are not as to any other
matters).
(f) No Obligation to Cure Uncurable Defaults. Nothing contained herein

or in the Ground Lease or the Sublease shall require any applicable Subleasehold
Lender Party, as a condition to its exercise of its right to enter into a Direct Lease

or a Substitute Sublease, to cure any Default of Lessee not reasonably susceptible
of being cured by such Lender Party.
(g) Priority as to Approved Subleasehold Mortgages. If, pursuant to the

provisions of subparagraph (b) or subparagraph (c) above, more than one request
for a Direct lease or Substitute Sublease shall have been received by Lessee from
more than one holder of an Approved Subleasehold Mortgage (or any Approved
Foreclosure Transferee of Approved Subsequent Foreclosure Purchaser with
respect thereto), then in the absence of any written subordination and intercreditor
agreement or other similar agreement between such holders, priority with respect
to the right to enter into such Direct Lease or Substitute Sublease shall be given
(regardless of the order in which such requests shall have been made or received)
to such holders (or any Approved Foreclosure Transferees or Approved
Subsequent Foreclosure Purchasers with respect thereto) in the same order as the
order of recording of the applicable Approved Subleasehold Mortgages.
(h) Liability. No Subleasehold Lender Party (or any assignee, designee or

nominee thereof) shall become liable for the performance or observance of any
covenants or conditions to be performed or observed by Major Subtenant, unless
and until such Subleasehold Lender Party acquires possession of the Subleasehold
Estate, becomes the owner of the Major Subtenant Interest under the Sublease or
enters into a Direct Lease or Substitute Sublease as provided above. Thereafter,
such Subleasehold Lender Party shall be liable for the performance and
observance of those covenants and conditions which arise during its possession
and ownership as well as those which predate such possession or ownership as to
which such Subleasehold Lender Party is liable pursuant to the terms of this
Agreement (which, in the case of a Direct lease, shall be only those items
described in subparagraph 10(b)(ii) above). Such Subleasehold Lender Party
shall not be liable for the performance or observance of any covenants or
conditions to be performed or observed by Major Subtenant which accrue after
the transfer of such Subleasehold Lender Partys interest in the Subleasehold
Estate.
(i) No Obligation to Cure. Nothing herein contained shall require any

applicable Subleasehold Lender Party to cure any Default by Lessee or Event of
Lessees Default under the Ground lease; provided, however, that if such
Subleasehold Lender Party shall not: (i) cure same within the time and in the
manner provided by subparagraph (b) above; or (ii) request and obtain a Direct
Lease within the time provided by subparagraph (b) above, Lessor shall be
permitted to proceed with any rights or remedies under the Ground Lease and/or
otherwise available at law or in equity (subject, however, to any prior rights and
remedies of such Subleasehold Lender Party as to the Collateral, as provided for
by the Ground lease, the Sublease, this Agreement and/or Applicable Laws).
(j) No Obligation as to Accelerated Rent or Damages. Whenever this

Agreement refers to any Subleasehold Lender Partys curing monetary Defaults or

Events of Lessees Default, such Subleasehold Lender Party shall not be required
to pay any accelerated sums or any damages, other than the payment of accrued
interest on monetary sums as required pursuant to Section 8(b) of this Agreement,
on account thereof which may otherwise be provided for the terms of the Ground
lease, and upon such cure by such Subleasehold Lender Party, any such
acceleration by Lessor shall be deemed to be nullified and of no force or effect.
(k) Survival. The provisions of this Section 10 shall survive any Ground lease
Termination and shall continue in full force and effect thereafter to the same
extent as if this Section were a separate and independent contract among Lessor,
Major Subtenant and the applicable Subleasehold Lender Party.
(l) References to Sublease. As of the date any Direct Lease or Substitute

Sublease becomes effective, all references herein to the Sublease shall be deemed
references to such Direct Lease or Substitute Sublease.
11. Other Approved Subleasehold Mortgagees. In the event Major Subtenant

desires to encumber the Subleasehold Estate with any Approved Subleasehold Mortgage(s) in
addition to the Subleasehold Mortgage from time to time (to the extent permitted by the Ground
Lease, the Sublease, the Subleasehold Mortgage and other Subleasehold Loan documents or
otherwise approved in writing by Lessor, lessee or Subleasehold Mortgagee, as applicable),
Lessor, Lessee, Major Subtenant, Subleasehold Mortgagee and the anticipated holder(s) of such
Approved Leasehold Mortgage(s) shall enter into an agreement, in form and substance
reasonably acceptable to all such parties. Such agreement shall provide for rights and
obligations on the part of such holder(s) of Approved Subleasehold Mortgage(s) which are
comparable to those set forth herein as to Subleasehold Mortgagee. Notwithstanding the
foregoing, such agreement shall fully recognize Subleasehold Mortgagees first priority position
and shall contain such subordination and intercreditor provisions recognizing and preserving
such first priority position as are acceptable to Subleasehold Mortgagee, provided that such
provisions do not: (i) affect the business and financial terms of the Ground Lease and the
Sublease; (ii) constitute a material deviation from the Watson Island RFP and the Island Gardens
Proposal; (iii) significantly impair the protections afforded to Lessor pursuant to the Ground
Lease and this Agreement or impose any additional material burdens on Lessor; or (iv)
significantly impair the protections afforded to Lessee pursuant to the Sublease and this
Agreement or impose any additional material burdens on Lessee. Such provisions shall address,
among other things, priority as to lien rights and rights to receive payments, priority and timing
as to cure rights concerning Defaults, procedures for disbursing Condemnation Awards and Net
Insurance Proceeds consistent with the provisions of the Ground lease, the Sublease and this
Agreement, foreclosure rights and standstill requirements. In addition, there may be
comparable agreements between or among one or more Approved Leasehold Mortgagees and
one or more Approved Subleasehold Mortgagees.
12. Other SNDAs. Subleasehold Mortgagee specifically recognizes that: (i)

Approved Leasehold Mortgagees, other Major Subleasehold Mortgagees, Major Subtenants,
holders of Approved Time Share Licenses, certain Space Tenants and the operators of the

Hotels7 are entitled to enter into Subordination, Non-Disturbance and Attornment Agreements
as contemplated by the provisions of the Ground Lease, each in the form previously submitted
in writing to Subleasehold Mortgagee; and (ii) certain provisions of the Ground Lease, the
Sublease and such Subordination, Non-Disturbance and Attornment Agreements grant or will
grant certain possessory and/or other rights to such parties that will survive any Foreclosure
Transfer with respect to the Subleasehold Mortgage, the termination of the Ground Lease or the
Sublease, the granting of any New Lease, Direct lease, Substitute Sublease or New Lease and
certain other events described therein.
13. Lessors Cure Rights. Subleasehold Mortgagee hereby acknowledges that

Section 15.2 of the Ground Lease permits Lessor, upon prior written notice to Lessee, to cure
any default under the Subleasehold Mortgage nor cured by Major Subtenant within the
applicable notice and cure period thereunder. Subleasehold Mortgagee may, but shall not be
obligated, to accept any such cure.
14. Modifications, Amendments, Etc. No modification, amendment, waiver or

release of any provision of this Agreement or of any right, obligation, claim or cause of action
arising hereunder shall be valid or binding for any purpose whatsoever unless in writing and
duly executed by the parties against whom the same is sought and asserted.
15. Notices. All notices, demands and requests given or required to be given
hereunder or pursuant to the terms of the Ground Lease or the Sublease shall be in writing. All
such notices, demands and requests shall be given by United States Registered or Certified Mail,
postage prepaid, by reputable overnight courier, addressed to Major Subtenant in accordance
with the notice provisions of the Sublease; and to Subleasehold Mortgagee, as follows:
Subleasehold Mortgagee: ____________________________

____________________________
____________________________
Attn: _______________________
With a copy to: ____________________________

____________________________
Attn: _______________________
or to such other address as Subleasehold Mortgagee may from time to time designated by written
notice to Lessor.
All such notices, demands and request by Leasehold Mortgagee to Lessor shall be given
by United States Registered or Certified Mail, postage prepaid, by reputable overnight courier,
addressed to:

444 SW 2 Avenue
7
This provision will be modified to add the Marina operator, if applicable.

Miami, FL 33130
or to such other address as Lessor may from time to time designate by written notice to
Subleasehold Mortgagee.
16. Successors and Assigns. This Agreement may not be assigned by Major
Subtenant without Subleasehold Mortgagees prior written consent, which may be granted or
withheld in Subleasehold Mortgagees sole discretion. This Agreement shall inure to the benefit
of and be binding upon the parties hereto and their respective successors and permitted assigns.
17. Governing Law. This Agreement shall be construed in accordance with the
18. Authority. Each party to this Agreement represents to the other parties that: (i) it
is duly organized, validly existing and in good standing in its state of formation; and (ii) the
19. Further Assurances. Upon Subleasehold Mortgagees request, Lessor and Major
Subtenant shall, each at its sole expense, execute, acknowledge and deliver such further
instruments and do such further acts as may, in the opinion of Subleasehold Mortgagee, be
necessary, desirable, or proper to carry out more effectively the purpose of this Agreement.
20. Severability. In case any one or more of the provisions contained in this
21. Captions. The captions and headings contained in this Agreement are for
22. Recording. At Subleasehold Mortgagees option, this Agreement may be

recorded in the Public Records of Miami-Dade County, Florida.
23. Waiver of Jury Trial. The parties hereby knowingly, irrevocably, voluntarily
and intentionally waive any right any of them may have to a trial by jury in respect of any action,
proceeding or counterclaim based on, or arising out of, under or in connection with this
Agreement or any amendment or modification of this Agreement, or any other agreement
This waiver of jury trial provision is a material inducement for each of the parties hereto to enter
into this Agreement and for Subleasehold Mortgagee to make the Loan.
24. Termination. This Agreement shall terminate at such time as all obligations
secured by the Subleasehold Mortgage have been paid in full. Such obligations shall not be

deemed to have been paid in full (as such term is used herein) unless and until any period
under any bankruptcy or similar laws during which any payment to Subleasehold Mortgagee
may be required to be rescinded, disgorged or returned shall have expired without any such
payment being required to be rescinded, disgorged or returned.
25. Counterparts. This Agreement may be executed in one or more counterparts,

each of which shall be deemed an original and all of which shall be deemed but one agreement.
IN WITNESS WHEREOF, Lessor, Major Subtenant and Subleasehold Mortgagee have

executed this Agreement as of the day and date first written above.

_____________________________
Name: _______________________
By: _______________________
_____________________________ Name: _______________________
Name: _______________________ Title: _______________________
MAJOR SUBTENANT
____________________, a ___________________
__________________
_____________________________
Name: _______________________
By: _______________________
_____________________________ Name: _______________________
Name: _______________________ Title: _______________________
SUBLEASEHOLD MORTGAGEE
____________________, a ___________________
__________________
_____________________________
Name: _______________________

By: _______________________
_____________________________ Name: _______________________
Name: _______________________ Title: _______________________

STATE OF FLORIDA )
)


or produced I.D. _______________________________
________________________________
(type of I.D.)
Signature: ______________________
Serial No., if any: _______________________

ACKNOWLEDGMENT OF MAJOR SUBTENANT
STATE OF FLORIDA )
)
COUNTY OF )
by ___________________ as ___________________ of ______________________, a
______________________, on behalf of the ____________________.

or produced I.D. _______________________________
________________________________
(type of I.D.)
Signature: ______________________
Serial No., if any: _______________________

ACKNOWLEDGMENT OF SUBLEASEHOLD MORTGAGEE
STATE OF FLORIDA )
)
COUNTY OF )

____________, 20__, by ___________________ as ___________________ of
______________________, a ______________________, on behalf of the
____________________.

or produced I.D. _______________________________
________________________________
(type of I.D.)
Signature: ______________________
Serial No., if any: _______________________

JOINDER AND CONSENT
Lessee hereby joins in and consents to the foregoing Subordination, Non-Disturbance and
Attornment Agreement and agrees to be bound by its terms, covenants and conditions.
FLAGSTONE ISLAND GADENS, LLC, a

By: Flagstone Miami Holdings, LLC, a Delaware

limited liability company, as its sole and
Managing member
By: Flagstone Property Group, LLC, a Delaware

limited liability company, as its sole and
managing member
By: _________________________________
Mehmet Bayraktar, sole and managing
member
_____________________________
Name: _______________________
_____________________________
Name: _______________________

STATE OF FLORIDA )
)


or produced I.D. _______________________________
________________________________
(type of I.D.)
Signature: ______________________
Serial No., if any: _______________________

EXHIBIT A

EXHIBIT B

EXHIBIT C
DESCRIPTION OF SUBLEASEHOLD MORTGAGE

EXHIBIT N
PROHIBITED USES
Without limiting the generality of the other provisions of the Amended and Restated
Ground Lease, the following uses of the Property shall not be permitted:
(a) any unlawful or illegal business, including, without limitation, casino gambling, or games of
chance or reward, the use of the Marina as a departures and arrival point for vessels which have
casino gambling or other games of chance on board whether on or off-site (collectively,
Gambling Boats) unless otherwise permitted and/or approved by Lessor subject to the
provisions and in accordance with Section 7.3 and Section 7.12 of the Lease;
(b) the rental and/or operation of jet skis and/or any similar motorized personal watercraft, except for
the noncommercial use thereof by owners, users and staff of Mega-Yachts using the Marina and
their families and guests;
(c) any adult entertainment and/or adult service establishments as defined in Article 25 of Ordinance
11000, as amended, of the Zoning Ordinance of the City of Miami or any peep show store, head
shop store, topless or strip club or adult book store (which shall mean a store which sells or offers
for sale sexually explicit printed materials, audio or videotapes or films or sexual devices) or any
other similar store or club or any establishment selling, exhibiting or distributing pornographic
materials;
(d) hauling and/or dry land storage of vessels;
(e) any residential uses, including, without limitation, time share and interval ownership other than
Approved Time Share Licenses; provided, however, that the foregoing shall not be deemed to
prohibit the Hotels from having the associated facilities and amenities described in the definitions
of Hotel A and Hotel B;

(f) private clubs (including, without limitation, private yacht clubs, other than any private clubs
which are aboard vessels at the Marina or which otherwise do not operate on the Upland Parcel),
except for ancillary uses such as staff lounges on the Upland Parcel; provided, however, that the
foregoing shall not be deemed to prohibit: (i) the charging of fees or any other activities permitted
by Section 7.6 of the Lease; or (ii) an executive floor club or similar arrangement offered or
operated at either or both of the Hotels;
(g) any use which emits an unreasonable degree of obnoxious odor, noise, or sound which can be
heard or smelled outside of any building within the Project; provided, however, that, the
foregoing shall not be deemed to prevent (i) the provision of outdoor music at the Hotels and
Retail Space (and the restaurants and banquet spaces located therein) to the extent permitted
under all Applicable Laws; or (ii) the use of any Major Project Component for an outdoor
special event such as a festival or art fair, which may include outdoor music in connection
therewith;
(h) any operation primarily used as a warehouse operation and any assembling, manufacturing,
distilling, refining, smelting, agricultural, or mining operation;
(i) any dumping, disposing, incineration, or reduction of garbage (exclusive of garbage compactors
located near the rear of any building);
(j) any fire sale, bankruptcy sale (unless pursuant to a court order) or auction house operation;
(k) any central laundry, dry cleaning plant, or Laundromat; provided, however, that this prohibition
shall not be applicable to any such on-site service in connection with the operations of the Hotels
or Marina;
(l) any automobile, truck, trailer or recreational vehicle sales, leasing or repair facilities; provided,
however, that the foregoing shall not be deemed to prevent: (i) sales, leasing or charters of or
repair services for yachts or other marina vessels; or (ii) the interval rental of automobiles on a
daily or weekly basis;
(m) any veterinary hospital or animal raising facilities or pet supply shops;

(n) any mortuary or funeral home;
(o) any health club or spa fitness center or workout facility or massage parlor other than such
facilities which are made available to guests of the Hotels (whether or not such facilities are
located inside or outside the Hotels, and whether or not such facilities are also made available to
persons who are not guests of the Hotels);
(p) any training or educational facility, including, but not limited to, beauty schools; barber colleges,
reading rooms, places of instruction or other operations catering primarily to students or trainees
rather than to customers; provided however, this prohibition shall not be applicable to on-site
employee training by an occupant incidental to the conduct of its business within the Premises or
to any retail store that offers training or instruction as an ancillary service to its retail operations;
(q) any store engaged in the sale of fireworks or drug paraphernalia;
(r ) any car wash other than a car wash service operated by the parking valet for Hotel or Marina
guests and their families, guests, staff and employees; provided, however, that the foregoing shall
not be deemed to prohibit the washing of marina vessels);
(s) any liquor store or grocery store except in connection with a gourmet shop or sundry store or
provisioning store serving guests and patrons of the Hotels and the Marina (provided, however,
that the foregoing shall not be deemed to prohibit the sale of liquor in connection with any
restaurant or the Hotels); or
(t) any use which would constitute a material breach of the covenants described in Exhibit N-1.

EXHIBIT N-1
COVENANTS AS TO PORT OF MIAMI

EXHIBIT O
LIST OF PRE-APPROVED FINANCIAL ADVISORS
HSBC Group
Holliday Fenoglio Fowler
Credit Suisse Group (CSFB)
Lehman Brothers
Bank of America
JP Morgan Chase
Goldman Sachs
Morgan Stanley
Bear Stearns
Merrill Lynch
Wachovia Securities
Fleet
UBS Warburg
GMAC
GE Capital
CIBC World Markets
Deutsche Bank Securities
RBS Greenwich Capital
Eastdil Realty
CB Richard Ellis
Cushman & Wakefield
Granite Partners
Rockwood Realty
Insignia/ESG
Trammell Crow
Colliers International
Jones Lang LaSalle
BF Capital Partners
The Greenwich Group International

EXHIBIT P
ORGANIZATIONAL DOCUMENTS
Flagstone Property Group, LLC, a Delaware Limited Liability Company f/k/a Flagstone
Properties, LLC
1. Certified Certificate of formation of Flagstone Properties, LLC dated December 9, 2002
2. Certified Certificate of amendment of Flagstone Properties, LLC, dated December 11, 2002
3. Written consent of the Managing Member of Flagstone Properties, LLC (a Delaware Limited
Liability company) dated December 10, 2002
4. Application for Authority of Flagstone Properties, LLC
5. Certified Certificate of Good Standing of Flagstone Properties, LLC dated December 9, 2002
6. Form for filing an application for authority for a foreign limited liability company to conduct
business in New York State dated December 10, 2002
7. Certificate of Amendment or Change of application for authority of Flagstone Properties, LLC

dated December 11, 2002
8. Certificate of amendment or Change of Application for authority of Flagstone Properties, LLC-

Filer: Joel J. Goldschmidt, Esq. dated December 11, 2002
9. Certified qualification documents by Flagstone Property Group, LLC dated December 17, 2002
10. Management Agreement dated July 17, 2003
11. Written Consent of the Members of Flagstone Property Group, LLC dated March 1, 2003
12. Limited Liability Company Operating Agreement of Flagstone Property Group, LLC dated
January 15, 2003

Flagstone Miami Holdings, LLC, a Delaware Limited Liability Company
1. Certified Certificate of Formation of Flagstone Miami Holdings, LLC dated December 9, 2002
2. Written consent of the Managing Member of Flagstone Miami Holdings, LLC (a Delaware
Limited Liability Company) dated December 10, 2002
3. Certificate of Good Standing for Flagstone Miami Holdings, LLC dated December 9, 2002
4. Application for authority of Flagstone Miami Holdings, LLC dated December 10, 2002
5. Certified qualification documents by Flagstone Miami Holdings, LLC dated December 17, 2002
6. Application for authority of Flagstone Miami Holdings, LLC
7. Written Consent of the Members of Flagstone Miami Holdings, LLC dated March 1, 2003
9. Limited Liability Company Operating Agreement of Flagstone Miami Holdings, LLC dated
January 15, 2003

Flagstone Island Gardens, LLC, a Delaware Limited Liability Company
1. Certified Certificate of formation of Flagstone Island Gardens, LLC dated December 9,

2002
2. Consent of the sole Member of Flagstone Island Gardens, LLC dated December 11, 2002
3. Certificate of Merger of Flagstone Properties, LLC Properties, LLC (a Florida Limited

Liability company) and Flagstone Island Gardens, LLC (a Delaware Limited Liability
Company) dated December 11, 2002
4. Plan of Merger of Flagstone Properties, LLC (a Florida Limited Liability company) and
Flagstone Island Gardens, LLC (a Delaware Limited Liability company) dated December
10, 2002
5. Certified Articles of Merger for Flagstone Island Gardens, LLC December 11, 2002
6. Articles of Merger of Flagstone Properties, LLC (a Florida Limited Liability Company)

and Flagstone Island Gardens, LLC (a Delaware Limited Liability Company) dated
December 11, 2002
7. Plan of Merger of Flagstone Properties, LLC (a Florida Limited Liability Company) and
Flagstone Island Gardens, LLC (a Delaware Limited Liability Company) dated
December 10, 2002
8. Written consent of the Managing Member of Flagstone Island Gardens, LLC (a Delaware
Limited Liability Company) December 10, 2002
9. Application for authority of Flagstone Island Gardens, LLC
10. Certificate of Good Standing of Flagstone Island Gardens, LLC dated December 9, 2002
11. Form for filing an application for authority for a foreign limited liability company to
conduct business in New York State dated December 10, 2002
12. Certified qualification documents by Flagstone Island Gardens, LLC dated December 17,
2002
13. Written Consent of the Members of Flagstone Island Gardens, LLC dated March 1, 2003
14. Limited Liability Company Operating Agreement of Flagstone Island Gardens, LLC
dated January 15, 2003

EXHIBIT R
CIVIC ARTS ENDOWMENT TRUST
1. Trust.
(a) Term. The term of the Trust shall coincide with the Lease Term (including any
applicable Extension Terms); provided, however, that the Trust shall terminate upon any sooner
termination of the Lease or Lessees right to possession of the Property and the Leasehold Improvements,
for any reason whatsoever (collectively, a Lease Termination).
(b) Corpus and Trust Income. The amount which is funded into the Trust pursuant to
Paragraph 2 below (the Corpus), and the income earned thereon (the Trust Income) shall be held
and disbursed in the manner provided below.
(c) Operating Expenses. Annual operating expenses of the Trust shall be paid out of the
Trust Income and not the Corpus.
2. Funding.
(a) Initial Term. During each year of the initial Lease Term, Lessee shall fund the Trust (or
cause the Trust to be funded) in amounts equal to the following percentages of the net operating income
for the Project during each such year as reflected in the operating statements of Lessee and each
applicable Major Subtenant (NOI): (i) Seven Tenths Percent (.7%) during each of the first fifteen (15)
years of the Lease Term; (ii) Six Tenths Percent (.6%) during each of the second fifteen (15) years of the
Lease Term; and (iii) Five Tenths Percent (.5%) during each of the third fifteen (15) years of the Lease
Term.
(b) First Extension Term. If Lessee duly exercises the first (1st) Extension Option pursuant
to Section 3.2 of the Lease, then during each year of the first (1st) Extension Term, Lessee shall fund the
Trust (or cause the Trust to be funded) in an amount equal to Five Tenths Percent (.5%) of NOI for such
year.

(c) Second Extension Term. If Lessee duly exercises the second (2nd) Extension Option
pursuant to Section 3.2 of the Lease, then during each year of the second (2nd) Extension Term, Lessee
shall fund the Trust (or cause the Trust to be funded) in an amount equal to Five Tenths Percent (.5%) of
NOI for such year.
3. Return of Funds.
(a) End of Initial Lease Term. If Lessee does not duly exercise the first (1st) Extension
Option, then, at the end of the initial Lease Term (or any sooner Lease Termination), the Trust shall be
terminated, and the entire Corpus shall be returned to and become the sole property of Lessee but all other
funds then in the Trust shall be retained by and become the sole property of Lessor. If Lessee does duly
exercise the first (1st) Extension Option, then at the end of the initial Lease Term, an amount equal to
Seventy Percent (70%) of the Corpus of the Trust shall be returned to and become the sole property of
Lessee. The remaining balance shall continue in the Trust, and Lessee shall continue to have the funding
obligations described in Paragraph 2(b) above.
(b) End of First Extension Term. If Lessee does not duly exercise the second (2nd)
Extension Option, then, at the end of the first (1st) Extension Term (or any sooner Lease Termination), the
Trust shall be terminated, and the entire Corpus shall be returned to and become the sole property of
Lessee but all other funds then in the Trust shall be retained by and become the sole property of Lessor.
If Lessee does duly exercise the second (2nd) Extension Option, then at the end of the first (1st) Extension
Term, the then existing Corpus and all other funds then in the Trust shall continue in the Trust, and
Lessee shall continue to have the funding obligations described in Paragraph 2(c) above.
(c) End of Second Extension Term. If Lessee duly exercises the second (2nd) Extension
Option, then at the end of the second (2 nd) Extension Term (or any sooner Lease Termination), the Trust
shall be terminated, and the entire Corpus shall be returned to and become the sole property of Lessee but
all other funds then in the Trust shall be retained by and become the sole property of Lessor.

EXHIBIT S
MAJOR SUBLEASE SNDA
Prepared By and Return to:


FLAGSTONE ISLAND GARDENS, LLC, a Delaware limited liability company (Lessee),
and _________________________, a _________________________ (Major Subtenant).
WITNESSETH:
Property); and
Property to Lessee, subject to and in accordance with the terms and conditions of the Ground
Lease (unless otherwise defined herein, all capitalized terms used herein shall have the respective
meanings ascribed to them in the Ground Lease); and
and
WHEREAS, pursuant to that certain Sublease dated ____________, 200_ (the

Sublease), a memorandum of which was recorded in Official Records Book ______, at Page
_______, of the Public Records of Miami-Dade County, Florida, Lessee has subleased to Major
Subtenant a portion of the Property as more particularly described in Exhibit B, attached
hereto and incorporated herein by this reference (the Sublease Property), subject to and in
accordance with the terms and conditions of the Sublease; and
WHEREAS, the Sublease provides for Major Subtenant to construct and operate certain
Leasehold improvements on the Sublease Property (the Subleasehold Improvements), and
further provides that during the term of the Sublease (the Sublease Term), Major Subtenant is
and shall be the owner and holder of all such Subleasehold Improvements (with the ownership
thereof reverting to Lessee, subject to and in accordance with the terms and conditions of the
Ground Lease and the Sublease, upon the expiration of the Sublease Term or the sooner
termination of the Sublease); and

1. Recitals. The foregoing recitals are true and correct and incorporated herein by
this reference.
2. Certain Defined Terms. As used herein the following terms shall have the
respective meanings ascribed to them below:
(a) Ground Lease Termination shall mean the termination of the Ground
Lease for any reason, or the rejection or disaffirmation of the Ground Lease in
any bankruptcy, insolvency or other similar proceedings, if the effect of such
rejection or disaffirmation is to cause the Ground Lease to terminate.
(b) New Lease shall mean any new ground lease hereafter entered into
between Lessor and a New Lessee, subsequent to a Ground Lease Termination.
(c) New Lessee shall mean: (i) Major Subtenant, if Major Subtenant enters
into a New Lease pursuant to the terms of this Agreement; (ii) any other Major
Subtenant, if such Other Major Subtenant enters into a New Lease pursuant to the
terms of any Other Major Subtenant SNDA; (iii) an Approved Leasehold
Mortgagee or any other Person which enters into a New Lease pursuant to the
terms of any Leasehold Mortgage SNDA; or (iv) an Approved Subleasehold
Mortgagee or any other Person which enters into a New Lease pursuant to the
terms of any Subordination, Non-Disturbance and Attornment Agreement to
which such Approved Subleasehold Mortgagee is a party.
(d) Substitute Sublease shall mean a sublease entered between a New

Lessee, as sublessor, and Major Subtenant, as sublessee, pursuant to the terms of
this Agreement, subsequent to a Ground Lease Termination.

(e) Direct Lease shall mean a direct lease for the Sublease Property entered
into between Lessor, as lessor, and Major Subtenant, as lessee, pursuant to the
terms of this Agreement, subsequent to a Ground Lease Termination.
(f) Leasehold Mortgage SNDA shall mean any Subordination, Non-

Disturbance and Attornment Agreement or other similar agreement now or
hereafter entered into among Lessor, Lessee and an Approved Leasehold
Mortgagee with respect to the Ground Lease.
(g) Other Major Subtenant shall mean any Major Subtenant with respect
to any Major Project Component other than the Major Project Component which
is subject to the Sublease.
(h) Other Major Subtenant SNDA shall mean any Subordination, Non-
Disturbance and Attornment Agreement to which Lessor and any Other Major
Subtenant are parties.
(i) Default shall mean any default or any event which, if not remedied,
would or could result in an event of Lessees Default under the Ground Lease.
(j) Default Notice shall mean any written notice of other written
communication from Lessor to Lessee pertaining to an Event of Lessees Default.
3. Subordination of Sublease. The Sublease and all of Major Subtenants right,

title and interest in and to the Sublease, the Sublease Property and the Subleasehold
Improvements are and shall be unconditionally subject and subordinate to the right, title and
interest of Lessor in and to the property and the Ground Lease, subject to the provisions of the
Ground Lease and this Agreement.
4. Lessors Consent to Sublease. Pursuant to any and all applicable provisions of

the Ground Lease, Lessor irrevocably and fully consents to the execution and delivery of the
major Sublease and the recordation of a memorandum or short form thereof. Lessor hereby
further acknowledges and agrees as follows:
(a) Approval of Sublease. Lessor has approved the Sublease pursuant to

Section 33.3 of the Ground Lease, and the Sublease qualifies as and constitutes a
Major Sublease as such term is defined, described and used in the Ground
Lease.
(b) Approval of Major Subtenant. Lessor has approved Major Subtenant

pursuant to Section 33.3 and Article VIII of the Ground Lease, and Major
Subtenant qualifies as and is a Major Subtenant as such term is defined,
described and used in the Ground Lease. All rights and benefits of a Major
Subtenant provided in the Ground Lease may be exercised and enjoyed by Major
Subtenant in accordance with the provisions of the Ground Lease, and Lessor is
bound with respect to the Sublease and Major Subtenant by all provisions in the

Ground Lease concerning Major Subtenants and major Subleases. As used
herein, the term Major Subtenant shall include any assignee or successor of
Major Subtenant after any Major Subtenant Transfer of Control or Major
Subleasehold Estate Transfer which is permitted pursuant to Article VIII of the
Ground Lease.
(c) Condition of Ground Lease for SNDA Satisfied. This Agreement fully
satisfies the requirements of Section 33.2 of the Ground Lease as to the execution
and delivery of a Subordination, Non-Disturbance and Attornment Agreement
with respect to the Sublease.
5. Lessors Lien Rights. The parties acknowledge and agree that Lessor has certain
lien rights pursuant to Article XXIII of the Ground Lease, but that such lien rights are subject to
the limitations set forth in Section 23.3 of the Ground Lease.
6. No Termination of Ground Lease. So long as the Sublease remains in effect,

Lessor shall not accept from Lessee, and Lessor shall not offer to Lessee, any Ground Lease
Termination without Major Subtenants prior written consent. Any such purported Ground
Lease Termination without Major Subtenants prior written consent shall be null and void and of
no force or effect. Notwithstanding the foregoing, the provisions of this Section 6 shall not
preclude Lessor from exercising its right to terminate the Ground Lease on account of an Event
of Default, subject to and in accordance with the terms and conditions of Sections 7 through 9
below.
7. Notice and Cure Rights. So long as the Sublease remains in full force and
effect, Lessor shall have the obligations, and Major Subtenant shall be afforded the notice and
cure rights and other rights, set forth in this Section 7 (unless an Approved Leasehold
Mortgagee, Approved Subleasehold Mortgagee, Other Major Subtenant or any other Person
entitled to cure the alleged Default has already cured the alleged Default.
(a) Notice of Default. Whenever Lessor sends or gives Lessee any Default
Notice, Lessor shall simultaneously send a copy of such Default Notice to Major
Subtenant. Furthermore, Lessor agrees to use reasonable efforts to respond to any
written inquiries by Major Subtenant to the City Attorney of the City of Miami,
Florida (City Attorney) with respect to the status of any such Event of Lessees
Default or cure related thereto.
(b) Right to Cure. Major Subtenant shall be afforded the same period of time
as is allowed to any Approved Leasehold Mortgagee or other Person under the
provisions of any applicable Leasehold Mortgage SNDA, plus an additional
fifteen (15) days, to cure the alleged Default or cause the same to be cured,
provided that such cure shall require payment of interest at the Default Rate (as
defined in Section 1.5(s) of the Ground Lease) on sums due pursuant to the
Ground lease for the period commencing on the date on which Major Subtenant
first received such Default Notice until the date payment is received by Lessor. In
the event an Approved Leasehold Mortgagee or any other person cures the alleged

Default or causes same to be cured, Lessor shall use reasonable efforts, within
two (2) business days thereafter, to give Major Subtenant written notice of such
fact, provided, however that Lessor shall not have any liability for failure to
provide such written notice. Furthermore, Lessor agrees to use reasonable efforts
to respond to any written inquiries Major Subtenant to the City Attorney as to
whether an Approved Leasehold Mortgagee or any other Person has cured the
(c) Cooperation. In connection with any efforts by Major Subtenant to cure

the alleged Default or cause same to be cured, Lessor agrees to cooperate in the
prosecution of any proceedings brought by major Subtenant to obtain possession
of any portion of the Property other than the Sublease Property); provided,
however, that: (i) notwithstanding the foregoing, Lessor shall not be obligated to
cooperate if Lessor determines in its sole and absolute discretion that such
cooperation may expose Lessor to liability; and (ii) Lessor shall not be obligated
to incur any cost in connection with such cooperation unless Lessor is reimbursed
for any actual reasonable cost so incurred by Lessor.
(d) Effect of Stay. Lessor agrees that if by reason of a bankruptcy,

insolvency or similar type proceeding, or by reason of any other judicial order or
legislative enactment, Major Subtenant shall be stayed from commencing (Or if
commenced, from continuing) proceedings described in subparagraph 7(b) above
which are necessary to enable Major Subtenant to cure such Event of Lessees
Default within the time set forth in subparagraph 7(b) above, Major Subtenant
shall be deemed to be prosecuting such proceedings in the exercise of due
diligence and in good faith so long as it is in good faith attempting to obtain relief
from any such stay.
(e) Acceptance of Cure. Lessor herby agrees to accept, any such cure of a
Default made within the time set forth in subparagraphs 7(b) and 7(d) above, as
applicable by or on behalf of Major Subtenant, as if same had been performed by
Lessee.
(f) Nullification of any Termination. Any attempt by Lessor to terminate

the Ground lease on account of any Default or Event of Lessees Default shall be
null and void and of no force or effect for so long as Major Subtenant is pursuing
a cure thereof pursuant to this Section 7 within the time set forth in subparagraphs
7(b) and 7(d) above, as applicable.
8. Lessors Right to Terminate.
(a) Notice of Intent to Terminate. If (i) any Default described above (or any
Default occurring while any Major Subtenant is exercising its cure rights) is not
cured within the applicable time set forth in subparagraphs 7(b) and 7(d) above, as
applicable, and (ii) Lessor intend to terminate the Ground Lease, Lessor shall give
Major Subtenant written notice (by registered or certified mail, return receipt

requested) of Lessors intent to terminate the Ground Lease on account of the
failure to cure same in accordance with the Ground Lease and this Agreement
(provided that such Default is not timely cured pursuant to the terms of any
Leasehold Mortgage SNDA).
(b) Termination. Such termination shall become effective if and only if: (i)
such Default has not theretofore been cured by any other Person; and (ii) Major
Subtenant shall fail to cure same within fifteen (15) days after the date on which
such default may be cured pursuant to the terms of any Leasehold Mortgage
SNDA. In the event an approved Leasehold Mortgagee or any other Person cures
the alleged Default or causes same to be cured, Lessor shall use reasonable efforts
to give, within two (2) business days thereafter, major Subtenant written notice of
such fat; provided, however, that Lessor shall not have any liability for failure to
provide such written notice. Furthermore, Lessor agrees to use reasonable efforts
to respond to any written inquiries by Major Subtenant to the City Attorney as to
whether an Approved leasehold Mortgagee or any other Person has cured the
9. Ground Lease Termination.
(a) Preservation of Sublease. Upon the occurrence of any Ground Lease

Termination, the Sublease shall, unless it is deemed terminated by operation of
law, remain in full force and effect notwithstanding such Ground lease
Termination and shall revert to Lessor as a Direct Lease between Lessor and
Major Subtenant subject to the terms and conditions set forth in subsection (e)
(iii) below. If the Sublease remains in full force and effect notwithstanding such
Ground Lease Termination and reverts to Lessor, then in the event a New Lease is
entered into between Lessor and any new Lessee (other than Major Subtenant),
the Sublease shall be assigned and transferred, without recourse, by Lessor to the
new Lessee, and shall continue in full force and effect as a major Sublease under
the New Lease.
(b) New Lease or Direct Lease. If upon any Ground Lease Termination: (i)
the Sublease is deemed terminated by operation of law; and (ii) no New Lessee
(other than Major Subtenant) has yet entered into a New Lease, Major Subtenant
shall, upon satisfying the conditions set forth below, have the right (but not the
obligation) to enter into a New Lease or a Direct lease with Lessor upon the terms
and conditions set forth below.8
(c) Notice. Major Subtenant shall give lessor written notice of its election to
enter into such new Lease or Direct lease (the Election Notice) within fifteen
(15) days after the last date on which any Approved Leasehold Mortgagee (or any
other Person entitled to enter into such New Lease pursuant to the provisions of
8
If required by Major Subtenant, this provision will be modified to provide for the Sublease to be deemed
automatically converted to a new Lease or direct Lease where the conditions set forth in subparagraphs (c) and
subparagraph (d)(i) or subparagraph (d)(ii), as applicable, have been met.

any Leasehold Mortgage SNDA) may elect to enter into a New Lease provided
that such election is not made by such Approved leasehold Mortgagee or other
person so entitled. Such Election Notice must specify whether Major Subtenant
elects to enter into a New Lease or to enter into a Direct Lease, and once such
election is made Major Sublease shall not have the right to elect the other. Lessor
and Major Subtenant shall enter into such New Lease or Direct Lease (whichever
is applicable) within sixty (60) days after the Election Notice is given. If Major
Subtenant timely gives such Election Notice, then from the date of the Ground
Lease Termination until the earlier to occur of: (i) the date on which Major
Subtenant enters into such New Lease or Direct Lease; or (ii) the expiration of the
sixty (60) day period described above, Major Subtenant may use and enjoy the
Sublease property without hindrance by Lessor but subject to compliance with the
terms of the Sublease.
(d) Cure of Defaults.
(i) In the Case of a Request for a New Lease. As a condition to

entering into a New Lease, Major Subtenant shall: (i) have remedied all
Defaults on the part of Lessee involving the payment of money to Lessor,
subject to the provisions of subparagraph 9(k) below; and (ii) continue to
pay all Rent that would come due under the Ground lease but for such
Ground Lease Termination.
(ii) In the Case of a Request for a Direct Lease. As a condition to

entering into a Direct Lease, Major Subtenant shall: (i) have remedied all
Defaults on the part of Lessee involving the payment of money to Lessor
to the extent of the Sublease Proportionate Amount (as hereinafter
defined) for the period such Default shall have existed (i.e., such monetary
amount multiplied by such Sublease Proportionate amount), and all other
Defaults specifically related to the sublease Property and/or the
Subleasehold Improvements, subject to the provisions of subparagraph
9(k) below; and (ii) continue to pay all Rent that would come due under
the Ground lease but for such Ground Lease Termination to the extent of
the Sublease Proportionate amount during the term of the Direct Lease
(i.e., such Rent amount multiplied by such Sublease Proportionate
Amount). The term Sublease Proportionate amount shall mean, for any
applicable period of time, a fraction, the numerator of which is an amount
equal to the base rent and percentage rent payable under the sublease
during such period, and the denominator of which is an amount equal to
the aggregate base rent and percentage rent payable under all Approved
Major Subleases or direct Leases then in existence during such period
(plus any anticipated rents for any Major Project Component which is not
then subject to a major Sublease or Direct Lease).
(e) Terms and Conditions.

(i) In the Case of a New Lease. The term of any such New lease
shall begin on the date of the termination of the Ground Lease and shall
continue for the remainder of the Lease Term, including any Extension
Terms that were previously exercised or may thereafter be exercised
thereunder (it being agreed that the lessee under the New Lease shall have
the same rights to renew the term of the New Lease as the Lessee had
under the Ground Lease, provided that such rights are exercised by the
lessee under the New Lease within the original timeframes provided for in
the Ground Lease, notwithstanding the fact that the Ground Lease has
been terminated, and further provided that, notwithstanding anything
contained herein to the contrary, in no event shall the term of the New
Lease extend beyond the maximum 75 year Lease Term). Such New
Lease shall otherwise contain the same terms and conditions as those set
forth in the Ground Lease including but not limited to, the provisions of
Section 13.4 of the Ground Lease), except for requirements which are no
longer applicable or have already been performed; provided, however, that
such New Lease shall require the lessee thereunder promptly to
commence, and expeditiously to continue , to remedy all other defaults on
the part of the lessee thereunder to the extent reasonably susceptible of
being remedied.
(ii) In the Case of a Direct Lease. The term of any such Direct Lease
shall begin on the date of the Ground lease Termination and shall continue
for the remainder of the Sublease Term, including any extension terms that
were previously exercised or may thereafter be exercised thereunder (it
being agreed that the lessee under the Direct Lease shall have the same
rights to renew the term of the Direct Lease as the Lessee had under the
Ground lease, provided that such rights are exercised by the lessee under
the Direct Lease within the original timeframes provided for in the Ground
Lease, notwithstanding the fact that the Ground Lease has been
terminated, and further provided that, notwithstanding anything contained
herein to the contrary, in no event shall the term of the Direct Lease
extend beyond the maximum 75 year :ease Term). Such Direct Lease
shall otherwise contain the same terms and conditions as those set forth in
the Sublease, except for requirements which are no longer applicable or
have already been performed; provided, however, that:
(1) such Direct Lease shall require the lessee thereunder promptly
to commence, and expeditiously to continue, to remedy all then
existing Defaults on the part of Lessee (where such Defaults
are specifically related to the Sublease Property and/or the
Subleasehold Improvements) to the extent reasonably
susceptible of being remedied;
(2) such Direct Lease shall include any changes which are
appropriate on account of the relationship between the parties

being that of lessor and lessee rather than sublessor and
sublessee;
(3) such Direct Lease shall include, at Lessors option in its sole
discretion, the remedies to which Lessor and Lessee are
entitled to under Sections 25.2, 25.3 and/or 25.4 of the Ground
Lease;
(4) such Direct Lease shall provide that notwithstanding anything

in the Sublease to the contrary, Lessor, as lessor under the
Direct Lease, shall not be:
(A) liable for any act or omission of, or breach or default

by, Lessee under the Sublease;
(B) subject to any offsets or defenses which Major

Subtenant or any Subleasehold Lender Party may have
against Lessee under the Sublease;
(C) bound by any rent or other payments, including without

limitation, common area maintenance changes, taxes,
security deposit, etc., which Major Subtenant or any
Subleasehold Lender Party may have paid under the
Sublease to Lessee or any Person other than Lessor
more than thirty (30) days in advance of the applicable
due date therefor under such Direct Lease;
(D) bound by any covenants and/or obligations to be

performed by or on behalf of Lessee, as lessor under the
Sublease, including, without limitation, any obligation
on the part of Lessee to perform capital improvements
and/or to repair and/or replace the Sublease Property
and/or Sublease Improvements due to casualty or
condemnation, other than the covenant of quiet
enjoyment by Lessor so long as no default exists under
the Direct Lease, except and to the extent that any such
covenant and/or obligation is expressly made or
undertaken by lessor under the Ground Lease; and
(E) without limiting the foregoing subsections (A) through

(D) above, be liable for any indemnity made by Lessee
to Major Subtenant under the Sublease, including,
without limitation, with respect to hazardous and toxic
substances and/or materials.

(iii) No Cancellation of Space Leases or Approved time
Share Licenses. Between the date of any Ground Lease
Termination and the date of execution and delivery of such
New Lease or Direct Lease, Lessor shall not cancel or
terminate any Space Lease or any Approved Time Share
License related to the Sublease Property, or accept any
cancellation, termination or surrender thereof (unless such
termination shall be effective as a matter of law upon the
Ground Lease Termination), without the prior written
consent of Major Subtenant.
(iv) Approval by Lessor of Sublease. In connection with

Lessors agreement to grant a Direct Lease to the
applicable parties provided herein on the same terms and
conditions of the Sublease, subject, however, to the
provisions of this Section 10, Lessee and Major Subtenant
hereby acknowledge and agree that it shall be reasonable
for the City Manager to consider in its approval of the
Sublease in accordance with Section 33.3 of the Ground
Lease the possibility that the Lessor will be required to
enter into a Direct lease hereunder on the same terms and
conditions of such Sublease, as such terms may be
modified by this Section 10.
(f) Substitute Sublease. If, after any such Direct Lease has been entered
into, a New Lease is entered into between Lessor and a New Lessee (other than
Major Subtenant), such New lessee and Major Subtenant shall, without Lessors
consent, enter into a Substitute Sublease upon the same terms and conditions as
those specified in the Lease for the remainder of the term that was set forth in the
Direct Lease, including any extension options, if applicable, whether exercised or
remaining to be exercised. In such event, such Substitute Sublease shall be
deemed effective as of the effective date of the New Lease, and such Direct Lease
shall be deemed terminated as of the effective date of the New Lease.
(g) Restoration of Positions. At the time of the execution and delivery of the
Direct Lease or the New Lease and the Substitute Sublease, as applicable, Lessor,
the New Lessee, Major Subtenant and all other parties having an interest in the
Sublease Property, including, but not limited to, any tenants under Subleases,
holders of Approved Time Share Licenses and Approved Mortgagees shall
execute, acknowledge and deliver such new instruments (including new
mortgages and other security documents, new Major Subleases, new Approved
Time Share Licenses, new Space Leases, new Subordination, Non-Disturbance
and Attornment Agreements and new easements which were previously granted,
as the case may be), and shall make such payments and adjustments among
themselves, as shall be necessary and proper for the purpose of restoring to each
of such parties as nearly as reasonably possible, the respective interest and status

with respect to the Sublease Property which was possessed by the respective
parties prior to the Ground Lease Termination.
(h) Subrogation. Major Subtenant shall be subrogated to the rights of Lessor

against Lessee as to any monetary defaults of Lessee which are cured by major
Subtenant as a condition to obtaining such New Lease or Direct Lease, and any
other Defaults which are remedied as described in subparagraphs (d)(i) and (e)(i)
or subparagraphs (d)(ii) and (d)(ii) above, as applicable (but not as to any other
matters).
(i) No Obligation to Cure Uncurable Defaults. Nothing contained herein

or in the Ground Lease or the Sublease shall require Major Subtenant, as a
condition to its exercise of its right to enter into Direct Lease or a Substitute
Sublease, to cure any Default of Lessee not reasonably susceptible of being cured
by such Major Subtenant.
(j) No Obligation to Cure. Nothing herein contained shall require Major

Subtenant to cure any Default by Lessee or Event of Lessees Default under the
Ground Lease, except as otherwise provided for in section (d)(i) and (ii) above.
(k) No Obligation as to Accelerated Rent or Damages. Whenever this

Agreement refers to Major Subtenants curing monetary Defaults or Events of
Lessees Default, Major Subtenant shall not be required to pay any accelerated
sums or any damages, other than the payment of accrued interest on monetary
sums as require pursuant to Section 7(b) of this Agreement, on account thereof
which may otherwise be provided for by the terms of the Ground Lease, and upon
such cure by Major Subtenant, any such acceleration by Lessor shall be deemed to
be nullified and of no force or effect.
(l) Survival. The provisions of this Section 9 shall survive any Ground
Lease Termination and shall continue in full force and effect thereafter to the
same extent as if this Section were a separate and independent contract among
Lessor, Lessee and Major Subtenant.
(m) References to Sublease. As of the date any Direct Lease to which Major
Subtenant is a party or any Substitute Sublease becomes effective, all references
herein to the Sublease shall be deemed references to such Direct Lease or
Substitute Sublease.
10. Right to Enter into Direct Lease In the Event Extension Option Is Not
Exercised. In the event Major Subtenant duly and timely exercises any extension option it has
under the Sublease but Lessee (or any other Person entitled to do so) fails to duly and timely
exercise any extension option under the Ground Lease which must be exercised in order to
permit Major Subtenant to enjoy the benefits of such extension option under the Sublease, Major
Subtenant shall be entitled to enter into a Direct Lease prior to the expiration of the then-
applicable term under the Ground Lease, provided that: (i) Major Subtenant gives Lessor written

notice of such election within fifteen (15) days after the date on which any such other Person is
entitled to exercise such extension option under the Ground Lease; and (ii) Major Subtenant
satisfies the conditions set forth in subparagraph 9(d)(ii) above. The commencement date of
such Direct Lease shall be the date that would have been the first day of the extension option
under the Ground Lease had such extension option been exercised. The provisions of
subparagraphs (9)(e) and 9(g) through 9(m) above shall apply with respect to any such Direct
Lease.
11. Priority as between Major Subtenants. In the event Major Subtenant requests a
New Lease pursuant to an Election Notice given within the time set forth in subparagraph 9(c)
above and any one or more Other Major Subtenants timely requests a New lease in accordance
with the provisions of any applicable Other Major subtenant SNDAs, then priority as to the right
to enter into such New Lease shall be given based on the chronological order in which such
requests are made (i.e., first in time is first in right).
12. Modifications, Amendments, Etc. No modification, amendment, waiver or

release of any provision of this Agreement or of any right, obligation, claim or cause of action
arising hereunder shall be valid or binding for any purpose whatsoever unless in writing and duly
executed by the parties against whom the same is sought and asserted.
13. Notices. All notices, demands and requests given or required to be given
hereunder or pursuant to the terms of the Ground Lease or the Sublease shall be in writing. All
such notices, demands and requests shall be given by United States Registered or Certified Mail,
postage prepaid, by reputable overnight courier, addressed to Lessee in accordance with the
notice provisions of the Ground Lease and addressed to Major Subtenant in accordance with the
notice provisions of the Sublease. All such notices, demands and request6s to Lessor shall be
given by United States Registered or Certified Mail, postage prepaid, by reputable overnight
courier, addressed to:

444 SW 2 Avenue
Miami, FL 33130
or to such other address as Lessor may from time to time designate by written notice to
Subleasehold Mortgagee.
14. Successors and Assigns: This Agreement may not be assigned by Lessor or
Lessee except in connection with an assignment of the Ground Lease by Lessor or Lessee, as
applicable, as specifically permitted by the terms of the Ground Lease. This Agreement may not
be assigned by Major Subtenant except in connection with an assignment of the Sublease by
Major Subtenant as specifically permitted by the terms of the Sublease. This Agreement shall
inure to the benefit of and be binding upon the parties hereto and their respective successors and
permitted assigns.
15. Governing Law. This Agreement shall be construed in accordance with the

16. Authority. Each party to this Agreement represents to the other parties that: (i) it
is duly organized, validly existing and in good standing in its state of formation; and (ii) the
17. Further Assurances. Upon written request of any party to this Agreement,
Lessor, Lessee and Major Subtenant shall, each at its sole expense, execute, acknowledge and
deliver such further instruments and do such further acts as may be necessary, desirable, or
proper to confirm the rights and obligations of the parties hereto and carry out more effectively
the purpose of this Agreement.
18. Severability. In case any one or more of the provisions contained in this
19. Captions. The captions and headings contained in this Agreement are for
20. Recording. At Major Subtenants option, this Agreement may be recorded in the
Public Records of Miami-Dade County, Florida.
21. Waiver of Jury Trial. The parties hereby knowingly, irrevocably, voluntarily
and intentionally waive any right any of them may have to a trial by jury in respect of any action,
proceeding or counterclaim based on, or arising out of, under or in connection with this
Agreement or any amendment or modification of this Agreement, or any other agreement
22. Counterparts. This Agreement may be executed in one or more counterparts,

each of which shall be deemed an original and all of which shall be deemed but one agreement.

IN WITNESS WHEREOF, Lessor, Lessee and Major Subtenant have executed this
Agreement as of the day and date first written above.

Name: _______________________
By: _______________________
Name: _______________________ Name: _______________________
Title: _______________________



By: _________________________
Mehmet Bayraktar, sole and
Managing member
Name: _______________________
Name: _______________________
MAJOR SUBTENANT
________________________, a
_________________ ___________________
Name: _______________________
By: _______________________
Name: _______________________ Name: _______________________
Title: _______________________

STATE OF FLORIDA )
)


or produced I.D. _______________________________
________________________________
(type of I.D.)
Signature: ______________________
Name: _______________________
[Print or type]
Title: _______________________
Notary Public
Serial No., if any: _______________________
My commission expires: __________________

STATE OF FLORIDA )
)
COUNTY OF )


or produced I.D. _______________________________
________________________________
(type of I.D.)
Signature: ______________________
Name: _______________________
[Print or type]
Title: _______________________
Notary Public
Serial No., if any: _______________________

ACKNOWLEDGMENT OF MAJOR SUBTENANT
STATE OF FLORIDA )
)
COUNTY OF )
by ___________________ as ___________________ of ______________________, a
______________________, on behalf of that ____________________.

or produced I.D. _______________________________
________________________________
(type of I.D.)
Signature: ______________________
Name: _______________________
[Print or type]
Title: _______________________
Notary Public
Serial No., if any: _______________________

EXHIBIT A

EXHIBIT B

EXHIBIT T
FORM OF FIRST SOURCE HIRING AGREEMENT
SECTION 1. DEFINITIONS

As used in this Agreement, the following capitalized terms shall have the following meanings.
All definitions include both the singular and plural form. Capitalized terms not specifically defined herein
shall have the meanings ascribed to them in the Development Agreements.
Agency shall mean the South Florida Work Force, a state and federally funded 501 C3
organization, or some entity comparable to the foregoing reasonably acceptable to the City Manager. In
the event the Agency ceases to exist, upon request of City or the Developer, the Developer shall be
permitted to create or select a similar entity capable of handling the responsibilities designated to the
Agency hereunder, acceptable to the City Manager.
Agreement shall mean this First Source Hiring Agreement in its entirety.
Business User shall mean any person or entity that (i) enters into a lease agreement or similar
agreement for use of space at the Site, and (ii) intends to operate or actually operates an ongoing business
at the Site other than development or construction of the Project or Retail Use (as hereinafter defined).
The term Business User shall not include any person or entity that enters into a space lease in the retail
areas, dining areas or other areas other than Hotels, Marina or Parking Garage, to sell or offer food,
products or services (the Retail Use).
City shall mean the City of Miami, as represented by the City Manager of the City of Miami.
Construction Contract shall mean a contract with a total contract volume of $500,000 or more
related to the construction of the Development or part thereof. Construction Contract shall not include
lease agreements or contracts related to operations of ongoing business at Site.
Construction Contractor shall mean a prime contractor, a subcontractor, or any other person or
entity entering into a Construction Contract (as defined above) for the construction of the Development or
part thereof.

Developer shall mean the Flagstone Island Gardens, LLC, a Delaware limited liability
company.
Development Agreements shall have the meaning ascribed to it in the Recitals.
Effective Date shall mean the Possession Date (as defined in the Ground Lease at Section 4.1
thereof, that is, the date the Ground Lease is signed and delivered by City and Developer and possession
of the Site is turned over to Developer in commencement of the Lease Term.
Full Time Employee shall mean an individual employed for a minimum of thirty-two (32)
hours per standard five-day work week.
Low-Income Individual shall mean an individual whose household income is no greater than
80% of the income limits of the City of Miami as issued and published by U.S. HUD on a yearly basis, or
such other low income threshold as approved by the City Manager, or an individual who is unemployed.
Developer may rely on the Agency to determine and advise as to who is a Low Income Individual and to
make all determinations relating to employment, economic status, residency, nationality and other
relevant information to the extent the Agency agrees to provide such service.
Occupancy Date shall mean the date the Business User has taken possession of their respective
lease area and is open for business to the general public.
Operations shall mean all work (other than the initial Project development or construction work
and Retail Use) conducted by a Business User on any portion of the Site. The commencement of
Operations of one Business User shall not necessarily mean the commencement of Operations of another
Business User. The commencement of Operations of the Project shall mean the Occupancy Date as
defined herein.
Overtown Area shall mean that area as depicted in Exhibit A attached hereto and made a part
hereof.

Project or Development shall mean all of the Leasehold Improvements (including but not
limited to, all of the Major Project Components) to be completed pursuant to the Development
Agreements.
Qualifying Individuals shall mean Low-Income Individuals who are Residents.
Residents shall mean a person who resides in the City of Miami (or the County of Miami-Dade)
at the time of application for employment. The Developer shall implement or cause to be implemented a
program that ensures priority among residents among otherwise equally qualified persons. The Developer
will give priority to those residing within the City of Miami. In the event there is not a sufficient number
of qualified Residents that reside within the City of Miami, then the balance of any percentage thresholds
of Developers performance can be met utilizing Residents that reside within Miami-Dade County.
Developer may rely upon the Agency to determine who is a Resident and to make determination relating
to employment, economic status, residency, nationality and other relevant information to the extent the
Agency agrees to provide such service.
Site or On-Site shall mean the approximately 10.8 acres of upland and 13.4 acres of adjacent
submerged land located at the northwest quadrant of Watson Island in the City of Miami, Florida and
other ancillary locations that the City has authorized Developer to use pursuant to a license or other
written agreement.
SECTION 2. CUSTOMIZED AND FIRST SOURCE HIRING PROGRAM
CONSTRUCTION PHASE AND BUSINESS OPERATIONS PHASE
A. Construction Phase
1. General Statement. This section is to develop reliable resources for the prescreening of
resumes and operation of training programs that will facilitate the skills and the
employment of Low-Income Individuals that reside in the City of Miami and Miami

Dade County for the construction phase of the Project. This section aims to accomplish
that goal (i) by establishing a mechanism whereby Low-Income Individuals can receive
job training in the skills requested by employers in the Development, and (ii) by
establishing a system for prompt reliable pre-screening and referral of applicants to
employers as jobs become available.
2. Providing Employment Opportunities. Developer shall require each Construction

Contractor to provide employment opportunities generated by the Project to Qualifying
Individuals including in particular, but not limited to, those who are participants in the Agencys
training and employment programs, subject to the Construction Contractors obligation to fill
vacancies generated by the Project with (i) Construction Contractors employees from other jobs,
and (ii) permanent full time employees laid off by Contractor within the last two (2) years due to
work slow downs. It is understood that jobs may be offered on the basis of qualifications but if
qualifications are equal such employment opportunities shall, subject to (i) and (ii) above, be
offered by Developer (a) first to residents of the Overtown Area, (b) second to other City of
Miami residents, and (c) third to residents of Miami-Dade County.
3. Specific Provisions designed to Benefit Residents.
a) Not later than two months prior to the Effective Date, unless otherwise approved
by the City Manager, the Developer will set up, or cause to be set up, a Skills
Training Program (Skills Training Program) during construction to provide for
On-Site, or Off-Site as approved by the City Manager, with the objective of
training for a minimum of ten percent (10%) of the entire anticipated On-Site
Project construction workforce, whether union or non-union. The actual hiring
requirements are set forth in various other Sections of this Agreement. The
requirement for participation in the program will be included in each
Construction Contract. The purpose of the Skills Training Program will be to
teach the Qualifying Individuals marketable construction skills. The Developer
will operate or cause to be operated the Skills Training Center, which will
provide for the advancement of skills for the construction personnel at the
Project. It will teach a tight curriculum of safety fundamental skills for untrained
people, advanced skills for trained personnel, additional skills for certificates in
alternate trades, and management of construction operations.

b) The Developer and the Construction Contractor shall notify the Agency in a
timely manner, as necessary and appropriate, when it wishes for the Agency to
help develop customized training programs which enable Qualifying Individuals
to qualify for and secure entry level and apprenticeship construction positions,
whether union or non-union. The Developer may provide rent-free space within
the Site or any areas it may license from the City, or elsewhere, for the site or
local offices of the Agency. In the event the Agency does not perform in a
timely manner, the Developer or Construction Contractor shall notify the
Agency, with a copy to the City, of such deficiency. If the Agency does not
implement steps to cure such deficiency within fifteen (15) days of such notice,
unless modified by the City Manager, the Developer shall immediately identify
or establish a new agency acceptable to the City Manager to fill the role of the
Agency.
c) The Developer and the Construction Contractor will notify the Agency in a
timely manner of entry-level, apprenticeship positions and union or non-union
job openings resulting from the Construction Contract requirements that will not
be filled through the Developers Skills Training Program including the number
of positions needed and the minimum qualifications required for each position.
d) The Developer and Construction Contractor will utilize the Agency as the first
source in identifying candidates for its Skills Training Program and except for
those positions filled through the Developers Skills Training Program, will
declare the Agency the first source to identify candidates for those entry-level,
apprenticeship and union and non-union positions.
e) The Developer and the Construction Contractor shall give preference and first
consideration on the basis of qualifications. Should qualifications be equal
among candidates, the Developer and Construction Contractor, subject to the
Construction Contractors obligation to fill vacancies generated by the Project
with (i) Construction Contractors employees from other jobs, and (ii) permanent
full time employees laid off by Contractor within the last two (2) years due to
work slow downs, and to the extent permitted by law and any existent labor
agreements, such employment opportunities shall be offered by Developer and
the Construction Contractor in the following order of priority: (a) first, to
residents of the Overtown Area, (b) second, to other City of Miami residents, and
(c) third, to residents of Miami-Dade County.

f) The Developer and the Construction Contractor shall advertise or cause to be
advertised through the Agency, in local minority media and City TV, the City of
Miami community television channel, and hold job fairs seeking to attract
Qualifying Individuals to seek training and employment at the Project.
g) It is the objective of this Agreement (but not a covenant by City or Developer)
that all of those that successfully complete Skills Training Program, which
training was developed for the purpose of developing skills for construction jobs
that can be utilized in the Project, shall receive job offers for the Project. It is
understood that successful completion of training includes mastery of many
performance, attitude, and team skills. As long as these persons remain employed
at the Project, their positions will continue to be counted toward this threshold of
Developers performance regardless of any change in their status as a Qualifying
Individual. Annual thresholds shall be pro-rated monthly as required.
h) In the event that the Agency is unable to identify qualified persons to fill the
positions identified by the Developer or the Construction Contractor within a
reasonable time frame acceptable to the Developer or Contractor, any unfilled
targeted positions may be filled by any qualified person, irrespective of their
status as Qualifying Individuals.
i) The Developer or Contractor shall use good faith to register a resident apprentice
training program with the local unions for Construction Contracts in order to
involve trained City residents and Qualifying Individuals as apprentices and
ultimately as journeypersons for the benefit of the Project.
j) The City acknowledges that all employees of the Project will be required to have
the necessary employment skills, as well as meeting the requirements of the
Project insurance policy, including, without limitation, requirements for a drug
free workplace. In addition, the City acknowledges that various employment
opportunities may require union membership, and may require security
clearances consistent with the Projects security policies and procedures. For
purposes of this Agreement, to the extent the Agency provides the above
services, the Developer may rely on the information provided by the Agency for
verification purposes.
k) To the extent that the procedures set forth in this section are in conflict with the
procedures implemented by the Developer or Construction Contractor in order to
comply with the applicable federal, state and local laws, the Construction

Contractor may substitute other procedures, acceptable to the City Manager, in
order to accomplish the purpose and intent of this Agreement.
B. Business Users/ Business Operations Phase
1. General Statement. This section is to provide accredited coursework in Retail

Management, Leisure Management, Customer Service, and basic educational high school
diploma skills (Career Training Program). Included in this Career Training Program are
accelerated programs in computers, basic mathematics, and language skills. The Developer and
participating Business Users may depend upon the Agency to provide and implement such
training subject to the Agency agreeing to provide such services. The Career Training Program
will focus on developing alliances with organizations within the Miami area to produce
educational programs for all employees of the Project that will substantially include the following
courses of study:
Hospitality Training
Retail Training
Catering and Dining Training
Marina Operations Training
Public Space Management
Customer Service Training
Multiple Language Skills
Botanical Training
Educational Teaching for cultural facilities
Emergency Services Training (for immediate care prior to arrival of emergency
service personnel or professional emergency services).
2. Specific Provisions Designed to Benefit Residents.
a) Consistent with Project construction schedule, but no later than four (4) months
prior to the Occupancy Date, the Developer will provide or cause to be provided
operational skills training for the staff of the completed Project, which can be
used by the Projects Business Users participating in the Program, which training
shall be provided on site or at a location reasonably acceptable to the City
Manager. This will include the courses of study listed above in Section 2 B. 1.
This training shall continue to be provided for a term commensurate with the

need but in no event shall the training terminate prior to one month after the
Occupancy Date for each Major Project Component.
b) The Developer may notify the Agency to assist in developing and maintaining
customized training programs, and will notify the Agency in a timely manner, as
necessary and appropriate, to assist in developing customized training programs,
which enable Low Income Individuals to qualify for and secure the operations
jobs, as well as to improve the skills and capabilities of employees for self
improvement and career advancement.
c) The Developer will maintain or cause to be maintained an up-to-date database
accessible to the Developer and the Business Users who participate. The
Developer and the Business Users who participate may notify the Agency
electronically in a timely manner of applicable job openings containing the
approximate number and type of jobs that will need to be filled, the basic
qualifications necessary, and contact information for obtaining further
information and information for applying for jobs.
d) The Developer shall give preference and first consideration to the highest
qualified candidates. Among equally qualified candidates, to the extent permitted
by law and any existent labor agreements, preference shall be given to Qualifying
Individuals. Developer may rely upon the Agency to determine who is a
Resident and to make determination relating to employment, economic status,
residency, nationality and other relevant information to the extent the Agency
agrees to provide such service.
e) The Developer shall advertise or cause to be advertised through the Agency in
local minority media and City TV, the City of Miami community television
channel, and hold, directly or through the Agency, job fairs seeking to attract
Low Income Individuals residing in the City of Miami to seek employment at the
Project.
f) With respect to Business Operations, the Developer shall offer, or cause to be
offered, employment to a minimum of twenty-five percent (25%) of all the initial
Full Time Employee job openings or seventy-five percent (75%) of those
Qualifying Individuals who have successfully completed the Career Training
Program, trained for the purpose of this Project, whichever is greater. As long as
these same persons remain employed within the Project or in other locations of
the same Business Users, their positions will continue to be counted toward this

threshold, irrespective of their Qualifying Individual status. Should a Qualifying
Individual be relocated, the vacated position shall still be counted towards the
total jobs in the Project and the minimum percentage shall continue to apply.
Priority will be given among equally qualified candidates to those residing within
the City of Miami. In the event there is not a sufficient number of qualified
Qualifying Individuals that reside within the City of Miami, then the balance of
the threshold can be met utilizing Low Income Individuals that reside within
Miami-Dade County. This shall apply to the initial job openings and shall
continue so long as the Developer is in control of the project or on the tenth
anniversary of the Occupancy Date of the last Major Project Component
(excluding the Retail use) to open, whichever comes later.
g) The Developer shall provide or cause to be provided to the City monthly reports
defining the progress and employment status of those candidates who are hired.
h) If Developer anticipates difficulty meeting the percentage threshold requirements
referenced above, Developer shall, meet and confer with the City Manager to
determine mutually agreeable additional steps which can be taken to meet the
percentage threshold requirement.
3. Exemption for Small Businesses. Business Users responsibilities with regard to the
First Source Hiring shall not apply to jobs at businesses that employ fewer than ten (10) Full
Time Employee workers, in addition to owner-workers or members of owners immediate family,
proof of which must be provided at City request.
4. Thresholds and Notice to Cure: If the City at any time determines that the Developer
has not met the objectives set-forth in Exhibit B of this Agreement in accordance with the terms
and mechanisms as set forth in Exhibit B, the City agrees to first provide the Developer with a
Notice of Non-Compliance specifying the points of non-compliance and the terms of cure, and
provide the Developer with a thirty (30) day cure period; provided, however, such thirty (30) day
period shall be extended so long as Developer promptly commences cure and diligently continues
to pursue such cure. The successful completion of the cure shall be determined by the City
Manager. To the extent required by institutional lenders, City agrees to provide duplicate notices
of default to addresses specified by Developer.
5. Positive and Negative Points Systems: The City and Developer have agreed upon the
point system described in Exhibit B attached hereto to monitor Developer performance. Target
levels are set at 95% performance; however, Developer shall not be deemed to be non-performing
unless or until Developer is at 75% threshold. Developers performance in any given year in

excess of 95% will be cumulative and carried over to future years. Also, based upon monthly
reporting results, if prevailing economic conditions warrant, the percentages may be modified
with City Managers concurrence. Developer will provide annual labor forecast to City, upon
Citys written request, but under no circumstances can performance be based on anything other
than actuals in arrears. The point and value system may be modified at any time with mutual
written consent of the Developer and the City Manager.
SECTION 3. MONITORING AND ENFORCEMENT
A. Monthly Reports: Construction. During Construction, the Developer, will provide, or

cause to be provided, regular monthly electronic reports consistent with the timing and formats of
normal employment operational reports, regarding the disposition of all individuals trained in the
Skills Training Program including the position applied for and whether such individual was hired
or not. If the individual was not hired, then the Developers report should further provide a brief
explanation of why any such candidate was not hired or considered qualified. Copies shall be
provided by the Developer to the City Manager with copies to the appropriate departments as set
forth in Section 5 of this Agreement.
B. Monthly Reports: Business Users. During Operations, Developer will provide, or cause to
be provided, the City with monthly reports consistent with the timing and formats of normal
employment operational reports, regarding date and number of initial position requests, date
required for candidate to commence work, the disposition of all individuals trained in the Career
Training Program referrals, including the position applied for and whether such individual was
hired or not. If the individual was not hired, then the report should further provide a brief
explanation of why any such candidate was not hired or considered qualified.
C. Quarterly Reports Analysis. The Developer shall prepare, or cause to be prepared, detailed
quarterly reports on the implementation of all sections of this Agreement during construction of
the Project and as long as the Developer has control of the Project or through the tenth
anniversary of the Occupancy Date for the last Major Project Component (excluding the Retail
use) to open, whichever comes later, including those sections where the Construction Contractor,
or Business User is the party hiring the individuals. These reports may be prepared by the Agency
or other qualifying entity, as submitted to and approved by the City Manager, upon whom the
Developer may rely, and shall provide, at a minimum, a listing of the individuals, ethnicity,
residency, classification applied for, employers name, date of hire, status of employment (i.e.,

still employed or date terminated), total hours worked for the reporting period, gross monthly
earnings, recruitment source and percentage of Qualifying Individuals when they were initially
hired for any component of the Project, which status shall continue to be applicable to any
thresholds that are set, no matter of changes in employee status as a Qualifying Individual.
These reports should further provide a comprehensive summary of the above, including, but not
limited to, the following:
total number of positions hired to-date
total number of positions held by Qualifying Individuals residing in the City at date of hire
total number of positions held by Qualifying Individuals residing in Miami-Dade County at
date of hire
total new hires this reporting period
total new hires from prior reporting period
total new hires to-date
total number of individuals referred from each respective recruiting source
total number of individuals hired and not hired from each respective recruiting source.
These reports shall be provided to the City, consistent with any security provisions of the Project.
If the report indicates that the percentage threshold requirement is not being met, the Developer
will include as part of the report a discussion of the reasons why that is the case. In compiling
this report, Developer shall be entitled to rely on information provided by the Construction
Contractors or Business Users, respectively, without responsibility to perform independent
investigation. Further, in the event the Agency prepared the report or the initial data on
Qualifying Individuals, on behalf of the Developer, the Developer shall be entitled to rely on
information provided by the Agency to the extent the Agency has agreed to provide such
information.
D. Enforcement by the City. The City Manager shall determine the necessity of investigating
complaints relating to implementation of this Agreement. The Developer shall cooperate fully
and promptly with any such investigation, and shall make copies available at no cost, to the City
Manager requested records and information the City reasonably deems relevant to monitoring the
implementation of this Agreement, consistent with security procedures and policies. If the City
Manager determines that the provisions of this Agreement are not being followed, he will
determine the necessity of engaging and will proceed to engage in a good-faith effort to hear
respective issues and to negotiate a resolution. During the process of such investigation, the

investigation and its findings will be held in the most strict and confidential manner, reporting
findings only to the City Manager and the Developer. If negotiations do not arrive at a resolution
within a reasonable period of time, the City Manager may issue his written findings consistent
with the terms and provisions of a Notice to Cure as per Section 2.D. above. If Developer fails to
comply with the Notice to Cure the City Manager may pursue any available legal remedies,
including but not limited to any or all of the following practices:
1. A legal action to enforce this Agreement and/or any term or covenant thereof. The court
shall award reasonable attorneys fees and costs to the prevailing party in an action
enforcing or interpreting the requirement of this Agreement.
2. A declaration of ineligibility for future City contracts and/or redevelopment agreements
with the City until penalties and restitution have been paid in full. Nothing in this
Section 4 shall derogate or limit the rights of the City to enforce this Agreement through
pursuit of any available legal or equitable remedies.
SECTION 4. IMPLEMENTATION OF FIRST SOURCE HIRING PROGRAM
Inclusion of this Agreement in Leases and Contracts.
A. Construction Contracts and Business Users Agreements. The Developer shall not
execute any Construction Contract or Major Subleases of or any portion of the Site, unless this
Agreement, or the most current draft of this Agreement is acknowledged to have been received and
agreed to be complied with by such Construction Contracts and Major Subleases as a material term.
Similarly, except for Retail Users, Developer shall not execute any lease agreement of the Site, or portion
thereof, unless the written acknowledgement of this First Source Hiring Agreement (or its most current
draft), by the Business User is contained within the contract or lease.
B. Developer Assurance Regarding Preexisting Contracts. Developer warrants and

represents that as of a date of mutual execution of this Agreement, it has executed no construction
contract or agreement that would violate any provision of this Agreement had it been executed after the
date of mutual execution of this Agreement.
SECTION 5. NOTICES
Correspondence. All correspondence shall be in writing and shall be addressed to the affected
parties at the addresses set forth below. A party may change its address by giving notice in compliance

with this Section 5 the addresses of the parties are:
If to the Developer: Flagstone Island Gardens, LLC

506 Celebration Avenue
Celebration, Florida 34747
Attn: Mehmet Bayraktar
With a copy to: Joseph L. Herndon, Project Director

Flagstone Island Gardens, LLC
1674 Meridian Ave, Suite 300
Miami Beach, FL 33139
(electronically to jherndon@flagstonegroups.com)
With a copy to: Shutts & Bowen LLP

1500 Miami Center
201 South Biscayne
Attn: Kevin D. Cowan, Esq.
and Terry B. Fein, Esq.
With a copy to: Latham & Watkins

885 Third Avenue
New York, New York 10022
Attn: Richard L. Chadakoff, Esq.
If to the City: Chief Executive Officer (City Manager)

City of Miami Florida
With a copy to: Department of Economic Development

City of Miami
444 SW 2 Avenue, 3rd Floor

With copy to: Department of Community Development

City of Miami
444 SW 2 Avenue, 2nd Floor
Miami, FL 33130

444 SW 2 Avenue, 9th Floor
SECTION 6. GENERAL PROVISIONS
A. Severability Clause. If any term, provision, covenant, or condition of this Agreement is held by
a court of competent jurisdiction to be invalid, void, or unenforceable, the remainder of the
provisions shall continue in full force and effect.
B. Binding on Successors. This Agreement shall be binding upon and inure to the benefit of the
heirs, administrators, executors, successors in interest, and assigns of each of the parties hereto.
Any reference in this Agreement to a specifically named party shall be deemed to apply to any
successor in interest, heir, administrator, executor, or assign of such party.
C. Intended Beneficiaries. The City is an intended third-party beneficiary of contracts and other
agreements, which incorporate this Agreement, with regard to the terms of this Agreement. The
City shall therefore have the right to enforce the provisions of this Agreement against all parties
incorporating this Agreement into contracts or other agreements.
D. Term. Section 3 Monitoring and Enforcement, of this Agreement shall become effective on the
date of mutual execution of this Agreement, and shall remain in effect for as long as the
Developer remain in control of the Project or for ten years from the Occupancy Date of the last
Major Project Component (excluding Retail Space) to open, whichever comes later.
E. Material Terms. The provisions of this Agreement are material terms of the Ground Lease
Agreement for the Project.

F. Waiver. The waiver of any provision or term of this Agreement shall not be deemed as a waiver
of any other provision or term of this Agreement. The mere passage of time, or failure to act
upon a breach, shall not be deemed as a waiver of any provision or terms of this Agreement.
G. Estoppel. Both parties agree to provide the other (and their designees) within fifteen (15) days of
request an estoppel letter acknowledging that the other party is not in default of this Agreement.
H. Construction. Each of the parties has been represented by counsel in the negotiation and
drafting of this Agreement. Accordingly, this Agreement shall not be strictly construed against
any party, and the rule of construction that any ambiguities be resolved against the drafting party
shall not apply to this Agreement.
I. No termination of Existing Employees. Neither the Developer, the Business Users nor the
construction teams shall be obligated to terminate any existing employees to comply with the
terms and provisions of this Agreement. Should the Developer not be able to meet the thresholds
or objectives of this Agreement due to low employment position vacancy, the threshold will be
based upon the job openings that are available.
J. Entire Agreement. This Agreement contains the entire agreement between the parties and
supersedes any prior agreements, whether written or oral. This Agreement sets forth the general
framework for a First Source Hiring Policy and may be supplemented by additional memoranda
approved by the Developer and the City Manager detailing the procedures and deadlines for
carrying out this policy.
K. Amendments. This Agreement may not be altered, amended or modified, except by an
instrument in writing signed by the Developer and City Manager.
L. Authority of Signatories. The individuals executing this Agreement represent and warrant that
they have the authority to sign on behalf of the respective parties.
M. Waiver of Jury Trial. The parties hereby knowingly, irrevocable, voluntarily and intentionally
waive any right either may have to a trial by jury in respect of any action, proceeding or
counterclaim based on this Agreement, or arising out of, under or in connection with this
Agreement or any amendment or modification of this Agreement, or any course of conduct,
course of dealing, statements (whether verbal or written) or actions of any party hereto. This
waiver of jury trial provision is a material inducement of the City and Developer entering into
the subject transaction.

EXHIBIT A
OVERTOWN AREA

EXHIBIT B
POINT SYSTEM

EXHIBIT 14.14
SKETCH OF ENTRANCE ROAD
42
EXHIBIT 14.18
HOLD HARMLESS AND INDEMNIFICATION AGREEMENT
KNOW ALL MEN BY THESE PRESENT:
That Flagstone Island Gardens, LLC, a limited liability company (Flagstone), for and in consideration
of the approval by the City of Miami (the City) of the Amended and Restated Agreement to Enter into
Ground Lease between the City and Flagstone pursuant to Resolution No. R-10-0402 dated September
23, 2010 and the sum of Ten and No/100 ($10.00) Dollars, receipt of which is hereby acknowledged, on
behalf of itself, its successors and assigns, agrees to indemnify, hold harmless and defend the City from
and against any and all liabilities, penalties, fines, suits, claims, demands, actions, losses, expenses,
investigation and remediation costs, causes of action, proceedings, judgments, executions and reasonable
costs of any kind or nature whatsoever (including reasonable attorneys fees at trail, administrative
proceeding or appeal) in connection with, arising out of or related to items listed on Exhibit A attached
hereto and by this reference incorporated herein.
IN WITNESS WHEREOF, Flagstone has caused this Indemnification and Hold Harmless
Agreement to be executed this ___ day of _________________, 2011.
Delaware limited liability company, by Flagstone
Miami Holdings, LLC, by Flagstone Property Group,
LLC
By:
Mehmet Bayraktar, Managing Member
STATE OF FLORIDA )
)
COUNTY OF DADE )
The foregoing instrument was acknowledged before me this ___ day of _____, 2011, by Mehmet
Bayraktar on behalf of and Managing Member of Flagstone Property Group, LLC, Managing Member of
Flagstone Miami Holdings, LLC, Managing Member of Flagstone Island Gardens, LLC, who is
personally known to me or has produced _______________________ as identification, and he did __/ did
not ___ take an oath.
[NOTARY SEAL]
Print Name:
Notary Public
My Commission Expires:
43
COMPOSITE ATTACHMENT 1
Citys Authorizing Resolution No. 10-0402, adopted September 23, 2010
44
45
ATTACHMENT 2
Flagstones Authorization______________adopted __________ 20____
UNANIMOUS WRITTEN CONSENT OF THE MEMBERS

OF
FLAGSTONE ISLAND GARDENS, LLC
The undersigned, being all of the members of Flagstone Island Gardens, LLC, a
Delaware limited liability company (the Company), hereby consents to the adoption of the
following resolutions:
RESOLVED, that the Company shall enter into an Amended and

Restated Agreement To Enter Into Ground Lease with the City of
Miami, as approved by the Miami City Commission, via
Resolution No. R-10-0402, on September 23, 2010, for the purpose
of amending and restating the Agreement to Enter into Ground
Lease and the exhibits thereto including, but not limited to, the
Amended and Restated form of Ground Lease attached thereto as
Exhibit C;
be it further
RESOLVED, that Flagstone Development corporation, the

managing member of the Company, through its officers, is hereby
authorized and directed to execute and deliver, in the name and on
behalf of the Company, any and all agreements, certificates,
instruments, documents and plans, and to take any and all action
and to do any all things, as may be necessary or desirable to carry
out the intent and accomplish the purposes of the foregoing
resolutions; and
be it further
Resolved, that all previous resolutions previously adopted by the

company that may be inconsistent with the foregoing resolutions
are hereby superseded or modified by these resolutions.
Dated as of February 1, 2010
Flagstone Miami Holdings, LLC

By: Flagstone Development Corporation
By: ___________________________
Mehmet Bayraktar, President
46
Flagstone Development Corporation
By: ___________________________
Mehmet Bayraktar, President
47
Citys Resolution No. 10-0402, adopted September 23, 2010
With Exhibit A and other attachments thereto, and as further amended by City Resolution No.
13-______, adopted ______, 2013 extending the Marina Component Possession Date and start of
construction to on or before June 2, 2014
48
EXHIBIT A
49
This Exhibit A is an attachment to City Commission Resolution No. 10-0402, adopted
September 23,, 2010, as amended by City Resolution No. 13-_______, adopted _____ , 2013,
extending the Marina Component Possession Date and start of construction to June 2,
2014, and contains material business terms, and becomes Composite Attachment 3 to the
Amended and Restated Agreement to Enter Into Ground Lease (hereinafter, the
Agreement to Enter) and to the form of Amended and Restated Ground Lease(s)
(hereinafter the Ground Lease(s)). All terms used herein but not defined herein shall
have the definitions given to them in the Agreement to Enter or in the form of Ground
Lease(s).
I. GENERAL CONSTRUCTION SCHEDULE FOR ALL MAJOR PROJECT

COMPONENTS.
Flagstone/Ground Lessee shall have the time periods set forth below to commence and
complete construction of the various Major Project Components, as such Major Project
Components are approved in accordance with the Major Use Special Permit and as such are
defined in the form of Ground Lease(s). Throughout this Exhibit A, (a) Commence(s)
Construction or Start(s) Construction shall mean that all material plans and permits are
approved and issued and the actual act of physical construction has begun; and (b) Completion
Date shall mean the date upon which the earlier of the temporary certificate of occupancy
(TCO) or a certificate of occupancy (CO), has been issued for the completion of
construction.
Until 6/2/2014 45 months from 9/1/2010 to Start Construction of the Marina Component.
(a) As described in Section VI(c) below, Marina Component

construction may be started earlier and separately from the
Parking/Retail Components once applicable conditions precedent
for Marina Component have been met.
Until 12/01/2015 18 months from 6/2/2014 to the Completion Date of the Marina
Component.
(a) If Marina Component Starts Construction earlier than 6/2/2014, then

Flagstone shall have 18 months from such earlier start date to the
Completion Date of the Marina Component.
Until 9/1/2016 72 months from 9/1/2010 to Start Construction of both the Retail/Parking
Components
Until 8/31/2019 108 months from 9/1/2010 to the Completion Date of Retail/Parking
Components.
(a) Parking spaces for Hotels may be completed separately with

construction of Hotels Components.
50
(b) Flagstone agrees to design, construct and provide utility lines needed
for each of the Major Project Components on a component by
component basis as necessary and as approved by the City and as
required by the Master Declaration as a condition precedent to
executing the first Ground Lease. Flagstone shall design, construct
and provide utility lines needed for both Hotel Components in
connection with the construction of utility lines for the
Parking/Retail Components.
Until 9/1/2018 96 months from 9/1/2010 to Start Construction of both Hotels

Components, if the two (2) 5-year Options to extend described below are
not exercised, therefore until 8/31/2020 (being twenty-four (24) months)
to the Completion Date. Flagstone cannot exercise the second Option if no
hotel construction has commenced by 8/31/2023.
Until 9/1/2023 156 months from 9/1/2010 to Start Construction of a Hotel Component, if
only the first 5-year Option to extend is exercised. Accordingly, the first
Option period ends on 8/31/2023.
(a) During the first Option period, a Hotel Component must be completed within twenty-four
(24) months after Construction Commencement, therefore until 8/31/2025 to the
Completion Date of at least one Hotel Component. Accordingly, both the Rent(s)
payments schedule and the Option payments schedule in this Exhibit A would apply
throughout the entire period of construction, even if the Completion Date of such
construction period runs beyond the Option period.
(b) The first 5-year Option period runs from 9/01/2018 through 8/31/2023. The first Option
period payment is $250,000 per annum ($125,000 per Hotel Component per annum) with
monthly payments beginning 9/01/2018 for the first Option period ending 8/331/2023.
(c) All Option payments are to be paid monthly in advance beginning on the first day of the
month. The first Option is exercised by Flagstones giving not less than thirty (30) days
advance written notice prior to 8/31/2018 to the City for the first Option period to begin.
Until 9/1/2028 216 months from 9/1/2010 to Start Construction of the second Hotel
Component if Flagstone exercises the second 5-year Option to extend;
accordingly, the second Option period ends on 8/31/2028:
(a) The second 5-year Option period runs from 9/01/2023 through
8/31/2028. The second 5-year Option period payment is $315,000
per annum ($157,500 per Hotel Component per annum) with
monthly payments beginning 9/01/2023 for the second Option
period ending 8/31/2028, but second 5-year Option is not available
unless the first Hotel Component Starts Construction before the
end of the first 5-year Option period on 8/31/2023.
51
(b) All Option payments are to be paid monthly in advance beginning
on the first day of the month. The second Option is exercised by
Flagstones giving not less than thirty (30) days advance written
notice prior to 8/31/2023 to the City for the second Option period
to begin.
(c) During the second Option period, the second Hotel Component
must be completed within twenty-four (24) months after Flagstone
Commences Construction, therefore until 8/31/2030 to reach the
Completion Date of the second Hotel Component that commenced
construction during the second Option period. Accordingly, both
the Rent(s) payments schedule and the Section IV Option
payments schedule in this Exhibit A would apply throughout the
entire period of construction, even if such construction period runs
beyond the Option period.
II. GENERAL RENT(S) PAYMENT SCHEDULE FOR ALL MAJOR PROJECT

COMPONENTS.
During the periods outlined below, Flagstone/Ground Lessee shall pay to the City the
amounts outlined below.
Annual
Beginning
Amount
2/1/2010 Consideration for Extension Period. This amount
through $200,000 shall not be applied as a credit.
9/30/2010
$300,000 is a Pre-Payment of Construction
10/1/2010 $300,000
Rent/Base Rent to City
$500,000 is a Pre-payment of Construction
10/1/2011 $500,000
$750,000 is a Pre-payment of Construction
10/1/2012 $750,000
$1,000,000 Construction Rent, subject to II(h)
10/1/2013 $1,000,000
below
10/1/2014 $1,000,000
below
10/1/2015 $1,000,000
below
$1,500,000 Construction Rent is the amount
actually received by City since $360,000 was pre-
10/1/2016 $1,140,000* paid for this year per above schedule and Section
II below, unless there is no credit pursuant to
Section VI(a) below.
$1,675,000 Construction Rent is the amount
10/1/2017 $1,315,000*
actually received by City since $360,000 was pre-
52
Annual
Beginning
Amount
paid pursuant to the above schedule and Sections
II below, unless there is no credit pursuant to
Section VI(a) below.
$2,000,000 Base Rent is the amount actually
received by City since $360,000 was pre-paid
pursuant to the above schedule and Section II
10/1/2018
below, unless there is no credit pursuant to
and annually $1,640,000*
Section VI(a) below. Base Rent continues until
thereafter
termination of Ground Lease(s). Additionally,
Percentage Rent payments begin as described in
(d) below.
10/1/2019 $1,640,000*
below, unless there is no credit pursuant to
Section VI(a) below. Additionally, Percentage
Rent payments continue as described in (d) below.
10/1/2020 $1,890,000* below, unless there is no credit pursuant to
Section VI(a) below. Additionally, Percentage
Rent payments continue as described in (d) below
until the termination of Ground Lease(s).
*Notwithstanding the Annual Amounts set forth above and pursuant to Section II(g)
below, credits of the Pre-Payment of Construction/Base Rent cannot be given until
the Marina Component Starts Construction prior to 6/2/2014 and both of the
Parking/Retail Components Start Construction prior to 9/1/2016 pursuant to the
above General Construction Schedule for All Major Project Components. As stated
in Section II(g) below, when all (i) of the Marina Component Starts Construction
prior to 6/2/2014 and (ii) the Retail/Parking Components Start Construction prior
to 9/1/2016, then credit of the Pre-Paid Construction/Base Rent begins the month
following the date upon which all of those three (3) specific Components have
started construction.
(a) As set forth in the State Waiver (as defined in Section VII below) at certain times
Flagstone is obligated to pay the City and the City is obligated to use said funds to
pay fees to the State of Florida.
(b) During the thirty-six (36) months after 9/01/2010 to 8/31/2013, Flagstone has a
10-day grace period beyond the first of each month to make each Pre-Paid
Construction Rent payment, and agrees to not require any notice from the City in
53
the event of non-payment of any Pre-Paid Construction Rent payment. In the
event that Flagstone defaults for non-payment, Flagstone also agrees to waive its
defenses as to non-payment against the City, immediately vacate and turn over to
the City for the Citys possession all of Flagstones rights, and interests in the
Property and the easement areas, remove from such easement areas and from the
Property all of its property of whatever kind as requested in writing by the City
Manager, and immediately (i) return or sign over, as applicable, to the City all of
Flagstones rights, directly or indirectly, in the permits, plans, specifications, and
all related governmental approvals, documents, instruments, and agreements as
necessary related to the Property, and (ii) deliver to the City all of such permits,
plans, specifications, and all related governmental approvals, documents,
instruments, and agreements which are in Flagstones possession or in Flagstones
control.
(c) All payments to the City (for various Rents and for Option payments) are to be
paid monthly in advance beginning on the first day of the month, except for the
lump sum payment Flagstone shall pay to the City upon the date of City
Commission Approval of the Agreement to Enter and the Ground Lease, for the
Consideration of Extension Period amount from February 1, 2010 through
September 30, 2010.
(d) Additionally, if the Agreement to Enter is not signed in the same month of City
Commission Approval, then Flagstone shall also pay a lump sum payment amount
of $25,000 per month for each month from October 1, 2010 until the Agreement
to Enter is executed.
(e) Additional provisions regarding Percentage Rent payments are included in the
form of each Amended and Restated Ground Lease(s). As stated therein,
Percentage Rent on the Gross Revenues of each Component begins on the third
anniversary after each Major Project Component is Open for Business. Open for
Business means the earlier of the date that the applicable Major Project
Component receives either its TCO or CO. Base Rent may begin sooner than
02/01/2018 (i.e., if both Hotels are Open for Business prior to that time as set
forth in the Amended and Restated Hotel Ground Lease).
(f) As stated in the applicable Amended and Restated Ground Leases, once Base
Rent begins, it continues each year for the remaining term of the applicable
Ground Lease(s). On the first anniversary of the commencement of the Base Rent
for each Major Project Component, the Base Rent thereafter becomes subject to
an annual Consumer Price Index (CPI) adjustment as set forth in the Ground
Lease(s). Percentage Rent on the Gross Revenues of each Major Project
Component begins on the third anniversary after each Major Project Component
is Open for Business.
(g) If the Marina Component Starts Construction prior to 6/2/2014 and the
Retail/Parking Component(s) both Start Construction prior to 9/1/2016, then on
the first day of the month following the date when the Marina Component and
54
the Retail/Parking Component(s) (all 3 such Components) have started
construction, the Construction Rent payment (subject to credits described in (g)
below) becomes at least $1,000,000 per year, as opposed to the lesser Prepaid
Construction/Base Rent payment amounts shown on the above Section II General
Rents Payment Schedule for All Major Project Components.
(h) If the Marina Component Starts Construction prior to 6/2/2014 and the
Retail/Parking Component(s) (all 3 such Components) Start Construction by
9/1/2016, then as shown on the above Section II General Rent(s) Payment
Schedule for All Major Project Components, Flagstone is entitled to a credit back
of Pre-Paid Construction Rent/Base Rent each year beginning in the month
following the date upon which construction has started on all 3 such Components
in the amount of $30,000 per month for fifty-one (51) months and of $20,000 for
the 52nd month until Flagstone has received a total aggregate credit of $1,550,000.
This monthly credit is a return of Pre-Paid Construction/Base Rent paid by
Flagstone between 9/1/2010 and 8/31/2013. If Flagstone Starts Construction of
all three (3) of the Marina Component and the Retail/Parking Components prior to
6/2/2014, then the total credit back amount is reduced by 1/36th for each month
prior to 2/1/2013 that all such Components have commenced. Conversely, if
Flagstone does not Commence Construction of all three (3) of the Marina
Component and the Retail/Parking Components by 8/31/2016, then no credit of
Prepaid Construction Rent is allowed and the City keeps all of the Prepaid
Construction Rent amount received.
(i) If no construction begins by 6/2/2014 on any Major Project Component, then the
City keeps all Prepaid Construction/Base Rent, Flagstone agrees to not require
any notice from the City to terminate for failure to begin construction, and
Flagstone also agrees to waive its defenses against the City, immediately vacate
and turn over to the City for the Citys possession all of Flagstones rights and
interests in the Property and the easement areas, remove from such easement
areas and from the Property all of its property of whatever kind as requested in
writing by the City Manager, and immediately (i) return or sign over, as
applicable, to the City all of Flagstones rights, directly or indirectly, in the
permits, plans, specifications, and all related governmental approvals, documents,
instruments, and agreements as necessary related to the Property, and (ii) deliver
to the City all of such permits, plans, specifications, and all related governmental
approvals, documents, instruments, and agreements which are in Flagstones
possession or in Flagstones control.
III. OPTION PAYMENT SCHEDULE (FIRST OPTION).
Flagstone has two (2) 5-year Options (Option(s)) to extend the date to Commence
Construction of the Hotels Components, and Flagstone has the choice to build either one Hotel
Component or two Hotel Components; that choice triggers Option payments for one Hotel
Component or two Hotels Components accordingly.
55
If Flagstone exercises the first Hotel Option period for only one Hotel Component,
Flagstone must also pay to the City the following additional Option payment amounts.
Annual Option
Annual Base Annual Amounts
Beginning payment (for
Rent to the City
One Hotel)
$2,125,000 (Base Rent plus
9/1/2018 $125,000 $2,000,000
Option payment)
9/1/2019 $125,000 $2,000,000
Option payment)
9/1/2020 $125,000 $2,000,000
Option payment)
9/1/2021 $125,000 $2,000,000
Option payment)
9/1/2022 $125,000 $2,000,000
Option payment)
If Flagstone exercises the first Hotel Option period for two (2) Hotel(s) Components,
Flagstone must also pay to the City the following additional Option payment amounts.
Annual Option
Beginning payments (for
Rent to the City
2nd Hotel)
9/1/2018 $250,000 $2,000,000
Option payments)
9/1/2019 $250,000 $2,000,000
Option payments)
9/1/2020 $250,000 $2,000,000
Option payments)
9/1/2021 $250,000 $2,000,000
Option payments)
9/1/2022 $250,000 $2,000,000
Option payments)
Flagstone is obligated to pay to the City and the City is obligated to use said funds
to pay fees to the State of Florida.
(b) Flagstone can exercise the Option for only one Hotel Component or for both
Hotel Components, or stop Option payments at any time by giving written notice
to the City at least thirty (30) days before the date that the next Option payment is
due, but if Flagstone elects not to exercise the Option for one or both Hotel
Component(s), or fails to make any Option payment(s), then Flagstone must turn
56
over to the City immediately any applicable Hotel Ground Lease(s), Flagstone
also agrees to waive its defenses as to failure to pay the required Option
payments, immediately vacate and turn over to the City for the Citys possession
all of Flagstones rights and interests in the Hotel Component(s), any Hotel
Ground Lease, and the applicable easement areas, remove from such easement
areas all of its property of whatever kind as requested in writing by the City
necessary related to the applicable Hotel Component(s), and (ii) deliver to the
City all of such permits, plans, specifications, and all related governmental
approvals, documents, instruments, and agreements relating to the applicable
Hotel Component(s) which are in Flagstones possession or in Flagstones
control, and City has the rights to seek a new developer for the applicable Hotel
Component(s).
(c) For Any Hotel(s) Component(s) that Start(s) Construction during the first Option
period and continue construction into the second Option period, the Option
payments shall increase on 9/01/2023 to the second Option period Option
payment amount(s) set forth below in Section IV, and shall continue at such
second Option payment amount(s) until the Completion Date. Such Option
payments for the Hotel(s) Component(s) are in addition to the required
Construction Rent, Base Rent, Percentage Rent, CPI Adjustments, Marina Rent,
and any other Rents for the Hotels and any other Major Project Components.
IV. OPTION PAYMENTS SCHEDULE (SECOND OPTION).
If Flagstone exercises its second Hotel Option period for one Hotel Component only,
Flagstone must pay to the City the following additional amounts:
Annual Option
payment (For Annual Base Annual Amounts
Beginning
One Hotel Rent to the City
Only)
9/1/2023 $157,500 $2,000,000 $ 2,157,500
9/1/2024 $157,500 $2,000,000 $ 2,157,500
9/1/2025 $157,500 $2,000,000 $ 2,157,500
9/1/2026 $157,500 $2,000,000 $ 2,157,500
9/1/2027 $157,500 $2,000,000 $ 2,157,500
If Flagstone exercises its second Hotel Option period for two Hotel Components,
Flagstone must pay to the City the following additional amounts:
57
Annual Option
Beginning payments (For
Rent to the City
2nd Hotel)
9/1/2023 $315,000 $2,000,000 $ 2,315,000
9/1/2024 $315,000 $2,000,000 $ 2,315,000
9/1/2025 $315,000 $2,000,000 $ 2,315,000
9/1/2026 $315,000 $2,000,000 $ 2,315.000
9/1/2027 $315,000 $2,000,000 $ 2,315,000
Flagstone is obligated to pay the City and the City is obligated to use said funds to
pay fees to the State of Florida.
(b) Because Flagstone has twenty-four (24) months to complete construction of any
Hotel(s) Component, Flagstone shall continue to make Option payments to the
City beyond 8/31/2028 until such time that the final Hotel(s) Component(s)
construction has reached the final Completion Date. Flagstone can stop Option
payments at any time by giving written notice to the City at least thirty (30) days
before the date that the next Option payment is due, but if Flagstone elects not to
or fails to make any Option payment(s), then Flagstone must turn over to the City
immediately the Hotel Ground Lease(s) for the Hotel which is not to be
constructed, Flagstone also agrees to waive its defenses as to failure to pay the
required Option payments, immediately vacate and turn over to the City for the
Citys possession all of Flagstones rights and interests in the Hotel
Component(s), any Hotel Ground Lease, and the applicable easement areas,
remove from such easement areas all of its property of whatever kind as requested
in writing by the City Manager, and immediately (i) return or sign over, as
instruments, and agreements as necessary related to the applicable Hotel, and (ii)
deliver to the City all of such permits, plans, specifications, and all related
governmental approvals, documents, instruments, and agreements relating to the
applicable Hotel Component(s) which are in Flagstones possession or in
Flagstones control, and City has the rights to seek a new developer for the
applicable Hotel Component(s).
(c) If Flagstone does not Start Construction of the second Hotel Component by
9/1/2028, then both the City and Flagstone have their separate rights to terminate
the Agreement to Enter and Flagstone must immediately vacate and turn over to
the City for the Citys possession all of Flagstones rights and interests in the
Property related to the second Hotel Component and the easement areas, remove
from such easement areas and from the Property related to the second Hotel
Component all of its property of whatever kind as requested in writing by the City
Manager, and (i) return or sign over, as applicable, to the City all of Flagstones
rights, directly or indirectly, in the permits, plans, specifications, and all related
governmental approvals, documents, instruments, and agreements as necessary
58
related to the applicable Hotel, and (ii) deliver to the City all of such permits,
plans, specifications, and all related governmental approvals, documents,
instruments, and agreements relating to the applicable Hotel Component(s) which
are in Flagstones possession or in Flagstones control, and City has the rights to
seek a new developer for the applicable Hotel Component(s).
(d) Flagstone has a 10-day grace period beyond the first of each month to make each
Option payment, and agrees to not require any notice from the City in the event of
non-payment of any Option payment. In the event that Flagstone defaults for non-
payment, Flagstone also agrees to waive its defenses as to non-payment against
the City, immediately vacate and turn over to the City for the Citys possession all
of Flagstones rights and interests in the Second Hotel Component and the
easement areas, remove from such easement areas and from the Second Hotel
Component all of its property of whatever kind as requested in writing by the City
necessary related to the Second Hotel Component, and (ii) deliver to the City all
of such permits, plans, specifications, and all related governmental approvals,
documents, instruments, and agreements which are in Flagstones possession or in
Flagstones control.
V. ADDITIONAL AGREEMENTS CONCERNING HOTEL COMPONENTS.
(a) No Hotel Component can Start Construction until both the Marina Component
and the Parking/Retail Components Start Construction.
(b) Once a Hotel Component reaches its Completion Date, the Option payments for
that Hotel Component stop. For the portion of any construction period that
extends into the Option period, all applicable Option payment(s) (and all ongoing
Construction Rent payments) shall continue until the Completion Date. (Pursuant
to the applicable Ground Lease(s), the Percentage Rent Payment Beginning
Anniversary Date starts running for any Hotel on the date when it is Open for
Business and Percentage Rent payments begin on the third anniversary of the
Percentage Rent Payment Beginning Anniversary Date in order to give that Hotel
a Stabilization Period).
(c) The second Option period cannot be exercised unless one Hotel Component has
started construction before the end of the first Option period. If one Hotel
Component does not Start Construction before the end of the first Option period,
then the Option period terminates and no second Option exists. If the second
Hotel Starts Construction before the end of the first Option period and continues
construction into the second Option period, then the Option payments applicable
to the second Option period shall be due upon commencement of the second
Option period until the second Hotel Component reaches its Completion Date.
59
(d) Upon entering into the Ground Lease for any Hotel Component(s) and prior to
Starting Construction for any such Hotel Component(s), Flagstone shall provide a
Construction Bond to the City for the full amount of the construction cost of any
such Hotel Component(s).
VI. ADDITIONAL AGREEMENTS CONCERNING FLAGSTONE FORFEITURE /

CITY TERMINATION RIGHTS.
(a) If the Marina Component does not Start Construction by 6/2/2014 or both the
Parking/Retail Components do not Start Construction by 9/01/2016, then
Flagstones rights to build any Components expires and ceases, the Agreement to
Enter is terminated, City retains all Prepaid Construction/Base Rent (as
consideration for the extension of time until 6/2/2014 for the Marina Component
and as consideration for the extension of time until 9/1/2016 for both the
Parking/Retail Components) and Flagstone must turn over to the City
immediately the applicable Ground Lease(s), Flagstone also agrees to waive its
defenses as to failure to begin construction against the City, immediately vacate
and turn over to the City for the Citys possession all of Flagstones rights and
interests in the Property and the easement areas, remove from such easement
areas and from the Property all of its property of whatever kind as requested in
writing by the City Manager, and immediately (i) return or sign over, as
instruments, and agreements as necessary related to the Property, and (ii) deliver
to the City all of such permits, plans, specifications, and all related governmental
approvals, documents, instruments, and agreements which are in Flagstones
possession or in Flagstones control.
(b) If any Hotel Component does not Start Construction according to the applicable
deadline under the construction schedule and the Option schedule(s) (as
applicable), then Flagstones rights to build the applicable Hotel Component
expires (but Flagstones obligations under the payment schedule for the Marina
Component, the Parking/Retail Component, and any Hotel Component that is/are
complying continues to the end of the applicable Ground Lease(s)). Any time
Flagstone loses the right to construct a Hotel(s) Component, then Flagstone must
turn over to the City immediately the applicable Ground Lease(s), Flagstone also
agrees to waive its defenses as to failure to begin construction against the City,
immediately vacate and turn over to the City for the Citys possession all of
Flagstones rights and interests in the applicable Hotel Component, any Hotel
Ground Lease, and the related easement areas, remove from such easement areas
and from the Property all of its property of whatever kind as requested in writing
by the City Manager, and immediately (i) return or sign over, as applicable, to the
City all of Flagstones rights, directly or indirectly, in the permits, plans,
specifications, and all related governmental approvals, documents, instruments,
and agreements as necessary related to the applicable Hotel Component, and (ii)
60
deliver to the City all of such permits, plans, specifications, and all related
governmental approvals, documents, instruments, and agreements which are in
Flagstones possession or in Flagstones control.
(c) Subject to Section VII(a), Flagstone may separately ground lease and separately
construct the Marina Component prior to 6/2/2014 if the conditions precedent for
the Marina Component are met
(d) If construction is continuing during the Option period(s), then Flagstone shall pay
both, Construction Rent or Base Rent in accordance with the General Rent
Schedule in Section II above, and the applicable Option payments related to its
choice to construct either one or two Hotel Components.
VII. CROSS DEFAULTS; SEPARATE DEFAULTS.
(a) During the period prior to the earlier of 96 months from 9/01/2010 (being
8/31/2018) or the date upon which the first Hotel is Open for Business, Ground
Leases for the separate Major Project Components shall be cross-defaulted for
any Base Rent payment defaults, Prepaid Construction/Base Rent payment
defaults, and any Construction Rent payment defaults.
(b) After the earlier of 96 months from 9/01/2010 (being 8/31/2018) or the date upon
which the first Hotel is Open for Business, (i) the Base Rent, Percentage Rent,
and all other payments to the City each year thereafter shall be apportioned to
each separate Major Project Component Ground Lease for direct payments to the
City by each separate Ground Lease lessee in an amount reflecting each separate
Major Project Components respective percentage share of the total Project
Development Costs to that point in time, and (ii) the Ground Leases for the
separate Major Project Components shall not be cross-defaulted for any defaults,
including but not limited to any defaults in payments of Base Rent, Prepaid
Construction Rent/Base Rent, Construction Rent, Percentage Rent, or any other
Rent, with each separate lessee being solely responsible for any payment
default(s) to the City.
(a) Notwithstanding anything to the contrary in this Exhibit A, if the Retail/Parking

Components do not Commence Construction by the 72 nd month from 9/01/2010
(being 8/31/2016), then (i) there will be no crediting of Prepaid Construction/Base
Rent, the City shall keep all Prepaid Construction/Base Rent received, (ii) the City
can terminate the Agreement to Enter, all Ground Lease(s), and (iii) the City can
take back the Marina Component, the Retail/Parking Components, any Hotel
Components and the balance of the Project and the Property.,
VIII. STATE WAIVER.
State Waiver means collectively the Partial Modification of Restrictions as defined in the
Marina Component Amended and Restated Ground Lease.
61
IX. INDEMNIFICATION/HOLD HARMLESS FOR CITY; DISCHARGE OF
EXISTING LIENS, JUDGMENTS, AND GARNISHMENTS.
The City Commission in connection with Resolution No. 10-0144 of March 25, 2010
directed, and Flagstone agreed (a) that Flagstone and City entered into a Hold Harmless,
Indemnification, and Security Agreement (the Hold Harmless, Indemnification, and Security
Agreement) within thirty (30) days of the Citys determination in Section X below to proceed
under the new State Waiver, protecting the City against any and all lawsuits and related costs, (b)
that Flagstone shall assist the City in defending against any and all lawsuits involving liens,
judgments, garnishments and any other matters against Flagstone related to the Property and the
easement areas, (c) to the extent any lawsuit is pending against the City relating to any lien(s) on
the subject Property, that Flagstone shall provide to the City not less than $200,000 in security
in such form(s) as satisfactory to the City Manager at such time as the parties enter into the Hold
Harmless, Indemnification and Security Agreement, and (d) Flagstone shall provide to the City
Manager audited financial statements as soon as the same are completed, and any other
information needed in connection with the Hold Harmless, Indemnification and Security
Agreement. Additionally, Flagstone shall have up to one hundred and twenty (120) days from the
date of City Commission approval of the Amended and Restated Agreement to Enter Into
Ground Lease (the City Commission Approval Date) to clear and discharge as many liens,
garnishments, and judgments as possible, prior to making a deposit with the Miami-Dade County
Clerk of Courts Registry for all remaining outstanding liens, garnishments, and judgments at the
end of that one hundred and twenty (120) day period. Upon the one hundred and twenty first
(121st) day after the City Commission Approval Date, Flagstone shall deliver to the Miami-Dade
County Clerk of Courts Registry to be held in an escrow account, an amount not less than the
total remaining outstanding balance of all liens, garnishments, and judgments not previously
discharged during the one hundred and twenty (120) day period from the City Commission
Approval Date (and update such deposit amount as and if necessary from time to time and at the
time of execution of the Amended and Restated Agreement to Enter into Ground Lease, (and
update such deposit amount as and if necessary at time of execution of the Amended and
Restated Ground Lease). If Flagstone does not provide the foregoing, then the City shall
terminate the existing Agreement to Enter with Flagstone, terminate all easements with
Flagstone, and the City shall not enter into the contemplated new Amended and Restated
Agreement to Enter Into Ground Lease and the Amended and Restated Ground Lease, as
applicable at such time.
X. SECURITY DEPOSITS.
The Amended and Restated Agreement to Enter Into Ground Lease and the form of Ground
Lease(s) provide for security deposits in connection with the easement areas, the Pre-paid
Construction Rent/Base Rent, and the Ground Lease(s).
(a) Security for the Easements. Prior to the execution and delivery of the new
Amended and Restated Agreement to Enter by City to Flagstone, Flagstone shall either
62
(a) deliver the amount of Thirty-Five Thousand and No/100 Dollars ($35,000.00) (the
Easement Deposit) to Escrow Agent or (b) provide to City, at Flagstones sole cost
and expense, a Letter of Credit in the amount of Thirty-Five Thousand and No/I00
($35,000.00) (the Easement Security LOC). Notwithstanding the foregoing, Flagstone
shall be permitted to utilize any combination of cash or Letter of Credit so long as the
easement deposit equals Thirty-Five Thousand and No/100 Dollars ($35,000.00) in the
aggregate. The Easement Deposit or the Easement Security LOC, as applicable, shall
hereinafter be referred to as the Easement Security and shall provide security for the
faithful performance by Flagstone of all of the provisions of the Easements to be
performed or observed by Flagstone.
(b) Security Deposit for the Construction Rent/Base Rent: Prior to execution of
the new and Amended and Restated Agreement to Enter, Flagstone shall either (a) deliver
the amount equal to one years Construction Rent/Base Rent to the Escrow Agent, or (b)
provide to City, at Flagstones sole cost and expense, a Letter of Credit in the amount
equal to one years Construction Rent/Base Rent as defined herein. Notwithstanding the
foregoing, Flagstone shall be permitted to utilize any combination of cash or Letter of
Credit so long as the Security Deposit for the Pre-Paid Construction Rent/Base Rent
equals the amounts defined in the aggregate. The Security Deposit for the Construction
Rent/Base Rent, shall herein after be referred to as the Security Rent Deposit and shall
provide security for the faithful performance by Flagstone of all rent payment provisions
of this Agreement to be performed or observed by Flagstone. During the periods outlined
below, Flagstone shall deliver the Security Rent Deposits as defined below:
Commencing Annual Amount Required for Rent

Security Deposit
October 1, 2010 $300,000
October1, 2011 $500,000
October 1, 2012 $750,000
October 1, 2013 $1,000,000
October 1, 2014 $1,000,000
October1, 2015 $1,000,000
October 1, 2016 $1,500,000
October 1, 2017 $1,675,000
October1, 2018 $2,000,000
63
Any LOC Deposit held by the Lessor or Cash Deposit held by Escrow Agent, as defined in the
Agreement to Enter between the Parties (having an effective date of February 1, 2010) as
security under such Agreement to Enter into Ground Lease to begin being deposited as of
October 1, 2010 may be credited toward the following years Security Rent Deposit. The annual
amount due on September 1, 2018 of $2,000,000 shall remain in effect for the life of the
Agreement to Enter and of the Ground Lease(s), in accordance with the schedule listed in this
section and in Section 5.2 of the Agreement to Enter. If an Event of Lessees Default for non-
payment of rent occurs hereunder, Lessor may, at its option and without prejudice to any other
right or remedy that Lessor may have hereunder, apply or require distribution of all or any
portion of the Security Rent Deposit for the payment of any sum to which Lessor may become
entitled by reason of such Event of Lessees Default, including, without limitation, reasonable
attorneys fees and costs which Lessor may incur in connection therewith. If Lessor so applies
or requires the distribution to Lessor of all or any portion of the Security Rent Deposit, Lessee
shall, within thirty (30) days after written demand therefor, deposit cash with Lessor in an
amount sufficient to restore any such deficiency or amend or replace any LOC Deposit,
whichever is applicable, to the full amount thereof, and Lessees failure to do so shall, at
Lessors option, constitute an Event of Lessees Default hereunder. In the event Lessor applies
or requires distribution of all or any portion of an LOC Deposit where no Event of Lessees
Default then existed, Lessor shall be deemed to have improperly requested and received such
application or distribution, and Lessee shall be entitled to recover from Lessor the amount which
was improperly requested and received, or to reduce the Rent Security Deposit by an equivalent
amount.
XI. LABOR PEACE AGREEMENTS. (Note applicable to Marina Component)
The parties acknowledge that the City Commission by Resolution No. 10-0144, adopted on
March 25, 2010, has directed that the Project is subject to the provisions of earlier City
Commission Resolution No. 09-0263, adopted May 28, 2009, regarding the establishment of
labor peace agreements prior to and during the operation of hospitality operations on the
Property.
XII. COVENANT OF GOOD FAITH AND FAIR DEALING.
All matters in this Exhibit A contain a covenant of good faith and fair dealing by Flagstone and
the City in reasonably complying with their respective obligations.
{Remainder of this page intentionally left blank}
64
City Commission Resolution No. 09-0263, adopted May 28, 2009
and
Form of Labor Peace Agreement ( if applicable to the particular Ground Lease and the related
Major Project Component)
65
66
Amended Partial Modification and City Resolution No. R-11-0337, adopted September
15, 2011, as modified by Amended Partial Modification of 2014 with City Resolution R-
14- _______, adopted May 8, 2014 and State Board of Trustees authorization adopted
May 13, 2014 and Flagstones related Compliance Agreement with City effective as of
May 8, 2014.
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Marina Component Amended and Restated Ground Lease-Clean 8-26-14 Final PDF

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Marina Component Amended and Restated Ground Lease-Clean 8-26-14 Final PDF

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MARINA COMPONENT

AMENDED AND RESTATED GROUND LEASE

THE CITY OF MIAMI, FLORIDA

FLAGSTONE ISLAND GARDENS, LLC

May 30, 2014

ARTICLE II DEMISE ..................................................................................................................... 21

ARTICLE IV DELIVERY OF POSSESSION AND DEVELOPMENT AND OPERATION OF

Marina Component Amended and Restated Ground Lease-Final 459875 Page i

Section 6.8 Major Subleasehold Estates ............................................................................. 55

Marina Component Amended and Restated Ground Lease-Final 459875 Page ii

ARTICLE XV LESSORS RIGHT TO PERFORM LESSEES COVENANTS;

Marina Component Amended and Restated Ground Lease-Final 459875 Page iv

Marina Component Amended and Restated Ground Lease-Final 459875 Page v

Marina Component Amended and Restated Ground Lease-Final 459875 Page vi

ARTICLE XXXV OPERATING AGREEMENTS FOR HOTELS AND MARINA........................... 195

AMENDED AND RESTATED GROUND LEASE1

STATEMENT OF BACKGROUND AND PURPOSE

Island is shown on the sketch set forth in Exhibit A.

B. A portion of land located in the northwest quadrant of Watson Island, consisting

of approximately 10.79 acres, is legally described in Composite Exhibit B1 and is hereinafter

as legally described in Composite Exhibit B-2 is hereafter referred to as the Marina

Marina Component Amended and Restated Ground Lease-Final 459875 Page 1

Submerged Parcel, located on Watson Island at approximately 1050 MacArthur Causeway,

referred to as the Total Project Property.

of the Property as described in the Watson Island RFP.

F. In response to the Watson Island RFP, Lessee submitted to Lessor a proposal

under Resolution No. 01-1198.

Marina Component Amended and Restated Ground Lease-Final 459875 Page 2

the Project is set forth in Exhibit F.

I. This document is an Amended and Restated Ground Lease, which incorporates

Marina Component Amended and Restated Ground Lease-Final 459875 Page 3

time periods; and

L. The City Commission pursuant to Resolution No. 10-0402, adopted September

Lease is attached as an exhibit (the Agreement to Enter).

set forth, the Parties do hereby covenant and agree as follows:

INCORPORATION, EXHIBITS AND DEFINITIONS

Incorporation by Reference. The foregoing Statement of Background and Purpose is

Exhibit A -- Sketch of Watson Island

Composite Exhibit B-1 and B-2--Legal Descriptions of Upland Parcel and

Marina Component Upland Parcel

Exhibit C -- Legal Description of Submerged Parcel

Composite Exhibit D --Copy of Surveys D-1 and D-2 (updated)

Exhibit E -- Description of Project Components and Amenities

Exhibit E-1 -- Description of Public Art

Exhibit F -- Conceptual Site Plan

Exhibit G -- Definition of Gross Revenues

Exhibit H -- Definition of Marina; Marina Approval Procedures

Exhibit I -- Permitted Title Exceptions

Exhibit J -- List of Pre-Approved Hotel Franchisors (not applicable

Exhibit K -- List of Pre-Approved Lenders (not applicable if self-funded)

Exhibit L -- Approved Leasehold Mortgage Subordination, Non-Disturbance

and Attornment Agreement (not applicable if self-funded)

Exhibit M -- Approved Major Subleasehold Mortgage Subordination,

Non-Disturbance and Attornment Agreement

Exhibit N -- Prohibited Uses

Exhibit N-1 -- Covenants as to Port of Miami

Exhibit O -- List of Approved Financial Advisors

Marina Component Amended and Restated Ground Lease-Final 459875 Page 5

Exhibit Q -- Provisions Not Applicable to Private Lessor

Exhibit R -- Civic Arts Endowment Trust (not applicable to Marina Component)

Exhibit S -- Approved Major Subtenant Subordination, Non-Disturbance and

Attornment Agreement (not applicable to Marina Component)

Exhibit T -- Form of First Source Hiring Agreement and Amendment effective as of