01/14/2019Monday, January 14, 2019
9:00 AM
City of Clearwater
City Hall
112 S. Osceola Avenue
Clearwater, FL 33756
Council Chambers - Main Library
Community Redevelopment Agency
Meeting Agenda
January 14, 2019Community Redevelopment Agency Meeting Agenda
1. Call To Order
2. Approval of Minutes
2.1 Approve the December 3, 2018 CRA Meeting Minutes as submitted in written
summation by the City Clerk
3. Citizens to be Heard Regarding Items Not on the Agenda
4. New Business Items
4.1 Approve amendments to the Development Agreement adopted on October 30,
2017 between the Community Redevelopment Agency (CRA) and The Ring
Workspaces, LLC and authorize the appropriate officials to execute same.
4.2 Approve the Purchase Contract for the City of Clearwater Community
Redevelopment Agency (CRA) to purchase real property located at 701 Franklin
Street, Parcel No.15-29-15-54450-011-0010, with a purchase price of $525,000
and total expenditures not to exceed $540,000 including closing-related costs
and preparation of the site and authorize the appropriate officials to execute
same, together with all other instruments required to affect closing.
5. Director's Report
6. Adjourn
Page 2 City of Clearwater Printed on 1/4/2019
Cover Memo
City of Clearwater City Hall
112 S. Osceola Avenue
Clearwater, FL 33756
File Number: ID#18-5494
Agenda Date: 1/14/2019 Status: Agenda ReadyVersion: 1
File Type: MinutesIn Control: Community Redevelopment Agency
Agenda Number: 2.1
SUBJECT/RECOMMENDATION:
Approve the December 3, 2018 CRA Meeting Minutes as submitted in written summation by the
City Clerk
SUMMARY:
APPROPRIATION CODE AND AMOUNT:
USE OF RESERVE FUNDS:
Page 1 City of Clearwater Printed on 1/4/2019
Community Redevelopment Agency Meeting Minutes December 3, 2018
Page 1
City of Clearwater
City of Clearwater
City Hall
112 S. Osceola Avenue
Clearwater, FL 33756
Meeting Minutes
Monday, December 3, 2018
9:00 AM
Council Chambers
Community Redevelopment Agency
Draft
Community Redevelopment Agency Meeting Minutes December 3, 2018
Page 2
City of Clearwater
Roll Call
Present 4 - Chair George N. Cretekos, Trustee Bob Cundiff, Trustee Hoyt
Hamilton, and Trustee David Allbritton
Also Present – Jill Silverboard – Deputy City Manager, Micah Maxwell – Assistant
City Manager, Pamela K. Akin – City Attorney, Rosemarie Call – City Clerk, Nicole
Sprague – Official Records and Legislative Services Coordinator, and Amanda
Thompson – CRA Executive Director.
To provide continuity for research, items are listed in agenda order although not
necessarily discussed in that order.
Unapproved
1. Call to Order – Chair Cretekos
The meeting was called to order at 9:38 a.m. at City Hall.
2. Approval of Minutes
2.1 Approve the October 29, 2018 CRA Meeting Minutes as submitted in written summation
by the City Clerk
Trustee Cundiff moved to approve the October 29, 2018 CRA
Meeting Minutes as submitted in written summation by the City
Clerk. The motion was duly seconded and carried unanimously.
3. Citizens to be Heard Regarding Items Not on the Agenda – None. 4. New Business Items
4.1 Approve the 2019 Community Redevelopment Agency meeting schedule and adopt
Resolution 18-03.
Community Redevelopment Agency staff has prepared the proposed meeting
schedule for the City of Clearwater Community Redevelopment Agency (CRA)
Board for the calendar year 2019. CRA Board meeting will be held monthly in
the City Council Chambers at the Clearwater Main Library, 100 North Osceola
Avenue. Draft
Community Redevelopment Agency Meeting Minutes December 3, 2018
Page 3
City of Clearwater
The meeting schedule will be posted on the CRA’s website, with separate
meeting notices provided by the City Clerk’s Office and noted on the City’s
website prior to each meeting.
If there is no action for the board to consider at a scheduled meeting, staff will
recommend the meeting be cancelled. Changes to the dates may be required
to accommodate needs of the Board members and/or CRA staff.
If there is a need for a special meeting CRA staff will notify the board and the
meeting will be noticed by the City Clerk’s Office as well as the City’s website.
Trustee Hamilton moved to approve the 2019 Community
Redevelopment Agency meeting schedule. The motion was duly
seconded and carried unanimously.
Resolution 18-03 was presented and read by title only. Trustee
Allbritton moved to adopt Resolution 18-03. The motion was duly
seconded and upon roll call, the vote was:
Ayes: 4 - Chair Cretekos, Trustee Cundiff, Trustee Hamilton and Trustee
Allbritton
4.2 Approve a Grant to Loan Agreement in the amount of $100,000 with ClearSkyz Cafe III,
LLC for interior building improvements at 418 Cleveland Street and authorize the
appropriate officials to execute same.
At the July 16, 2018 CRA meeting, the Trustees directed staff to invite a grant
application for from the restaurant tenant, ClearSky on Cleveland, for the Anchor
Tenant Program. The trustees stated they would consider a grant request of
$100,000 for building improvements.
ClearSky on Cleveland has submitted a grant application, supporting invoices
and the financial documentation necessary for a complete grant request. As
outlined in their application, the tenant has made $112,312.09 in building
improvements to upgrade the electrical infrastructure, provide ADA compliant
ramps and doors as well as installed hurricane windows. These improvements
were necessary to open the restaurant and will stay with the building beyond the
10-year lease that is currently in place. The tenant spent more than $1 million
dollars to construct the entire restaurant space, including a new dining area in
the rear of the building. The Anchor Tenant program allows for the loan to be
forgiven over a 5-year period. The tenant has agreed to stay in business and
maintain the existing improvements for a minimum of 5 years. Draft
Community Redevelopment Agency Meeting Minutes December 3, 2018
Page 4
City of Clearwater
The proposed grant application meets the goals of the Anchor Tenant program
and the CRA’s redevelopment plan to attract more foot traffic to downtown and
improve the appearance of buildings. ClearSky on Cleveland is a full-service
restaurant that has proven to be a dining destination for local residents and
tourists to Clearwater Beach. The interior renovations, quality food and service
have set a new standard for restaurants in downtown.
APPROPRIATION CODE AND AMOUNT:
Funds are available in 3887552-94893 Opportunity Fund
Trustee Cundiff moved to approve a Grant to Loan Agreement in the
amount of $100,000 with ClearSkyz Cafe III, LLC for interior building
improvements at 418 Cleveland Street and authorize the appropriate
officials to execute same. The motion was duly seconded and
carried unanimously.
4.3 Approve the extension of a lease agreement between the Community Redevelopment
Agency (CRA) and Water’s Edge Commercial Group, LLC, a Florida Limited Liability
Company, for the premises located at 331 Cleveland Street No. 2502 and authorize the
appropriate officials to execute same.
The CRA Trustees approved a new lease amendment for this site on October
29, 2018. Due to a misunderstanding between CRA staff and the property
owner, that lease did not contain the correct lease rate. The property owner
wishes to increase the rent from $8.00 to $14.21 per square foot. Current lease
rates in downtown range from $10 to $25 per square foot. This increased rate is
reasonable given the current market and the original build out investment of
$65,000 from the property owner. No other terms of the lease have changed
include the end date of January 31, 2020.
Background Information from the October 29, 2018 hearing:
The CRA began a lease with Water’s Edge Commercial Group, LLC on June 1,
2017 to use approximately 2,000 square feet of first-floor retail space located in
the ground floor of Water’s Edge Condominiums as an Artist Workshop/Exhibit
Space and public education space for Imagine Clearwater. The retail space,
branded as Second Century Studios, has assisted in implementation of
downtown redevelopment goals by providing increased cultural programming to
generate foot traffic in downtown and engaging the public in the Imagine
Clearwater plan. To date, the space has hosted Bazaar Art Collective, an arts
installation, Plasti-Plast, by national artist Amy Landesburg, two Clearwater
employee arts shows and most recently the Florida Center for Creative
Photography.
Draft
Community Redevelopment Agency Meeting Minutes December 3, 2018
Page 5
City of Clearwater
Second Century Studios will continue to play a key role in the CRA’s 18-month
strategy by providing a space for public art programming, hosting targeted
networking events for private investors and supporting pop-up retail businesses
to increase opportunities for shopping in downtown. These activities support
building a positive brand, attracting housing and encouraging private investment.
Also, the studio fills a space on highly visible downtown corner that is difficult to
lease due to the lack of guaranteed parking. Future activities in Second Century
Studios include:
• Holiday Vendor Market (November 17 - December 31, 2018)
• “Dreams of Dali”, a virtual reality exhibit, by The Dali Museum (January -
June 2019)
• Pop up retail and art exhibitions (July-November 2019)
• Holiday Vendor Market (November - December 2019)
After January 31, 2020, staff anticipates this retail space will return to use by the
private market.
APPROPRIATION CODE AND AMOUNT:
Funding for this agreement is available in CRA project 94885, ULI
Implementation.
In response to questions, CRA Executive Director Amanda Thompson
said the original rent was $8.00 per sq. ft.; the proposed rate increased
by more than 75% but still below the market rate. Staff has looked at other
locations within the Downtown core but found them to be either too large
for the CRA's programmatic needs or required significant renovations to
meet the ADA and fire sprinkler system requirements. She said the
objective is to remain in the Downtown core and near the Imagine
Clearwater site to be a source of public information when the Harborview
Center is demolished. The space will be leased through January 2020.
Trustee Allbritton moved to approve the extension of a lease
agreement between the Community Redevelopment Agency (CRA)
and Water’s Edge Commercial Group, LLC, a Florida Limited
Liability Company, for the premises located at 331 Cleveland Street
No. 2502 and authorize the appropriate officials to execute same.
The motion was duly seconded and carried unanimously.
4.4 CRA 18-month Strategy Update
CRA Executive Director Amanda Thompson provided a PowerPoint Draft
Community Redevelopment Agency Meeting Minutes December 3, 2018
Page 6
City of Clearwater
presentation. Recreation Specialist Madai Gutierrez reviewed upcoming
Holiday Extravaganza programming and marketing efforts. CRA Executive
Assistant Anne Lopez provided an update on the mural program. Downtown
Manager Anne Fogarty France reviewed the permitting team process and
provided an update on the Food and Drink Grant Program.
In response to a suggestion that the Trustees review mural designs prior
to contract execution, the City Attorney said the CRA does not select the
mural; the property owner approves the mural design. Ms. Thompson
said the mural installed at the Garden Street Garage was approved by the
Public Art and Design Board and the Downtown Development Board.
In response to a question, Ms. Thompson said the CRA pays for the
mural.
Support was expressed to have the CRA review the mural design prior
to installment.
The City Attorney said if the mural program is renewed, staff can redraft
the program. She expressed a concern that CRA regulate the content of
the murals. Staff prefers the decision be made through the appropriate
advisory board or the property owner.
Support was expressed to bring mural designs to the CRA prior to
contract execution.
In response to questions, Ms. Fogarty-France said $1.6 million funds
have been requested through the Food and Drink Grant Program. Ms.
Thompson said the property owner has until December 1 to secure a
tenant. If a tenant is not secured, staff will work with the property owner to
secure a tenant. The grant funds are available on a first come first
served basis. The CRA will review the grant application and decide
whether to fully or partially fund the grant request.
5. Director's Report – None. 6. Adjourn
The meeting adjourned at 10:15 a.m. Draft
Cover Memo
City of Clearwater City Hall
112 S. Osceola Avenue
Clearwater, FL 33756
File Number: ID#18-5520
Agenda Date: 1/14/2019 Status: Agenda ReadyVersion: 1
File Type: Action ItemIn Control: Community Redevelopment Agency
Agenda Number: 4.1
SUBJECT/RECOMMENDATION:
Approve amendments to the Development Agreement adopted on October 30, 2017 between
the Community Redevelopment Agency (CRA) and The Ring Workspaces, LLC and authorize
the appropriate officials to execute same.
SUMMARY:
The Community Redevelopment Agency trustees approved a development agreement on
October 30, 2017 with The Ring Workspaces, LLC (grantee) to establish a co-work space at
600 Cleveland Street (One Clearwater Tower). The CRA’s investment of $600,000 in the
project was contingent on specific environmentally friendly building standards, the provision of
parking, construction timelines, performance reporting and a partnership with the city’s
“Clearwater Business SPARK” program among other requirements.
To date, the grantee has received a Certificate of Occupancy for the second floor of the
co-work space and is actively finishing the third floor of the co-work space. After a site visit on
November 29, 2018, the CRA Director issued an extension until January 21, 2019 to obtain a
Certificate of Occupancy for the third floor due to unavoidable construction delays caused by
difficulty in acquiring plastic free materials. Construction invoices have been appropriately filed
and reimbursement payments have been issued for a total of $502,236.74 for this grant. The
remaining grant funds are $97,763.26.
The grantee and the CRA Director are jointly requesting to amend portions of the existing
development agreement and Exhibit “K” to better reflect the updated project timeline, applicable
environmental building standards and to accurately capture the impact of this project on the
CRA’s downtown redevelopment goals. The following amendments are proposed:
·Removal of the requirement to build the 1,300 square foot outdoor terrace and
reallocation of those grant funds ($97,763.26) to environmentally friendly lighting,
flooring materials and improved indoor air quality. The cost to construct the outdoor
terrace increased from $125,000 to $206,066.17 since the project began. Outdoor
space needs can be met using Station Square Park and the indoor air quality and
lighting improvements will have a greater positive impact on the occupants’ health than
the terrace on a daily basis.
·Amendment of the reporting period and required metrics for the annual performance
report. Annual reports are currently required to be submitted on December 31st of each
year. This date will be modified to 30 days after the Certificate of Occupancy is issued
for the third floor. The metrics have been updated to capture building performance,
marketing and partnership information.
·Clarification on what needs to be included in the Certificate of Completion (COC) and
Page 1 City of Clearwater Printed on 1/4/2019
File Number: ID#18-5520
when the COC is due.
·Updating the description of the WELL standards and other environmental benchmarking
programs that are referenced, including removing the Living Building Challenge and
replacing it with the Fitwel program.
No other changes to the development agreement are proposed. The grantee still has an
obligation to operate the co-work space for five years from the date of project completion. That
obligation is backed by a performance mortgage on the site located at 630 Laura Street and the
performance mortgage will reduced by 20% for each year of operation as a co-work space.
The Ring remains an exciting investment in support of downtown redevelopment goals to
attract high tech businesses and activate the downtown core. It contributes to building a
positive brand for downtown as a unique co-work space designed to support a high level of
health and well-being. Your approval of the grant agreement amendments is recommended.
APPROPRIATION CODE AND AMOUNT:
The grant funds for The Ring are in capital improvement project 388-94893. There is no change
to the originally approved grant amount of $600,000. As of December 21, 2018, $502,236.74
has been approved for reimbursement.
Page 2 City of Clearwater Printed on 1/4/2019
DEVELOPMENT AGREEMENT
The Ring Workspaces, LLC, 600 Cleveland St.)
This Development Agreement ("Agreement") is made as of this (.l day
of October, 2017, by and between the COMMUNITY REDEVELOPMENT AGENCY OF THE
CITY OF CLEARWATER, FLORIDA, a public body corporate and politic of the State of
Florida created pursuant to Part III, Chapter 163, Florida Statutes ("Agency"), and The Ring
Workspaces, LLC, a Florida limited liability company ("Developer").
WITNESSETH:
WHEREAS, the Agency and Developer have entered into and concluded negotiations of
a development agreement pursuant to Developer's request for specific assistance as outlined
herein, pertaining to and setting forth the terms and conditions for the improvement of certain
portions (i.e. a portion of the second and third floor) of 600 Cleveland St, Clearwater, Florida,
and legally described as set forth in Exhibit A, to be leased by and operated by "The Ring
Workspaces, LLC" as co -working facilities in the community redevelopment area of the City;
WHEREAS, at a duly called public meeting on October 30, 2017, the Agency approved
this Agreement and authorized and directed its execution by the appropriate officials of the
Agency;
WHEREAS, Developer has approved this Agreement and has authorized and directed
certain individuals to execute this Agreement on behalf of Developer; and
WHEREAS, Section 163.387(6), Florida Statues, allows for use of moneys in the
redevelopment trust fund to be expended from time to time for undertakings of a community
redevelopment agency as described in the redevelopment plan; and
WHEREAS, the CRA has adopted a Community Redevelopment Plan (a/k/a Clearwater
Downtown Redevelopment Plan) that establishes certain Goals, Objectives and Principles to
guide the revitalization of Downtown Clearwater; and
WHEREAS, according to the Community Redevelopment Plan (pg 47), a guiding
principle states, "The revitalization of Downtown Clearwater is critical to the City's overall
success. The city will use all tools and incentive available in the CRA to revitalize Downtown";
and
WHEREAS, Objective 1H of the Community Redevelopment Plan states, "A variety of
incentives shall be available to encourage redevelopment within the Downtown"; and
WHEREAS, according to the Community Redevelopment Plan (pg 257), CRA
Redevelopment Incentive Funding "...will provide financial incentives to developers to offset the
high land, development and construction costs within the Downtown...to encourage investment
in Downtown that will revitalize the center city with people, employees, businesses and
activities"; and
WHEREAS, the city's June 2014, Urban Land Institute (ULI) report, Clearwater Florida:
A New Vision for Downtown, recommends "...attracting and supporting new entrepreneurial
small businesses by investing in a center that can provide attractive, affordable workspace"; and
to achieve this goal, the city could allocate funds or partner with organizations"; and
WHEREAS, on January 17, 2017, the CRA Board of Trustees adopted a "Strategic Plan"
that identifies Downtown priorities including "support [for] the creation of a co -working business
space via public-private partnership"; and
WHEREAS, the City of Clearwater manages a network of small business service
providers called Clearwater Business SPARK which provides services and support to small
businesses and entrepreneurs in every stage of development, which will become more
successful in fulfilling its mission with a physical office presence within the Project (as defined
herein) which Developer proposes to provide at no cost; and
WHEREAS, regional competitiveness in the Tampa Bay area office and business market
is critical to the economic development of the city of Clearwater and the CRA; and
WHEREAS, Developer will be a tenant and operator of the co -working space in, the
property located at 600 Cleveland Street (a/k/a One Clearwater Tower), Clearwater, Florida and
desires to develop the Project; and
WHEREAS, to support the economic development and downtown revitalization goals,
objectives, and principles stated above, the Agency will contribute funds to be applied to the
completion of the Project; and
WHEREAS, the Agency and Developer are desirous of entering into this Agreement to
effectuate the development of the Project; and
NOW, THEREFORE, in consideration of the mutual promises and covenants contained
herein, the parties hereby agree as follows:
ARTICLE 1. DEFINITIONS.
1.01. Definitions. The terms defined in this Article I shall have the following
meanings, except as herein otherwise expressly provided:
1) "Act" means the Constitution of the State of Florida; Section 163.01, Florida
Statutes, Part III, Chapter 163, Florida Statutes; Chapter 166, Florida Statutes, other applicable
provisions of law, and ordinances and resolutions of the City and the Agency implementing
them.
2) "Agency" means the Community Redevelopment Agency of the City, as created
by Resolution No. 81-68 of the City, adopted by the City Council on August 6, 1981, including
any amendments thereto, and any successors or assigns thereto.
GM17-9311-025/211355/ 1 ] 2
3) "Agreement" means this Development Agreement, including any Exhibits, and
any amendments hereto or thereto.
4) "Agreement Expiration Certificate" means the instrument executed by the parties
hereto as provided in Section 11.19 certifying that all obligations of the parties hereto have been
satisfied and this Agreement has expired in accordance with its terms, the form of which is
attached hereto as Exhibit E.
5) "Agreement Termination Certificate" means the instrument executed by the
parties hereto as provided in Section 9.06 stating that this Agreement has been terminated prior
to its Expiration Date as provided in Section 9.05, the form of which is attached hereto as
Exhibit F.
6) "Area" means the area located within the corporate limits of the City having
conditions of slum and blight (as those conditions are defined in the Act) as found by the City
Council in Resolution No. 81-67, adopted by the City Council on August 6, 1981, and as
amended by Resolution No. 03-22, adopted by the City Council on May 1, 2003.
7) "Authorized Representative" means the person or persons designated and
appointed from time to time as such by Developer or the Agency, respectively, pursuant to
Section 2.04.
8) "Building Permit" means, for "The Ring Workspaces" Project to be constructed in
the Site, a permit issued by the City authorizing, allowing and permitting the commencement,
prosecution and completion of construction to the extent provided in said permit.
9) "City" means the City of Clearwater, Florida, a Florida municipal corporation, and
any successors or assigns thereto.
10) "City Council" means the governing body of the City, by whatever name known or
however constituted from time to time.
11) "Commencement Date" means the date of issuance of the first Building Permit
for "The Ring Workspaces, LLC " co -working facilities Project.
12) "Completion Date" means the date on which construction of the Project is
substantially complete as evidenced by a Completion Certificate.
13) "Construction Financing" means the funds provided by the Construction Lender to
Developer during the term of this Agreement to pay the cost of developing and constructing the
The Ring Workspaces, LLC " co -working facilities Project, or any portion thereof, on the Project
Site, including, financing costs, "soft costs," overhead, and the design, construction and
equipping of the Project.
14) "Construction Lender" means any person or persons providing the Construction
Financing or any portion thereof.
GM17-9311-025/211355/ 1 ] 3
15) "Contractor" means one or more individuals or firms constituting a general
contractor or other type of construction contractor properly licensed by the State of Florida or
other appropriate jurisdiction to the extent required by applicable law, authorized to perform
construction contractor services in the State of Florida, registered with the City as required by
applicable law, bonded and insured to the extent required by applicable law and this Agreement,
including Developer or any affiliates of Developer.
16) "Coworking" means the use of a single office and/or collaborative working space by
individualists who may be classified as entrepreneurs, independent contractors, frequent
travelers, self-employed or those working for different employers, typically so as to share
equipment, ideas and knowledge in a business environment. These individuals may develop
professionally and will often have the ability network within the space whilst participating in
various workshops, lectures and seminars (hereinafter referred to as "The Ring Project").
17) "Developer" means The Ring Workspaces, LLC, a Florida limited liability company,
and any successors and assigns thereof, including any entity, partnership, joint venture, or other
person in which The Ring Workspaces, LLC, is a general partner or principal, but not including
any entity, partnership, joint venture, or other person in which The Ring Workspaces, LLC is a
general partner or principal which is not undertaking or participating in any development of the
The Ring"" co -working facilities Project, or any part thereof.
18) "Effective Date" means the date determined in accordance with Section 11.20
when the Memorandum of Development Agreement is recorded and this Agreement becomes
effective.
19) "Exhibits" means those agreements, diagrams, drawings, specifications,
instruments, forms of instruments, and other documents attached hereto and designated as
exhibits to, and incorporated in and made a part of, this Agreement.
20) "Expiration Date" means the date on which this Agreement expires, as evidenced
by the Agreement Expiration Certificate being recorded in the public records of Pinellas County,
Florida, as provided in Section 11.19 hereof.
21) "Impact Fees" means those fees and charges levied and imposed by the City,
Pinellas County and any other governmental entity on projects located on the Site for certain
facilities and services impacted by development such as the
22) "Permits" means all zoning, variances, approvals and consents required to be
granted, awarded, issued, or given by any governmental authority in order for construction of
the Project, or any part thereof, to commence, continue, be completed or allow occupancy and
use, but does not include the Building Permit.
23) "Plan" means the community redevelopment plan for the Area, including the Site,
as adopted by the City Council on September 18, 2003, by enactment of its Ordinance No. 7153-
03, and amended by Ordinance No. 7231-01 adopted on December 4, 2003, Ordinance No. 7343-
04 adopted on November 4, 2004, Ordinance No. 7367-05 adopted on February 3, 2005;
Ordinance No. 8014-09 adopted on January 15, 2009 and Ordinance No. 8192-10 adopted on
September 9, 2010..
GM17-9311-025/211355/ 1 ] 4
24) "Project" means the "The Ring" co -working facilities Project. More specifically,
the Project is the internal build out for an approximately 18,000 square foot co -working facilities
along with a 1,300 square foot outdoor lounge overlooking Station Square Park, to be leased by
600 Cleveland, LLC to, The Ring Workspaces, LLC., who will operate co -working facilities as
described in Exhibit G attached hereto.
25) "Project Plans and Specifications" means the plans and specifications pertaining
to the construction, installation and equipping of the ""The Ring " co -working facilities Project,
including the schedule for completing the Project, consisting of the plans and specifications
attached hereto as Exhibit B.
26) "Project Professionals" means any architects, attorneys, brokers, engineers,
consultants, planners, construction managers or any other persons, or combination thereof,
retained or employed by Developer in connection with the planning, design, construction, permit
applications, completion and opening of the Project, but does not include Developer.
27) "Proposal" means the proposal for redevelopment of the Site, attached hereto as
Exhibit G.
28) "Site" means the entire third floor and part of the second floor of that certain
property with a street address of 600 Cleveland Street, located in Clearwater, Florida, as more
particularly described on Exhibit A attached hereto, on which the "The Ring Workspaces" co -
working facilities Project is to be located.
29) "Site Plan" means a floor plan that depicts the internal build out of the co -working
facility, the initial version of which is attached hereto as Exhibit B.
30) "Termination Date" means the date on which this Agreement is terminated by
any party hereto as provided in Section 9.05, and as evidenced by the Agreement Termination
Certificate.
31) "Unavoidable Delay" means those events constituting excuse from timely
performance by a party hereto from any of its obligations hereunder, as such events are defined
in and subject to the conditions described in Article 10 hereof.
32) "The Ring" co -working facilities Project means the improvements consisting of
the internal build out of an approximately 18,000 square foot co -working facilities along with a
1,300 square foot outdoor lounge overlooking Station Square Park; with a dedicated parking lot
adjacent to the Project addressed at 630 Laura Street containing 60 parking spaces for
exclusive use of The Ring as contemplated by the Proposal and this Agreement and
constructed substantially in accordance with the Plans and Specifications and the operation
thereof. The co -working facility shall include a membership for the City and its partners to be
used for "Spark" as provided herein.
1.02. Use of Words and Phrases. Words of the masculine gender shall be deemed and
construed to include correlative words of the feminine and neuter genders. Unless the context
shall otherwise indicate, the singular shall include the plural as well as the singular number, and
the word "person" shall include corporations and associations, including public bodies, as well
GM 17-9311-025/211355/1 ] 5
as natural persons. "Herein," "hereby," "hereunder," "hereof," "hereinbefore," "hereinafter" and
other equivalent words refer to this Agreement and not solely to the particular portion thereof in
which any such word is used.
1.03. Florida Statutes. AH references herein to Florida Statutes are to Florida Statutes
2017), as amended from time to time.
ARTICLE 2. PURPOSE; PROPOSAL
2.01. Intent; Purpose of Agreement.
a) The purpose of this Agreement is to (i) secure economic assistance through the
Agency which supports the implementation of the City of Clearwater's "District Vision" for the
revitalization of the Downtown Core; and (ii) to further the implementation of the Plan by the
development and construction and operation of the Project thereon in accordance with the
Project Plans and Specifications, all to enhance the quality of life, increase employment and
improve the aesthetic and useful enjoyment of the Area through the eradication of conditions of
blight, all in accordance with and in furtherance of the Plan and as authorized by and in
accordance with the Act.
b) (1) The Site is to be redeveloped according to Project Plans and
Specifications for use as an approximately 18,000 square foot co -working facilities along with a
1,300 square foot outdoor lounge overlooking Station Square Park; with a dedicated parking lot
adjacent to the Project addressed at 630 Laura Street containing 60 parking spaces for
exclusive use of The Ring. Developer commits to maintain the operation of the Project as co -
working facilities for a period of not less than 5 years from the Completion Date.
2) The Ring co -working facility shall include a membership for the City and
its partners as provided in Exhibit I attached hereto, to be used for the City's business
development activities,.
2) As provided in this Agreement, the Agency shall undertake certain public
actions pursuant to the Act and as implementation of the Plan, and provide assistance in
obtaining such approvals by governmental authorities as are necessary for development of the
Project.
c) As provided in this Agreement, Developer shall carry out the redevelopment of
the Site by obtaining approvals by governmental authorities necessary for development of the
Project, and constructing various private improvements on the Site.
2.02. Developer's Proposal.
a) The Proposal for the redevelopment of the Site, specifically including the design,
construction, equipping, completion and use of the Project, and each component thereof, is
hereby found by the Agency and acknowledged by Developer: (1) to be consistent with and in
furtherance of the objectives of the Plan, (2) to conform to the provisions of the Act, (3) to be in
the best interests of the citizens of the City, (4) to further the purposes and objectives of the
Agency, and (5) to further the public purpose of eradicating conditions of blight in the Area.
The parties recognize and agree that during the process of review and approval provided for in
GM 17-9311-025/211355/1 ] 6
the Agreement the design of the Project may be subject to change and modification as may be
either agreed to by the parties or required as provided herein or by the appropriate regulatory
authority, and should any changes be necessary or desirable the parties agree that they will act
expeditiously and reasonably in reviewing and approving or disapproving any changes or
modifications to the Project.
b) Based upon and as a result of the findings set forth in subsection (a) above, the
Proposal, including such changes and revisions as are provided by this Agreement, is hereby
affirmed by Developer and approved and accepted by the Agency.
2.03. Cooperation of the Parties. The parties hereto recognize that the successful
development of the Project and each component thereof is dependent upon continued
cooperation of the parties hereto, and each agrees that it shall act in a reasonable manner
hereunder, provide the other party with complete and updated information from time to time,
with respect to the conditions such party is responsible for satisfying hereunder and make its
good faith reasonable efforts to ensure that such cooperation is continuous, the purposes of this
Agreement are carried out to the full extent contemplated hereby and the Project is designed,
constructed, equipped, completed and operated as provided herein.
2.04. Authorized Representative.
a) Each party shall designate an Authorized Representative to act on its behalf to
the extent of the grant of any authority to such representative. Written notice of the designation
of such a representative (and any subsequent change in the Authorized Representative) shall
be given by the designating party to the other party in writing in accordance with the procedure
set forth in Section 11.03 hereof.
b) Except as otherwise expressly provided in this Agreement, whenever approval or
action by Developer or the Agency is required by this Agreement, such action or approval may,
in the discretion of the party considering such approval or action, be taken or given by the
Authorized Representative thereof. A party to this Agreement may rely upon the representation
of the other party's Authorized Representative that such person has the requisite authority to
give the approval or take the action being done by that Authorized Representative. A party may
not later deny that its Authorized Representative had the authority represented to and relied
upon by the other party or revoke or deny any action taken by such Authorized Representative
which was relied upon by the other party.
c) Developer does hereby notify the Agency that its initial Authorized
Representative for the Project is Daniels Ikajevs of The Ring Workspaces, LLC,
d) The Agency does hereby notify Developer that its initial Authorized Representative is
Seth Taylor, Director of the CRA.
ARTICLE 3. LAND USE REGULATION.
3.01. Zoning. On the Effective Date, the zoning classification for the Site is "Downtown
District", abbreviated as "D." The parties recognize and acknowledge that the zoning
classification of the Site as of the Effective Date permits development of the Project.
GM17-9311-025/211355/1] 7
3.02. Redevelopment Plan. The Agency represents to Developer and Developer
acknowledges that as of the Effective Date, the Site is in the Downtown Core District and the
provisions of the Plan pertaining to the Site were consistent with the "The Ring Workspaces,
LLC" co -working facilities Project as contemplated by the Proposal and this Agreement.
3.03. Permits.
a) Developer shall cause the tenant's contractor to prepare and submit to the
appropriate governmental authorities, including the City, the applications for each and every
Building Permit and any and all necessary Permits for the Project. Developer shall bear all costs
of preparing such applications, applying for and obtaining such permits including applicable
application, inspection, regulatory and Impact Fees or charges pertaining to the Project,
including, but not limited to, any such permit, review, application, inspection, regulatory or
Impact Fees.
b) The Agency shall cooperate with Developer in obtaining all necessary Permits
and the Building Permits required for the construction and completion of the Project.
c) The Agency's duties, obligations, or responsibilities under any section of this
Agreement, specifically including but not limited to this Section 3.04 do not affect the Agency's
or the City's right, duty, obligation, authority and power to act in its governmental or regulatory
capacity in accordance with applicable laws, ordinances, codes or other building or project
regulation.
d) Notwithstanding any other provisions of this Agreement, any required permitting,
licensing or other regulatory approvals by the Agency or the City shall be subject to the
established procedures and requirements of the Agency or the City with respect to review and
permitting of a project of a similar or comparable nature, size and scope. In no event shall the
Agency or the City, due to any provision of this Agreement, be obligated to take any action
concerning regulatory approvals except through its established processes and in accordance
with applicable provisions of law.
3.04. Not a Development Order or Permit. The parties do hereby acknowledge, agree
and represent that this Agreement is not intended to be and should not be construed or deemed
to be a "development order" or "development permit" within the meaning of those terms in
Section 163.3164, Florida Statutes.
3.05. Permitted Uses.
a) The Project shall consist of 18,000 square foot co -working facilities along with a
1,300 square foot outdoor lounge overlooking Station Square Park.
b) The Project shall have access to a dedicated parking lot adjacent to the Project
addressed at 630 Laura Street containing 60 parking spaces for exclusive use of The Ring.
ARTICLE 4. PROJECT PLANS AND SPECIFICATIONS.
GM17-9311-025/211355/ 1 ] 8
4.01. Site Plan.
a) Developer has prepared a Site Plan, a copy of which is attached hereto as
Exhibit B, which contemplates development of the Project consistent with this Agreement.
Developer agrees that during the term of this Agreement, any material changes to the Site Plan
or any subsequent versions of the Site Plan will be submitted to the City for review, if such
review is required by the Land Development Code, and Agency for approval, which Approval
shall not be unreasonably withheld or delayed.
ARTICLE 5. CONSTRUCTION AND OPERATION OF THE PROJECT.
5.01. Interior Demolition. Permits issued by the City for pre -construction activities on
the Site, interior demolition, shall not be considered a Building Permit for purposes of this
Agreement.
5.02. Construction of the Project.
a) (1) Developer shall construct the Project on the Site substantially in
accordance with the Project Plans and Specifications therefor. Subject to Unavoidable Delay
and the terms and conditions in this Agreement, Developer shall submit plans for permit
approval by no later than 60 days from the date of approval of this Agreement. (2) For
purposes of this Section 5.02, "commence construction" of the Project means commencement
of meaningful physical development of that part of the Project as authorized by the Building
Permit therefor which is continued and prosecuted with reasonable diligence toward and with
the objective of completion of the Project.
b) (1) After the Commencement Date, Developer shall continue, pursue and
prosecute the construction of the Project with reasonable diligence to completion by the
Completion Date and shall not at any time actually or effectively have abandoned (or its
Contractor having actually or effectively abandoned) the Site. For purposes of this subsection
b), "abandoned" means to have ceased any construction work which effectively advances the
construction of the Project toward completion. Subject to Unavoidable Delay and the terms and
conditions in this Agreement, the Project shall be completed by no later than 7 months after
permits have been issued.
2) All obligations of Developer with respect to commencement, continuation
and completion of construction of the Project shall be subject to delays and extensions from
time to time for Unavoidable Delay. Developer shall not be deemed to be in default of this
Agreement to the extent construction or completion of the Project, or any part thereof, is not
complete by reason of Unavoidable Delay.
c) For purposes of this Section 5.02, "completion," "complete," "substantially
complete" or "substantial completion" means, with respect to construction of the co -working
facilities space of the Project, a Certificate of Occupancy for the co -working facilities space has
been issued by the City.
GM17-9311-025/21135511 ] 9
d) If the Agency believes adequate progress in the construction of the Project is not
being made, the Agency shall give notice to Developer that adequate progress is apparently not
being made in the construction of the Project and to respond within ten (10) business days
thereafter as to why adequate progress is or is not being made toward completion of the
Project.
5.03. Project Alterations or Improvements. During the construction of the Project,
Developer may, from time to time, make minor alterations and improvements, structural or
otherwise, to the Project as Developer deems desirable and consistent with the Project Plans
and Specifications for the use contemplated by this Agreement; provided, however, that prior to
the commencement of any material alterations or improvements of sufficient size and scope as
to constitute a material change in the previously approved Project Plans and Specifications,
Developer shall notify the Agency of such material change and may submit a change,
amendment or revision to the Project Plans and Specifications to the Agency for review. Any
change to the facade improvements during or after construction must be approved by the
Agency prior to implementation. Nothing in this Section 5.03 is intended nor shall be deemed to
limit or restrict the exercise of governmental or regulatory powers or authority by the City or any
other governmental entity or to enlarge its regulatory authority.
5.04. Completion Certificate.
a) (1) Upon the substantial completion of the construction of the Project in
accordance with the provisions of this Article 5, Developer shall prepare and execute the
Completion Certificate, which shall then be delivered to the Agency. Upon receipt of the
certificate the Agency shall promptly and diligently proceed to determine if construction of the
Project has been completed substantially in accordance with the Project Plans and
Specifications and this Agreement. Upon making such a determination, the Agency shall
execute the certificate and return it to Developer. The date of the Completion Certificate shall
be the date when all parties shall have executed said certificate.
2) The Completion Certificate shall constitute a conclusive determination by
the parties hereto of the satisfaction and termination of the obligations of Developer hereunder
to construct the Project; provided, however that nothing in this Section 5.04 shall be a waiver of
the rights, duties, obligations or responsibilities of the City or any other governmental entity
acting in its regulatory or governmental capacity or an approval of said construction for
purposes of the issuance of a certificate of occupancy for the Project. The remaining obligations
of Developer, including but not limited to the obligation to operate the Project as co -working
facilities for of a period of not less than five years shall survive and are not affected by the filling
of the Completion Certificate.
3) The parties agree that it is their intent that the review by the Agency for
purposes of the Completion Certificate determination pursuant to this Section 5.04 is not to be
an additional or duplicate inspection over and above that required for purposes of the Building
Permit, including the issuance of a certificate of occupancy. The Agency agrees that for
purposes of determining if the Project has been substantially completed in accordance with the
Project Plans and Specifications, the issuance of a certificate of occupancy for the Project shall
be a conclusive determination of substantial completion for purposes of this subsection (a) and,
if such certificate has been determined to have been issued, then the Agency agrees to execute
the Completion Certificate.
GM17-9311-025/2113551 1 ] 10
b) (1) If the Agency shall refuse or fail to execute the Completion Certificate
after receipt of a request by Developer to do so, then the Agency shall, within ten (10) days after
its receipt of such request, provide Developer with a written statement setting forth in
reasonable detail the reason(s) why the Agency has not executed the Completion Certificate
and what must be done by Developer to satisfy such objections so that the Agency would sign
the certificate. Upon Developer satisfying the Agency's objections, then Developer shall submit
a new request to the Agency for execution of the Completion Certificate and that request shall
be considered and acted upon in accordance with the procedures in paragraph (a)(1) for the
original request.
c) The Completion Certificate shall be in a form sufficient to be recorded in the
public records of Pinellas County, Florida. After execution by the Agency, it shall be promptly
returned to Developer who shall record the certificate in the public records of Pinellas County,
Florida, and pay the cost of such recording.
5.05. Agency Not in Privity with Contractors. The Agency shall not be deemed to be in
privity of contract with any Contractor or provider of goods or services with respect to the
construction of any part of the Project.
5.06 Developer's obligation to Operate Co -working facility. Developer shall have the
obligation to operate or assure the continued operation of the co -working facility as provided in
this Agreement for a period of no less than five(5) years from the Completion Date or
commencement of operation of the co -working facility whichever is later. Developer shall
provide a guarantee executed by the owner of the Site/Landlord (600 Cleveland, LLC) in the
form attached hereto as Exhibit L upon execution of this Agreement.
5.07 Annual Report. Developer shall file annually no later than December 31st of
each year a Report containing the information attached in Exhibit K.
5.08 Security for Developer's Performance. In consideration of the reimbursements
and payments made by the Agency pursuant to Article 6 hereof, Developer shall provide a
Performance Mortgage to secure the funds so paid, in substantially the form as set forth and
attached hereto as Exhibit C. Before any funds are paid, the mortgage shall be in place,
securing a first lien position on the property so identified for Agency payments. This obligation
and the Performance Mortgage provided hereto shall survive termination as provided in
paragraph 9.05 and 9.06. Pursuant to the provisions of Section 6.02 herein, the Agency shall
cancel and release the Performance Mortgage and the same shall be of no further force and
effect, at the earlier of (a) the end of the 5 -year period contemplated therein during which the
property is maintained as a co -working facility or (b) the date on which repayment is made
pursuant to the provisions of Section 6.03.
ARTICLE 6. PAYMENTS BY AGENCY.
6.01 Co -working Facilities Buildout Loan to Grant. The Agency shall reimburse
Developer for co -working facilities buildout and/or permanent fixtures for the project as specified
in Exhibit H in an amount not to exceed Six Hundred Thousand Dollars ($600,000.00).
Developer shall provide the Agency with documentation verifying expenditures for the co -
working facilities buildout. The documentation shall include invoices from the contractor for the
GM17-9311-025/211355/ 1 ] 11
work for which reimbursement is sought and proof of payment by Developer. Provided further,
that the total amount of reimbursement payments for said improvements shall not exceed 50%
of the total amount of expenditures made by Developer for the co -working facilities buildout. All
payments shall be made in accordance with the Local Government Prompt Payment Act,
Florida Statutes § 218.70.
6.02 Repayment by Developer. All payments by the Agency pursuant to this article 6
are subject to repayment by Developer if Developer fails to maintain the property as co -working
facilities for a period of five years as provided in § 5.06. If at any time during the first five years
following the issuance of the certificate of completion, the project fails to be operated as co -
working facilities, Developer shall repay to the Agency the amounts paid by the Agency
pursuant to this article. The amount to be repaid by the Developer shall be reduced by 20% for
each year the co -working facility is open and operating as provided in substantial compliance
with Exhibit G. Developer's obligation to repay the incentives provided herein shall be secured
by a performance mortgage as provided in section 5.06.
ARTICLE 7. REPRESENTATIONS, WARRANTIES AND COVENANTS
OF DEVELOPER.
7.01. Representations and Warranties. Developer represents and warrants to the
Agency that each of the following statements is currently true and accurate and agrees the
Agency may rely upon each of the following statements:
a) Developer is a Florida limited liability company duly organized and validly existing
under the laws of the State of Florida, has all requisite power and authority to carry on its
business as now conducted, to own or hold its properties and to enter into and perform its
obligations hereunder and under each document or instrument contemplated by this Agreement
to which it is or will be a party, is qualified to do business in the State of Florida, and has
consented to service of process upon a designated agent for service of process in the State of
Florida.
b) This Agreement and, to the extent such documents presently exist in form
accepted by the Agency and Developer, each document contemplated or required by this
Agreement to which Developer is or will be a party have been duly authorized by all necessary
action on the part of, and have been or will be duly executed and delivered by, Developer, and
neither the execution and delivery thereof, nor compliance with the terms and provisions thereof
or hereof: (1) requires the approval and consent of any other party, except such as have been
duly obtained or as are specifically noted herein, (2) contravenes any existing law, judgment,
governmental rule, regulation or order applicable to or binding on Developer, (3) contravenes or
results in any breach of, default under or, other than as contemplated by this Agreement, results
in the creation of any lien or encumbrance upon any property of Developer under any indenture,
mortgage, deed of trust, bank loan or credit agreement, Developer's articles of organization, or,
any other agreement or instrument to which Developer is a party or by which Developer may be
bound.
c) This Agreement and, to the extent such documents presently exist in form
accepted by the Agency and Developer, each document contemplated or required by this
Agreement to which Developer is or will be a party constitutes, or when entered into will
constitute, a legal, valid and binding obligation of Developer enforceable against Developer in
GM17-9311-025/211355/1] 12
accordance with the terms thereof, except as such enforceability may be limited by applicable
bankruptcy, insolvency or similar laws from time to time in effect which affect creditors' rights
generally and subject to usual equitable principles in the event that equitable remedies are
involved.
d) There are no pending or, to the knowledge of Developer, threatened actions or
proceedings before any court or administrative agency against Developer, or against any
controlling manager, member, employee or agent of Developer, which question the validity of
this Agreement or any document contemplated hereunder, or which are likely in any case, or in
the aggregate, to materially adversely affect the consummation of the transactions
contemplated hereunder or the financial condition of Developer.
e) Developer has filed or caused to be filed all federal, state, local and foreign tax
returns, if any, which were required to be filed by Developer, and has paid, or caused to be paid,
all taxes shown to be due and payable on such returns or on any assessments levied against
Developer.
f) All financial information and other documentation, including that pertaining to the
Project or Developer, delivered by Developer to the City and the Agency, was, on the date of
delivery thereof, true and correct.
g) The principal place of business and principal executive offices of Developer are
331 Cleveland Street, #2502, Clearwater, FL 33755 and, until the expiration or termination of
this Agreement, Developer will keep original or duplicate records concerning the Project (such
as construction contracts, financing documents and corporate documents) and all contracts,
licenses and similar rights relating thereto at an office located in the corporate limits of the City
of Clearwater.
h) As of the Effective Date, Developer has the financial capability to carry out its
obligations and responsibilities in connection with the development of the Project as
contemplated by this Agreement.
i) Developer (with the assistance of its Project Professionals) has the experience,
expertise, and capability to develop, cause the construction, and complete the Project and,
oversee and manage the design, planning, construction, and completion of the Project, and to
acquire the Site as provided herein.
7.02. Covenants. Developer covenants with the Agency that until the earlier of the
Termination Date or the Expiration Date:
a) Developer shall timely perform or cause to be performed all of the obligations
contained herein which are the responsibility of Developer to perform.
b) Developer shall assist and cooperate with the Agency to accomplish the
development of the Project by Developer in accordance with this Agreement, and the Project
Plans and Specifications and will not violate any laws, ordinances, rules, regulations, orders,
contracts or agreements that are or will be applicable thereto, including the Plan and the Act.
GM 17-9311-025/211355/1 ] 13
c) Subsequent to the Effective Date, Developer shall maintain its financial capability
to develop, construct, complete and maintain the Project and shall promptly notify the Agency of
any event, condition, occurrence, or change in its financial condition which materially adversely
affects, or with the passage of time is likely to adversely affect, Developer's financial capability
to successfully and completely develop, construct and complete the Project as contemplated
hereby.
d) Developer shall promptly cause to be filed when due all federal, state, local and
foreign tax returns required to be filed by it, and shall promptly pay when due any tax required
thereby so as to avoid an uncured tax lien against the Site.
e) Subject to and except as permitted by Section 7.01, prior to the expiration or
termination of this Agreement, Developer shall maintain its existence, will not dissolve or
substantially dissolve all of its assets and will not consolidate with or merge into another limited
liability company, corporation, limited partnership, or other entity without the prior approval of
the Agency, unless Developer is the surviving entity or retains a controlling interest in the
consolidated or merged entity, in which case no consent by Agency shall be required. In any
event, prior to the expiration or termination of this Agreement, Developer, will promptly notify the
Agency of any changes to the existence or form of the corporation of Developer.
f) Developer shall not sell, lease, transfer or otherwise dispose of all or
substantially all its assets without adequate consideration and will otherwise take no action
which shall have the effect, singularly or in the aggregate, of rendering Developer unable to
continue to observe and perform the covenants, agreements, and conditions hereof and the
performance of all other obligations required by this Agreement.
g) Provided all conditions precedent thereto have been satisfied or waived as
provided herein, Developer shall design, construct and complete the Project such that it is
substantially complete as provided in this Agreement no later than the Completion Date.
7.03 Covenant: Nondiscrimination. Developer covenants by and for itself and any
successors in interest that there shall be no discrimination against or segregation of any person
or group of persons on account of race, color, creed, religion, sex, marital status, ancestry or
national origin in the marketing, sale, lease, sublease, transfer, use, occupancy, tenure or
enjoyment of the site, nor shall Developer itself or any person claiming under or through it
establish or permit any such practice or practices of discrimination or segregation with reference
to the selection, location, number, use or occupancy of tenants, lessees, subtenants,
sublessees or vendees of the Site.
ARTICLE 8. REPRESENTATIONS, WARRANTIES AND COVENANTS
OF THE AGENCY.
8.01. Representations and Warranties. The Agency represents and warrants to
Developer that each of the following statements is currently true and accurate and agrees that
Developer may rely on each of the following statements:
GM17-9311-025/211355/1] 14
a) The Agency is a validly existing body corporate and politic of the State of Florida,
is the duly created community redevelopment agency of the City under Part III, Chapter 163,
Florida Statutes (known as the Community Redevelopment Act of 1969), has all requisite
corporate power and authority to carry on its business as now conducted and to perform its
obligations hereunder and under each document or instrument contemplated by this Agreement
to which it is or will be a party.
b) This Agreement and, to the extent such documents presently exist in form
accepted by the Agency and Developer, each document contemplated or required by this
Agreement to which the Agency is or will be a party have been duly authorized by all necessary
action on the part of, and have been or will be duly executed and delivered by, the Agency, and
neither the execution and delivery thereof, nor compliance with the terms and provisions thereof
or hereof (1) requires the approval and consent of any other party, except such as have been
duly obtained or as are specifically noted herein, (2) contravenes any existing law, judgment,
governmental rule, regulation or order applicable to or binding on the Agency, (3) contravenes
or results in any breach of, or default under or, other than as contemplated by this Agreement,
results in the creation of any lien or encumbrance upon any property of the Agency under any
indenture, mortgage, deed of trust, bank loan or credit agreement, applicable ordinances,
resolutions or, on the date of this Agreement, any other agreement or instrument to which the
Agency is a party, specifically including any covenants of any bonds, notes, or other forms of
indebtedness of the Agency outstanding on the Effective Date.
c) This Agreement and, to the extent such documents presently exist in form
accepted by the Agency and Developer, each document contemplated or required by this
Agreement to which the Agency is or will be a party constitute, or when entered into will
constitute, legal, valid and binding obligations of the Agency enforceable against the Agency in
accordance with the terms thereof, except as such enforceability may be limited by public policy
or applicable bankruptcy, insolvency or similar laws from time to time in effect which affect
creditors' rights generally and subject to usual equitable principles in the event that equitable
remedies are involved.
d) There are no pending or threatened actions or proceedings before any court or
administrative agency against the Agency, or against any officer of the Agency, which question
the validity of any document contemplated hereunder, or which are likely in any case, or in the
aggregate, to materially adversely affect the consummation of the transactions contemplated
hereunder or the financial condition of the Agency.
8.02. Covenants. The Agency covenants with Developer that until the earlier of the
Termination Date or the Expiration Date:
a) The Agency shall timely perform or cause to be performed all of the obligations
contained herein which are the responsibility of the Agency to perform.
b) During each year that this Agreement and the obligations of the Agency under
this Agreement shall be in effect, the Agency shall cause to be executed and to continue to be
in effect those instruments, documents, certificates, permits, licenses and approvals, and shall
cause to occur those events contemplated by this Agreement that are applicable to and are the
responsibility of the Agency.
GM 17-9311-025/211355/1 ] 15
c) The Agency shall assist and cooperate with Developer to accomplish the
development of the Project in accordance with this Agreement and the Project Plans and
Specifications, will carry out its duties and responsibilities contemplated by this Agreement, and
will not violate any laws, ordinances, rules, regulations, orders, contracts, or agreements that
are or will be applicable thereto, and, to the extent permitted by law, the Agency will not enact or
adopt or urge or encourage the adoption of any ordinances, resolutions, rules, regulations or
orders or approve or enter into any contracts or agreements, including issuing any bonds, notes,
or other forms of indebtedness, that will result in any provision of this Agreement to be in
violation thereof.
d) The Agency shall maintain its financial capability to carry out its responsibilities
as contemplated by this Agreement and shall notify Developer of any event, condition,
occurrence, or change in its financial condition which adversely affects, or with the passage of
time is likely to adversely affect, the Agency's financial capability to carry out its responsibilities
contemplated hereby.
ARTICLE 9. DEFAULT; TERMINATION.
9.01. Default by Developer.
a) Provided the Agency is not then in default of this Agreement under Section 9.02
hereof, there shall be an "event of default" by Developer upon the occurrence of any one or
more of the following after the Effective Date:
1) Developer shall fail to perform or comply with any material provision of
this Agreement applicable to it within the time prescribed therefor; provided, however, that
suspension of or delay in performance by Developer during any period in which the Agency is in
default of this Agreement as provided in Section 9.02 hereof will not constitute an event of
default by Developer under this subsection (a); or
2) Developer shall make a general assignment for the benefit of its creditors,
or shall admit in writing its inability to pay its debts as they become due or shall file a petition in
bankruptcy, or shall be adjudicated a bankrupt or insolvent, or shall file a petition seeking any
reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief
under any present or future statute, law or regulation or shall file an answer admitting, or shall
fail reasonably to contest, the material allegations of a petition filed against it in any such
proceeding, or shall seek or consent to or acquiesce in the appointment of any trustee, receiver
or liquidator of Developer or any material part of such entity's properties; or
3) Within sixty (60) days after the commencement of any proceeding by or
against Developer seeking any reorganization, arrangement, composition, readjustment,
liquidation, dissolution or similar relief under any present or future statute, law or regulation,
such proceeding shall not have been dismissed or otherwise terminated, or if, within sixty (60)
days after the appointment without the consent or acquiescence of Developer of any trustee,
receiver or liquidator of any of such entities or of any material part of any of such entity's
properties, such appointment shall not have been vacated.
b) (1) If an event of default by Developer described in subsection (a) above
shall occur, the Agency shall provide written notice thereof to Developer, and, if such event of
GM17-9311-0251211355111 16
default shall not be cured by Developer within thirty (30) days after receipt of the written notice
from the Agency specifying in reasonable detail the event of default by Developer, or if such
event of default is of such nature that it cannot be completely cured within such time period,
then if the Agency is not then in default of this Agreement and Developer shall not have
commenced to cure such default within such thirty (30) day period and shall not diligently
prosecute such cure to completion within such reasonable longer period of time as may be
necessary then, in addition to any remedy available under Section 9.03, the Agency may
terminate this Agreement or pursue any and all legal or equitable remedies to which the Agency
is entitled, provided, however, if Developer shall fail to cure such event of default within said
thirty (30) day or longer period or ceases to proceed diligently to timely cure such event of
default, then the Agency may proceed to enforce other available remedies without providing any
additional notice to Developer. The Agency shall have no obligation to make the payments
provided in Article 6 herein, while developer is in default.
2) Any attempt by the Agency to pursue any of the above referenced
remedies will not be deemed an exclusive election of remedy or waiver of the Agency's right to
pursue any other remedy to which either may be entitled.
3) Any time periods or deadlines provided in this Agreement shall be tolled
or extended by the amount of time to cure any event of default hereunder if such event affects
Developer's or Agency's ability to perform by such deadline or the expiration of such period.
c) In the event of a termination of this Agreement pursuant to this Section 9.01, the
Agency shall not be obligated to make or to continue to make any payments provided for in
Article 6.
9.02. Default by the Agency.
a) Provided Developer is not then in default under Section 9.01, there shall be an
event of default" by the Agency under this Agreement in the event the Agency shall fail to
perform or comply with any material provision of this Agreement applicable to it; provided,
however, that suspension of or delay in performance by the Agency during any period in which
Developer is in default of this Agreement as provided in Section 9.01 hereof will not constitute
an event of default by the Agency under this subsection (a).
b) If an event of default by the Agency described in subsection (a) shall occur,
Developer shall provide written notice thereof to the Agency, and, after expiration of the curative
period described in paragraph (c) below, may terminate this Agreement, institute an action to
compel specific performance of the terms hereof by the Agency or pursue any and all legal or
equitable remedies to which Developer is entitled; provided, however, if the event of default by
the Agency occurs on or prior to the Commencement Date, any monetary recovery by
Developer in any such action shall not include any lost profits or consequential damages and
shall be limited to bona fide third -party out-of-pocket costs and expenses, including reasonable
attorneys' fees, incurred by Developer in connection with the negotiation of this Agreement as
well as any investigation, due diligence, development, design or construction costs incurred by
Developer in connection with the proposed acquisition and development of the Site, unless any
such default by the Agency was willful and committed in bad faith with reckless disregard for the
rights of Developer.
GM17-9311-025/211355/1] 17
c) Developer may not terminate this Agreement or institute an action described in
paragraph (b) above if the Agency cures such event of default within thirty (30) days after
receipt by the Agency of written notice from Developer specifying in reasonable detail the event
of default by the Agency, or if any such event of default is of such nature that it cannot be
completely cured within such period, then within such reasonably longer period of time as may
be necessary to cure such default, provided however, if the Agency is proceeding diligently and
in good faith, the curative period shall be extended for a period of not exceeding an aggregate
of thirty (30) days without any approval or consent of Developer being required, but such
approval will be required (and shall be given or withheld in Developer's sole discretion) if the
curative period is to be extended beyond thirty (30) days after the notice of default has been
given by Developer to the Agency if the Agency has commenced to cure such default within
such thirty (30) day period and is diligently prosecuting such curative action to completion. The
Agency shall within said thirty (30) day period or such longer period promptly, diligently and in
good faith proceed to cure such event of default after receipt of the notice from Developer and
shall succeed in curing such event of default within said period of time, provided, however, if the
Agency shall fail to cure such event of default within said thirty (30) day or longer period or
ceases to proceed diligently to timely cure such event of default, then Developer may proceed
with its available remedies without providing any additional notice to the Agency.
d) Any attempt by Developer to pursue any of the remedies referred to in
paragraphs (a), (b), or (c) above will not be deemed an exclusive election of remedy or waiver of
Developer's right to pursue any other remedy to which it might be entitled.
e) Any time periods or deadlines provided in this Agreement shall be tolled or
extended by the amount of time to cure any event of default hereunder if such event affects
Developer's or Agency's ability to perform by such deadline or the expiration of such period.
9.03. Obligations, Rights and Remedies Cumulative. Unless specifically stated herein
to the contrary, the specified rights and remedies to which either the Agency or Developer are
entitled under this Agreement are not exclusive and are intended to be in addition to any other
remedies or means of redress to which the Agency or Developer may lawfully be entitled and
are not specifically prohibited by this Agreement. The suspension of, or delay in, the
performance of its obligations by Developer, while the Agency shall at such time be in default of
their obligations hereunder shall not be deemed to be an "event of default." The suspension of,
or delay in, the performance of the obligations by the Agency while Developer shall at such time
be in default of its obligations hereunder shall not be deemed to be an "event of default" by the
Agency.
9.04. Non -Action on Failure to Observe Provisions of this Agreement. The failure of
the Agency or Developer to promptly or continually insist upon strict performance of any term,
covenant, condition or provision of this Agreement, or any Exhibit hereto, or any other
agreement, instrument or document of whatever form or nature contemplated hereby shall not
be deemed a waiver of any right or remedy that the Agency or Developer may have, and shall
not be deemed a waiver of a subsequent default or nonperformance of such term, covenant,
condition or provision.
9.05. Termination.
GM17-9311-025/211355/1] 18
a) Developer and the Agency acknowledge and agree that as of the Effective Date
certain matters mutually agreed by the parties hereto are essential to the successful
development of the Project have not been satisfied or are subject to certain conditions, legal
requirements or approvals beyond the control of any of the parties hereto or which cannot be
definitely resolved under this Agreement. In recognition of these events or conditions, the
parties hereto mutually agree that, provided the appropriate or responsible party therefor
diligently and in good faith seeks to the fullest extent of its capabilities to cause such event or
condition to occur or be satisfied, the failure of the events or conditions listed in subsection (b)
below to occur or be satisfied shall not constitute an event of default by any party under this
Article 9, but may be the basis for a termination of this Agreement as provided in this Section
9.05.
b) In addition to any other rights of termination provided elsewhere in this
Agreement, this Agreement may be terminated as provided in subsection (c) after the
occurrence of any of the following events or conditions:
1) All of the Site is taken by the exercise of the power of eminent domain by
a governmental authority (except the City or the Agency) or a person entitled to exercise such
power or benefiting there from, or such part of the Site is taken by the power of eminent domain
so as to render the Project commercially unfeasible or unusable for its intended uses as
contemplated by this Agreement;
2) The appropriate governmental authority (but not including the City in
exercise of its governmental and regulatory authority and responsibility), upon petition by
Developer, unduly delays or denies or fails to issue the Permits, issue the Building Permits, or
approve any other land use approval necessary to commence construction of the Project on the
Site;
3) A moratorium on new construction is imposed by a governmental
authority within the City or Pinellas County so as to prevent construction of the Project to
commence;
4) The City or other appropriate governmental authority has issued a
concurrency compliance certificate or a reservation of services capacity as described in Section
3.05 and such certificate or reservation has been revoked, repealed, superseded, or otherwise
no longer of any effect or Developer is unable to rely upon such certificate or reservation, if such
a certificate or reservation is required for development of the Project on the Site, and Developer
cannot obtain a new or replacement certificate or reservation for the Project.
5) The City approves an amendment to the Plan which is inconsistent with
the Project being located on the Site.
c) Upon the occurrence of an event described in subsection (b), then Developer or
the Agency may upon determining that such event cannot reasonably be expected to change in
the foreseeable future so as to allow development of the Project, may elect to terminate this
Agreement by giving a notice to the other party hereto within thirty (30) days of the occurrence
of such event or the determination of inability to cause a condition precedent to occur or be
satisfied, stating its election to terminate this Agreement as a result thereof, in which case this
GM17-9311-025/211355/1 ] 19
Agreement shall then terminate, provided, however, only Developer may elect to terminate this
Agreement upon the occurrence of an event described in paragraph (5).
d) In the event of a termination pursuant to Section 9.05(b), neither Developer nor
the Agency shall be obligated or liable one to the other in any way, financially or otherwise, for
any claim or matter arising from or as a result of this Agreement or any actions taken by
Developer and the Agency, or any of them, hereunder or contemplated hereby, and each party
shall be responsible for its own costs.
e) Notwithstanding anything to the contrary contained herein, in the event that any
party shall have, but shall not exercise, the right hereunder to terminate this Agreement
because of the non -satisfaction of any condition specified herein, and such condition is
subsequently satisfied, then the non -satisfaction of such condition shall no longer be the basis
for termination of this Agreement.
9.06. Termination Certificate.
a) In the event of a termination of this Agreement as provided in 9.05 prior to the
Expiration Date, each of the parties hereto do covenant and agree with each other to promptly
execute a certificate prepared by the party electing to terminate this Agreement, which
certificate shall expressly state that this Agreement has been terminated in accordance with its
terms, is no longer of any force and effect except for those provisions hereof which expressly
survive termination, that the rights, duties and obligations of the parties hereto have been
terminated and released (subject to those surviving provisions hereof, including but not limited
to paragraph 5.06) and that the Site is no longer subject to any restrictions, limitations or
encumbrances imposed by this Agreement.
b) The certificate described in subsection (a) shall be prepared in a form suitable for
recording and promptly after execution by all of the parties hereto shall be recorded in the public
records of Pinellas County, Florida. The cost of recording the termination certificate shall be
paid by the terminating party.
9.07 Remedies. All remedies provided for herein and under Florida law shall be
cumulative and shall survive the technical termination of this Agreement pursuant to execution,
delivery and recordation of a Termination Certificate or otherwise hereunder.
ARTICLE 10. UNAVOIDABLE DELAY.
10.01. Unavoidable Delay.
a) Any delay in performance of or inability to perform any obligation under this
Agreement (other than an obligation to pay money) due to any event or condition described in
paragraph (2) as an event of "Unavoidable Delay" shall be excused in the manner provided in
this Section 10.01.
b) "Unavoidable Delay" means any of the following events or conditions or any
combination thereof: acts of God, acts of the public enemy, riot, insurrection, terrorist attack,
war, pestilence, archaeological excavations required by law, unavailability of materials after
timely ordering of same, epidemics, quarantine restrictions, freight embargoes, fire, lightning,
GM 17-9311-025/2113 55/ 1 ] 20
hurricanes, earthquakes, tornadoes, floods, extremely abnormal and excessively inclement
weather (as indicated by the records of the local weather bureau for a five-year period
preceding the Effective Date), strikes or labor disturbances, delays due to proceedings under
Chapters 73 and 74, Florida Statutes, restoration in connection with any of the foregoing or any
other cause beyond the reasonable control of the party performing the obligation in question,
including, without limitation, such causes as may arise from the act of the other party to this
Agreement, or acts of any governmental authority (except that acts of the Agency shall not
constitute an Unavoidable Delay with respect to performance by the Agency).
c) An application by any party hereto (referred to in this paragraph (c) and in
paragraph (d) as the "Applicant") for an extension of time pursuant to subsection (a) must be in
writing, must set forth in detail the reasons and causes of delay, and must be filed with the other
party to this Agreement within thirty (30) days following the occurrence of the event or condition
causing the Unavoidable Delay or thirty (30) days following the Applicant becoming aware (or
with the exercise of reasonable diligence should have become aware) of such occurrence.
d) The Applicant shall be entitled to an extension of time for an Unavoidable Delay
only for the number of days of delay due solely to the occurrence of the event or condition
causing such Unavoidable Delay and only to the extent that any such occurrence actually
delays that party from proceeding with its rights, duties and obligations under this Agreement
affected by such occurrence.
ARTICLE 11. MISCELLANEOUS.
11.01. Assignments.
a) (1) Prior to the earlier of the Termination Date or the Expiration Date,
Developer may sell, convey, assign or otherwise dispose of any or all of its right, title, interest
and obligations in and to the Project, or any part thereof to any person with the prior written
consent of the Agency, which shall not be unreasonably withheld, provided that such party
hereinafter referred to as the "assignee"), to the extent of the sale, conveyance, assignment or
other disposition by Developer to the assignee, shall be bound by the terms of this Agreement
the same as Developer for such part of the Project as is subject to such sale, conveyance,
assignment or other disposition, except for the sale of a condominium in the ordinary course of
business.
2) If the assignee of Developer's right, title, interest and obligations in and to
the Project, or any part thereof, assumes all of Developer's obligations hereunder for the
Project, or that part subject to such sale, conveyance, assignment or other disposition, then
Developer shall be released from all such obligations hereunder which have been so assumed
by the assignee, and the Agency agrees to execute an instrument evidencing such release,
which shall be in recordable form.
b) An assignment of the Project, or any part thereof, by Developer to any
corporation, limited partnership, general partnership, or joint venture, in which Developer is the
or a general partner or has either the controlling interest or through a joint venture or other
arrangement shares equal management rights with a financial institution and maintains such
controlling interest or equal management rights for the term of this Agreement shall not be
deemed an assignment or transfer subject to any restriction on or approvals of assignments or
GM17-9311-025/211355/1] 21
transfers imposed by this Section 11.01, provided, however, that notice of such assignment
shall be given by Developer to the Agency no Tess than thirty (30) days prior to such assignment
being effective and the assignee shall be bound by the terms of this Agreement to the same
extent as would Developer in the absence of such assignment. If Developer shall at any time
withdraw or be replaced as a general partner or no longer have the controlling interest or
management rights as described in this subsection, then that event shall constitute an
assignment of Developer's right, title, interest or obligations under this Agreement for purposes
of this Section 11.01 and the prior approval of the Agency shall be obtained before such an
event shall be effective.
11.02. Successors and Assigns. The terms herein contained shall bind and inure to the
benefit of the Agency, and its successors and assigns, and Developer, and its successors and
assigns, except as may otherwise be specifically provided herein.
11.03. Notices.
a) All notices, demands, requests for approvals or other communications given by
either party to another shall be in writing, and shall be sent by registered or certified mail,
postage prepaid, return receipt requested or by overnight courier service, facsimile
transmission, or by hand delivery to the office for each party indicated below and addressed as
follows:
To Developer: To the Agency:
Daniels Ikajevs
The Ring Workspaces, LLC
331 Cleveland St., #2502
Clearwater, FL 33755
FAX # (727)
with copies to:
David E. Platte, Esq.
Trask Daigneault, LLP
1001 S. Ft. Harrison Ave., Suite 201
Clearwater, FL 33756
Attention: David E. Platte
Phone: (727) 733-0494
Fax #: (727) 733-2991
Community Redevelopment Agency of
the City of Clearwater
112 S. Osceola Avenue
Clearwater, FL 33756
Attention: Seth Taylor
FAX # (727) 562-4052
with copies to:
Pamela K. Akin, City Attorney
City of Clearwater
112 S. Osceola Avenue
Clearwater, FL 33756
Attention: City Attorney
FAX # (727) 562-4021
GM 17-9311-025/211355/1 ] 22
b) Notices given by courier service or by hand delivery shall be effective upon
delivery and notices given by mail shall be effective on the third (3rd) business day after mailing.
Refusal by any person to accept delivery of any notice delivered to the office at the address
indicated above (or as it may be changed) shall be deemed to have been an effective delivery
as provided in this Section 11.03. The addresses to which notices are to be sent may be
changed from time to time by written notice delivered to the other parties and such notices shall
be effective upon receipt. Until notice of change of address is received as to any particular
party hereto, all other parties may rely upon the last address given.
11.04. Severabilitv. If any term, provision or condition contained this Agreement shall,
to any extent, be held invalid or unenforceable, the remainder of this Agreement, or the
application of such term, provision or condition to persons or circumstances other than those in
respect of which it is invalid or unenforceable, shall not be affected thereby, and each term,
provision and condition of this Agreement shall be valid and enforceable to the fullest extent
permitted by law.
11.05. Applicable Law and Construction. The laws of the State of Florida shall govern
the validity, performance and enforcement of this Agreement. This Agreement has been
negotiated by the Agency and Developer, and the Agreement, including, without limitation, the
Exhibits, shall not be deemed to have been prepared by the Agency or Developer, but by all
equally.
11.06. Venue; Submission to Jurisdiction.
a) For purposes of any suit, action, or other proceeding arising out of or relating to
this Agreement, the parties hereto do acknowledge, consent, and agree that venue thereof is
Pinellas County, Florida.
b) Each party to this Agreement hereby submits to the jurisdiction of the State of
Florida, Pinellas County and the courts thereof and to the jurisdiction of the United States
District Court for the Middle District of Florida, for the purposes of any suit, action, or other
proceeding arising out of or relating to this Agreement and hereby agrees not to assert by way
of a motion as a defense or otherwise that such action is brought in an inconvenient forum or
that the venue of such action is improper or that the subject matter thereof may not be enforced
in or by such courts.
c) If at any time during the term of this Agreement Developer is not a resident of the
State of Florida or has no office, employee, agency or general partner thereof available for
service of process as a resident of the State of Florida, or if any permitted assignee thereof shall
be a foreign corporation, partnership or other entity or shall have no officer, employee, agent, or
general partner available for service of process in the State of Florida, Developer hereby
designates the Secretary of State, State of Florida, its agent for the service of process in any
court action between it and the Agency arising out of or relating to this Agreement and such
service shall be made as provided by the laws of the State of Florida for service upon a
non-resident; provided, however, that at the time of service on the Florida Secretary of State, a
copy of such service shall be delivered to Developer at the address for notices as provided in
Section 11.03.
GM17-9311-025/211355/1] 23
11.07. Agreement Not a Chapter 86-191, Laws of Florida, Development Agreement.
Developer and the Agency acknowledge, agree and represent that this Agreement, including,
without limitation, any of the Exhibits, is not a development agreement as described in Sections
19-31, Chapter 86-191, Laws of Florida, codified as Sections 163.3220-163.3243, Florida
Statutes.
11.08. Estoppel Certificates. Developer and the Agency shall at any time and from time
to time, upon not Tess than ten (10) days prior notice by another party hereto, execute,
acknowledge and deliver to the other parties a statement in recordable form certifying that this
Agreement has not been modified and is in full force and effect (or if there have been
modifications that the said Agreement as modified is in full force and effect and setting forth a
notation of such modifications), and that to the knowledge of such party, neither it nor any other
party is then in default hereof (or if another party is then in default hereof, stating the nature and
details of such default), it being intended that any such statement delivered pursuant to this
Section 11.08 may be relied upon by any prospective purchaser, mortgagee, successor,
assignee of any mortgage or assignee of the respective interest in the Project, if any, of any
party made in accordance with the provisions of this Agreement.
11.09. Complete Agreement; Amendments.
a) This Agreement, and all the terms and provisions contained herein, including
without limitation the Exhibits hereto, constitute the full and complete agreement between the
parties hereto to the date hereof, and supersedes and controls over any and all prior
agreements, understandings, representations, correspondence and statements whether written
or oral, including the RFP and the Proposal.
b) Any provisions of this Agreement shall be read and applied in para materia with
all other provisions hereof.
c) This Agreement cannot be changed or revised except by written amendment
signed by all parties hereto.
11.10. Captions. The article and section headings and captions of this Agreement and
the table of contents preceding this Agreement are for convenience and reference only and in
no way define, limit, describe the scope or intent of this Agreement or any part thereof, or in any
way affect this Agreement or construe any article, section, subsection, paragraph or provision
hereof.
11.11. Holidays. It is hereby agreed and declared that whenever a notice or
performance under the terms of this Agreement is to be made or given on a Saturday or Sunday
or on a legal holiday observed in the City, it shall be postponed to the next following business
day.
11.12. Exhibits. Each Exhibit referred to and attached to this Agreement is an essential
part of this Agreement. The Exhibits and any amendments or revisions thereto, even if not
physically attached hereto shall be treated as if they are part of this Agreement.
11.13. No Brokers. The Agency and Developer hereby represent, agree and
acknowledge that no real estate broker or other person is entitled to claim or to be paid a
GM 17-9311-025/211355/1 ] 24
commission as a result of the execution and delivery of this Agreement, including any of the
Exhibits, or any proposed improvement, use, disposition, lease, conveyance or acquisition of
any or all of the Site.
11.14. Not an Agent. During the term of this Agreement, Developer hereunder shall not
be an agent of the City or the Agency, with respect to any and all services to be performed by
Developer (and any of its agents, assigns, or successors) with respect to the Project, and the
Agency is not an agent of Developer (and any of its agents, assigns, or successors).
11.15. Memorandum of Development Agreement. The Agency and Developer agree to
execute, in recordable form, on the Effective Date, the short form "Memorandum of Agreement
for Development," the form of which is attached hereto as Exhibit D , and agree, authorize and
hereby direct such Memorandum to be recorded in the public records of Pinellas County,
Florida, as soon as possible after execution thereof. The Agency shall pay the cost of such
recording.
11.16. Public Purpose. The parties acknowledge and agree that this Agreement
satisfies, fulfills and is pursuant to and for a public purpose and municipal purpose and is in the
public interest, and is a proper exercise of the Agency's power and authority under the Act.
11.17. No General Obligation. In no event shall any obligation of the Agency under this
Agreement be or constitute a general obligation or indebtedness of the City or the Agency, a
pledge of the ad valorem taxing power of the City or the Agency or a general obligation or
indebtedness of the City or the Agency within the meaning of the Constitution of the State of
Florida or any other applicable laws, but shall be payable solely from legally available revenues
and funds. Neither Developer nor any other party under or beneficiary of this Agreement shall
ever have the right to compel the exercise of the ad valorem taxing power of the City, the
Agency or any other governmental entity or taxation in any form on any real or personal
property to pay the City's or the Agency's obligations or undertakings hereunder.
11.18. Technical Amendments. In the event that due to minor inaccuracies contained
herein or any Exhibit attached hereto or any other agreement contemplated hereby, or due to
changes resulting from technical matters arising during the term of this Agreement, the parties
agree that amendments to this Agreement required due to such inaccuracies, unforeseen
events or circumstances which do not change the substance of this Agreement may be made
and incorporated herein. The Chairman of the Agency is authorized to approve such technical
amendments on behalf of the Agency, respectively, and is authorized to execute any required
instruments, to make and incorporate such amendment to this Agreement or any Exhibit
attached hereto or any other agreement contemplated hereby.
11.19. Term; Expiration; Certificate.
a) If not earlier terminated as provided in Section 9.05, the term of this Agreement
shall expire and this Agreement shall no longer be of any force and effect (except for those
matters which specifically survive such expiration) on the seventh (7th) anniversary of the
Effective Date.
b) Upon completion of the term of this Agreement, all parties hereto shall execute
the Agreement Expiration Certificate. The Agreement Expiration Certificate shall constitute (and
GM17-9311-025/211355/1] 25
it shall be so provided in the certificate) a conclusive determination of satisfactory completion of
all obligations hereunder and the expiration of this Agreement.
c) The Agreement Expiration Certificate shall be in such form as will enable it to be
recorded in the public records of Pinellas County, Florida. Following execution by all of the
parties hereto, the Agreement Expiration Certificate shall promptly be recorded by Developer in
the public records of Pinellas County, Florida, and Developer shall pay the cost of such
recording.
11.20. Effective Date. Following execution of this Agreement (and such of the Exhibits
as are contemplated to be executed simultaneously with this Agreement) by the authorized
officers of the Agency and by authorized representatives of Developer following approval hereof
by the Agency and Developer, this Agreement (and any executed Exhibits) shall be in full force
and effect in accordance with its terms and upon the recording of the Memorandum of
Development Agreement as contemplated by Section 11.15 hereof. Upon termination of the
Development Agreement or expiration of its term, the Agency and Developer shall execute a
release of the recorded Memorandum of the Development Agreement. A copy of said release is
attached hereto as Exhibit M.
11.21 Miscellaneous
a) Developer shall be authorized to utilize the parking spaces designated for The
Ring or members of The Ring including Agency and Spark partners for nights, weekends and
special event parking as agreed upon between Developer and the CRA Director. However, in
such case, no less than 10 spaces shall be marked and reserved for The Ring tenants during at
all times.
b) Developer shall be allowed to substitute collateral for the Performance Mortgage,
reasonably satisfactory to Agency. However substituting collateral in no way alters or releases
Developers obligation to provide 60 parking spaces for exclusive use of The Ring at 630 Laura
Street, as provided herein.
IN WITNESS W5EOF, the rties hereto have set their hands and their respective
seals affixed as of this day of NWT) 2017.
COMMUNITY REDEVELOPMENT AGENCY OF
THE CITY OF CLEARWATER, FLORIDA
By: — crOr1 r rA k5
George N. Cretekos
Chairperson
Approved as t form: Attest:
amela K. A n Rosemarie Call
City Attorney City Clerk
GM17-9311-025/211355/1 ] 26 iO
DEVELOPMENT AGREEMENT
The Ring Workspaces, LLC, 600 Cleveland St.)
Witnesses: The Ring Workspaces, LLC,
a Florida limited liability company
STATE OF FLORIDA
COUNTY OF PINELLAS
By
Dan s revs, it Managing Member
The foregoing instrument was acknowledged before me this j 3 day of
CAI 7ej , 201tbyby Daniels Ikajevs, Managing Member of The Ring Workspaces, LLC,
a Florida limited liability com an and on behalf of said company. He is personally known to me
or have p alid driver's Iicens as identification.
SEAL)
rinted/Typed Name:
Notary Public -State of Florida
Commission Number:
GM17-9311-025121135511] 27
601 "
tes, Notary Public State of Florida
Valerie R McHargue
c I My Commission FF 992616
a Or Expires 0611512020
LIST OF EXHIBITS
EXHIBIT A Legal Description
EXHIBIT B Project Plans and Specifications
EXHIBIT C Performance Mortgage
EXHIBIT D Memorandum of Agreement for Development
EXHIBIT E Agreement Expiration Certificate
EXHIBIT F Agreement Termination Certificate
EXHIBIT G Business Plan
Exhibit H Budget and CRA construction contributions
Exhibit I City Membership Plan with floor plan
Exhibit J Lease between 600 Cleveland, LLC and The Ring Workspaces,
LLC
Exhibit K Annual Report
Exhibit L Landlord Guarantee
Exhibit M Release of Memorandum of Development Agreement
GM17-9311-025/211355/1] 29
I"MINIMI+
Blumberg Na5192
Fidelity Natiionraal TInsuncoitle'
File No.: 421300496TS
Policy No.: FL6751-10-421300496TS-2013.2730609-89882237
EXHIBIT 'A'
PARCEL 1
Lot 1, of CLEARWATER TOWER, according to the plat thereof, as recorded in Plat Book 104,
Pages 81 and 82, inclusive, of the public records of Pinellas County, Florida.
AND
PARCEL 2
Lots 1 through 10, Block 6, GOULD & EWING'S 1ST AND 2ND ADDITION TO CLEARWATER
HARBOR FLA, according to the plat thereof recorded in Plat Book 1, Page 52, of the public
records of Hillsborough County, Florida, of which Pinellas County was formerly a part. Said land
now lying and being in Pinellas County Florida.
AND
PARCEL 3
Lots 3 and 6, Block 5, GOULD & EWING'S 1ST AND 2ND ADDITION TO CLEARWATER HARBOR
FLA, according to the plat thereof recorded in Plat Book 1, Page 52, of the public records of
Hillsborough County, Florida, of which Pinellas County was formerly a part. Said land now lying
and being in Pinellas County Florida.
THE TELEPHONE NUMBER TO PRESENT INQUIRIES OR OBTAIN INFORMATION ABOUT
COVERAGE AND TO PROVIDE ASSISTANCE IS 1-800-669-7450
THIS POLICY VALID ONLY IF SCHEDULE B IS ATTACHED
ALTA Owner's Policy
6/17/06) (with Florida
30609 4 of 4 Modifications)
Copyright American Land Title Association. All rights reserved. The use of this Form is
restricted to ALTA licensees and ALTA members in good standing as of the date of use. Ail other
uses are prohibited. Reprinted under license from the American Land Title Association
1EXHIBIT
Implementation Plan
c;;] THE RING
Tasks
Financial Grant A royal
Attain Building Permits
Finalize contract with GC
Order Furniture in Time for delivery and
installation
Install VAV, duct, airterminals and Coz
and Air . ualit Sensors
Install network cabling, Poe Lights and
com.lete electrical . rid
Completed Plumbing
Purchase Printers, Coffee Machine, TV's,
Telephones and supplies
Develop Website, CRM and payment
system
Pre -sale . romotion beg ins
Set U. Social Media Accounts
Marketing and Advertisin.
Floors Installation Com .lete
Overall Construction com . lete
Recruitment of Community Manager and
Front Desk
Grand O.enin.
TIMELINE (Weeks)
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ISSUE DATE
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REVISIONS
SHEET
EXHIBIT C
PREPARED BY AND RETURN TO:
KEN BURKE, CLERK OF COURT
AND COMPTROLLER PINELLAS COUNTY, FL
INST# 2018054785 02/21/2018 04:46 PM
OFF REC BK: 19949 PG: 1638-1653
DocType:MTGET RECORDING: $137.60
NO DOCUMENTARY STAMP TAXES ARE DUE ON THIS MORTGAGE BECAUSE IT
SECURES THE PERFORMANCE OF AN OBLIGATION, NOT THE PAYMENT OF
MONEY.
PERFORMANCE MORTGAGE
THIS PERFORMANCE MORTGAGE, made and entered into this LS day ofNovembey , 2017, between THE RING WORKSPACES, LLC, a Florida limited liability
company, hereinafter referred to as "Mortgagor", whose mailing address is: 331 Cleveland Street
2502, Clearwater, Florida 33755, and COMMUNITY REDEVELOPMENT AGENCY OF
THE CITY OF CLEARWATER, FLORIDA, a public body corporate and politic of the State
of Florida created pursuant to Part III, Chapter 163, Florida Statutes, hereinafter referred to as
Mortgagee", whose mailing address is: 112 S. Osceola Avenue, Clearwater, FL 33756,
WITNESSETH:
WHEREAS, Mortgagor and Mortgagee entered into that certain Development Agreement
dated Atma 1be/ /5 , 2017, [the "Agreement"], a memorandum of which Agreement is
to be recorded simultaneously herewith, wherein it is agreed that the Mortgagor has certain
development obligations as to that certain land situate in Pinellas County, Florida, as described in
Exhibit "A" attached hereto; and
WHEREAS, until the Termination Date or Expiration Date of the Agreement, it is the
intention by virtue of this Mortgage to secure the full performance by the Mortgagor, in accordance
with the said Agreement and proper application of all credits and fees applicable or payable from
Mortgagee to Mortgagor under said Agreement in the amount of Six Hundred Thousand and
00/100 dollars ($600,000.00); it is
NOW, THEREFORE, to secure the performance and observance by Mortgagor of all
covenants and conditions in the Agreement and in this Mortgage and in all other instruments
securing the Agreement, and in order to charge the properties, interest and rights hereinafter
described with such payment, performance and observance and for and in consideration ofthe sum
of One Dollar ($1.00) paid by Mortgagee to Mortgagor this date, and for other valuable
considerations as provided in the Agreement, the receipt of which is acknowledged, Mortgagor
does hereby grant, bargain, sell, alien, remise, release, convey, assign, transfer, mortgage,
hypothecate, pledge, deliver, set over, warrant and confirm unto Mortgagee, its successors and
assigns forever, the property described in Exhibit "A" attached hereto and made a part hereof by
reference and situated in Pinellas County, Florida.
TOGETHER with all buildings, structures and improvements of every nature whatsoever
now or hereafter situated on the land, and all fixtures, machinery, appliances, equipment, furniture,
and personal property of every nature whatsoever now or hereafter owned by Mortgagor and
GM17-9311-025/209183/1 ]
1
located in or on, or attached to, or used or intended to be used in connection with or without the
operation of, the land, buildings, structures or other improvements, and owned by Mortgagor,
including all extensions, additions, improvements, betterments, renewals, substitutions, and
replacements to any of the foregoing and all of the right, title and interest of mortgagor in and to
any such personal property or fixtures.
TOGETHER with all easements, rights ofway, streets, ways, alleys, passages, sewer rights,
waters, water courses, water rights and powers, and all tenements, hereditaments and
appurtenances whatsoever, in any way belonging, relating or appertaining to any of the property
hereinabove described, or which hereafter shall in any way belong, relate or be appurtenant thereto,
whether now owned or hereafter acquired by Mortgagor, and the reversion and reversions,
remainder and remainders, and all the estate, right, title, interest, property, possession, claim and
demand whatsoever, at law as well as in equity, of Mortgagor of, in and to the same.
TOGETHER with all rents, royalties, issues, profits, revenue, income and other benefits
from the property described herein, to be applied against the indebtedness and other sums secured
hereby, provided, however, that permission is hereby given to Mortgagor so long as no default has
occurred hereunder, to collect, receive, take, use and enjoy such rents, royalties, issues, profits,
revenue, income and other benefits as they become due and payable, but not in advance thereof.
The foregoing assignment shall be fully operative without any further action on the part of either
party and specifically Mortgagee shall be entitled, at its option, upon the occurrence of a default
hereunder, to all rents, royalties, issues, profits, revenue, income, and other benefits from the
property whether or not Mortgagee takes possession of the property. Upon any such default
hereunder, the permission hereby given to Mortgagor to collect such rents, royalties, issues, profits,
revenue, income and other benefits from the property shall terminate and such permission shall
not be reinstated upon a cure of the default without Mortgagee's specific consent. Neither the
exercise of any rights under this paragraph by Mortgagee nor the application of any such rents,
royalties, issues, profits, revenue, income or other benefits to the indebtedness and other sums
secured hereby, shall cure or waive any default or notice of default hereunder or invalidate any act
done pursuant hereto or to any such notice, but shall be cumulative ofall other rights and remedies.
TOGETHER with a security interest in all articles of personal property and all materials
delivered to the property described herein for use in any construction being conducted thereon,
and owned by Mortgagor, and all contract rights, general intangibles, actions and rights in action,
including all rights to insurance proceeds, and all proceeds, products, replacements, additions,
substitutions, renewals and accessions of any of the foregoing. This Mortgage is a self -operative
security agreement with respect to such property, but Mortgagor agrees to execute and deliver on
demand such other security agreements, financing statements and other instruments as Mortgagee
may request in order to perfect its security interest or to impose the lien hereof more specifically
upon any of such property. Mortgagee shall have all the rights and remedies in addition to those
specified herein of a secured party under the Uniform Commercial Code ofFlorida.
ALL OF WHICH real and personal property, rights and intangibles are herein referred to
as the "Mortgaged Property".
0M17-9311-025/209183/1 ]
2
TO HAVE AND TO HOLD the Mortgaged Property and all parts thereof unto Mortgagee,
its successors and assigns, to its own property use and benefit forever, subject, however, to the
terms and conditions herein.
PROVIDED ALWAYS, that ifall obligations are timely performed and the warranties and
conditions of this Mortgage are complied with, this Mortgage shall be null and void, and so long
as Mortgagor is not in default under the Agreement, it shall be entitled to the full benefit of its
contract rights under said Agreement.
Mortgagor covenants and agrees with Mortgagee as follows:
ARTICLE ONE
COVENANTS OF MORTGAGOR
1.01 Performance of Agreement, Mortgage. Mortgagor shall perform, observe and
comply with all provisions hereof, of the Agreement and of every other instrument securing the
Agreement.
1.02 Warranty of Title. Mortgagor covenants and warrants that it is seized of an
indefeasible estate in fee simple in the real property hereby mortgaged, has good and absolute title
to all existing personal property hereby mortgaged or made subject to the security interest hereby
created and has good right, full power and lawful authority to convey, mortgage and encumber the
same as provided herein; that Mortgagee may at all times peaceably and quietly enter upon, hold,
occupy and enjoy the real property hereby mortgaged and every part thereof; that the real property
and all existing personal property hereby mortgaged or made subject to the security interest hereby
created is free and clear of all liens, security interests, charges and encumbrances whatsoever,
except for easements of record and the lien for property taxes not yet due and payable and any
mortgage described in Section 3.01 below. Mortgagor shall and will make such further assurances
to perfect Mortgagee's fee simple title to the real property hereby mortgaged, and the title to the
personal property hereby mortgaged or made subject to the security interest hereby created as may
reasonably be required. Except as herein provided, Mortgagor fully warrants the title to the real
property and all existing personal property hereby mortgaged or made subject to the security
interest hereby created, and every part hereof, and will forever defend the same against the claims
of all persons whomsoever.
1.03 Taxes and Liens.
A. Mortgagor shall pay promptly, when and as due, and shall promptly exhibit to
Mortgagee receipts for the payment of, all taxes, assessments, rates, dues, charges, fees, levies,
fines, impositions, liens, liabilities, obligations and encumbrances of every kind whatsoever now
or hereafter imposed, levied or assessed upon or against the Mortgaged Property or any part
thereof, and any charge which, if unpaid, would become a lien or charge upon the Mortgaged
Property prior to or equal to the lien of this mortgage, before they become delinquent and before
any interest attaches or any penalty is incurred.
B. Mortgagor shall not permit or suffer any mechanics', laborers', materialmen's,
statutory or other lien which might or could be prior or equal to the lien of this Mortgage to be
created or to remain a lien upon any of the Mortgaged Property.
0M17-9311.0251209183/1)
3
1.04 Insurance.
A. ,Mortgagor shall at its sole expense obtain for, deliver to and maintain for the benefit
of Mortgagee, during the life ofthis Mortgage, insurance policies in such amounts as Mortgagee
may require, insuring the Mortgaged Property against fire, flood, extended coverage, and such
other insurable hazards, casualties, contingencies and public liability insurance, as Mortgagee may
require, and shall pay promptly, when due, any premiums on such insurance policies and on any
renewals thereof. The form of such policies and the companies issuing them shall be acceptable to
Mortgagee. All such policies and renewals thereof shall be held by Mortgagee and shall contain a
non-contributory mortgagee endorsement making losses payable to Mortgagee subject to the rights
of any mortgagee described in Section 3.01 below. The coverage under such policies shall be
limited to the improvements now or hereafter located on the Mortgaged Property. At least fifteen
15) days prior to the expiration date of all such policies, renewals thereof satisfactory to
Mortgagee shall be delivered to Mortgagee, Mortgagor shall deliver to Mortgagee receipts
evidencing the payment of all premiums on such insurance policies and renewals. Delivery of the
insurance policies and renewals thereof shall constitute an assignment to Mortgagee, as further
security, of all unearned premiums. In the event of loss, Mortgagor will give immediate written
notice to Mortgagee and Mortgagee may make proof of loss if not made promptly by Mortgagor.
In the event of the foreclosure of this Mortgage or any other transfer of title to the Mortgaged
Property in extinguishment of the indebtedness and other sums secured hereby, all right, title and
interest of Mortgagor in and to all insurance policies and renewals thereof then in force shall pass
to the purchaser or grantee.
B. Mortgagor hereby assigns to Mortgagee all proceeds from any insurance policies,
and Mortgagee is hereby authorized and empowered, at its option, to adjust or compromise any
loss under any insurance policies on the Mortgaged Property, and to collect and receive the
proceeds from any such policy or policies. Each insurance company is hereby authorized and
directed to make payment for all such losses directly to Mortgagee alone, and not to Mortgagor
and Mortgagee jointly. After deducting from such insurance proceeds any expenses incurred by
Mortgagee in the collection or handling of such funds, Mortgagee may apply the net proceeds, at
its option, either toward restoring the improvements or as a credit on any portion of the
indebtedness and other sums secured hereby, whether then matured or to mature in the future, or
at the option of Mortgagee such sums either wholly or in part may be paid over to the Mortgagor
to be used to repair such improvements or to build new improvements in their place or for any
other purpose or object satisfactory to Mortgagee, without affecting the lien of this Mortgage for
the full amount secured hereby before such payment took place. Mortgagee shall not be
responsible for any failure to collect any insurance proceeds due under the terms of any policy
regardless of the cause of such failure. Notwithstanding anything in the foregoing to the contrary,
the rights of Mortgagee under this Subsection 13 shall be subject and subordinate to the rights of
any mortgagee described in Section 3.01 below.
C. Mortgagor shall at its sole expense obtain for, deliver to and maintain for the benefit
of Mortgagee, during the life of this Mortgage, liability insurance policies relating to the
Mortgaged Property, in such amounts, with such companies and in such form as may be required
by Mortgagee. Mortgagee may require such policies to contain an endorsement, in form satis-
factory to Mortgagee, naming Mortgagee as an additional insured thereunder. Mortgagor shall
pay promptly, when due, any premiums on such insurance policies and renewals thereof.
GM1 7-931 1-025/209183/ 1 ]
4
D. In the event of a foreclosure of this Mortgage, the purchaser of the Mortgaged
Property shall succeed to all the rights of Mortgagor, including any right to unearned premiums,
in and to all policies of insurance assigned and delivered to Mortgagee, with respect to all property
herein encumbered.
E. Subject to the rights ofany mortgagee described in Section 3.01 below, Mortgagee
may, at its option, direct the payment ofthe insurance proceeds into an escrow account at a bank,
title insurance company or law firm designated by Mortgagee to be held for the benefit of the
Mortgagor and Mortgagee during the re -building ofthe Mortgaged Property and shall be released
by Mortgagee upon the approval of the inspecting architect or engineer that the Mortgaged
Property has been restored to the condition it was prior to the loss. In the event additional financing
is necessary to meet the requirements of any general contract which might be used to effect such
reconstruction, then the Mortgagor shall place said additional funds into the escrow account.
1.05 INTENTIONALLY DELETED.
1.06 Condemnation. If all or a material part (which determination shall be made by
Mortgagee in its sole and absolute discretion) ofthe Mortgaged Property shall be damaged or taken
through condemnation (which term when used herein shall include any damage or taking by any
governmental authority or any other authority authorized by the laws of the State of Florida or the
United States of America to so damage or take, and any transfer by private sale in lieu thereof),
either temporarily or permanently, at the option of Mortgagee, Mortgagor shall be deemed in
default hereunder. Mortgagee shall be entitled to all compensation awards, damages, claims,
rights of action and proceeds of, or on account of, any damage or taking through condemnation
and is hereby authorized, at its option, to commence, appear in and prosecute, in its own or
Mortgagor's name, any action or proceeding relating to any condemnation, and to settle or
compromise any claim in connection therewith. All such compensation awards, damages, claims,
rights of action and proceeds, and any other payments or relief, and the right thereto, are hereby
assigned by Mortgagor to Mortgagee, which, after deducting therefrom all its expenses, including,
without limitation, attorneys' fees, may release any monies so received by it without affecting the
lien ofthis Mortgage or may apply the same, in such manner as Mortgagee shall determine, to the
reduction of the sums secured hereby and to any prepayment charge provided in the Agreement,
this Mortgage or other instrument securing the Agreement. Any balance of such monies then
remaining shall be paid to Mortgagor. Mortgagor agrees to execute such further assignments of
any compensation, awards, damages, claims, rights of action and proceeds as Mortgagee may
require. Notwithstanding anything in the foregoing to the contrary, the rights of the Mortgagee
under this Section 1.06 shall be subject and subordinate to the rights of any mortgagee described
in Section 3.01 below.
1.07 Care of Property.
A. Mortgagor shall preserve and maintain the Mortgaged Property in good condition
and repair. Except as contemplated and permitted elsewhere in this mortgage, Mortgagor shall not
remove, demolish, alter or change the use of any structure or other improvement presently or
hereafter on that portion of the Mortgaged Property described as the Project in the Agreement
without the prior written consent of Mortgagee, nor permit, commit or suffer any waste,
impairment or deterioration ofthe Mortgaged Property or ofany part thereof, and will not take any
GM17-931 1-025/209183/ 1 ]
5
action which will increase the risk of fire or other hazard to the Mortgaged Property or to any partthereof.
B. Mortgagee may enter upon and inspect the Mortgaged Property at any reasonabletimeduringthelifeofthisMortgage.
C. Mortgagor will promptly comply with all present and future laws, ordinances, rules
and regulations of any governmental authority affecting the Mortgaged Property or any partthereof.
1.08 Transfer of Property Title. If all or any part of the Mortgaged Property or any
interest therein is sold or transferred by Mortgagor without Mortgagee's prior written consent,
which shall not be unreasonably withheld excluding (a) the creation of a lien or encumbrance
subordinate to this mortgage, (b) the creation of a purchase money security interest for appliances,
fixtures or equipment, (c) a transfer by devise, descent or by operation of law upon the death of a
joint tenant, (d) the grant of any leasehold interest of twenty (20) years or less not containing an
option to purchase. Mortgagee may, at Mortgagee's option, declare a default hereunder.
Mortgagee shall have waived such option to accelerate if, prior to the sale or transfer, Mortgagee
and the person to whom the mortgaged property is to be sold or transferred reach agreement in
writing that the credit of such person is satisfactory to Mortgagee and that the interest payment on
the sums secured by this mortgage shall be at such rate as Mortgagee shall request.
1.09 Further Assurances. At any time and from time to time, upon Mortgagee's request,
Mortgagor shall make, execute and deliver or cause to be made, executed and delivered to
Mortgagee any and all such further mortgages, instruments of further assurance, certificates,
updated financial statements and secure financial information and any other documents as
Mortgagee may consider necessary or desirable in order to effectuate, complete or perfect, or to
continue and preserve the obligations of Mortgagor under the Agreement and this Mortgage, and
the lien of this Mortgage as a valid and existing lien upon all of the Mortgaged Property, whether
now owned or hereafter acquired by Mortgagor. Upon any failure by Mortgagor to do so,
Mortgagee may make, execute, record, file, re-record or refile any and all such mortgages,
instruments, certificates and documents for and in the name ofMortgagor, and Mortgagor hereby
irrevocably appoints Mortgagee the agent and attorney-in-fact ofMortgagor to do so. Mortgagor
shall promptly deliver to Mortgagee receipts showing payment in full of all of the above items
which are not paid from the escrow account, if any, herein established.
1.10 INTENTIONALLY DELETED
1.11 After Acquired Property. The lien of this Mortgage will automatically attach,
without further act, to all after acquired property located in or on, or attached to, or used or intended
to be used in connection with or with the operation of, the Mortgaged Property or any part thereof.
1.12 Expenses. Mortgagor shall pay or reimburse Mortgagee for all costs, charges and
expenses, including reasonable attorneys' fees and disbursements and costs incurred or paid by
Mortgagee in any threatened, pending or completed action, proceeding or dispute in which
Mortgagee is or might be made a party or appears as a party plaintiff or party defendant and which
affects or might affect the Agreement, this Mortgage or any other instrument securing the
0M17.9311-025!209183/ 1 ]
6
Agreement, or the Mortgaged Property or any part thereof, or the interests of Mortgagor or
Mortgagee therein, including but not limited to the foreclosure of this Mortgage, condemnation
involving all or part of the Mortgaged Property or any action to protect the security hereof,
including all appellate proceedings in connection with or arising out of any of the foregoing. All
costs, charges and expenses so incurred or paid by Mortgagee shall become due and payable
immediately, whether or not there be notice, demand, attempt to collect or suit pending. The
amounts so incurred or paid by Mortgagee, together with interest thereon at the Default Rate as
hereinafter defined from the date incurred until paid by Mortgagor, shall be secured by the lien of
this mortgage.
1.13 Performance of Defaults. If Mortgagor defaults in the payment of any tax,
assessment, encumbrance or other imposition, in its obligation to furnish insurance hereunder or
in the performance or observation of any other covenant, condition or term in this Mortgage or in
any other instrument securing the Agreement, Mortgagee may at its option perform, correct or
observe the same, and all payments made (whether such payments are regular or accelerated
payments) and costs and expenses incurred or paid by Mortgagee in connection therewith shall
become due and payable immediately, whether or not there be notice or demand. The amounts so
incurred or paid by Mortgagee, together with interest thereon at the Default Rate as hereinafter
defined from the date incurred until paid by Mortgagor, shall be secured by the lien of this
Mortgage. Nothing contained herein shall be construed as requiring Mortgagee to advance or
expend monies for any purpose mentioned in this paragraph, or for any other purpose. Mortgagee
is hereby empowered to enter and to authorize others to enter upon the Mortgaged Property or any
part thereoffor the purpose ofperforming or observing any such defaulted covenant, condition or
term, without thereby becoming liable to Mortgagor or any person in possession holding under
Mortgagor.
1.14 Estoppel Affidavits. Either Mortgagor or Mortgagee within ten (10) days after
written request from the other shall furnish a written statement, duly acknowledged, setting forth
the ongoing or unmet obligations under the Agreement, and any other unpaid sums secured hereby,
and whether or not any offsets or defenses exist.
ARTICLE TWO
DEFAULTS
2.01 Event of Default. The term default, wherever used in this Mortgage, shall mean
any one or more of the following events:
A. Breach of or failure by Mortgagor to duly keep, perform and observe any other
covenant, condition or agreement in the Agreement, this Mortgage, any other instrument securing
the Agreement or any other instrument collateral to the Agreement or executed in connection with
the sums secured hereby.
B. If the Mortgagor at any time shall: (i) file a voluntary petition in bankruptcy, or (ii)
be adjudicated as bankrupt or insolvent, or (iii) seek or consent to or acquiesce in the appointment
of a trustee, receiver, master or liquidator of all or any substantial part of the Mortgaged Property
or of any or all of the rents, revenues, issues, earnings, profits or income thereof; or (iv) make any
general assignment for the benefit of creditors; or make an admission in writing of its inability to
GM17-9311.025209183/ 1j
7
pay its debts generally as they become due; or (v) if a court of competent jurisdiction enters an
order, judgment or decree approving a petition filed against Mortgagor seeking any arrangement,
composition, readjustment, liquidation, or similar relief under any present or future federal, state
or other statute, law or regulation relating to bankruptcy, insolvency or other relief for debtors.
C. Material breach of any warranty or material untruth of any representation of
Mortgagor contained in the Agreement, this Mortgage or any other instrument securing the
Agreement.
D. Should foreclosure proceedings (whetherjudicial or otherwise) be instituted on any
mortgage or any junior lien ofany kind secured by any portion of the Mortgaged Property, and not
be terminated within forty-five (45) days.
E. Should Mortgagor default in any other loan from Mortgagee to Mortgagor.
F. Except for sale of portions of the Mortgaged Property made in the ordinary course
of business for which a partial release or consent is obtained, should Mortgagor encumber, sell or
otherwise dispose of the Mortgaged Property, or any part or interest thereof, without the consent
in writing ofthe Mortgagee, which shall not be unreasonably withheld.
2.02 Mortgagee's Power of Enforcement. If an event of default shall have occurred,
Mortgagee may, either with or without entry or taking possession as hereinabove provided or
otherwise, proceed by suit or suits at law or in equity or by any other appropriate proceeding or
remedy; (a) to enforce the Agreement or the performance of any term hereof or any other right;
b) to foreclose this Mortgage and to sell, as an entirety or in separate lots or parcels, the Mortgaged
Property, under the judgment or decree of a court or courts of competent jurisdiction; or (c) to
pursue any other remedy available to it. Mortgagee may take action either by such proceedings or
by the exercise ofits powers with respect to entry or taking possession, or both, as the Mortgagee
may determine.
2.03 Receiver. If an event of default shall have occurred, Mortgagee, to the extent
permitted by law and without regard to the value or occupancy ofthe security, shall be entitled as
a matter of right if it so elects to the appointment of a receiver to enter upon and take possession
of the Mortgaged Property and to collect all rents, revenues, issues, income, products and profits
thereof and apply the same as the court may direct. The receiver shall have all rights and powers
permitted under the laws of the State of Florida and such other powers as the court making such
appointment shall confer. The expenses, including receiver's fees, attorney's fees, costs and
agent's compensation, incurred pursuant to the powers herein contained shall be secured by this
Mortgage. The right to enter and take possession of and to manage and operate the Mortgaged
Property, and to collect the rents, issues and profits thereof, whether by a receiver or otherwise,
shall be cumulative to any other right or remedy hereunder or afforded by law, and may be
exercised concurrently therewith or independently thereof. Mortgagee shall be liable to account
only for such rents, issues and profits as are actually received by Mortgagee.
2.04 INTENTIONALLY DELETED
2.05 Delay or Omission No Waiver. No delay or omission of Mortgagee or any holder
or the Agreement to exercise any right, power or remedy accruing upon any event ofdefault shall
0M17.9311-025/209183/ 1 ]
8
exhaust any such event of default or to constitute acquiescence therein. Every right, power and
remedy given to Mortgagee may be exercised from time to time and as often as may be deemed
expedient by Mortgagee.
2.06 No Waiver of One Default to Affect Another. No waiver of any event of default
hereunder shall extend to or affect any subsequent or any other event of default then existing, or
impair any rights, powers or remedies consequent thereon. If Mortgagee (a) grants forbearance or
an extension of time for performance secured hereby; (b) takes other or additional security for the
performance thereof; (c) waives or does not exercise any right granted in the Agreement, this
Mortgage or any other instrument securing the Agreement; (d) releases any part of the Mortgaged
Property from the lien of this Mortgage or any other instrument securing the Agreement; (e)
consents to the filing of any declaration of condominium, map, plat or replat of the land; or (f)
makes or consents to any agreement changing the terms of this Mortgage or subordinating the lien
or any charge hereof, no such act or omission shall release, discharge, modify, change or affect the
original liability under the Agreement, this Mortgage, or otherwise of Mortgagor, or any
subsequent purchaser of the Mortgaged Property or any part thereof or any maker, co-signer,
endorser, surety or guarantor. No such act or omission shall preclude Mortgagee from exercising
any right, power or privilege herein granted or intended to be granted in case ofany event ofdefault
then existing or of any subsequent event of default nor, except as otherwise expressly provided in
an instrument or instruments executed by Mortgagee, shall the lien of this Mortgage be altered
thereby. In the event of the sale or transfer by operation of law or otherwise of all or any part of
the Mortgaged Property, Mortgagee, without notice to any person, firm or corporation, is hereby
authorized and empowered to deal with any such vendee or transferee with reference to the
Mortgaged Property or the indebtedness secured hereby, or with reference to any of the terms or
conditions hereof, as fully and to the same extent as it might deal with the original parties hereto
and without in any way releasing or discharging any of the liabilities or undertakings hereunder of
the original Mortgagor.
2.07 Cumulative. No right, power or remedy conferred upon or reserved to Mortgagee
by the Agreement, this mortgage or any other instrument securing the Agreement is exclusive of
any other right, power or remedy, but each and every such right, power and remedy shall be
cumulative and concurrent and shall be in addition to any other right, power and remedy given
hereunder or under the Agreement or any other instrument securing the Agreement, or now or
hereafter existing at law, in equity or by statute.
2.08 Default Rate. Any advancements made by and expenses incurred by Mortgagee,
shall bear interest from the due date or the date of advancement or payment by Mortgagee at the
highest contract rate of interest permitted to be charged under the laws of the State of Florida,
which rate is herein referred to as the "Default Rate".
2.09 JURY WAIVER
NOW, SHOULD IT BECOME NECESSARY TO ENFORCE THE AGREEMENT
THROUGH AN ATTORNEY, ANY OF US, WHETHER MAKER, SURETY, OR
ENDORSER ON THIS AGREEMENT, HEREBY AGREES TO PAY ALL COSTS OF
COLLECTION, INCLUDING A REASONABLE ATTORNEYS' FEE, AND INCLUDING
ANY ATTORNEYS' FEES INCURRED BY ANY APPEAL. THE UNDERSIGNED
GM17-9311-0251209183/1]
9
JOINTLY AND SEVERALLY DO HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE THE RIGHT EITHER MAY HAVE TO A TRIAL BY JURY
IN RESPECT TO ANY LITIGATION BASED HEREON OR ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS AGREEMENT AND ANY AGREEMENT
CONTEMPLATED TO BE EXECUTED IN CONJUNCTION HEREWITH, OR ANY
COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
VERBAL OR WRITTEN), OR ACTIONS OF EITHER PARTY. THIS PROVISION IS A
MATERIAL INDUCEMENT FOR MORTGAGEE ACCEPTING THIS AGREEMENT.
ARTICLE THREE
SUBORDINATION
3.01 Subordination of Easement Rights. Provided that Mortgagor is not in default
hereunder, Mortgagee agrees to subordinate the lien of this Mortgage to the rights ofthe holders
of any easement hereafter granted by Mortgagor which may reasonably be required to furnish to
the Mortgaged Property utilities such as, but not limited to, water, electricity, sanitary and storm
sewers, gas and telephone.
ARTICLE FOUR
HAZARDOUS SUBSTANCE
4.01 Mortgagor hereby represents that neither Mortgagor nor, to Mortgagor's
knowledge, any other person has ever used the Mortgaged Property as a storage facility for any
Hazardous Substance" other than gasoline or motor oil (to the extent same may be HazardousSubstances) used in the ordinary course ofMortgagor's business.
Mortgagor hereby agrees to indemnify Mortgagee and hold Mortgagee harmless from and
against any and all losses, liabilities, including strict liability, damages, injuries, expenses,
including reasonable attorneys' fees, costs of any settlement or judgment and claims of any and
every kind whatsoever paid, incurred or suffered by, or asserted against, Mortgagee by any person
or entity or governmental agency for, with respect to, or as a direct or indirect result of, the presence
on or under, or the escape, seepage, leakage, spillage, discharge, emission, discharging or releasefromthepremisesofanyHazardousSubstance (including, without limitation, any losses,
liabilities, including strict liability, substances or standards of conduct concerning any Hazardous
Substance), regardless of whether within the control of Mortgagee, so long as the act or omission
in question occurs prior to the sale of the premises and complete dispossession of Mortgagor
thereunder.
For purposes of this instrument, "Hazardous Substances" shall mean and include those
elements or compounds which are contained in the list of hazardous substances adopted by theUnitedStatesEnvironmentalProtectionAgency (EPA) and the list of toxic pollutants designated
by Congress or the EPA or defined by any other Federal, state or local statute, law, ordinance,
code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of
conduct concerning any hazardous, toxic or dangerous waste, substance or material as now or at
any time hereafter in effect.
GM17-9311-025209183/ 1 ]
10
If Mortgagor receives any notice of (i) the happening of any material event involving the
spill, release, leak, seepage, discharge or cleanup of any Hazardous Substance on the premises orinconnectionwithMortgagor's operations thereon or, (ii) any complaint, order, citation or
material notice with regard to air emissions, water discharges, or any other environmental, health
or safety matter affecting Mortgagor (an "Environmental Complaint") from any person or entityincluding, without limitation, the EPA), then Mortgagor shall immediately notify Mortgagee
orally and in writing of said notice.
Mortgagee shall have the right, but not the obligation, and without limitation of
Mortgagee's rights under this instrument, to enter onto the Mortgaged Property or to take such
other actions as it deems necessary or advisable to clean up, remove, resolve or minimize the
impact of, or otherwise deal with, any such Hazardous Substance or Environmental Complaint
following receipt of any notice from any person or entity (including, without limitation, the EPA)
asserting the existence of any Hazardous Substance or an Environmental Complaint pertaining to
the Mortgaged Property or any part thereof which, if true, could result in an order, suit or other
action against Mortgagor and/or which, in the sole opinion of Mortgagee, could jeopardize its
security under this instrument. All reasonable costs and expenses incurred by Mortgagee in the
exercise of any such rights shall be secured by this instrument and shall be payable by Mortgagorupondemand.
Mortgagee shall have the right, in its reasonable discretion, to require Mortgagor to
periodically (but not more frequently than annually unless an Environmental Complaint is then
outstanding) perform (at Mortgagor's expense) an environmental audit and, if deemed necessary
by Mortgagee, an environmental risk assessment, each ofwhich must be satisfactory to Mortgagee,
of the Mortgaged Property, hazardous waste management practices and/or hazardous waste
disposal sites used by Mortgagor. Said audit and/or risk assessment must be by an environmental
consultant satisfactory to Mortgagee. Ifthe environmental audit or environmental risk assessment
reveals no recognized environmental concerns, Mortgagee shall be solely liable for the cost ofsaid
audit or assessment and shall reimburse Mortgagor for said cost upon demand. Should Mortgagor
fail to perform said environmental audit or risk assessment within thirty (30) days of the
Mortgagee's written request, Mortgagee shall have the right, but not the obligation, to retain an
environmental consultant to perform said environmental audit or risk assessment. All costs and
expenses incurred by Mortgagee in the exercise of such rights shall be secured by this instrument
and shall be payable by Mortgagor upon demand.
Any breach of any warranty, representation or agreement contained in this section shall be
an event ofdefault hereunder and shall entitle Mortgagee to exercise any and all remedies provided
in this instrument, or otherwise permitted by law.
ARTICLE FIVE
MISCELLANEOUS PROVISIONS
5.01 Successors and Assigns Included in Parties. Whenever one of the parties hereto is
named or referred to herein, the successors and assigns of such party shall be included and all
covenants and agreements contained in this Mortgage, by or on behalf of Mortgagor or Mortgagee,
shall bind and inure to the benefit oftheir respective successors and assigns, whether so expressed
or not.
0M17-9311-025/209183/ 1 ]
11
5.02 Headings. The headings ofthe articles, sections, paragraphs and subdivision ofthis
Mortgage are for convenience of reference only, are not to be considered a part hereof, and shall
not limit or expand or otherwise affect any of the terms hereof.
5.03 Invalid Provisions to Affect no Others. In the event that any of the covenants,
agreements, terms or provisions contained in the Agreement, this Mortgage or any other instrument
securing the Agreement shall be invalid, illegal or unenforceable in any respect, the validity ofthe
remaining covenants, agreements, terms or provisions contained herein and in the Agreement and
any other instrument securing the Agreement shall be in no way affected, prejudiced or disturbed
thereby.
5.04 Changes. Neither this Mortgage nor any term hereof may be changed, waived,
discharged or terminated orally, or by any action or inaction, but only by an instrument in writing
signed by the party against which enforcement of the change, waiver, discharge or termination is
sought. Any agreement hereafter made by Mortgagor and Mortgagee relating to this Mortgage
shall be superior to the rights of the holder of any intervening lien or encumbrance.
5.05 Governing Law. This Mortgage is made by Mortgagor and accepted by Mortgagee
with reference to the laws of the State of Florida and shall be construed, interpreted, enforced and
governed by and in accordance with such law.
5.06 INTENTIONALLY DELETED.
5.07 Mortgagor as Lessor. Mortgagor shall faithfully perform the covenants of
Mortgagor as lessor under any present and future leases, affecting all or any portion of the
Mortgaged Property, and neither do nor neglect to do, nor permit to be done, anything which may
cause the termination of said leases, or any of them, or which may diminish or impair their value,
or the rents provided for therein, or the interest of Mortgagor or Mortgagee therein or thereunder.
5.08 INTENTIONALLY DELETED.
5.09 Waiver of Homestead Exemption; Time of Essence. Each individual Mortgagor,
for himself and family, hereby waives and renounces all homestead exemption rights provided for
by the Constitution and Laws of the United States and of the State of Florida in and to the
Mortgaged Property as against the collection of the secured indebtedness, or any part thereof; and
Mortgagor agrees that where, by the terms of the conveyance or the Agreement secured hereby, a
day is named or a time fixed for the payment of any sum of money or the performance of any
agreement, the time stated enters into the consideration and is of the essence of the whole contract.
5.10 Prior Liens. Except for any mortgage or easement described in Sections 3.01 and
3.02 ofthis Mortgage, Mortgagor shall keep the Mortgaged Property free from all other prior liens
and, upon demand of Mortgagee, pay and procure release of any such other lien which in any waymayimpairthesecurityofthisMortgage.
5.11 Mortgagor's Duty to Defend. Mortgagor will defend, at its own cost and expense,
and indemnify and hold Mortgagee harmless from, any action, proceeding or claim affecting theMortgagedProperty, the Agreement or any other loan document. Costs and expenses will include
all reasonable attorney's fees.
GM17-9311-0251209183/11
12
If Mortgagor neglects or refuses to act pursuant to this paragraph, Mortgagee, at its option
whether electing to declare the entire secured indebtedness due and collectible or not, or to pursue
other remedies for an event of default), may pay for all reasonable attorney's fees, costs and
expenses incurred in any such action. All such payments, bearing interest thereon from the time
of default as determined by prime rate, plus 100 basis points, as quoted in the Wall Street Journal,
as ofthe effective day ofany default and shall accrue at that rate, from time to time, as of the date
of default, shall be deemed a part of the secured indebtedness and shall be immediately due and
payable by Mortgagor to Mortgagee.
5.12 Compliance with Law. The Mortgagor warrants and represents the Mortgagor has
complied, and shall hereafter comply, with all valid laws, rules, ordinances and regulations of the
federal, state and local government, and all agencies and subdivisions thereof which laws rules,
ordinances and regulations apply or relate to the Mortgaged Property, the development,
construction and improvements existing or contemplated thereon or as a part thereof, and the sale
or other disposition of the Mortgaged Property, or parts thereof, or the improvements now or
hereafter located thereon or a part thereof, including, but not limited to, all such laws, rules,
ordinances, and regulations regarding land use, zoning, building, subdivision, environment,
OSHA, pollution and sales practices.
5.13 Construction. This Mortgage and all related loan documents, including but not
limited to the Agreement, shall not be construed more strongly against any party regardless of who
was more responsible for its preparation.
5.14 Addresses for Notices.
A. Any notice, report, demand or other instrument authorized or required to be given
or furnished under this Mortgage to Mortgagor or Mortgagee shall be deemed given or furnished
when addressed to the party intended to receive the same, at the address of such party on the first
page hereof, and delivered at such address by personal delivery, national overnight courier
company, or when mailed by first class U.S. Mail, postage prepaid and deposited into the U.S.
Mail, being deemed the delivery of notice, or when given by facsimile transmission or via e-mail,
as follows:
To Mortgagor:
To Mortgagee:
Attn: Daniels Ikajevs -
600 Cleveland, LLC
331 Cleveland Street #2502
Clearwater, FL 33755
Attn: City Attorney
City of Clearwater
112 S. Osceola Avenue
Clearwater, FL 33756
FAX # (727) 562-4021
B. Either party may change the address to which any such notice, report, demand or
other instrument is to be delivered or mailed, by furnishing written notice of such change to the
GM17-9311-025/209183/ 1 ]
13
other party, but no such notice ofchange shall be effective unless and until received by such other
party.
5.15 Termination of Agreement. This Performance Mortgage shall not be affected by
termination of the Agreement, to the extent that the CRA (Mortgagee) has expended funds or is
obligated to expend funds for which Mortgagor is liable to reimburse Mortgagee pursuant to the
Agreement and all obligations under this Performance Mortgage shall survive until Mortgagee has
satisfied its liabilities and fulfilled its obligations to Mortgagee under the Agreement.
5.16 Mortgagee's Satisfaction of Mortgage. Notwithstanding anything to the contrary
elsewhere contained in this Mortgage, ifduring the term ofthis Mortgage, Mortgagor seeks to sell
the Mortgaged Property and the Purchaser of the Mortgaged Property requires that this Mortgage
be satisfied as a condition to its closing of said sale or re -financing, then in such event, Mortgagee
shall furnish a written satisfaction of this Mortgage in recordable form upon (a) Mortgagor's
presentation of reasonable evidence that one of the foregoing events has occurred and (b)
Mortgagor's payment to Mortgagee of an amount equal to the sum which would be due Mortgagee
if Mortgagor had failed to comply with the provisions of Section 6.02 of the Agreement as of the
date of the closing of any such sale or re -financing.
5.17 Miscellaneous.
a) Mortgagor shall be authorized to utilize the parking spaces designated for The Ring
or members of The Ring including Mortgagee and Spark partners for nights, weekends and
special event parking as agreed upon between Mortgagor and Mortgagee. However, in
such case, no less than 10 spaces shall be marked and reserved for The Ring tenants at all
times.
b) Mortgagor shall be allowed to substitute collateral for the Performance Mortgage,
reasonably satisfactory to Mortgagee. However, substituting collateral in no way alters or
releases Mortgagor's obligation to provide 60 parking spaces for exclusive use ofThe Ring
at 630 Laura Street, as provided herein.
NO DOCUMENTARY STAMP TAXES OR INTANGIBLE PERSONAL PROPERTY
TAXES ARE DUE ON THIS MORTGAGE BECAUSE IT SECURES THE
PERFORMANCE OF AN OBLIGATION, NOT THE PAYMENT OF MONEY.
IN WITNESS WHEREOF, the Mortgagor has made, executed, sealed and delivered this
Mortgage, the day and year first above written.
Signed, sealed and delivered
in the presence of:
ratio L
Print Name TX,t i 0.11 C1 ZV ni 30..
GM17-9311-025/209183/1]
14
THE RING WORKSPACES, LLC
B
ame Ikajev anaging Member
STATE OF FLORIDA
COUNTY OF PINELLAS
I HEREBY CERTIFY, that on this day personally appeared before me, an officer duly
authorized to administer oaths and take acknowledgments, by Daniels Ikajevs, as managing
member of The Ring Workspaces, LLC, known to be the individual described in, or who produced
as identification, and who executed the foregoing instrument, and
acknowledged before me that he executed the same as his free act and deed for the purposes therein
expressed.
WITNESS my iland and official seal at / aeAtti v 7,-, said County and State,
this 30 day of J Aloof c,, , 2017.
ZP / -it
GM17-9311-025/209183/1]
15
Notary Pub..
Print NameVQVn ( J )4e/tale/soil
My Commission Exres:
DARRYL J. HENDERSON
1.1 Commission # FF 197831eExpiresFebruary9, 2019
Bonded Thtu TinyFan Insurance9003957019
EXHIBIT "A"
LEGAL DESCRIPTION
That property situated in the City of Clearwater, County of Pinellas, State of
Florida, and described as follows:
Lots 13 through 18, inclusive, of Block 18, GOULD & EWING'S 2ND
ADDITION TO CLEARWATER HARBOR, FLORIDA, as per map or plat
thereof recorded in Plat Book 1, Page 52, of the Official Records of
Hillsborough County, Florida, of which Pinellas County was formerly a part.
LESS AND EXCEPT that portion of the above described parcel conveyed to
the City of Clearwater, Florida, a municipal corporation, by Warranty Deed
recorded in Official Records Book 4151, Page 691, of the Official Records of
Pinellas County, Florida.
Address: 63o Laura Street, Clearwater, FL 33755
Pinellas County Tax Parcel No. 16-29-15-32292-018-0130
GM17-93 11-025/209183/1 ]
16
KEN BURKE, CLERK OF COURT
AND COMPTROLLER PINELLAS COUNTY, FL
INST# 2018054784 02/21/2018 04:46 PM
OFF REC BK: 19949 PG: 1635-1637DocType:AGM RECORDING: $27.00
EXHIBIT C
CITY OF CLEARWATER COMMUNITY REDEVELOPMENT AGENCY
PROMISSORY NOTE
THIS AGREEMENT, entered into this /5 day of A d , 2017, by and between
the Community Redevelopment Agency of the City of Clearwater, Florida (hereafter "CRA"),
whose address is P.O. Box 4748, Clearwater, Florida 33758-4748, a public body corporate and
politic of the State of Florida and The Ring Workspaces, LLC, whose address is 331 Cleveland
St., #2502, Clearwater, FL 33755 (hereinafter "Borrower").
WITNESSETH
WHEREAS, the CRA has committed CRA funds to be applied for redevelopment in the
Community Redevelopment Area (CRA Redevelopment Incentive Funding); and
WHEREAS, the types of incentives contemplated by this program include other financial
incentives to redevelopment and businesses Downtown; and
NOW THEREFORE, in consideration of the premises, the mutual covenants, and promises
contained herein, and other good and valuable consideration, the Borrower and the CRA agree and
covenant each with the other as follows:
A. GENERALLY
The foregoing recitals are true and correct and are incorporated in and form a part of this
Promissory Note.
B. BORROWER'S PROMISE TO PAY
For value received, the undersigned ("Borrower") promises to pay the sum of -six hundred
thousand dollars ($600,000.00) in U.S. dollars to the order of the lender. The lender is the
Community Redevelopment Agency of the City of Clearwater, organized and existing under
the laws of the State of Florida and located at 112 S. Osceola Avenue, Clearwater, Florida
33756.
C. INTEREST/FOREGIVENESS
Funds shall be provided in the form of zero percent (0%) interest loan -to -grant to the Borrower,
which, barring a default by the Borrower, the City will forgive at a rate of twenty percent (20%)
per year over the five-year loan term so long as Borrower remains a tenant at 600 Cleveland Street
and operates "The Ring Workspaces" as provided in the Development Agreement between the
CRA and The Ring Workspaces,LLC dated October16th 2017.
Borrower acknowledges that CRA is not in privity (a party to) ofcontract with the Contractor, and
GM17-9311-025/211254/1]
shall not be bound by any terms of the Contract, but rather shall only be obligated to disburse the
funds provided for hereunder when Work is completed and acceptable as determined by the CRA
in its sole discretion.
The Project may not be altered, modified, removed or demolished without prior written approval
of the CRA. Any ofthese actions may result in a repayment/reimbursement ofthe subject funds to
the City by the Borrower.
D. PAYMENT
The Borrower agrees to repay the City the loan balance if he/she fails to perform any of the
covenants or agreements contained in the Development Agreement or this Promissory Note.
E. DEFAULT BY BORROWER
This loan may be terminated in its entirety or disbursement of loan funds may be withheld for the
following, which shall constitute a default under this Promissory Note and Development
Agreement: (a) defective Work not remedied within ten (10) days of written notice of such defect,
b) failure of the Contractor to make prompt and proper payments to subcontractors, or for labor,
materials, or equipment; (c) reasonable evidence that the work cannot be completed for the unpaid
balance ofthe contract sum, (d) failure to complete the project in a timely manner; (e) failure to
maintain the improvements, as determined by the CRA in its reasonable discretion, for a period
equal to the term ofthe loan; (f) modification to an approved design plan without the prior written
authorization from the CRA.
F. MISCELLANEOUS PROVISIONS
Execution of this Promissory Note by the Borrower is a representation that the Borrower is
competent, familiar with the terms of the Development Agreement, and fully intends to honor the
agreement.
This Note shall be governed by the laws of the State of Florida, and venue shall be in Pinellas
County.
Should any section or part of any section of this Promissory Note be rendered void, invalid, or
unenforceable by any court of law, for any reason, such a determination shall not render void,
invalid, or unenforceable any other section or any part of any section in this Note.
This Note is non -assignable by the Borrower.
F. COPY RECEIVED
1. Borrower hereby acknowledges receipt of a copy of this instrument.
GM17-9311-025/211254/1]
IN WITNESS WHEREOF, the Borrower and the CRA have executed or caused these presents
to be executed by its respective authorized representatives to be effective as of the day and year
first above written.
In the presence of:
BORROWER:
Op.2 o I
Bo ignatur Da
ess Date
STATE OF FLORIDA )
COUNTY OF PINELLAS )
The foregoing instrument was acknowledged before me this Z 3 day of
2016 , by Dfoeo .11a levs , who is personally known to me or produced
as identification.
Print/Type Name: DA v1,7 J • )/-6 40-1
Notary Public
1 „,,,,. Astv.. DARRYL J. HENDERSON
Commission # FF 197831s -rfte 'ayte0 Expires February 9, 201944,R(,i.• Baled TMu TroyFain insurance800385-7019
GM17-9311-025/211254/1)
KEN BURKE, CLERK OF COURT
AND COMPTROLLER PINELLAS COUNTY, FL
INST# 2017345256 11/13/2017 09:18 AM
OFF REC BK: 19838 PG: 39-40
DocType:AGM RECORDING: $18.50
EXHIBIT D
Memorandum of Development Agreement
The Ring Workspaces, LLC 600 Cleveland St.
This Me orandum of Development Agreement ("Memorandum") is made this
day of it}/t,., , 2017_, by and between the COMMUNITY
REDEVELOPMENT AGENCY OF THE CITY OF CLEARWATER, FLORIDA, a public
body corporate and politic of the State of Florida (the "Agency"), whose address is 112
S. Osceola Avenue, Clearwater, FL 33756, and The Ring Workspaces, LLC, a Florida
Limited Liability Company ("Developer"), whose address is 331 Cleveland St., #2502,
Clearwater, FL 33755.
This Certificate pertains to a Development Agreement "The Ring Workspaces")
by and between the Agency and the Developer, dated as of QJ) -(LJ , 2017
the "Development Agreement"), which provides, among other things, for the
construction of the The Ring Workspaces Project as same is defined and provided in the
Development Agreement.
The Development Agreement is incorporated herein and made a part hereof by
reference as fully as though it were set forth herein in its entirety. It is the intention of the
parties to hereby ratify, approve and confirm the Development Agreement as a matter of
public notice and record. Nothing herein shall in any way affect or modify the
Development Agreement, nor shall the provisions of this Memorandum be used to
interpret the Development Agreement. In the event of conflict between the terms of this
document and those contained in the Development Agreement, the terms in the
Development Agreement shall control.
A copy of the fully -executed Development Agreement is on file with the. City
Clerk, City of Clearwater, Florida, located at City Hall, 112 S. Osceola Avenue,
Clearwater, Florida, which is available for review and copying by the public.
IN WITNESS WHEREOF, thh parties. hereto have set their hands and their
respective seals affixed as of the %" day of ).,i,c) , 2017.
Approved as to form: Attest:
Pamela K. kin
City Attorney
GM I7-9311-025/211243/1 ]
COMMUNITY REDEVELOPMENT
AGENCY OF THE CITY OF
CLEARWATER, FLORIDA
By: Crc.k.%)s
George N. Cretekos
Chairperson
Rosemarie Call
City Clerk
GM 17-9311-025/211243/1
Memorandum of Development Agreement
The Ring Workspaces, LLC, 600 Cleveland St.
Witnesses:
STATE OF FLORIDA
COUNTY OF PINELLAS
The Ring Workspaces, LLC,
a Florida limited liability company
B
Da Is Ik. - vs, its
ATTEST:
aging Member
By:
Secretary
SEAL)
The foregoing instrument was acknowledged before me this 9-N0day of
QGWJ2N , 2011 by Daniels Ikajevs, Managing Member of The Ring
Workspaces, LLC, a Florida limited liability compan - o • . • - • liability
company. They are personally known to me or have ro uced a valid driver's licen as
identification.
SEAL)
Printed/Typed Name:
Notary Public -State of Florida
Commission Number:
GMI7-9311-025/211243/11 GM17-9311-025/211243/1
EXHIBIT E
Agreement Expiration Certificate
The Ring Workspaces, LLC"j
This Agreement Expiration Certificate ("Certificate") is made this day of
by and between the COMMUNITY
REDEVELOPMENT AGENCY OF THE CITY OF CLEARWATER, FLORIDA, a public
body corporate and politic of the State, of Florida (the "Agency"), whose address is 112
S. Osceola Avenue, Clearwater, FL 32521, and THE RING WORKSPACES, LLC, a
Florida limited liability company ("Developer"), whose address is 331 Cleveland St.,
2502, Clearwater, FL 33755.
This Certificate pertains to a Development Agreement ( "The Ring Workspaces,
LLC") by and between the Agency and the Developer, dated as of
200_ (the "Development Agreement"), which provides, among other things, for the
construction of "The Ring Workspaces" Project as same is defined and provided in the
Development Agreement.
The Development Agreement has expired in accordance with its own terms as of
and is no longer of any force or effect, and "The Ring
Workspaces, LLC» site is no longer subject to any restriction, limitation, or encumbrance
imposed by the Development Agreement. This Certificate has been executed by the
parties to the Development Agreement as provided in Section 11.19 thereof and
constitutes a conclusive determination of satisfactory completion of all obligations under
such Development Agreement and that the Development Agreement has expired.
A copy of the fully -executed Development Agreement is on file with the City
Clerk, City of Clearwater, Florida, located at City Hall, 112 S. Osceola Avenue,
Clearwater, Florida, which is available for review and copying by the public.
IN WITNESS WHEREOF, the parties hereto have set their hands and their
respective seals affixed as of the DAY OF , 20_.
SIGNATURE PAGES FOLLOW]
GM1 7-93 1 1-025 /2 10292/ 1 ]
Agreement Expiration Certificate
The Ring Workspaces, LLC"]
Approved as to form:
Pamela K. Akin
City Attorney
Witnesses:
STATE OF FLORIDA
COUNTY OF PINELLAS
COMMUNITY REDEVELOPMENT
AGENCY OF THE CITY OF
CLEARWATER, FLORIDA
By:
Attest:
George N. Cretekos
Chairperson
Rosemarie CaII
City Clerk
THE RING WORKSPACES, LLC, a Florida limited
liability company
BY:
Daniels Ikajevs, its Managing Member
ATTEST:
By:
Secretary
SEAL)
The foregoing instrument was acknowledged before me this day of
20, by Daniels Ikajevs, Managing Member of 600 Cleveland, LLC,
a Florida limited liability company, on behalf of such limited liability company. They are
personally known to me or have produced a valid driver's license as identification.
SEAL)
Printed/Typed Name:
Notary Public -State of Florida
Commission Number:
GM 17-9311-025/210292/ 11
EXHIBIT "F"
AGREEMENT TERMINATION CERTIFICATE
The Ring Workspaces, LLC"]
This Agreement Termination Certificate ("Certificate") is made this _ day of
by and between the COMMUNITY REDEVELOPMENT AGENCY OF
THE CITY OF CLEARWATER, FLORIDA, a public body corporate and politic of the State of
Florida (the "Agency"), whose address is 112 S. Osceola Avenue, Clearwater, FL 32521, and
THE RING WORKSPACES, LLC, a Florida limited liability company (the "Developer"), whose
address is 331 Cleveland St., #2502, Clearwater, FL 33755.
This Certificate pertains to a Development Agreement ("The Ring Workspaces,
LLC"), by and between the Agency and the Developer, dated as of
2017 (the "Development Agreement"), which provides, among
other things, for the lease of property within a project site as described in Exhibit "A" attached
hereto and made a part hereof for the operation and build out of the "The Ring" Project, as
same is defined in the Development Agreement.
The Development Agreement has terminated in accordance with its own terms
as provided in Article 9 thereof as of, , and is no longer of any force or
effect except for those provisions which expressly survive termination. This Certificate has been
executed by the parties to the Development Agreement as provided in Section 9.06 thereof and
constitutes a conclusive determination that the Development Agreement has been terminated,
the rights, duties and obligations of the parties hereto have been terminated and released
subject to those surviving provisions) and "The Ring Workspaces, LLC" is no longer subject to
any restrictions, limitations or encumbrances imposed by the Development Agreement.
A copy of the fully -executed Development Agreement is on file with the City
Clerk, City of Clearwater, Florida, located at City Hall, 112 S. Osceola Avenue, Clearwater,
Florida, which is available for review and copying by the public.
IN WITNESS WHEREOF, the parties hereto have set their hands and their
respective seals affixed as of the ! day of ,
COMMUNITY REDEVELOPMENT AGENCY OF
THE CITY OF CLEARWATER, FLORIDA
By:
Approved as to Form: Attest:
Pamela K. Akin
City Attorney
George N. Cretekos
Chairperson
Rosemarie Call
City Clerk
GM17-9311-025/211163/1] GM17-9311-025/211163/1
AGREEMENT TERMINATION CERTIFICATE
600 Cleveland, LLC "The Ring Workspaces"]
Witnesses:
STATE OF FLORIDA
COUNTY OF PINELLAS
THE RING WORKSPACES,LLC.,
a Florida limited liability company
BY:
Daniels Ikajevs, its Managing Member
ATTEST:
By:
Secretary
SEAL)
The foregoing instrument was acknowledged before me this day of
200_, by Daniels ikajevs, Managing Member of The Ring Workspaces,
LLC, a Florida limited liability company, on behalf of such limited liability company. He is
personally known to me or has produced a valid driver's license as identification.
SEAL)
Printed/Typed Name:
Notary Public -State of Florida
Commission Number:
GM17-9311-025/211163/1) GM17-9311-025/211163/1
1EXHIBIT
THE RING
Business Plan
Prepared by: The Ring Workspaces, LLC
July, 2017
E;;11 THE RING
CONFIDENTIALITY AND NON -DISCLOSURE
This document is for informational purposes only and is not an offering of sale of any securities of the
company. Information disclosed herein is proprietary and confidential. By accepting this material, the
recipient agrees that they will not utilize information contained herein for any competitive purpose. This
document is the property of The Ring and may not be disclosed, distributed, or reproduced without the
express written permission of the owner, Daniels Ikajevs.
The information presented in this Business Plan was prepared and provided by Daniels Ikajevs. Estimates and
projections contained herein involve significant elements of objective judgement and analysis and are based
on certain assumptions. Actual results may vary from estimates and projections and these variations may be
immaterial.
No representation or warranty expressed or implied, is made as to the accuracy or completeness of the
information contained in this overview, and nothing contained herein is relied upon as a promise or
representation, whether as to the past or future. This Business Plan does not contain all the information that
may be required to evaluate The Ring for a potential business relationship, and any recipient therefore should
conduct their own independent analysis and due diligence process.
THIS BUSINESS PLAN IS FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE AN
OFFER TO SELL OR SOLICITATION OF AN OFFER TO BUY ANY SECURITIES.
E;:i THE RING
Excellence is an art won by training and habituation. We are what
we repeatedly do. Excellence, then, is not an act but a habit"
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Aristotle
jj
THE RING
Table of Contents
Contents
CONFIDENTIALITY AND NON -DISCLOSURE 2
EXECUTIVE SUMMARY 5
BUSINESS OVERVIEW 6
LOCATION 12
BUSINESS GOALS AND OBJECTIVES i6
SERVICES i8
COMPETITIVE ANALYSIS 23
INDUSTRY ANALYSIS 25
MARKETING STRATEGY 32
OPERATIONAL SUMMARY 35
APPENDIX 4i
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E;;:l THE RING
EXECUTIVE SUMMARY
The Ring Workspaces offers world-class co -working facilities in the heart of downtown Clearwater. These
are beautifully appointed workspaces, designed using best practices from the worlds of Public Health and
Engineering. The goal is to create "the healthiest workspace in the world."
Members can work on a month-to-month or long-term basis. There are four types of memberships:
Virtual Address
Co -Working
Fight Club
Private Office
The Ring takes a multi -faceted and integrated approach to productivity which has been scientifically proven
to enhance cognitive functioning, improve sleep and reduce sick building symptoms. This can lead to as
much as a $6,500 equivalent in improved productivity per person per year.
Though The Ring is the first co -working facility in Clearwater, it offers the following advantages over others
in Tampa or St. Petersburg:
Healthy workspace: meticulous attention to all workspace components and unique health
amenities.
Optimal productivity focus: the healthy environment gets productivity results for its members.
Technology: technology surpasses the competition with sleep pods and a recording studio
Access to venture capital: Members will have special access to fund their businesses.
Building ownership: While most co -working spaces rent, The Ring partners own the space.
The co -working industry is exploding, with it sitting today at 1 Billion dollars and more than i Million people
working this way in 2017. The Ring possesses all ofthe factors needed to thrive in this marketplace.
Marketing methods will include both community and online methods:
Community: Public Relations, corporate outreach and events.
Online: Website, Social Media, PPC and Remarketing, active video channel, e-mail.
In order to suit the unique demographics of Clearwater, The Ring will appeal to Millennials, Gen X and Baby
Boomers alike. The company will operate on a lean basis, but will create employment in the City of
Clearwater for young people engaged with technology.
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E;;:1 THE RING
BUSINESS OVERVIEW
Business Description
The Ring Workspaces, LLC is a Florida -based limited liability company that offers state-of-the-art,
destination co -working facilities that optimize human wellness, productivity, and performance using green
building best practices. It is a proposed real estate venture to begin operations in the final quarter of 2017.
The company was incorporated in 2016 in Clearwater, FL and isjointly owned by established real estate
investor Daniels Ikajevs and his two partners, Zigrida Ikajeva and Simee Adhikari.
600 Cleveland St Suite oo, Clearwater, FL 33755
This building is beautifully situated near
the beach, creating an enviable work -life
balancefor its members. Clearwater's
landmark Coachman Park is nearby,
which hosts popular events andfestivals.
The building is at the heart ofa newly
revitalized downtown area, nearmany
restaurants, amenities and other
businesses.
History of the Business
The Ring was conceptualized by real estate experts Daniels Ikajevs and Simee Adhikari. With over 28
combined years of experience, they envisioned an innovative and integrated workspace that met the needs
oftoday's entrepreneurs, innovators and industry leaders. Following a quiet but fast-growing industry trend
of synergetic and collaborative working environments, they quickly identified an opportunity for
redevelopment in Downtown Clearwater.
Daniels Ikajevs being an avid real estate developer and resident of the Downtown area, combined his
passion for personal and professional growth to create a facility that allowed start-ups to mature and engage
with industry experts. By touring over go co -working facilities around the USA and Europe, he deepened his
understanding of effective space layouts and honed in on the needs of today's professionals. Inspired by the
expanding market and the world-wide co -working movement, he sought to develop a similar working
model. Feasibility and Profitability Studies further justified cause for development.
Simee Adhikari, a former Information Technology (IT) professional, understood the difficult toll that long
office hours, and structurally unhealthy working environments could take on the body. The IT industry is one
that requires commitment and offers little work -life balance. Simee eventually left the industry to advance a
1oIPag e
ETil THE RING
career in Real Estate which presented a more flexible and physically active professional form of
engagement. Observing the professional lifestyles of fellow friends and family, she foresaw an ideal
opportunity to drastically improve the physical work environment. This paradigm brought about an
evidence -based qualitative and quantitative approach to space development and design that has the
potential to revolutionize the industry.
Establishing more than just a facility or a brand, the duo merged their personal and professional ethics and
values to construct a meticulous and healthy environment that will prepare entrepreneurs for continual
growth. The Ring balances the conditions for success. On one hand, clean air, green spaces and natural light
create a conventionally healthy atmosphere. On the other hand, a science -based application of proven
methodologies from the worlds of Public Health and Engineering for improved productivity in the workplace
create an evidence -based healthy workplace. The Ring aims therefore to connect an ecosystem of like-
minded, ambitious professionals in the center of beautiful Clearwater. The Ring is an elevated workspace
where anyone with a passion and determination can succeed.
Company Vision and Mission
Ourmission is to create the healthiest workspace in the world. A healthy body optimizes productivity, which,
for entrepreneurs, leads to growth andprofit. The business's success will be measured using triple -bottom-line
TBL) accounting: social, environmental andfinancial — creating significant benefitsfor all three.
Social: The enterprise will benefit the community of Clearwater by creating a hubfor creative and
technical professionals
Financial: The business will deliver a healthy profitfor itsowners
Environmental: Thefacility will be built using green building bestpractices
Company Values
Author Simon Sinek says "People don't buy what you do; they buythe WHY you do what you do". Our
Why" is encompassed in our five core values:
Innovation: Utilizing findings from latest scientific research, The Ring puts the best industry practices in
healthy workspaces design into motion. Cutting-edge technology is utilized to improve wellness,
performance and productivity so our members can thrive.
Integration: Like two fighters in the ring, we believe that concepts that can seem at odds belong together.
Body and mind are not separate concerns — instead they are integrated to reach their full potential.
Technology and traditional knowledge come together to forge a new path for our members. Personal
wellbeing and professional success do not have to be separate - they can be one and the same.
Inspiration: Our goal is to help our members attain their greatest potential.
Integrity: We strive to be upfront and honest in all endeavors. We understand that reputation and integrity
are valuable assets.
Ingenuity: The Ring will be the industry leader and trendsetter in collaborative spaces, situated in
downtown Clearwater where people like to work and play.
iipag e
LOCATION
THE RING
The Ring is strategically situated in One Clearwater Tower, an ii story "Class A" office building, located in
the heart of the downtown Clearwater. The building currently houses large financial, legal and insurance
institutions, as well as established tech firms and NGOs. The Ring will thus be amongst a diverse cross
section of Clearwater's most prominent and respected business entities, presenting an opportunity to
attract a broad demographic of customers.
Building Tenant Portfolio:
Bank of America
The Clearwater Chamber ofCommerce
Hill Ward Henderson PPAs
Hub Insurance
Interface Systems
Major Government and Private Organizations within a io Mile Radius:
Clearwater City Hall
Pinellas County Civil Court
Church of Scientology Headquarters
City of Clearwater Municipal Services Building
Pinellas County offices
Morton Plant Hospital
There is a strong demand for office space in the area driven by an underserved entrepreneurial culture
embedded in Clearwater. There is an immediate need for dedicated business space that will cultivate small,
middle and large scale business growth while promoting economic expansion. In addition to this rapidly
growing business district, The Ring is within close proximity to world class entertainment, restaurants and a
large number of luxury condominium buildings.
Key Target Markets Include:
Island Estates
Clearwater Beach
Sand Key Beach
Belleair
The Ring Workspaces will occupy the entire third floor and part of the second floor of One Clearwater Tower,
having an approximate facility total of 18,000 sq. ft. In addition, there will be 1,300 sq. ft. outdoor lounge
overlooking beautiful Station Square Park.
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E;;11 THE RING
Virtual Tour
As you enter "The Ring" you will be immersed in a workspace inspired by nature. Elements such as sunlight,
stone, wood, preserved moss will have a strong presence throughout the space. This unique space is difficult
to convey with pictures alone, however, our artist endeavoured to create a beautiful rendering that would
represent the vision as clearly as possible.
Upon entering the building, visitors and members will recognize that they are in a unique space right
away. The green walls not only build a favorable atmosphere, but they also create just the right
amount of humidity.
e reception .es gives a strong impression, wit earl y materia s annatura ig t.
13lPag e
ImFj THE RING
Fight Club" and private office members will get the opportunity to present their businesses in "The
Ring" to potential Venture Capital investors.
The beautifully appointed open co -working area with private phone booths will create a conducive
atmosphere for creative ideas to flow.
14 Pag e
E;;11 THE RING
In Florida, the outdoors is an extension of life not found in other parts of the country. This beautiful
outdoor space is one where people can work, relax, and socialize with other members.
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E;;:l THE RING
BUSINESS GOALS AND OBJECTIVES
Short -Term Goals
55% office suite occupancy rate (23 out of 42 office suites rented) and 3o co -working memberships.
Mid -Term Goals
8o% stabilized office suite occupancy rate (34 out of 42 office suites rented) and 7o co -working
memberships.
Long -Term Goals
go% percent stabilized office suite occupancy rate (38 out of 42 office suites rented) and go co -
working memberships.
BUSINESS MANAGEMENT
Daniels Ikajevs, Co -Founder and Chairman
Daniels Ikajevs is the co-founder and Chairman of The Ring Workspaces, LLC. He is a local Real Estate Investor
and developer with over 14 years of experience in office and residential management and development. He
has been an active resident and business owner in downtown Clearwater for over 7 years and is currently
managing over i8o,000 sq. ft. of office and retail spaces. Daniels completed internationally recognized
Business Incubation Management (BIM) Certificate Program in 2017, and acquired fundamental knowledge
and information resources needed to run successful co -working facilities and incubation programs. He is also
the owner of the 11 -story building where The Ring workspace facility will be located. Daniels is actively
involved as an executive board member in Clearwater Downtown Partnership (CDP). Additionally, he also
serves as the Vice President of HOA in the 156 unit Water's Edge residential building located in Clearwater.
He holds an MBA with focus on Finance and Marketing. An avid traveler and car enthusiast, he has a keen
interest in cutting-edge technology and modern interior design concepts. As the second largest property
owner in downtown Clearwater, he is seasoned in designing and managing traditional office spaces. The Ring
co -working space concept is a natural progression, which integrates his knowledge of traditional building and
office operation with innovative technology and interior design concepts that is meant to revolutionize the
industry.
Simee Adhikari, Co -Founder and General Manager
Simee Adhikari is the co-founder of The Ring Workspaces, LLC. She has been an Entrepreneur, Real Estate
Developer, and Property Manager in the greater Pinellas and Hillsborough country for over 14 years. She holds
an active Florida realtor license, specializing in luxury residential, commercial, office, and retail spaces. This
gives her a broader understanding of the general real estate market, business and demographic trends, and
agency regulations. She has particular interest in Green Buildings and is currently pursuing a certification
course on that subject.
She is also a member of the Pinellas County Realtors Leadership Council. Simee also holds an undergraduate
degree in Computer Information Systems and a Master's in Business Administration (MBA). As a technology
16I Page
E;;;1 THE RING
consultant for Rolls Royce's environmental engineering division, her role was to translate client requirements
into highly technical design solutions, which was highly gratifying. However, after 4 years of working in the
software industry, she decided to switch gears to Real Estate and become an Entrepreneur. Her passion is to
create meaningful projects that can have a positive social, economic, and environmental impact. The Ring
Workspaces is a cumulative expression of her professional expertise and personal aspiration to bring about
positive change.
17IPage
SERVICES
THE RING
The Ring will provide first class co -working and office facilities on a month-to-month membership basis with
a ao% discounted rate for longer term. The Ring will have four main offering for entrepreneurs and virtual
workers.
Virtual Address Membership
Cost: $45 per month
This basic membership will include a dedicated mailbox with prestigious "The Ring Workspaces" address. It
will also give an opportunity for the members to rent offices or conference rooms on an hourly basis.
Co -working Membership
Cost: $gg per month
This membership category gets all of the benefits ofthe Virtual Address membership category plus it allows
access to all common spaces in The Ring on a first come first serve basis. Members will have access to all
amenities, including but not limited to the following:
Full-time community manager
Weekly networking events
Lectures and classes (body, mind, spirit)
Print, scan, fax machines
High speed secured internet access
Free coffee
Ergonomic office furniture
Access to outdoor lounge
Kitchen and dining area
Private phone booth
Recording studio
Sleeping pods
Free parking
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THE RING
Fight Club Membership
Cost: $250 per month
This membership includes all of the benefits ofthe Co -working membership and in addition will be granted
an opportunity to pitch their business idea to an investor panel once a year during "The Ring Main Event".
This membership is restricted to only i6 members who will have 24/7 access to a secured assigned desk
room. Each member will have a dedicated workspace with assigned storage.
Private Office Membership
Cost: Starting at $320 per month
This membership level will enjoy all the benefits of the Fight Club membership. In addition, they will be
granted the privilege to work in a secured private suite equipped with state of the art ergonomic furniture
such as:
Stand up desks
Herman Miller ergonomic office chairs
Day Pass
Cost: Free
A pass for one day will be made available for visitors to the city or for people who want to sample the facility.
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E;;11 THE Rt NG
Service Approach
The uniqueness offered by The Ring is its healthy approach to productivity. This is a multifaceted, integrated
approach comprising of the elements in the chart below.
Ergonomic
Design
Clean Air and
Natural Light
Colaborative
Space
Access to
Latest
Technology
Optimal
Productivity
Optimal
Layout
Organizing
and Learning
Tools
Health and
Fitness Focus
Enhanced Cognitive Functioning
According to the COGFX Study from Harvard T. H. Chan School of Public Health and the Global
Environment, cognitive functioning was significantly impacted by enhanced ventilations:
Cognitivefunction scores were better ingreen building conditions compared to the
Conventional building conditions across ninefunctional domains, including crisis response,
strategy, andfocused activity level.
On average, cognitive scores were:
1Harvard T. H. Chan School of Public Health: http://www.chgeharvard.org/resource/impact-green-buildings-
cognitive-function
20 Page
THE RiNG
o 6i percent higher in green building conditions
o ioi percent higherin enhanced green building conditions
o CO2, VOCs, and ventilation rate all had significant, independent impacts on
cognitivefunction.
According to United Technologies, there were key areas in which these cognitive enhancements took place2:
The greatest cognitivefunction differences were seen in the areas ofcrisis response (73
percent higher ingreen -certified, high -performing buildings); applied activity level — the
ability togear decision-making toward overall goals (44 percent); focused activity level —
the capacity to pay attention to situations at hand (38 percent); and strategy (31 percent).
All of these functions are key to productivity.
The Ring will be putting meticulous attention to detail in terms of creating an environment with enhanced
ventilation and reduced VOC levels.
Health Benefits
While many are concerned over health, and the dangerous impact of sitting for long periods oftime, the
study goes on to outline further health benefits3:
Sleep quality scores were 6.4 percent higherforparticipants in green -certified buildings,
suggesting building impact on sleep quality.
Finally, participants reported better environmental perceptions and 3o percentfewer sick
building symptoms in high -performing, green -certified buildings vs. high -performing, non -
certified buildings.
These health benefits mean that workers can focus on staying focused and get things done at work so after
work, they can enjoy their families, their hobbies and their significant others.
Quantifying Improved Productivity
These health benefits translate into energy savings as well according to United Technologies4.
Following the release ofThe COGfx Study, which showed dramatic impacts ofventilation
on cognitivefunction, the research team sought to evaluate the economic and
environmental costs against the health and productivity benefits ofenhanced ventilation in
office buildings. Studying three ventilation strategies andfour different heating, ventilating
and airconditioning (HVAC) systems across seven U.S. cities, the team found that the
indoor environment previously associated with a doubling ofcognitivefunction test scores
can be achieved at an energy cost between $2.4 and $40perperson peryear andresult in as
much as a $6,5oo equivalent in improvedproductivity perperson peryear. When energy -
2 United Technologies: htto://naturalleader.comlthecogfxstudvlstudv-2/better-thinking/
3 United Technologies
4 United Technologies: htto://naturalleader.com/thecogfxstudv/studv-i/improved-productivitv-auantified/
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1::;;I TME RING
efficient technologies are utilized, the studyfound the energy costs to be between si and
si8 perperson peryear, with a minimized environmental impact equivalent to
approximately 0.03 cars on the road per building peryear."
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THE RING
Healthy Co -Working Spaces in Other Cities
There is strong evidence that a quiet revolution is occurring across America and beyond for people wanting
healthier workspaces.
The Farms, Soho, NY, is a spacious, warm interior
embodying a love of nature and the principles
that guide it.
Denver, CO, is a sustainable co -
working community in the heart of Denver's RiNo
Arts District,
Second Home Lisboa7in Lisbon, Portugal has
over i,000 plants, which are proven to increase
productivity.
5The Farm: http://www.thefarmsoho.com/
Green Spaces: https://www.greenspaces.com/
Tree Hugger: https://www.treehugger.com/interior-design!second-home-coworking-space-selgascano.html
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EJ;11 THE RING
COMPETITIVE ANALYSIS
DIRECT COMPETITION
COMPETITOR ABOUT SERVICES/STRENGTHS WEAKNESSES
Station House is dedicated Co -working: Dedicated desks, Restaurant and events suchStationHouseconferenceoffices, private offices,
24-hour access.
as weddings make it less of
a serious workspace.
to providing a comfortable,
yet dynamic environment in
which our guests can
II I I interact socially or Amenities: Finest coffee and tea Entrepreneurs complain of
greedy" II II professionally, work or co- available — this is very important to
reviewers of various co -working
high prices and
owners.
work quietly, enjoy food,
drinks and entertainment,
and relax peacefully.
spaces. Yoga also available.
4,000 sq. feet of event space.
Do not offer support for
growing businesses. St. Petersburg
Founded in 2008, Tampa Bay Affordable co -working plans Strong technology focus, Tampa Bay Wave WaVE, 'by starting at $100/month and a day which may not beInc. is a
entrepreneurs, for pass for $15/day. appealing to those in other
TAMPA B A y entrepreneurs' 501(c)(3) industries.
t j'e non-profit helping
1, {% y ( entrepreneurs turn ideas
Accelerator growing 169 start-ups,
18 million dollars raised and 700 Blog and homepage of
jobs created. This includes a website not frequentlyintogrowingtechbusinessesmentornetwork, inventor network updated, making the
in Tampa Bay. Today we and investor forum. initiative appear
support over 150 tech start- abandoned from outsider.
ups and over 250 Events including Nerd lunch, Geek
entrepreneurs and other
crazy talented techies that
call Tampa Bay home.
end and Python meet -up.
In the cultural heart of Located in Ybor city, which is highly Targeted only to creatives, CoWork Ybor Tampa, CoWork Ybor is concentrated with professional which may be off-putting to
making space for creatives services businesses with access to people in other industries.
to collaborate, work and transit.
share ins iration. Sharedp
Does not offerspecial
Very affordable plans including facilities such as recording
f r space to share ideas, work
out the essentials and findF;,-,
support to be about your
business.
monthly access from $100/month,
day access for $12/day and group
access for $25/hr.
studio or access to funding.
Standard business amenities and
branded coffee.
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alTHE RING
SUBSTITUTES
Working from Home: People could instead work from home. However, people who work from co -working
spaces report significantly less loneliness, and significantly more productivity.
Local Coffee Shops (Starbucks, Panera Bread etc.): Workers can also choose to work in local coffee shops.
However, this option may not be favorable to some, considering cost of amenities such as coffee and
printing. Distracting background noise can also interrupt meetings.
COMPETITIVE ADVANTAGE
Building
Ownership
Venture
Capital
Healthy
Workspace
Technology
Optimal
Productivity
Healthy Workspace: Meticulous attention to detail to all of its workspace components including water, air,
light, temperature, furniture, VOC emission, and outdoor space. Stand-up desks, health events, an outdoor
lounge where members can work and socialize, makes The Ring stand out from other co -working spaces.
Optimal Productivity: Everything about the space is designed to foster optimal performance, and
productivity in the members while they work.
State of the Art Technology: Technology surpasses the competition including POE lighting, high-speed
secured internet, sleeping pods and a recording studio.
Venture Capitalist Funding: Access to venture capitalist funding is an incredibly valuable asset for
entrepreneurs.
Building Ownership: While most co -working spaces rent, the building is wholly owned by The Ring partners.
This offers an opportunity to spend capital on other benefits for members, and allows room for future
expansion without relocating.
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INDUSTRY ANALYSIS
INDUSTRY GROWTH
Co -working is heralding in a new way of working. The co -working manifesto, signed by members of over
1,700 workspaces says the following: "Co -working is redefining the way we do work. Inspired by the
participatory culture ofthe open source movement and the empowering nature of IT, we are building a more
sustainable future. We are a group of connected individuals and small businesses creating an economy of
innovation and creativity in our communities and worldwide. We envision a new economic engine composed
of collaboration and community, in contrast to the silos and secrecy of the lgth/loth century economy."8
More than being a movement, co -working is a booming undocumented industry. According to Forbes.com,
Co -working has become ubiquitous over the last three years. The co -working market now has over 7,000
players around the globe. Co -working operators have emerged alongside the startup boom. While everyone
has been reading and talking about Fintech, virtual reality and drones, this fast growing, new sub sector ofthe
real estate market has become one of the largest startup segments, hiding in plain sight."9
According to the largest Co -Working Conference, Global Co -working Unconference Conference (GCUC) the
industry sits at 1 Billion dollars.'°
In fact, according to industry website DeskMag, more than 1 million people will be working in co -working
spaces in 2017.11
8Coworking Manifesto: http://coworkingmanifesto.corn/
9Forbes: https://www.forbes.com/sites/falgunidesai/2o16/0V10/coworking-spaces-poised-to-enter-new-growth-
phase/#Sb4o881a1goa
GCUC: https://gcuc.co/whv-coworking/
11DeskMag: htto://www.deskmag.com/en/the-complete-2o17-coworking-forecast-more-than-one-million-
people-work-from-14000-coworking-spaces-s/2
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THE RING
Micro -economic trends
According to the 2017 Global Co -working survey, the following economic factors are at play by individual
players.
The primary source of income
for co -working spaces is
renting desks, though
combined membership plans is
slowly growing. Renting
private offices, renting
meeting spaces and renting
event and class spaces are also
significant income earners.
The majority of the expenses
associated with co -working
spaces is rental. Operating
costs and wages are other
significant costs for operators.
As an owner of the space, The
Ring is well positioned to
succeed.
INCOME STREAMS OF C
P(JEUC SUPPORT
X SALE OF TICKETS TO INTERNAL EVENTS
SALE OF FOOD S DRINKS
SPONSORING
VIRTUAL OFFICE SERVICES
RENTING EVENT .E CLASS SPACES
RENTING MEETING SPACES
RENTING PRNATE OFFICES
COMBINED MEMBERSHIP PLANS
111 RENTING DESKS
mFunaN AliMMEfcMWiw rwzoictosatamommaraver
EXPENSESOF COWORXING SPACES" desk.,; f,
E?`% OTHER'
FOOD & DRINKS
LI EQUIPMENT
EXTERNAL MARKETING
WAGES FOR OWNERS
MAINTENANCE
WAGES FOR STAFF
OPERATING COSTS
RENT OF LOCATION
2015-16 201617
OF MCAT -FOALS ARE
RENTEDBY A
COWORKINCSPACE
261Page
Co -working spaces in larger
city centers tend to have
better performance. The Ring
will target Tampa and St.
Petersburg as well through
various marketing methods.
SEO and the Co -working visa
program was the marketing
activity for profitable spaces.
The visa program is a
partnership with other co -
working spaces, where one
membership gives access to
many spaces. The Ring will
focus on this as a marketing
activity.
BY NO. OF INHABITANTS OFA LOCATION
E;;11 THE RING
PROFITABLE • ZERO LOSS. ZERO PROFIT UNPROFITABLE IS THETQ17Gi98A&CpN9GM i cwort 4
BY MARKETING ACTIVITIES - ALLcow:m*{INc SPACES desk
REFERRAL
PROGRAMS ASSCCIATiON
Sfa*L BONLINE COMM NOTY
MED4ACTINIVES 01/SC4NG
1E3 III=1 j=1 23%
ACTPATItS
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PROFITABLE ZERO Loss, ZEROPROFR '%;: UNPROFITABLE 2 TUE201 CONVOMMICRONEY4
27IPag e
THE RING
INDUSTRY TRENDS
Based on recent surveys and industry reports the following trends are emerging in the industry:
Niche Communities
Following standard industry lifecycle theory, as industries mature, niche markets begin to appear. The co -
working industry is no different. According to Forbes: "Operators will target specific sectors and professional
groups in an effort to build stronger community and therefore create loyalty among their renters."12 Services
offered to those in the niche include training and networking. An interesting space out of New Orleans called
Landing Zone features discountstargeting veterans for example.13
SHAPE CP Cry titliPKINC SPACES BY TYKE OE ACCESS
However, the Global Co -working survey shows that communities open to all are still more profitable.
Multiple Locations
Several regional players are expanding their locations, for example, some in the South are centred on
airports for local travellers. According to Forbes: "While WeWork has been the largest provider worldwide,
smaller providers are beginning to branch out into multiple locations with a membership concept allowing
clients to access different sites."14
12 Forbes
3Landing Zone: http://www.lznola.org/vetlaunch.html
Forbes
28IPag e
THE RING
Larger Spaces
According to the Global Co -working Survey, larger spaces are more successful showing the most profitable
spaces with 200+ memberships.
NUMBER OF MEMBERS PEP COWOPKING SPACE d skx
17%i2%
31% ,_...F, ,.r.,,,..,`,;,.
ABLE 11 ZERO LOSS. ZERO PROFIT UNPROFITABLE co n,E 20170.08AL CCMVORKPG SURVEY
This also allows for more event -based revenue, and "Larger spaces also enable co -working providers to
negotiate more effectively with building owners."5
New Services
To retain clients and drive more value, co -working operators are experimenting with concierge services,
group discounts to local retailers, hotels and airlines and other ancillary offerings."i6 For example, Galvanize,
out of Denver, Colorado offers education and access to partners such as Google for Entrepreneurs, IBM and
Silicon Valley Bank.17
Companies Engaging in Co -Working
An increasing number of companies are incorporating co -working into their business strategy. As said by the
Harvard Business Review (HBR):
Michael Kenny, Managing Partner ofSan Diego -based Co -Merge, told us, "In the past year
and a half, we've seen a dramatic increase in the use of the space by enterprise employees.
We have seen teams come in to use various on -demand meeting rooms. We have users
from global companies ofsize rangingfrom several hundred to several thousand employees
who use the space not only to allow their distributed workers to get productive work done,
but also to attract employees who demandflexible workplace and worktime. ""la
5 Forbes
16 Forbes
1JGalvanize.com: https://www.galvanize.com/entrepreneur#membership
i8HBR.org: https://hbr.org/zoiz/oclwhv-people-thrive-in-coworking-spaces
29JPag e
Remote workers are also joining co -working spaces individually
THE RING
INDUSTRY SUCCESS FACTORS
Sharable has identified io key success factors 9 in terms of a successful co -working space which are placed in
the first column of the chart below. How The Ring satisfies these success factors is on the column on the
right.
FACTOR
Clearly Identifiable
Market
Convenient Location
Interior Design
Branding
Community Culture
Events and Education
Seamless Sign -Up,
Access and Billing
Management
Music
Amenities
Pricing and Flexibility
THE RING
The Ring is located in the heart of downtown Clearwater, close to the
world-renowned beaches, restaurants, and sho.s.
The Ring brand differentiates it clearly based on clear and unique benefits,
desi•n of the interior s .ace, and desi.n of its lo•o and materials.
unique community culture. This is a key difference between a s
workspace and a co -working space.
The Ring will host a variety of events such as mind -body -spirit workshops,
networking mixers, yoga classes, community stretches etc., as well as
allow members to oranize their own.
working and flexible workspaces.
Although music may be the right choice for other concepts, The Ring will
choose not to include it upon launch as a conscious decision. However,
music will be made available in conference rooms and events.
The Ring offers a variety of flexible membership options at competitive
rices.
19 Sharable: http://www.shareable.net/blog/the-io-step-guide-to-a-successful-coworking-space
OfficeR&D: https://officernd.com/
3o1Page
ALJ
THE RING
TARGET MARKET PERSONAS
Everyone targeted by The Ring workspaces are focused on productivity and growth. They do not take a laid-back approach to business. They are
driven to succeed. These people can either be solo entrepreneurs, owners of small businesses, or workers of remote teams.
31 Pag e
Millennial Madison Gen X Xander Boomer Ben
Demographics: Age Group n-34, Demographics: Age Group 35-49, Demographics: Age Group 5o-68,
Male and Female Split Male and Female Split Male and FemaleSplit
Position: SocialEnterprise Entrepreneur Position: Digital Agency Owner Position: Senior Consultant
Background: Previouslyworked at a PR firm Background: Sales Background: Former Executive
Sala t 000rY35. Salary: t120,000 Salary: 870,000
Goals: Goals: Goals:
Wants to make a difference Make more money to support family Supplement retirement
Build awareness for a cause she cares about Willingto put in a lot of hours Strongly identifies with hisprofession
Grow social and professional network Healthylifestyle Combinebusiness with pleasurable lifestyle
Positive impact on the environment Get fundingfor business Enjoys an aesthetically -pleasing atmosphere
Hobbies: Running onthe beach, herdog Hobbies: Windsurfing, travel Hobbies: Golf, home renovation
Membership: Fight Club Membership Membership: ExecutiveOffice Membership Membership: Co -Working Membership
This isthe standard demographic forthe co -working space This is thepersonwho is ready to moveupfrom the co- Inaneffortto integrate with Clearwater's demographics, The
working environment, but still benefit from theatmosphere. Ring will alsohave eventsto appealto baby boomers.
31 Pag e
11;j THE RING
MARKETING STRATEGY
OVERVIEW
This method explains how to transform strangers into promoters. Strangers are attracted to the business
using online and offline methods and become visitors.
Visitors are converted based on seeing the free introductory membership offer and become leads.
Leads are closed based on sales skills and become customers.
Customers see their businesses succeed and receive regular, informative newsletters, and thus
become promoters. This, in turn, creates repeat and referral business.
u
r0
Pubic Relations
Website with SEO
Video Channel
Social media
PPC and
Remarketing
Corporate Outreach
Brochures
Events
Day pass
Co -Working Visa
Program
a
C
0
V
Sales skills
e
a
v1
O
V
E-mail newsletters
Benefits of the
healthy workspace
t Eventsal
Happy Hour
3
Q Q
32 Page
PROMOTIONAL TACTICS
STRATEGY
Public Relations
TACTIC
The healthy aspect of the space
along with the connection to
Clearwater and its revitalization
will be an outstanding "good
news story".
Search Engine Optimized grow co -working spaces most
SEO) Website
Active Video Channel
Co -Working Visa Program
Social Media Marketing
Pay Per Click Marketing and
Remarketing
effectively.
A recording studio will be part
of the co -working space. As a
result, members and the
community manager can post
videos regularly to the co -
working space's channel.
Having a co -working visa with
other co -working spaces had a
positive impact on results. The
Ring will therefore reach out to
other spaces in Tampa and St.
Petersburg to create these
alliances.
Marketing through Facebook,
Instagram, and Twitter offers an
opportunity to target
entrepreneurial users easily.
Facebook Retargeting could also
be used for people who
attended events and visitors to
the website.
This would be a highly targeted
Google AdWords campaign for
people searching for co -working
spaces near Clearwater.
Remarketing through Google
would also be used to
331 Page
EjTHE RING
DESIRED OUTCOME
Create awareness and sales for The
Ring.
Increase traffic to the website and
memberships. The website would be
open before the location opens, to
offer a pre -sale opportunity.
Video is a great social media tool, and
video is overtaking text and images on
the website. This will therefore attract
visitors to the website, and enhance
conversions. It would also establish a
sense of community for members.
Increase memberships with other
spaces in the area.
Increase memberships.
Increase memberships.
E-Mail Marketing
encourage repeat visitors to the
website.
E -Mail marketing would be used
as a relationship tool for anyone
who entered information on the
website.
7.;;:l THE RING
Increase sense of community and
convert leads into customers.
Corporate Outreach Since Clearwater is home to Ability to create a stable revenue
companies like Tech Data, source.
KnowBe4, and Honeywell.
Outreach to these and other
companies to have virtual teams
at The Ring location would
create a steady revenue source.
Brochures and Collateral Brochures and collateral will be This would be the main offline
created to attract different marketing activity for The Ring.
segments of the market. These
would be strategically placed at
business centers, meeting
points for entrepreneurs and
center events.
Events Events put on by the space or by
its members would be open to
the public. This would offer a
natural opportunity to grow
awareness.
PRICE STRATEGY
This is a benefit to the members, at
the same time as allowing members of
the public to view the space.
The Ring will implement a "Competitive Pricing" strategy where it sets the price based on what the
neighboring competition is charging. This strategy is generally used once a price for a service has reached an
equilibrium and there are also substitutes available.
341Page
16.:;}
THE RING
OPERATIONAL SUMMARY
Company Organization
The company would be lean, but would also create employment within Clearwater for young professionals
engaged in business, technology and service based industries, they will also be mentored by two Real
Estate and Business Owners striving to make a difference in the downtown community. Overall,
individuals working at The Ring would have an opportunity to grow as the company grows. New positions
and roles are also expected to grow as the entity grows.
General
Manager
Community
Manager
L
Front Desk
Associate
Assistant
Community
Manager
Chairman
Person: Daniels Ikajevs
Promote and oversee the highest standards of corporate governance within the Board and the
Company.
Be a sounding board and mentor to the Director of Operations and Business Development.
Enhance the overall effectiveness oftheteam.
General Manager
Person: Simee Adhikari
Building valuable partnerships
People Management
351Page
r;m11 THE RING
Fundraising (investment, sponsorship)
Growth Strategy
Filling in for any gaps in staffing needs
Policy/Procedure Development
Managing Operations Staff
Systems Maintenance
Community Manager
Person: TBD
Membership Sales Strategy
Hosting member gatherings (lunches, happy hours etc.)
Member Policy Development and Enforcement
Creating the space "vibe"
Member Communication Strategy
Billing Dispute Resolution
Facilities Management
Member Signups
Member Communication
Tours
Introducing new members to the community and facilitating connections
Some facilities maintenance
Keeping space tidy throughout the day
Front Desk Associate
Person: TBD
Screening for members/ non members
Greeting guests and informing members of guest arrival
Accepting packages and sorting mail
Opening and closing space daily
Keeping kitchen area up (brewing coffee, loading/unloading dishwasher, etc.)
Assistant Community Manager
Person: TBD
Once the facility is at full capacity, and Assistant Community Manager will be hired to assist the community
manager in the execution of duties associated their role.
36IPage
THERING
FacilityLayout
1 THE RING
381Pag
E;1 THE RING
Implementation Plan
Tasks
Financial Grant A .. royal
2 2 3 4 S 6 7 8 9
TIMELINE
10 11
Weeks)
12 13 14 15 i6 17 18 19 20 21
Attain Building Permits
Finalize contract with GC
Order Furniture in Time for delivery and
installation
Install VAV, duct, airterminals and Coz
and Air . ualit Sensors
Install network cabling, Poe Lights and
com.lete electrical .rid IlIlIlIll
Completed Plumbing
Purchase Printers, Coffee Machine, TV's,
Telephones and supplies UIIIUIIIIUUU• 111111
Develop Website, CRM and payment
system
Pre -sale .romotion be. ins
Set U. Social Media Accounts
Marketin. and Advertisin .
Floors Installation Com . lete
Overall Construction com.lete
Recruitment of Community Manager and
Front Desk
Grand 0 .enin.
39
SWOT Analysis
SWOT ANALYSIS
STRENGTHS
High performance environment
R ' State of the art amenities
Facility ownership
Access to venture capital
E;;11 THE RING
WEAKNESSES
Access to capital to fully fund renovations
Two floors may be inconvenient to
navigate — this can be resolved through
communications and signage
Downtown is currently quiet — will
therefore try to draw members from
nearby cities as well
OPPORTUNITIES THREAT
Increasing entrepreneurship culture around
the world
Clearwater recognized as among the top 25
beaches in the world — this positions the city
as one that draws people who love health
and natural spaces
Clearwater known as "best place to
retire" — The Ring will appeal to a Baby
Boomer market as a result
Entry of new competition — this is why
The Ring strives to be unique from the
beginning
Technology may become obsolete. As a
result, the team will keep an eye on
emerging technologies
401 Page
Appendixes
Appendix a: COGFX Study
ents lists available at
Building and Environment
The impact of working in a green certified building on cognitive
function and health
Piers MacNaughton ', Usha Satish b, Jose Guillermo Cedeno Laurent ', Skye Flanigan a, Jose
Vallarino a, Brent Coull c, John D. Spengler a, Joseph G. Allen a,
Department of Environmental Health, Harvard T.H. Chan Schoolof Public Health, Boston, MA, USA Psychiatry and Behavioral Sciences, SUNY -Upstate Medical
School, Syracuse, NY, USA `Department ofBiostatistics, Harvard T.H. Chan School of Public Health, Boston, MA. USA
Crtrstiark
a rticleinfo
Article history:
Received 27 June 2016
Received in revised form
23 November 2016
Accepted 24 November 2o16 Available
online 25 November 2016
Keywords:
Green certification Office buildings
Cognitive function
Buildingomics
abstract
Thirty years ofpublic heahh research have demonstrated that improved indoor environmental quality is associated with
betterhealth outcomes. Recent research has demonstrated an impact ofthe indoorenvironment on cognitive function. We
recruited log participants from io high -performing buildings (i.e. buildings surpassing the ASHRAE Standard 62.se2oio
ventilation requirement and with low total volatile organic compound concentrations) in five U.S. cities. In each city,
buildings were matched by week of assessment, tenant, type ofworkerand work functions. A key distinction between the
matched buildings was whether they had achieved green certification. Workers were administered a cognitive function test
of higher orderdecision-making performance twice during the same week while indoor environmental quality parameters
were monitored. Workers ingreen certified buildings scored 26.495 (95% CI: [12.896, 39.795)) higher on cognitive function
tests, controlling for annual earnings, job category and levelof schooling, and had 3045fewer sick building symptoms than
those in non -certified buildings. These outcomes may be partially explained by IEQ factors, including thermal conditions and
lighting, butthe findings suggest that the benefits of green certification standards go beyond measureable IEQ factors. We
describe a holistic "buildingomics' approach for examining the complexity offactors in a building that influence human
health.
Indoor environmental quality
1. Introduction
2016 The Authors. Publishedby Elsevier Ltd. This is an open access article under the CC BY license
http:(/creaivecommons.orq(lcensesibyi4 o1).
Thirty years of public health science and building science
have demonstrated that buildings play a key role in
shaping our health [ie51. Buildings have the capacity to
create conditions that are harmful to health or conducive
to health: they determine our exposure to outdoor
pollutants, by either facilitating entry of particles of
outdoor origin indoors, or acting as a barrier and
removing them through enhanced filtration [6]; they
govern exposure to chemicals of concern, such as volatile
organic compounds (VOCs), flame retardants and
polyfluorinated compounds, which can be ubiquitous or
nonexistent, depending on the decisions we make
regarding building materials and products [7,8]; buildings
either protect us from noise or contribute to the problem
through the introduction of indoor sources, poor noise
insulation, or poor acoustical design [9,101; they can
induce eye strain or improve alertness through impacts on
circadian rhythm, depending on the lighting system
1],121; buildings can protect us during heat events, or
create environments that magnify the problem through
solar heat gain [13,14]; and buildings can either wall us off
from nature or connect us to it [15,161.
The scientific literature around buildings and health has
identified the foundations of a healthy building including
factors such as ventilation, air quality, thermal comfort,
noise and lighting, and this body of research has served as
the basis for green certification standards to define their
indoor environmental quality (IEQ) guidelines. A review of
Corresponding author. HarvardT.H. Chan School ofPublic Health, trotPark Drive, Landmark
Center, 4o4 -L, Boston, MA, o2215, USA.
E-mail address: JGAllen (Ehsph.harJard.edu (J.G. Allen).
http:(rdx.do:.orgho.tot6/j.bu: denv.2o16.1t.o41
Construction 2012, BCA Green mark for new non-
residential buildingsv4.12013, and DGNB New Office
V2012 - demonstrates the approach ofthese certification
standards toward IEQ. All of the rating systems offer
credits for thermal comfort, indoor air quality (IAQ) and
leading, global green -building standards LEED New
Construction 2009, Green Star Office v3, BREEAM New
improvements in the green buildings [2o]. These include
reduced asthma and allergy symptoms in offices [21];
reduced respiratory symptoms, fewer sick building
symptoms, and better self-reported well-being in public
housing [22e24]; and fewer medical errors and decreased
mortality in hospitals [25]. Of these studies, Newsham et
al. used an approach similar to this study by recruiting
green and conventional office building pairs and measuring
IEQ. They found an improvement in IEQ, a reduction in
symptoms, and better reported sleep quality in the green
036o-1323)® 2016TheAuthors. Published byElsevier Ltd. This isanopen access article underthe CCBY license(http:(Jcreativecommons.org/licensesjbyi4.o1).
lighting; all but LEED NC 2009 have credits for acoustics; buildings [26]. A follow up paper by Colton et al. published
and Green STAR v3 and LEED NC 2009 have credits since the time of our review found that in addition to fewer
specifically for ventilation. However, building owners and
developers can opt for certain credits, and IEQ represents
only 4e2o% of the total score a building can obtain. Of the
reviewed rating systems, only LEED NC 2009 has
mandatory IEQ credits, for minimum IAQ performance and
environmental tobacco smoke control [17].
The adoption rates ofthe optional IEQ credits in LEED NC
2009 give an indication of how building owners are
prioritizing certain aspects of IEQ [17]. We extracted the
data and found that the vast majority of projects obtain
credits for low -emitting adhesives, paints and flooring
systems (Table 1). Increased ventilation is much less widely
adopted, despite strong evidence for health and
performance benefits of higher ventilation rates [18,19].
While some credits are preferentially adopted and others
not, buildings that seek LEED NC 2009 obtain on average 9
of the 15 possible IEQ credits, not including the required
fundamental commissioning credit under the energy and
atmosphere credit category.
The literature suggests thatthese credits translate into
improved IEQ. Our previous review of green buildings and
health identified 17 studies and found that, overall,
occupants report better IEQ and fewer health problems in
these buildings compared to non -certified buildings. These
studies found lower levels of VOCs, formaldehyde,
allergens, nitrogen dioxide, and particulate matter in green
buildings, which have been separately shown to impact
health. Six ofthe reviewed studies tracked the health of
occupants in addition to IEQ, and all six found
asthma symptoms, hospital visits and school absences
were reduced in the green certified public housing
development [27]. Comparisons of buildings in poor
condition to green buildings provide an opportunity to see
the biggest potential effect, but may falsely attribute
benefits to certification.
As part of our efforts to determine the factors that drive
better human health in buildings, we previously conducted
a study in a controlled setting to investigate several IEQ
factors e ventilation, CO2, and VOCs e and their impact on
cognitive function scores. We found significant impacts on
human decision-making performance related to all three of
these factors (Allen et al., 2015). Others have also found
independent effects of ventilation, CO2 and VOCs on
cognitive function and other physiological responses at
levels
Table 1
commonly found in indoor environments [19,28e31]. In this
current study, we looked at buildings that are high -
performing across these indicators of IEQ and investigated
the potential for additional benefits of green certification
on cognitive function, environmental perceptions, and
health.
2. Methods
2.1. Study design - Overview
Workers from 10 office buildings in five U.S. cities (two
buildings per city) were recruited to participate in a week-
long assessment. 12 participants were initially recruited
from each building. Participants completed surveys about
their health and environmental perceptions and took a
cognitive test on the Tuesday and Thursday of the
assessment. All buildings are high -performing buildings,
defined as buildings surpassing the ASHRAE Standard
62.1e2olo minimum acceptable per person ventilation
requirement and with low (<250 mg/m3) TVOC
concentrations; however, six of the buildings were
renovated to green via the LEED certification framework
while the remaining four did not seek green certification
during renovation [32].
2.2. Participant and building recruitment
The building assessments took place in urban areas ofthe
following cities: Boston, Massachusetts (9/29/2015-
10/2/2015); Washington DC (10/26/2015-10/30/2015);
Denver, Colorado (11/9/ 2015-11/13/2015); San Jose,
California (11/30/2015-12/4/2015); and Los Angeles,
California (12/14/2015-12/18/2015 and 2/1/2016-2/5/ 2016).
In each city, the buildings were matched strictly by tenant
and loosely by age and size (Table 3). In the first four cities,
the buildings were also matched by the dates of
assessment, and the buildings were recruited such that one
building was LEED-certified and the other not. The goal of
matching was to select two highperforming buildings in
each city that were as similar to each other as possible with
the key distinction being that one pursued LEED
certification. In the last city, Los Angeles, two green
certified buildings were recruited and the assessments
occurred on different dates due to an earlier enrolled
building dropping out of the study prior to the assessment;
a second building was subsequently recruited. The study
team visited each building prior to the assessment to: a)
perform a an initial assessment of the heating, ventilation
and air conditioning (HVAC) systems, 2) ensure that the
building classification as high -performing was valid, and 3)
recruit participants.
After obtaining permission from the building owner,
building management and tenant, 12 participants were
Credit
recruited to participate in a five day health assessment in
each building. Final
participant numbers by building are presented in Table 3.
As mentioned previously, the same tenant was used in
each city to ensure similar work functions, and all ofthe
companies employ primarily knowledge workers (i.e.
administrative, professional, technical and managerial
positions). Asthmatics were excluded during recruitment.
We did not restrict recruitment to select areas of each
building to limit potential selection bias, but we are unable
to demonstrate that our participants are representative of
the building population. The study protocol was reviewed
and approved by the Harvard T.H. Chan School of Public
Heafth Institutional Review Board. All participants signed
informed consent documents and were compensated
100.
2.3. Building assessment
The building assessment consisted ofthree parts. First, the
study team conducted an inspection of the building
systems along with the building engineers from each
facility. The study team recorded the type and condition of
the systems, how they are typically operated, and the
frequency of building commissioning tasks such as
changing the filters. Second, the study team characterized
each test space. The test spaces were defined bythe
unique ventilation zones in which the participants were
located. The baseline assessment ofthe test spaces
characterized the building, office and cleaning materials in
the space; the air supply and exhaust strategies; and the
environmental controls such as operable windows and
thermostat set points. On each cognitive testing day, a
separate assessment was conducted of the ventilation
rates, noises, odors and occupancy in each test space.
Lastly, the building manager was provided a survey asking
about general building information, building policies, and
utility costs. All elements ofthe building assessment were
adapted from the EPA BASE study [33]. These elements
were designed to assess the building as a whole rather than
just the IEQ of the participant's workstations. The building
EQca: Increased ventilation
EQc4.1: Low -emitting materials - adhesives and sealants
EQc4.2: Low -emitting materials - paintsand coatings
8004.3: Low -emitting materials -flooring systems
EQc4.4: Low -emitting materials - composite wood and agrifiber products
EQc5: Indoorchemical and pollutant source control
E0c6.1: Controllability of systems e lighting
EQc6.2: Controllabilityof systems -thermal comfort
EQc7.1: Thermal comfortedesign
8007.2: Thermal comforteverification
EQc8.1: Daylightand views e daylight
EQc8.2: Daylightand views eviews
Adoption Creditadootion rates for select
optional IEQ credits in 1600LEED
40.9%
86.5%
94.4%
79.1%
58.6%
40.7%
66.494
39.11/4
79.41/4
59-a%
19.5%
38.3%
NewConstruction aooq certified
buildings (USGBC. aoi61
assessments did not intend to validate the certification of
building; therefore, we cannot say whether the green
certified buildings still meet the criteria for certification nor
whether the non -certified buildings would classify as a
green certified building had they gone through the
certification process at the time of the study. We anticipate
that the organizations responsible for the non -certified
buildings would seek certification if it was possible since
the same organizations did obtain certification for the
green certified buildings in our study.
2.4. Environmental assessment
A complete characterization of the IEQ in each test space
was conducted on each cognitive testing day. Each
participant was outfitted with a Netatmo Weather Station
Netatmo, BoulogneBellancourt) in their cubicle to
measure temperature, humidity, carbon dioxide
concentrations in parts per million (ppm), and sound levels
in decibels) every 5 min for each participant. The units
were tested with 400 and woo ppm CO2 calibration gas
before and after the field campaign. If the sensor had
drifted, the CO2 data was adjusted first by the offset from
the 400 ppm reading and second by a scaling factor to
match the 1000 ppm reading ofthe instrument to woo
ppm. This process corrected both the intercept and slope
of the collected data to match experimentally derived
values. The CO2 data was then used to produce ventilation
cfm of outdoor air per person) and air exchange rates
ACH) for each participant -day of the study. For ventilation
rate, the 90 percentile CO2 concentration during occupied
hours was taken as the steady-state concentration of CO2
using the method described by Ludwig et al., and for air
exchange rate, the decays curves of CO2 were analyzed
using the tracer gas method described in ASTM Standard
E741-11 [34,35]. Briefly, when test spaces changed from
fully occupied to unoccupied, the rate of decay of occupant
generated CO2 can be used to estimate air exchange rates
using the validated methodology set forth by ASTM. These
approaches have some limitations; for example, air from
other zones with elevated CO2 levels can bias air exchange
rate calculations and assumptions about occupant CO2
generation rates may be inaccurate.
Air sampling was performed for 62 common VOCs and 14
common aldehydes in each building in the test space with
the most participants present during each cognitive testing
day. VOCs were collected using summa canisters according
to EPA method TO -15. Aldehydes were collected on an 8-h
integrated active air sample (0.4 L/min flow rate) according
to EPA method TO -11. ALS Analytical Laboratories
conducted the analyses of these samples (Cincinnati, OH).
25 VOCs and four aldehydes were not detected in any of
the samples. Each test space was also equipped with at
least one commercial sensor package (FengSensor,
Tsinghua University, Beijing) to measure the same
parameters as the Netatmo as well as light levels in lux and
particulate matter less than 2.5 mm in diameter (PM2.5) in
mg/m3. These sensors were installed on the first day of the
assessment (Monday) and collected on the final day ofthe
assessment (Friday).
2.5. Health assessment
Participants were provided a Basis Peak Watch (Basis an
Intel Company, San Francisco) for the duration of the
assessment, which tracked the participants' heart rate, skin
temperature, galvanic skin response, physical activity (i.e.
steps and calorie expenditure) and sleep patterns (i.e. sleep
duration, tossing and turning, number of interruptions).
The participants also completed a series of questionnaires
over the course of the study. The first was a baseline survey
about their perceptions of their work environment and
health. The second survey was completed each study day
at the end ofthe workday, a total of five times for each
participant, which asked about their environment and
whether they experienced any of 19 sick building syndrome
SBS) symptoms on that day. A followup survey was
completed on the final day of the study asking questions
about the previous week, such as satisfaction with noise,
lighting, thermal comfort and odors in their cubicle. These
surveys were adapted from the EPA BASE study as well
and used in our previous research on green buildings
30,33]
Cognitive functionwas assessed using the Strategic
Management Simulation (SMS) software on Tuesday and
Thursday at approximately 15:00. The participants
completed two different scenarios to avoid potential
learning effects, and the frequency of each scenario was
balanced between green certified and non -certified
buildings. The SMS tool is a validated, computer-based
test that measures higher -order decision making ability
across nine domains of cognitive function, ranging from
basic activity levels to strategy. The SMS tool, and how to
interpret scores in each cognitive domain, has been
extensively described in the literature [36e38]. Briefly, the
SMS tool immerses the participant in a 1.5 h long real-life
scenario, where they have to respond to several plot lines
that emerge over the course of the simulation. These plot
lines are validated for content and designed to capture
cognitive functions representative of productivity in the
real world. As a result, validations ofthe SMS testing have
found a high degree of correlation between performance
on the SMS test and other indicators of productivity such
as salary at age and number of employees supervised at
age [36]. Participants are given the flexibility to approach
the simulation in their own thinking style, with no stated
demands and a wide breadth of available responses. The
types of decisions and plans the participant makes and the
events to which they link these actions are processed by
the software through a series of algorithms that compute
scores for each domain. The SMS study team is blinded to
the building status (green certified vs. non -certified).
Participants' cognitive function scores on Tuesday and
Thursday were, on average, highly consistent. More
detailed methodology about the cognitive testing is
described elsewhere [19,29,39].
2.6. Statistical methods
The IEQ data collected in this study experienced building -
level clustering, which was accounted for with hierarchical
statistical tests. Two -sample t-tests with clustered data
were used to test for significant differences in IEQ between
green certified and noncertified buildings. For analyses of
participant outcomes, such as cognitive function and sleep,
the data was additionally clustered by the repeated
measurements on each participant. Generalized linear
mixed effect models were used to model the associations
between building classification and these outcomes,
treating participant ID and building ID as a random effect:
Cog:Scoreiit 1/4 b, pb,*$Green Certified b,i b b2. k b ei;j;k
i)
where Cog.Score;,;,k is the average cognitive score for
subject i on day j in building k, normalized to the non -
certified, high -performing buildings; b, is the fixed
intercept; b, is the fixed effect of high -performing, certified
buildings compared to high -performing, non -certified
buildings; b2 is the random effect of intercept for subject i;
and bz;,k is the random effect of intercept for building k.
Additional models were run with the following variables:
job category, annual earnings, level of schooling and
thermal comfort as indicator variables and previous night's
sleep as a continuous variable. The residuals were normally
distributed and homoscedastic for all models. We used
penalized splines to graphically assess linearity in the
associations between continuous variables and outcome
measures.
The SMS tool provides raw scores for nine domains of
cognitive function. To allow comparisons between
domains, the cognitive function scores were normalized to
scores in the non -certified building by dividing each score
by the average score in the noncertified buildings in that
domain, as has been done in previous studies using the
SMS test [39]. The average cognitive score is an average
score across the nine domains. Thermal comfort is a binary
variable that reflects whether or not a participant was
within the thermal comfort zone specified by ASHRAE
Standard 55-2004 on any particular day of the assessment
4o] (Fig. Si). Relative humidity and temperature from the
Netatmo were entered in the Fangerthermal comfort
equations to estimate whether the percent of people
dissatisfied with the thermal conditions would exceed io%
4i]. We assume constant radiant temperatures (same as
dry bulb temperature), air velocities (0.15 m/s), metabolic
rates (i met), and clothing (1 clo) between participants.
To assess sleep, we developed an index to characterize
each night of sleep across three well-known indicators of
sleep quality: sleep duration, tossing and turning, and
number of interruptions. It was calculated using data from
the Basis Watch for each night of sleep the participants had
during the assessment according to equation (2):
Sleep:Duration Toss:Turn
Sleep Score 14 i00%,
420 85
io%, (2)
Num:Int
4
where Sleep.Duration is the number of minutes the
participant spent sleeping between 9PM and 9AM the
following day, Toss.Turn is the number of minutes during
which the watch registered motion via the accelerometer
the maximum Toss.Turn in this study was 85), and
Num.lnt is the number of times during a night of sleep that
the sleep activity changed from asleep to awake and then
back to asleep (the maximum Num.lnt in this study was 4).
Ifthe participant slept for longer than 42o min, or 7 h, the
first term was capped at ioo%. Nights when the watch was
not worn or worn improperly were removed from the
analysis, resulting in a total sample size of 260 nights,soo
of which preceded a cognitive testing day. The average
Sleep Score was 83.1% with a standard deviation of 19.7%.
Sleep Scores and thermal comfort were added to the
model in Equation (i) to test their effect on cognitive
function. Analyses were performed using the open -source
statistical package R version 3.2.o (R Project for Statistical
Computing, Vienna, Austria). 3. Results
The non -certified buildings and green certified buildings
had similar air quality; the low CO2, low TVOC and high
ventilation rates indicate that the buildings were high -
performing at the time ofthe assessment (Fig. 1). The
ventilation rates exceeded the ASHRAE 62.1e203.0
standard for 84% of participants, which could mitigate the
buildup of airborne contaminants. The green certified
buildings were on average brighter (374 lux vs. 163 lux),
louder (51.8 dB vs. 48.9 dB), and drier (38.4% vs. 45.9%)
than the non -certified buildings; however, only the
difference in relative humidity was statistically significant
Fig. 1). Differences in humidity may be driven by the
ventilation strategies in the green certified buildings, which
more frequently had variable air volume ventilation
systems and energy recovery ventilators (ERVs). In the
cases when outdoor humidity was high, buildings with
ERVs had lower indoor humidity levels.
Between -subject analyses were necessary to compare
participants in different building classifications. Table 2
shows the demographic information for the participants in
each building classification: the matching criteria resulted
in the two groups having similar job classifications, gender
and ages. The green certified buildings had a slightly larger
percentage of white/ Caucasian participants and
participants with a college or graduate degree. These
buildings also had more participants at both the lower and
higher end ofthe range of annual earnings. We added
these variables as predictors to the cognitive function
models to test if they influenced baseline cognitive
abilities. While some ofthese variables had non-significant
associations with cognitive test scores, the effect estimate
of building classification did not change when these
parameters were added to the model, indicating that the
findings are not a result of residual confounding.
The impact of building classification on each domain of
cognitive function is summarized in Fig. 2. On average,
participants in the high -performing, green certified
buildings scored 26.4% (95% CI: [12.8%, 39.7%]) higher on
the SMS cognitive test than those in the high -performing,
non -certified buildings (p -value < o.00i). Cognitive scores
were statistically significantly higher for 7 of the 9 domains
with the largest impacts on crisis response, applied and
focused activity level and strategy. No differences in scores
were seen for basic activity level or information seeking.
For the average scores, the model's R2was 0.28, indicating
that 28% of the variability in cognitive function scores is
explained by the building classification alone.
Of the IEQ parameters assessed in the buildings, the
largest differences were seen for relative humidity. The
non -certified buildings were more frequently outside the
ASHRAE Standard 55 thermal comfort zone than the green
certified buildings due to their higher humidities (Fig. Si).
Both building classifications had participant -days where
the building was too cold to comply with
Vent tcfm'person) AER(ACH)
1
u 0
Fig. 1. Boxplots of indoor environmentalquality (I60) parametersin high -performing, non -certified buildings and high -performing, green certrfied buildings. Vent, AER, CO, Temp, RH and Noise
aremeasured bythe Netatmo in everyworkstation each day, TVOCs are measured with summa canisters inevery test space each cognitivetesting day, and PM,., and Light aremeasured by the
Peng Sensor in every testspace each day. An asterisk (*) denotes that the building classifications are statisticallysignificantly differentfrom each other for
that IEQ parameterafteradjusting for clustering by building. Total Annual Earnings 4s5o,00c
ASHRAE Standard 55. Atter controlling tor building
classification, participants scored S.4% higher on the
cognitive tests, averaged across the nine domains of >0250,000
CO2(perm)
High-performingIII High -performing
Green Certified
nvc$ 4194V13.4
r. ]
20c
14,
Temp Pct
40
Noese {0B)
I
741
50,000-075,000
075,000-$100,000
3100,000-3150,000
cognitive function, -on days when ttreytook the SMS tes
within the thermal comfort zone than when they
Table 2
Demographic breakdown ofparticipants ineach building classification.
34%
2194
to%
2794
7%
1396
4194
2194
18%4
894
High -Performing
Green Certified
High -Performing
Non -Certified
Number of Participants" 6g 40
Gender Male
Female
Age 20-30
31-40
41-50
51-60
61-7o
Ethnicity
White/Caucasian
Black orAfrican American
Asian
Latino
Other
Highest level of Schooling
High School Graduate
Some College
College Degree
Graduate Degree
lob Category Managerial
Professional
Technical
Secretarial or Clerical
Other
55%
45%
39%
2294
2194
2894
194
7094
694
7%
7%
9%
o94
1294
6396
25%
2296
45%
694
1894
9%
54%
4694
2894
33%
1596
1594
894
5690
1090
890
1394
1394
1090
26%
49%
1594
1094
54%
1894
1594
3%
Includes 2 participants ingreen certified buildings and 1 in non -certified buildings whodid not
completethe baseline survey.
took it without (Fig. 3). This finding is not statistically
significant at the 95% confidence level.
Previous night's sleep was also associated with cognitive
function scores. A 25% increase in Sleep Scores was
associated with a 2.8% increase in cognitive function
scores. Sleep quality was influenced by day -time exposures
in the office: participants in the green certified buildings
had 6.4% higher Sleep Scores than those in the non -
certified buildings. This may be in part a result of higher
light levels in the green buildings; a 300 lux increase in
illuminance during the day was associated with a 2.9%
increase in Sleep Scores that night. However, these
findings are not statistically significant (Fig. 3).
In addition to improved cognitive function scores,
participants in green certified buildings reported better
environmental perceptions and fewer symptoms than
those in non -certified buildings. Participants in green
certified buildings were generally more satisfied with
daylighting and electrical lighting in their workspace, and
Tess frequently reported the temperature being too hot or
too cold, the air movement being too much or too little,
the air being too dry or too humid, and the presence of
chemical, tobacco and other odors (Fig. S2). These
perceptions are linked to varying degrees to the monitored
IEQ in the spaces. For example, relative humidities were
15.9% higher when participants reported the air was too
humid and 9.3% lower when they reported the air was too
dry. Importantly, for the same change in monitored IEQ
conditions, participants in the green certified buildings
report a larger improvement based on environmental
perceptions. Lastly, participants in the non -certified
buildings reported o.5 (3o%) more symptoms each day
than those in the green certified buildings. Symptom
counts are higher when participants report an issue with
environmental conditions. Environmental perceptions and
total symptom counts were not associated with cognitive
function scores when introduced into the mixed effect
models.
4. Discussion
Previous research by our team, and others, has identified
Table3
Buildina characteristics ofthe zo hiah-oerformina buildings included in the study.
earnings, job categories, and level of schooling. The
reduction in self-reported symptoms and improvements in
environmental perceptions support previous research in
green buildings [23,24,27,30,42]. Participant's
environmental perceptions do track actual IEQ conditions,
but participants in green certified buildings are more likely
to have a positive response even when IEQ conditions are
the same. This observation, along with participants
reporting more symptoms when they report problems with
environmental conditions, highlights the limitations of
using subjective metrics when assessing building
performance or occupant wellbeing. For the cognitive
function results, some of the domains that had the largest
differences in scores (crisis response, information usage,
and strategy) are the most highly correlated with other
measures of productivity such as salary at age [36]. This
aligns with Allen et al. that found these same domains to
be the most impacted by CO2, TVOCs and ventilation. By
City Type Size (sq. ft) Year of Construction Type/Yearof Certification ' Ventilation Strategy' Numberof Participants
Boston Non -Certified <5o,000 1929
Boston Certified <50,000 1929
DC Non -Certified >500,000 1935
DC Certified >500,000 1917
Denver Non -Certified 5o,000eioo,000 1938
Denver Certified 5o,00ceioo,000 1938
San Jose Non -Certified 5o,o0oezoo,000 1971
San Jose Certified >500,000 1934
Los Angeles Certified <50,000 1953
Los Angeles Certified <50,000 1929
NA CV, RC
LEEDEBv3 Platinum in 2012 VAV, SP
NA VAV, RC
Pending CV, SP
NA CV, RC
LEED CI v3 Silver in 2011 CV, RC
NA CV, RC
LEED EB v3 Gold in 2015 VAV, RC
LEED EB v3 Platinum in 2013 VAV, RC
Pending VAV, RC
12
12
11
12
8
12
9
12
11
10
n°EB 3.4 Existing Buildings, CI 3LCommercial Interiors.
CV 'AConstant Volume, VAV 'A Variable AirVolume, SP 'A Singlepass with energy recovery ventilator, RC '4 Partial recirculationwith reheat.
IAQ as a key driver of cognitive function. In particular, CO2, comparison, lowering TVOC concentrations from -580
TVOCs, and ventilation all have independent impacts on mg/m3 to -40 mg/m3 caused a 61% increase in cognitive
cognitive function, even at levels deemed to be acceptable
by the relevant codes and standards [19,28,29,39]. Many
office buildings on the market now fit the classification as
high -performing by surpassing the ASHRAE Standard 62.1
ventilation requirement and having low TVOC
concentrations (<250 mg/m3). The findings of this study
indicate that even among high -performing buildings that
meet these IEQ criteria, additional benefits to cognitive
function and health may be achieved by seeking green
building certification. Participants in high -performing,
green certified buildings had better environmental
perceptions, 3o% fewer sick building symptoms, 26.4%
higher cognitive function scores and 6.4% higher Sleep
Scores than participants in the high -performing, non -
certified buildings even after controlling for annual
function scores in that study compared to 26.4% increase
from working in a green certified building in this study.
While much of the effect of green certification on cognitive
test scores is unexplained, the effect may be partly
attributed to several IEQ parameters. The green certified
buildings were generally less humid than the non -certified
buildings, and as a result a larger proportion of participants
in these buildings were in the thermal comfort zone
defined by ASHRAE 55 (Fig. Si). Participants outside this
thermal comfort zone scored 5.4% lower on the cognitive
simulations, but the finding was not statistically significant.
The detriments to cognitive function align with previous
research on
Nph-perhxming Hgh-performing
IMINGreen Certified
Cognitive Domain
Fig. 2. Cognitive scoresand 95% confidence intervalsfor each domain cfthe SMStool after controlling for participant, normalized to high -performing buildings, for participants in high -performing
and high -performing, green certified buildings.
Hgh High -performing
Green Certified
100 - 100 -
Fig. 3. Effectofa) thermal comfort on cognitive function scores, 6) yesterday's sleepon cognitive function scores, c) building classification on Sleep Scores, and d) light levels on Sleep Scores, using
generalized linear mixed effectmodels with gs% confidence intervals, treating building and participant as random effects. The effectsize forthermal comfort is comparing cognitive scores from tests
taken by participants within the ASFIRAE Standard 55-2013 comfortzone to thosewithout. The effect sizes foryesterday's sleep and light correspond to a 25%change in Sleep Scoreand goo lux
change in illuminance respectively.
thermal conditions and performance. In a review of 24 papers, Seppanen et al. found that work performance
was optimized at€ temperatures within the ASHRAE Standard 55 zone, and that the benefits were seen
using various different indicators of cognitive function ranging from simple cognitive tests to objectively
reported work performance [431. The impacts on the SMS tool indicate that high order decision-making may
also be affected by these exposures.
Not surprisingly, our study suggests that previous night's sleep is a driver of cognitive function scores. More
interesting is that better Sleep Scores were associated with better lighting conditions in the building. This is
biologically plausible, considering previous research linking exposure to daylighting or blue-enriched lighting
before sleep to sleep repression. Warmer light colors, such as those at dusk, trigger the body to release
melatonin, which has a fatiguing effect, and late-night screen use can delay or suppress the release of
melatonin [441. Similarly, a larger contrast between daytime light exposures and nighttime light exposures
leads to a larger amplitude in daily melatonin secretion cycles [45]. Daylighting and blueenriched lighting
during the day helps align the body's circadian rhythm and improve sleep quality at night [12]. This effect
was observed in our study: brighter lighting in the office during the day was associated with higher Sleep
Scores at night, and participants in the green certified buildings, which were generally brighter, had 6.4%
higher Sleep Scores than those in the non-certified buildings. This finding supports previous research by
Newsham et al. on sleep quality in green buildings [261.
Investigating real-world office buildings, as opposed to a simulated environment, posed several limitations
on the study. First, the case-control study design required between-subject comparisons. To minimize
baseline differences in cognitive function, we matched the buildings by tenant and job categories. Adding
annual earnings, level of education, and job category to our models did not influence the effect size of
building classification on cognitive function scores, nor were these factors statistically significantly
associated with cognitive scores. Second, the environmental conditions were variable between buildings
and could not be modified by the study team. The variability in exposures also limits the ability for the
factors we did measure to produce a quantifiable effect. Third, missing data for some outcomes, such as
sleep, reduced the power of those analyses. Fourth, while the sample size of participants was sufficiently
powered, factors that vary on building level, such as ventilation system type, have a sample size of io and
were underpowered. With this sample size we were not able to identify which individual green credits were
drivers of better performance, nor were we able to obtain the same level of building-related design data
from the non-certified buildings (precisely because they did not go through the certification process). As
such, it is possible that green certification in our study may simply be a proxy for more relevant indicators of
building performance. Fifth, we assessed the IEQ of the workstations of our participants, which may not be
representative of the building as a whole. During our building assessment, we did not observe major
differences in building systems, operation or maintenance for areas of the building in which we did not have
participants. As the buildings were all high-performing, the results of the study may not be representative of
conventional or problem buildings. In addition, the study population is representative ofthe general
population of knowledge workers and may not be generalizable to other worker populations.
The findings in this study hint at the complexity of understanding all ofthe building related factors that can
influence human health and performance. The measured IEQ variables only accounted for part of the impact
of green certification on productivity and health. Other aspects of the green certification process e such as
commissioning of building systems, 3rd party reviews of IEQ performance, and the commitment to
sustainability and health of owners and building managers e may play a role in how occupants perceive and
perform in a building. Here, we advocate for a holistic, "buildingomics" approach. Omics research describes
efforts to understand the totality of a given research field, currently best exemplified by genomics research
and the ambitious undertaking ofthe Human Genome Project. This has spurred a set of related eomics
research areas: transcriptomics, proteomics, metabolomics, epigenomics. And, in the field of exposure
science, the relatively new and equally challenging efforts to characterize human exposures over the course
of a person's lifetime e the exposome [46]. We now propose "buildingomics" to capture the complexity of
the research of health in buildings. "Buildingomics" is the totality of factors in indoor environments that
influence human health, well-being and productivity of people who work in those spaces. The primary
challenge is that buildings serve a variety of purposes and the potential exposures span several fields of
study; thus multi -disciplinary teams that include building scientists, exposure scientists, epidemiologists,
toxicologists, materials scientists, architects, designers, and social/behavioral scientists are necessaryto
characterize all the building -related factors that influence health in buildings.
5. Conclusions
Our findings show that in high -performing buildings additional benefits to health and productivity may be
obtained through green certification. In a sample of io high -performing buildings, participants in green
certified buildings had 26.4% higher cognitive function scores, better environmental perceptions and fewer
symptoms than those in high -performing, non -certified buildings. This outcome may be partially explained
by IEQ factors, including thermal conditions and lighting, but the findings suggest that the benefits of green
certification standards go beyond measureable IEQ factors. Building -level factors may play an important
role in occupant health and cognitive function yet have been largely overlooked. We describe the need for a
holistic, "buildingomics" approach to studying the drivers of human health and performance in buildings.
Acknowledgements
We would like to acknowledge our partners who allowed our team to investigate the impact of buildings on
their employees and tenants. We thank both the study participants and field staff for volunteering their
time. We also thank the reviewers of this manuscript for their thoughtful comments that have strengthened
the paper. This research was supported by a gift from United Technologies to the Center for Health and the
Global Environment at the Harvard T.H. Chan School of Public Health. United Technologies was not involved
in the recruitment of buildings or participants, data collection, data analysis, data presentation, or drafting
of the manuscript.
Dr. MacNaughton'stime was supported by NIEHS environmental epidemiology training grant
5T32ESoo7o69-35.
Appendix A. Supplementary data
Supplementary data related to this article can be found at http:// dx.doi.org/lo.ioi6/j,buildenv.2o16,11.o41.
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U. Satish, M.1. Mendel); K. Shektar, T. H:otchi, D.P. Sullivan, 5. Streufert, W.J. Fisk, Is CO2 an indoor pollutant? Direct effects of ow -to -moderate CO2 concentrations an
human decision-making performance, Environ:. Health Perspect. 12o (12) (2012) 1671.
P. MacNaughton, J. Spengler, J. Vallarir:o, S. Santanam, U. Satish; 1. Aiien, Environmental perceptions and health before and after relocation to a green build rg, Build.
Environ. 104(2016)-138e144.
T. Vet vilainen, H. Lindholm H Fau • Rintamaki, R. Rintamaki H Pau - Paakkonen, A. Paakkonen R Fau - Hireone.n. 0. Hirvonen AFau - Nierni, J. Niemi 0 (au - V)r ha,1.:'i::ha
High indoor COconcentrations in an office environment increases the transcutaneous 60 level and sleepiness during cognitive work, 2015, pp. 1545e9632 (Electronic.).
ASHRAE., Standard 62.1-2016 e Ventilation forAcceptable Indoor Air Quality. American SocietyforHeatng, Refrigeration, and Air.Condiz oning Engineers; Inc, 2016.
EPA, BuildingAssessment Survey and Evaluation, 1998 [cited 20151122); Availablefrom: http:/;www.epa.goviiaq,'basestudy_overvie'w.htmi.
J. Ludwig,;. McCarthy, B. Baker, R. Caron; D. Hanson, Areview ofselected methodologies to determine outdoorairventilation rates in BASE study buildings, in: Airand Waste
ManagementAssoc Conference, 2000.
ASTM, Standard Test Method for Determin.ngAir Change in a Single Zone byMeansofa TracerGas Dilution, ASTM International, 2011.
S. Streufert, R. Pogash, M. Piasecki, Simulation -based assessment of managerial competence: reliability and validity, Pers. ?sychol. 41(3) (1988) 52 e557.
ll. Satish, S. Streufe.rt, M. De;wan, 5. Voore, improvementsinsimulated reahworid relevantperformance for patents with seasonal allergic rhinitis: impact ofdesloratadine.,
Allergy 59 (4)(20°4) 415e420.
K. Breuer, U. Satish, Emergency managementsimulations: an approach tothe assessment of decision-making processes in complexdynamic crisis enviraemen
Ed,), From Mode€irc Managjng Security: a Systems Dynamics Approach, N.A. Press, Norway, 2002, pp. v G.
n:
J.G. Allen, P. MacNaughtar, S. Santanarn, U. Satish, J. Spender, Associations of coenitive function scores with carbon dioxide, ventilation, and volatile organic compound
exposures in office workers: a controlled exposure study ofgroes and conventional office enviror:ments, Environ. Health Perspect. 123 (to) (2o15).
ASHRAE, Standard 55-2010 e Thermal Environmental Conditionsfor Human Occupancy, American Society for Heating, Refrigeration, and Ar -Conditioning Engineers, Inc,
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E. Garland, S.H. Steenhurgh EtFau - Sanchez, A. Sanchez Sh Rau - Geevarughese, L. Geevarughese AFau - Bluestone, L.. BluestoneL. Fau - Rothenberg, A. Rothenberg L Pau -
Rialdi, M. Rialdi A Fau - Foley, M. Foley, Impact of LEEOcertitied affordable housing onasthma in the South Bronx, Prog. Community Health Partnersh. 7(s) (zoi..1) 29e37.
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0021.eg72X (Print)).
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and maintain circadian phase in young subject underfixed sleep schedule, Am. J. Physiology - Regul. irtegr. Comp. Physiology 291 (6) (zo06) R:7ggeRa8o7.
S.M. Rappaport, implications ofthe Exposomefor Exposure Science, 2020 (3.55geo64X (Electronic)).
Appendix 2: Tampa Bay Times Article
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CLEARWATER— A Latvian -born Water's Edge penthouse condo resident
made a splash last year when he bought retail space at the base of the tower.
Now he's expanding his reach downtown, snapping up the i1 -story Bank of
America building on Cleveland Street.
Daniels Ikajevs, 32, didn't immediately return a call for comment on the $7.3
million purchase. But downtown boosters and city officials believe that local
ownership of the landmark property at 60o Cleveland Street is good news for
downtown.
Clearwater's City Council appears poised to strike a deal to help Ikajevs better
market his new property.
We're certainly hopeful that Ikajevs becomes more of a permanent owner, as
opposed to a 'lease -up and sell' transitional owner and is more involved in the
overall strategy for downtown," said Rod Irwin, assistant city manager for
economic development.
Irwin said Ikajevs bought the building from a Texas bank that specializes in
buying foreclosed properties and attracting enough tenants to make them
attractive buys. Right now, the 145,000 -square -foot office building is about 70
percent leased.
Ikajevs "seems to be interested in becoming a player in downtown
development," said Irwin.
One hurdle was adequate parking. On Monday, the City Council advanced a
plan to lease 78 spaces in the city -owned Garden Avenue garage across the
street to Ikajevs for $2,500 a month. In exchange, the city will get after-hours
and weekend access to about 5o surface lot spots owned by Ikajevs.
The final vote is scheduled for Thursday's council meeting.
Ikajevs' latest buy is just the tip of the iceberg for downtown, said Bill
Sturtevant, chairman of the Clearwater Downtown Partnership.
We've got major, major investors who have taken a very strong interest in
downtown. It's what we've all been waiting for," Sturtevant said.
As many as four other investors are looking at downtown parcels. They like
what they see, especially the year-end opening of a refurbished Capitol
Theatre, but want some answers on limited parking options, Sturtevant said.
He declined to identify the other investors.
Possible new tenants for the Bank of America building include a "blend" of
tech firms and support services for the tech industry, Irwin said.
Downtown planners and boosters hope to expand a tech sector that already
employs several hundred workers. In June, the City Council picked a
developer to build hundreds of high-end apartments and retail space in
Prospect Lake, just east of downtown. They hope the development will help
keep the young, highly -paid workers spending their leisure time and money in
Clearwater instead of commuting to Tampa or St. Petersburg.
Earlier this year, Ikajevs bought 10,000 square feet of ground -floor retail
space in Water's Edge next to City Hall, where he said he planned to open a
gelato shop. The shop hasn't opened yet.
Ikajevs also bought five storefronts along the 500 block of Cleveland Street,
the former home of Peter Gillham's Nutrition Center. He told the Tampa Bay
Times at the time that he hoped to renovate and lease the storefronts in time
for the Capitol Theatre's opening, now slated for December. They are still
shuttered.
A native of Latvia, a Baltic nation formally controlled by the Soviet Union,
Ikajevs has lived in the area for more than a dozen years. He told the Times in
April that because he is foreign -born and interested in buying downtown
property, people often assume that he is a Scientologist. Ikajevs said he
doesn't belong to the church.
Charlie Frago can be reached at cfrago@tampabay.com or (727) 445-4159. You can
follow him on Twitter @CharlieFrago
EXPENDITURES Description Budget Actual Difference
a ... ,... r, .. ,..,., ,"i •... .,, ,., - w .,.0 a. to:, r .:.
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Contractor Fees
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Permits, Project Supervision, Labor, Travel, Site Cleaning
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33,000
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33,000
Architectural Drawings and Fees Floor Plans, Site Layouts, Revisions, Travel 10,000 10,000
Demolition Removal of existing walls, carpet, cabinets, fixtures 5,500 5,500
MEP Engineering Mechanical, Electrical, Plumbing Drawings 22,000 22,000
Mechanical Equipment and Installation 100,000 100,000
Electrical Receptacles, Switches, Circuitry, Sensors, Fixtures 110,000 110,000
Plumbing Equipment and Installation 24,000 24,000
Dry Wall Walls, Dividing Partitions, Ceiling 156,200 156,200
HVAC, VAV, Duct, Co2 Sensors, Controls Installation, Relocation and Upgrades 88,950 88,950
Doors & Windows Glass Work 186,000 186,000
Painting Low or No VOC Paint, Painters 36,190 36,190
Ceiling Wood, Slats, Beams, Exposed & Painted Areas 64,000 64,000
Wiring Mandatory Upgrades, Emergency/Exit 5,000 5,000
Flooring Concrete and Wood Covering 135,000 135,000
Fire Safety Sprinkler Adjustment, Strobes, Alarms 36,000 36,000
Specialties Hypo Allergenic Blinds, Refrigerator, convection oven, dishwasher, toile 28,950 28,950
Finishes 25,600 25,600
Technology & Lights Poe Lights, Switches, Server, Cabling 152,000 152,000
Misc.
Subtotal 1,218,390 1,218,390
Exhibit I
CO -WORK MEMBERSHIP PLAN FOR CITY OF CLEARWATER AND SMALL
BUSINESS SERVICES PARTNERS
Location: Second and Third Floor
600 Cleveland St.
Clearwater, FL 33755
Contact: Daniels Ikajevs, Owner
Email: dikajevs a(aol.com
The following proposal is offered to the Municipality of the City of Clearwater and is
effective after the Development Agreement has been approved.
TERMS:
Membership Plan
Square Feet
Floor
Term
Cost
Approximate Value
Executive Suite
190
2nd Floor Suite
Five years from date of occupancy
FREE for duration of term
70,000.00
THE PLAN INCLUDES:
The Ring onsite Community Manager Monday — Friday 8:00 am — 6:00 pm
24/7 access to Executive Suite on the 2"d Floor of The Ring
Free Parking (available on a first -come -first-served basis)
Free Mailing Address
High Speed Secured Internet
Paid Utilities (Water, Electricity, Cable)
Print/Scan/Fax/Copy Services
Telephony Provisions
Unlimited Access to 2nd Floor Conference Room with reservations available on a
first -come -first-served basis
20 hours/monthly of Conference Room Bookings (3rd Floor Main, Senses, Zen
Conference Rooms)
Ergonomic Furniture (4/each) Desks, Chairs and Mobile Storage Pedestals
Tier 1 Priority Access to all Networking Events, Exhibitions, and Workshops
Free Mind, Body, Soul Classes, Yoga and Self Defense Classes (TBD)
Weekly Networking with over 100 Businesses
GM17-9311-025/211151/ 1]
CITY OF CLEARWATER SPACE PLAN
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E3ANK OF AMERICA
James B. Mathias, A.IA.
Architect
LI NEI
TAMPA, 9...
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GM17-9311-025/211151/1]
600 CLEVELAND STREET
CLEARWATER, FLORIDA
SCALE: 1/4''=11-011
SECOND FLOOR
SCHEME IR
10/4/2017
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EXHIBIT!
ONE CLEARWATER TOWER - BANK OF AMERICA BUILDING
STANDARD LEASE AGREEMENT
THIS LEASE AGREEMENT, made and entered into as of this day of , 2017, by and
between 600 Cleveland, LLC, a Florida limited liability company d/b/a One Clearwater Tower (hereinafter
referred to as the "Landlord") and The Ring Workspaces, LLC, a Florida limited liability company d/b/a The
Ring (hereinafter referred to as the "Tenant").
1. PREMISES
Landlord hereby leases to Tenant and Tenant hereby rentsfrom Landlord, approximately 18,000 square
feet of rentable area on the second and third floors, and approximately 1,300 squarefeet of outdoor patio area
appurtenant to the thirdfloor as defined herein and shown on Exhibit "A" attached hereto and made a part
hereof (hereinafter referred to as the "Premises"), known as Suites 200 and 300 in the One Clearwater Tower -
Bank ofAmerica Building (hereinafter referred to as the "Building"), located at 600 Cleveland Street,
Clearwater, Florida 33755. For the purposes of this Lease, rentable area shall be the area actually occupied and
used exclusively by the Tenant plus a designated percentage of this area representing an allocated share of the
Common Areas (as hereinafter defined) of the Building.
2. TERM
The term of the Lease (hereinafter referred to as "Term") shall be for a period commencing on the
January 15, 2018 and expiring at midnight on the 31St of December 2028. It is understood that Tenant may
have access to the Premises prior to September le, 2017, to begin improvements within the Premises,
provided that (I) this Lease has been fully signed by Landlord and Tenant, (II) the Security Deposit and Base
Rent (including applicable taxes) has been paid to Landlord, (111) certificate(s) evidencing the insurance
required under this Lease has been provided to Landlord, (iv) any work within the Premises is initiated in
accordance with Exhibit "B".
Notwithstanding the above, if the Premises require improvements prior to occupancy thereof, and the
completion ofsaid improvements is delayed beyond the aforesaid commencement date of this Lease through
no fault of Tenant, as outlined in the attached Work letter, then the commencement and expiration dates of
this Lease, respectively, shall be deemed to have been extended until the date the Premises are, in fact, ready
for occupancy by Tenant, and shall terminate the aforesaid number of months thereafter.
3. USE
Tenant covenants that the Premises will be continuously used and occupied during the full term of this
Leasefor the purpose(s) of general office uses to include coworking space for members who will be licensed to
occupy and use conference rooms, private offices, shared workstations, on -demand work desks and meeting
space and special events meeting spaces, as well as any other related use commonly associated with shared
workspaces and will not use and occupy the Premisesfor any other purpose without the prior written consent
of Landlord.
4. RENTAL
A) BASE RENT: In consideration for this Lease and subject to the adjustments hereinafter specified
in this Lease, as rentalfor the Premises, the Tenant hereby agrees to pay to the Landlord, without deduction,
set-off, prior notice or demand, the sum of --- SEE ADDENDUM I, PARAGRAPH 1 --- commencing on the 1st day
ofJanuary 2018, and the required amount due and payable on the 1st day of each and every successive
calendar month thereafter during the term of the Lease. All rental installments to be paid by Tenant as herein
provided shall be paid to Landlord at its place of business as specified in Paragraph 42 herein until notice to the
contrary is given by Landlord. If the beginning date of this Lease commences on any day of the month other
than on the first (1st) day, the monthly Base Rentfor the unexpired portion of said month shall be prorated and
paid on a per diem basis, and the Landlord shall credit the difference, if any, toward the payment of the rent for
the next calendar month. Other remedies for non-payment ofrent notwithstanding, if the monthly rental
payment is not received by Landlord on or before the first (1st) day of the month for which rent is due, or if any
other payment due Landlord by Tenant is not received by Landlord on or before thefifth (5th) day of the month
nextfollowing the month in which Tenant was invoiced, a late charge of ten percent (10%) ofsuch past due
amount shall become due and payable in addition to such amounts owed under this Lease.
8) ADDITIONAL RENTS: After Calendar Year 2018, Tenant shall pay its share of the Operating
Expense increases to Landlord in monthly installments equal to one -twelfth (1/12) of the estimated annual
1
amount thereof on the First (1st) day of each month during the term hereof. The estimated annual amount of
Operating Expenses shall be determined by Landlord in its reasonable discretion and shall be delivered to Tenant
in writing prior to the commencement ofeach Lease year. Within one hundred twenty (120) days after the end
of each calendar year during the term hereof: (i) Landlord shall determine Tenant's share of actual Operating
Expenses and shall bill Tenantfor any deficit in the amount of operating expenses collected or refund any
overpayment in the amount of operating expenses paid by Tenant, so that Tenant shall pay no more or less than
its pro rata share of actual Operating Expensesfor any calendar year, and (ii) shall provide to Tenant a statement
of actual Operating Expenses for such calendar year only upon Tenant's written request, given to Landlord within
said 120 day period. Payments by Tenant of any deficits owed to Landlord shall be made within ten (10) days
after receipt of Landlord's bill. Tenant shall have the right, upon written request given to Landlord not more than
30 days after the expiration of any calendar year during the term hereof, at Tenant's expense, to audit Landlord's
books and records relating to Operating Expenses for the calendar year in question, and if such audit discloses
any expenses not permitted hereunder or that Tenant was charged more than its pro rata share ofactual
Operating Expenses, Landlord shall promptly refund the difference to Tenant. In no event shall Tenant's Base
Rent as defined above go below the initial negotiated base rent as set forth in addendum I to the Lease. Tenant's
failure to request an audit of Operating Expenses in any calendar year within 180 days after the expiration of
such calendar year shall be deemed to be Tenant's approval of the amount of such Operating Expenses and
Tenant, thereafter, waives the right or ability to audit or dispute the amount of such Operating Expenses. In the
event any Lease year is less than a twelve (12) month period, Tenant shall pay Landlord a pro rated portion of the
amount that would have been due for Operating Expenses charges under this Paragraphfor the full Lease year,
based on the number of days in such Lease year. Tenant agrees to make payment of the additional rental to
Landlord within ten (10) days following receipt of the invoice. In the year in which this Lease terminates,
Landlord, in lieu of waiting until the close of the calendar year to determine any excess Operating Expenses, has
the option to invoice Tenant for Tenant's pro rata share ofthe Operating Expenses based upon an estimate of
the year's excess Operating Expenses. Landlord shall invoice Tenant under this option within thirty (30) days
prior to the termination of the Lease or any time thereafter.
C) Alternatively, Landlord may make a goodfaith estimate of the Additional Rent to be due by
Tenantfor any calendar year or part thereof during the Term, and, unless Landlord delivers to Tenant a revision
of the estimated Additional Rent, Tenant shall pay to Landlord, on the Commencement Date and on the first
day of each calendar month thereafter, an amount equal to the estimated Additional Rentfor such calendar
year orpart thereof divided by the number ofmonths in such calendar year during the Term. From time to time
during any calendar year, Landlord may estimate and re -estimate the Additional Rent to be due by Tenant for
that calendar year and deliver a copy of the estimate or re -estimate to Tenant. Thereafter, the monthly
installments ofAdditional Rent payable by Tenant shall be appropriately adjusted in accordance with the
estimations so that, by the end of the calendar year in question, Tenant shall have paid all of the Additional
Rent as estimated by Landlord. Any amounts paid based on such an estimate shall be subject to adjustment
pursuant to Section 4 when the Landlord's Statement is available for each calendar year.
The term "Operating Expenses", as used above, includes all expenses incurred with respect to the
maintenance, management and operation of the Building of which the Premises are a part, including, but not
limited to, maintenance and repair costs, electricity, fuel, water, sewer, gas and other utility charges, security,
window washing, janitorial services, trash removal, landscaping and pest control, wages andfringe benefits
payable to employees of Landlord whose duties are connected with the operations and maintenance of the
Building, managementfees and administrative charges, amounts paid to contractors or subcontractors for
work or services performed in connection with the operation, management and maintenance of the Building,
all services, supplies, repairs, replacements or other expenses for maintaining, managing and operating the
Building including Common Area and parking area maintenance. The term "Operating Expenses" also includes:
the cost or portion thereofproperly allocated to the Real Property (as herein defined) amortized over such
reasonable period as Landlord shall determine, together with interest at the rate oftwelve percent (12%) per
annum on the unamortized balance, of any capital improvements made to the Building by Landlord which
result in a reduction of "Operating Expenses" or made to the Building by Landlord after the date of this Lease
that are required under any governmental law or regulation that was not applicable to the Building at the time
it was constructed and all real property and personal property taxes and installments ofspecial assessments,
charges, fees and payments levied or assessed by any public, governmental or regulatory body, as well as all
insurance premiums Landlord is required to pay or deems necessary to pay, including public liability insurance
with respect to the Land and Building of which the Premises are a part (collectively called "Real Property"). The
term "Operating Expenses" shall not include income and franchise taxes of Landlord, expenses incurred in
leasing to or procuring of tenants, leasing commissions, advertising expenses with respect to leasing or
promoting the Building, expenses for the renovating ofspace for new tenants, capital improvements (except as
noted above), interest or principal payments on any mortgage or other indebtedness of Landlord, or
depreciation allowance or expense.
The term "Common Area(s)'; as used in this Lease shall mean the portions of the Building, as well as all
parking area(s) (both covered and uncovered), and all landscaped and recreational areas, provided and
2
maintained by the Landlord for the common use and benefit of the tenants of the Building or the employees,
invitees, and licensees ofsuch tenants. Tenant's pro rata share ofthe Operating Expenses described above
shall be determined by multiplying the amount ofsuch operating and maintenance costs by afraction, the
numerator of which shall be the rentable area of the Premises (as stated in Paragraph 1 of this Lease) and the
denominator of which shall be the rentable area of the entire Building. For the purpose of this Lease, Tenant's
pro rata share shall be 13.64 % (18,000rsf/131,922rsf). The actual rentable square footagefigure will be
established byfield measurement by Dimensions Plus, Inc. using BOMA standards and the figures will be
adjusted as indicated.
Notwithstanding anything to the contrary above:
1) Landlord shall be required to change the fraction described above to reflect any increases in the
Building square footage resulting from Landlord constructing an additional Building or Buildings on the site.
Said change shall be effective as of the date the Certificate of Occupancy (either temporary or permanent) is
issuedfor the new Building or Buildings.
11) If the Building or Buildings are not ninety-five percent (95%) occupied by tenants during all or a
portion of any calendar year during the term of this Lease, then Landlord may elect to make an appropriate
adjustmentfor such year of the components of Operating Expenses which may vary depending upon the
occupancy level of the Building, employing sound accounting and management principles. Any such
adjustments shall also be deemed "Operating Expenses" paid or incurred by Landlord and included in
Operating Expenses" for such year, as if the Building had been ninety-five percent (95%) occupied and the
Landlord had actually paid or incurred such expenses, to the end that the actual amounts ofsuch variable
components of Operating Expenses befairly borne by occupants of the Building.
IMPOUNDS: In the event that a late charge is payable hereunder, whether or not collected, for three
3) installments of rent or other monetary obligation which Tenant is late in paying, Tenant shall pay to
Landlord, if Landlord shall so request, in addition to any other payments required under this Lease, monthly
advance installments, payable at the same time as required as estimated by Landlord to establish a fundfor
Operating Expenses which are payable by Tenant under the terms due, before delinquency, of any or all such
Operating Expenses. If the amounts paid to Landlord by Tenant under the provisions ofthis Paragraph are
insufficient to discharge the obligations of Tenant to pay such Operating Expenses as the same become due,
Tenant shall pay to Landlord, upon Landlord's demand, additional sums necessary to pay such obligations. All
moneys paid to Landlord under this Paragraph may be intermingled with other monies ofLandlord and shall
not bear interest. In the event of a default in the obligations of Tenant to perform under this Lease, then any
balance remaining from funds paid to Landlord under the provisions of this Paragraph may, at the option of
Landlord, be applied to the payment of any monetary default of Tenant in lieu of being applied to the payment
of Operating Expenses.
5. BUILDING SERVICES
Landlord agrees to use good faith efforts to provide in the Building:
A) Restroom and drinking facilities on each floor of the Building;
B) Heating and air-conditioning in season, Monday through Friday during the hours of 7:00 a.m.
to 6:00 p.m. (exclusive of legal holidays), and Saturdaysfrom 8:0Oa.m. to 1:OOp.m. at such temperatures and in
such amounts as are specified by Landlord to be standard; above standard or after hours services shall be
furnished at the lessor of actual cost or $35.00 per hour, only if so requested by Tenant and approved by
Landlord, and Tenant shall bear the entire cost of such service. Said rate shall be adjusted annually by Landlord,
based upon the Progress Energy power rate to the building;
C) Elevator service;
D) Janitorial service after standard business hours five (5) days a week (except legal holidays);
E) Electrical current for ordinary purposes connected with the aforesaid use of the Premises.
F) Electrical lighting service for the Premises, as well as all public areas and special service areas
of Building in the manner and to the extent deemed by Landlord to be standard.
G) Wireless access on a 24/7 basis for members
Tenant agrees that failure by Landlord to any extent to furnish, or any stoppage of, these defined
services, resulting from causes beyond the control of Landlord orfrom any other cause (including without
limitation, the unavailability offuel or energy or any applicable laws, rules or regulations relating thereto), shall
3
amount thereof an the First (1s.'t)..day of each mogth,,clurigg tf e term hereof 'The estimated an al amount of
Operating Expa'ns8s shplibe determined 4,y Lctndlorc(-.
of
ttt reasonable discretion.apd shall he deNusred to Tenant
in writing prior t the cpmmengement ofeach•I.pQ;se,.yertryWithtn,one hundred twenty (120) days after the end
of each calenda?year during the term hereof:;(i) Landlord shall determine Tenant's share of actual Operating
Expenses and shall bi(l Tenanrifor}any defigt4ln•the.anaountof operating expenses collected orrefund any
overpayment in,the Amountof operatinglexpersespaic ay Tiirrant, so thatTenpnt'shall j3ay nbiltore or, less than
its pro rcacta share•ofactual..Qpertiting Expe tses eiro,tiy:g rlenretat'yeaie,°aA (ii*all rpuid+ ti4 retldnt•a statement
of actudlOperatin Ex renseiforisuch cafe P•yeriokf i,upbr '1 haft's writt esr ' ' g ,t 3 aandlord within
said 120' day period. 'Payments 'by Tenant ofa +ttiefl4its oWeidt tphdlord seal! bprmade vitt nten (10) days
after receipt of landlord's bill. Tenant shall have the right, upon written request giUen td Landlordnot more than
30 days after the expiration ofany calendbr"year during the ter'rh hereof, at Tenant's expense, to audit Landlord's
books and recordsgelatingto Operating'E cpen%; 'sfo'rehe caleodat yLepr in questlop,`and if such audit -discloses
any expenses. notpermitted iier'eO tder dd et dt'7fenan 4va c tcccl i • are than i sr o rdtb' liT of actual
0 eratin' Expenses; enses, ra"ndlot 41 ° 3 ye , al ` tpgpdtallpromptCy re unfcftl"r F er ace t,Fenant;ln no e`g,i; $hgll Te ant s Base
Rent as defined above go below. the inititil rregotr rted":base'rent is'setforth in addemdurtT( to the Lease. Tenant'sfailuretorequestanaudit'of.Operating tzpensfs in any calendar year. within 180 daysaftertthe expiration of
such•calendar yearshdll be deemed to be Tenant's approval of the arnount ofsuch Operating Expenses and
Tenant, thereafter waives thc.rjgflt or abi4ty,.jo„audit pr drsputccipp•gmountQ .zuc%Operating Expenses. In the
event any Lease year is less than a twelve f12) mont'h,period,'Tpnarttshall pay L ndlgrd p.prso rated portion of the
amount that wbuld have jeer duefor Operating' Expenses charges under this l+faragraphfor thefull Lease year,
based on the nu• mber of days in such Lea, e year. Tenant agrees to make payment ofthe vidditiona/ rental to
Landlord withinten (1b) days following receipt of the. invoice. In the year in which this Lease terminates,
Landlord, in lieu or waiting untilthe close of the calendar year to determine any excesS'bperating Expenses, has
the'pptiori to•invpice Tenantfor Tenant's.pi-b,rata...thare.of-th Operating Expenses bbsedupon,an estimate oftheyearsexcc#',Operating E, penses. LQ, dloid shall7n.voiceTenant under this option within thirty (30) dayspriortotheterminationoftheLeaseoranytimethereafter.
C) Alternatively, Landlord May Make a goodfaith estimate ofthe Additional Rent to be due byTenantfor, any calendar year or part thereofduringthe Term, -and, unless Landlord delivers to Tenant a revision
of the estimated Additional Rent, Tenant shall pay to Landlord, on the Commencement Date and on thefirst
day of each calendar month thereafter, an amount equal to the estimated Additional Rentfor such calendar
year or part thereof divided by the number ofmonths in such calendar year during the Term. From time to time
during any calendar year, Landlord may estimate and re -estimate the Additional Rent to be due by Tenantfor
that calendar year and deliver a copy of the estimate or re -estimate to Tenant. Thereafter, the monthly
installments of Additional Rent payable by Tenant shall be appropriately adjusted in accordance with the
estimations so that, by the end of the calendar year in question, Tenant shall have paid all of the Additional
Rent as estimated by Landlord. Any amounts paid based on such an estimate shall be subject to adjustment
pursuant to Section 4 when the Landlord's Statement is available for each calendar year.
The term "Operating Expenses'; as used above, includes all expenses incurred with respect to the
maintenance, management and operation of the Building of which the Premises are a part, including, but notlimitedto, maintenance and repair costs, electricity, fuel, water, sewer, gas and other utility charges, security,
window washing, janitorial services, trash removal, landscaping and pest control, wages andfringe benefits
payable to employees of Landlord whose duties are connected with the operations and maintenance of theBuilding, management fees and administrative charges, amounts paid to contractors or subcontractors for
work or services performed in connection with the operation, management and maintenance of the Building,
all services, supplies, repairs, replacements or other expenses for maintaining, managing and operating theBuildingincludingCommonAreaandparkingareamaintenance. The term "Operating Expenses" also includes:
the cost or portion thereof properly allocated to the Real Property (as herein defined) amortized over such
reasonable period as Landlord shall determine, together with interest at the rate of twelve percent (12%) per
annum on the unamortized balance, of any capital improvements made to the Building by Landlord which
result in a reduction of "Operating Expenses" or made to the Building by Landlord after the date of this Lease
that are required under any governmental law or regulation that was not applicable to the Building at the timeitwasconstructedandallrealpropertyandpersonalpropertytaxesandinstallmentsofspecialassessments, charges, fees and payments levied or assessed by any public, governmental or regulatory body, as well as allinsurancepremiumsLandlordisrequiredtopayordeemsnecessarytopay, including public liability insurancewithrespecttotheLandandBuildingofwhichthePremisesareapart (collectively called "Real Property"). The
term "Operating Expenses" shall not include income and franchise taxes of Landlord, expenses incurred in
leasing to or procuring of tenants, leasing commissions, advertising expenses with respect to leasing orpromotingtheBuilding, expenses for the renovating of spacefor new tenants, capital improvements (except as
noted above), interest or principal payments on any mortgage or other indebtedness ofLandlord, ordepreciationallowanceorexpense.
The term "Common Area(s)'; as used in this Lease shall mean the portions of the Building, as well as all
parking area(s) (both covered and uncovered), and all landscaped and recreational areas, provided and
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maintained by the Landlord for the common use and benefit of the tenants of the Building or the employees,
invitees, and licensees of such tenants. Tenant's pro rata share of the Operating Expenses described above
shall be determined by multiplying the amount of such operating and maintenance costs by a fraction, the
numerator of which shall be the rentable area of the Premises (as stated in Paragraph 1 of this Lease) and the
denominator of which shall be the rentable area of the entire Building. For the purpose of this Lease, Tenant's
pro rata share shall be 13.64 % (18,000rsf/131,922rsf). The actual rentable square footage figure will be
established byfield measurement by Dimensions Plus, Inc. using BOMA standards and the figures will be
adjusted as indicated.
Notwithstanding anything to the contrary above:
i) Landlord shall be required to change the fraction described above to reflect any increases in the
Building squarefootage resulting from Landlord constructing an additional Building or Buildings on the site.
Said change shall be effective as of the date the Certificate of Occupancy (either temporary or permanent) is
issued for the new Building or Buildings.
ii) Ifthe Building or Buildings are not ninety-five percent (95%) occupied by tenants during all or a
portion of any calendar year during the term of this Lease, then Landlord may elect to make an appropriate
adjustment for such year of the components of Operating Expenses which may vary depending upon the
occupancy level of the Building, employing sound accounting and management principles. Any such
adjustments shall also be deemed "Operating Expenses" paid or incurred by Landlord and included in
Operating Expenses" for such year, as if the Building had been ninety-five percent (95%) occupied and the
Landlord had actually paid or incurred such expenses, to the end that the actual amounts ofsuch variable
components of Operating Expenses be fairly borne by occupants of the Building.
IMPOUNDS: In the event that a late charge is payable hereunder, whether or not collected, for three
3) installments of rent or other monetary obligation which Tenant is late in paying, Tenant shall pay to
Landlord, ifLandlord shall so request, in addition to any other payments required under this Lease, monthly
advance installments, payable at the same time as required as estimated by Landlord to establish a fundfor
Operating Expenses which are payable by Tenant under the terms due, before delinquency, of any or all such
Operating Expenses. If the amounts paid to Landlord by Tenant under the provisions of this Paragraph are
insufficient to discharge the obligations of Tenant to pay such Operating Expenses as the same become due,
Tenant shall pay to Landlord, upon Landlord's demand, additional sums necessary to pay such obligations. All
moneys paid to Landlord under this Paragraph may be intermingled with other monies ofLandlord and shall
not bear interest. In the event ofa default in the obligations of Tenant to perform under this Lease, then any
balance remaining from funds paid to Landlord under the provisions of this Paragraph may, at the option of
Landlord, be applied to the payment of any monetary default of Tenant in lieu of being applied to the payment
of Operating Expenses.
5. BUILDING SERVICES
Landlord agrees to use goodfaith efforts to provide in the Building:
A) Restroom and drinking facilities on each floor of the Building;
8) Heating and air-conditioning in season, Monday through Friday during the hours of 7:00 a.m.
to 6:00 p.m. (exclusive of legal holidays), and Saturdays from 8:00a.m. to 1:OOp.m. at such temperatures and in
such amounts as are specified by Landlord to be standard; above standard or after hours services shall be
furnished at the lessor of actual cost or $35.00 per hour, only ifso requested by Tenant and approved by
Landlord, and Tenant shall bear the entire cost ofsuch service. Said rate shall be adjusted annually by Landlord, based upon the Progress Energy power rate to the building;
C) Elevator service;
D) Janitorial service after standard business hours five (5) days a week (except legal holidays);
E) Electrical current for ordinary purposes connected with the aforesaid use of the Premises.
F) Electrical lighting servicefor the Premises, as well as all public areas and special service areas
of Building in the manner and to the extent deemed by Landlord to be standard.
G) Wireless access on a 24/7 basis for members
Tenant agrees thatfailure by Landlord to any extent tofurnish, or any stoppage of, these defined
services, resultingfrom causes beyond the control ofLandlord or from any other cause (including withoutlimitation, the unavailability offuel or energy or any applicable laws, rules or regulations relating thereto), shall
3
not: render Landlord liable in any respectfor damages to either person or property; be construed as an eviction
of Tenant; cause an abatement ofrent; or relieve Tenantfrom fulfillment of any covenant or agreement hereof.
Should any Building equipment or machinery breakdown or, for any cause, cease to function properly, Landlord
shall use reasonable diligence to repair the same promptly, but Tenant shall have no claim for rebate of rent or
damages on account of interruptions in service occasioned thereby or resulting therefrom; and Landlord shall
incur no liability whatsoever for any loss, damage or interruption ofservices caused by a strike or labor
stoppage (whether such shall involve employees ofLandlord or others), interruptions of transportation,
unavailability of materials, parts, machinery or supplies, acts of God, or other causes beyond Landlord's control.
6. PEACEFUL ENJOYMENT
Tenant shall, and may peacefully, have, hold and enjoy the Premises subject to the other terms thereof,
and provided Tenant pays the rentals herein recited and Tenant also hereby covenants and agrees to comply
with all the rules and regulations of the Board of Fire Underwriters, Officers or Boards of the City, County and
State having jurisdiction over the Premises, and with all ordinances and regulations of governmental
authorities wherein the Premises are located, at Tenant's sole cost and expense, but only insofar as any of such
rules, ordinances and regulations pertain to the manner in which the Tenant shall use the Premises; the
obligation to comply in every other case and also all cases where such rules, regulations and ordinances require
repairs, alterations, changes or additions to the Building (including the Premises, but not caused by Tenant's
use thereof) or Building equipment, or any part of either, being hereby expressly assumed by Landlord, and
Landlord covenants and agrees to comply with all such rules, regulations and ordinances with which Tenant has
not herein expressly agreed to comply.
7. PAYMENTS; SURVIVAL
Tenant will pay all rents and sums provided to be paid Landlord hereunder at the time and in the
manner herein provided. Time is of the essence as regards all rents and other sums provided herein to be paid
to Landlord by Tenant. Any and all monetary obligations of Tenant under the terms hereof shall be deemed to
be rent, shall be secured by any available lien for rent, and to the extent accrued shall survive expiration or
termination of the term hereof.
8. REPAIRS AND REENTRY
Tenant will, at Tenant's own cost and expense, repair or replace any damage or injury done to the
Building, the Premises, or any part thereof, caused by Tenant or Tenant's agents, employees, invitees, licensees
or visitors. if Tenantfails to make such repairs or replacements promptly, not to exceedfifteen (15) days from
the date of occurrence, Landlord may, at its option, make such repairs or replacements, and Tenant shall repay
the cost thereof to Landlord on demand. Tenant will not commit or allow any waste or damage to be
committed on any portion of the Premises or the Building and shall at the termination of the Lease, by lapse of
time or otherwise, deliver the Premises to Landlord broom clean and in as good condition as existed at the date
ofpossession of Tenant, ordinary wear and tear excepted, and upon such termination of this Lease, LandlordshallhavetherighttoreenterandresumepossessionofthePremises.
9. ALTERATIONS AND IMPROVEMENTS
Except as otherwise provided in Addendum # 1 and Exhibit "8" attached hereto, all installations and
improvements now or hereafter placed on the Premises other than Building Standard Improvements as set
forth in Exhibit "8" attached hereto and made a part of hereof, shall befor Tenant's account and at Tenant's
cost (and Tenant shall pay any and all taxes and increased insurance premiums thereon or attributable
thereto), which cost shall be payable by Tenant to Landlord in advance. Tenant shall not make or allow to be
made any alterations or physical additions in or to the Premises without first obtaining the written consent ofLandlord. Any alterations, physical additions or improvements to the Premises made by Tenant shall at oncebecomethepropertyoftheLandlordandshallbesurrenderedtoLandlordupontheterminationofthisLease. Landlord, at its option, may require Tenant to remove any physical additions and repair any alterations in order
to restore the Premises to the condition existing prior to the time Tenant took possession, all costs of removal
and alterations to be borne by Tenant. This clause shall not apply to movable equipment orfurniture owned byTenantwhichmayberemovedbyTenantattheendofthetermofthisLeaseifTenantisnotthenindefault
and ifsuch equipment andfurniture is not then subject to any other rights, liens and interests ofLandlord; however, Tenant shall be responsible for any damage caused to the Premises resulting from the removal of anyphysicaladditions.
10. ASSIGNMENT OR SUBLEASE
Landlord and Tenant shall have the right to transfer and assign, in whole or part, its rights and
obligations in the Building and property that are the subject of this Lease. Tenant shall not assign this Lease or
sublet all or any part of the Premises without the prior written consent of the Landlord, which may not be
4
unreasonably withheld or delayed. Landlord shall have the option, upon receiptfrom Tenant ofwritten request
for Landlord's consent to subletting or assignment, to cancel this Lease as of the date the requested subletting
or assignment is to be effective. The option shall be exercised, if at all, within fifteen (15) daysfollowing
Landlord's receipt of written notice, by delivery to Tenant of written notice of Landlord's intention to exercise
the option. In the event ofany assignment or subletting, Tenant shall nevertheless at all times, remain fully
responsible and liable for the payment of the rent and for compliance with all of its other obligations under the
terms, provisions and covenants of this Lease. Upon the occurrence of an "Event Of Default" (as defined
below), if all or any part of the Premises are then assigned or sublet, Landlord, in addition to any other
remedies provided by this Lease orprovided by law, may, at its option, collect directly from the assignee or
subtenant al! rents becoming due to Tenant by reason of the assignment or sublease, and Landlord shall have a
security interest in all properties on the Premises to secure payment of such sums. Any collection directly by
Landlordfrom the assignee or subtenant shall not be construed to constitute a novation or a release of Tenant
from the furtherperformance of its obligations under this Lease. In the event that Tenant shall sublease the
Premises for a rental in excess of the Base Rent due hereunder from Tenant to Landlord, then, notwithstanding
any other provision contained in this Lease to the contrary, the Base Rent providedfor in Paragraph 4 ofthis
Lease shall automatically be increased during the term ofsuch sublease to a sum equal to the amount of rent
payable under such sublease. In the event that Tenant shatl receive any valuable consideration for an
assignment or sublet of the Tenant's interest in this Lease, then, notwithstanding any other provision contained
in this Lease to the contrary, Tenant shall pay to Landlord as additional rent hereunder the amount of
consideration thereby received. Notwithstanding the provisions of this section, the normal operation of the
Tenant's business to include on demand licensing ofspaces to third parties for the permitted uses shall not be
considered an assignment or sublet. Any sublease or assignee hereofshall sign a written assumption of all of
Tenant's obligations hereunder, although Tenant shall not be releasedfrom said obligations as setforth above.
11. LEGAL USE AND VIOLATIONS OF INSURANCE COVERAGE
Tenant will not occupy or use, orpermit any portion of the Premises to be occupied or used, or do or
permit to be done anything in or about the Building, for any business or purpose which is unlawful or immoral,
in part or in whole, or deemed to be hazardous in any manner, or which will be disreputable or harmful to the
character or reputation of the Building or which will be bothersome to other tenants of the Building or visitors
to the Building, or which will be a nuisance. Tenant will not do anything or permit anything to be done in or
about the Premises or Building which will in any way increase the rate of insurance on the Building and/or its
contents; and in the event that, by reason of acts or omission of Tenant there shall be an increase in rate of any
insurance on the Building or its contents, then Tenant hereby agrees to pay such increase in full and to remedy
such condition upon five (5) days written demand by Landlord.
12. INDEMNITY LIABILITY
Tenant hereby agrees to indemnify and hold harmless Landlord of andfrom any and allfines, suits,
claims, demands and actions of any kind (including expenses and attorney'sfees) by reason of any breach,
violation, or nonperformance of any condition hereof, including failure to abide by the Rules of the Building or
any act or omission on the part of the Tenant, its agents, invitees, or employees. Tenant isfamiliar with the
Premises and acknowledges that they are received by Tenant in good state of repair and accepted by Tenant in
the condition in which they are now orshall be when readyfor occupancy and that Landlord has not made any
representations as to the Premises except as set forth herein. Tenant hereby agrees that Landlord shall not be
liable for injury to Tenant's business or any loss ofincome therefrom orfor damage to the goods, wares,
merchandise or other property of Tenant, Tenant's employees, invitees, customers, or any other person in or
about the Premises whether such damage or injury is caused by or results from fire, steam, electricity, gas,
water or rain, orfrom the breakage, leakage, obstruction or other defects of pipes, sprinklers, wires, appliances
plumbing, air conditioning or lighting fixtures, orfrom any other cause, whether the said damage or injury
resultsfrom latent defects or other conditions arising upon the Premises or upon other portions of the
Building(s) of which the Premises is a part, orfrom other sources or places and regardless of whether the cause
ofsuch damage or injury or the means ofrepairing the same is inaccessible to Tenant. Landlord shall not be
liable for any damages arising from any act or neglect of any other tenant of the Building. Tenant accepts the
Premises as suitable for the purposes for which they are leased and assumes all risks ofdamage to persons or
property, and agrees that no representations, except such as are contained herein, have been made to Tenant
respecting the condition of the Premises.
13. RULES OF BUILDING
Tenant and Tenant's agents, employees, licensees, members, invitees and visitors shall comply fully
with all requirements of the Building, which may be made by Landlord. A copy ofsuch rules shall be furnished
to Tenant and by Tenant to Tenant's licensees, members, invitees and visitors and such rules may be changed
or amended by Landlordfrom time to time without either prior notification to Tenant or Tenant's consent. The
present version ofsaid rules are printed on a separate schedule, which is attached to this Lease as Exhibit "C"
and made a part hereof
5
14. ENTRY FOR REPAIRS AND INSPECTION
Tenant will permit Landlord or its officers, agents or representatives the right to enter into and upon
any and all parts of the Premises, at all reasonable hours to inspect same or clean or make repairs or
alterations or additions as Landlord may deem necessary or desirable, and Tenant shall not be entitled to any
abatement or reduction of rent by reason thereof; provided, however, that nothing herein requires Landlord
make any such repairs, alterations or additions. Landlord shall be entitled to enter upon the Premises at any
time to make emergency repairs. Tenant hereby waives any claimsfor damages for any injury of or
interference with Tenant's business, any loss ofoccupancy or quiet enjoyment of the Premises, and any other
loss occasioned thereby. For each of the aforesaid purposes, Landlord shall at all times have and retain a key
with which to unlock all of the doors in, upon and about the Premises, excluding Tenant's vaults and safes, if
any, and Landlord shall have the right to use any and all means which Landlord may deem proper to open said
doors in an emergency in order to obtain entry to the Premises, and any entry to the Property obtained by
Landlord by any of said means shall not under any circumstances be construed or deemed to be aforcible or
unlawful entry into, or a detainer of, the Property, or an eviction of Tenantfrom the Premises or any portion
thereof.
15. USE OF BUILDING NAME
Tenant shall not, except to designate Tenant's business address (and then only in a conventional
manner and without emphasis or display) use the name of the Building "One Clearwater Tower" or any
simulation or abbreviation ofsuch name for any purpose whatsoever. Landlord reserves the right to change
the name of the Building at any time. Tenant will discontinue using such name and any simulation or
abbreviation thereoffor the purpose ofdesignating Tenant's business address within thirty (30) days after
Landlord shall notify Tenant that the Building is no longer known by such name.
16. GRAPHICS
Landlord shall provide and install, at Tenant's cost, all initial signs, letters and numerals on entry doors
to the Premises. All such signs, letters and numerals shall be in the standard graphics for the Building and
reasonably acceptable to Landlord and no others shall be used or permitted on the Premises without Landlord's
prior written consent, which may be withheld in Landlord's sole discretion. Pylon signage shall be at Tenant's
expense and only with the prior written consent of the Landlord. All pylon signage shall be removed by Tenant
at lease expiration. Exhibit D attached includes the building sign criteria.
17. SUITE ACCESS
Landlord will provide tenants with 24 hour, 7 days a week limited access to the premises. Landlord
agrees to provide tenant with initial supply ofbuilding card keys, key fobs, suite keys and access protocols at no
charge. Initial supply shall consist of 2 keys per door lock or access point per workspace or demised office space.
Any additional keys above the initial supply ifprovided by Landlord shall be billed to Tenant at Landlord's actual
cost.
18. DEFACING PREMISES AND OVERLOADING
Tenant shall not place anything or allow anything to be placed on or near any door, partition, wall or
window which may be unsightly from outside the Premises, and Tenant shall not place or permit to be placed
any article of any kind on any window ledge or on the exterior walls or windows, blinds, shades, awnings or
otherforms of inside or outside window coverings. No inside or outside window coverings or window
ventilators, or similar devices, shall be placed in or about the outside windows in the Premises except to the
extent, if any, that the character, shape, color, material and make thereof isfirst approved by the Landlord, and
Tenant shall not do any painting or decorating in the Premises or make, paint, cut or drill into, or in any way
deface any part of the Premises or Building without the prior written consent of the Landlord, which may be
withheld in Landlord's sole discretion. Tenant shall not overload anyfloor or part thereof in the Premises, or
anyfacility in the Building or any public corridors or elevators therein, and shall not bring in or remove anylargeorheavyarticles, without Landlord's prior written consent, which may be withheld in Landlord's sole
discretion. Landlord may direct and control the locations of safes and all other heavy articles. Furniture and
other large or heavy articles, may be brought into the Building, removed therefrom or movedfrom place to
place within the Building only at times and in the manner designated in advance by Landlord. Tenant agrees
not to place any load on any portion of the Premises or other portions of the Building or its equipment that
would exceed the allowable load limitsfor the Building, as specified by Landlord.
19. LIABILITY INSURANCE
Tenant shall, at its sole cost and expense, obtain and maintain in fullforce and effect for the mutual
benefit of Landlord and Tenant, commercial general liability insurance in the minimum amount of
6
2,000,000.00, combined single limit coverage, against claims for bodily injury, death or property damage
arising out of the use and occupancy of the Premises. A certificate of such insurance shall be furnished to
Landlord at the commencement of the Lease term and each renewal certificate of such policy shall befurnished
to Landlord at least thirty (30) days prior to the expiration of the policy it renews. Each such policy ofinsurance
shall contain an agreement by the insurer that such policy shall not be canceled without thirty (30) days prior
written notice to Landlord. Such insurance may be in the form of general coverage, floater policy, or so-called
blanket policy issued by insurers of recognized responsibility. The nature and scope ofsuch policy of insurance
and the insurer thereunder shall be subject to Landlord's approval which shall not be unreasonably withheld or
delayed. Should the Tenantfail to procure policies as is provided in this Lease, the Landlord may obtain such
insurance and the premiums on such insurance shall be deemed additional rental to be paid by the Tenant unto
the Landlord upon demand. For special events that may be scheduled where either legal mind altering
substances that impair judgment including but not limited to alcoholic beverages of any type may be served,
Tenant shall ensure that liquor liability or other coverage is obtained and provide Landlord with a certificate of
insurance evidencing the coverage and naming Tenant and Landlord as additional insureds.
20. CASUALTY INSURANCE
Landlord shall at all times during the term of this Lease, maintain a policy or policies of insurance with
the premiums paid in advance, issued by and binding upon some solvent insurance company, insuring the
Building against loss or damage byfire, explosion or other hazards and contingencies for the full insurable
value; provided, that Landlord shall not be obligated in any way or manner to insure any personal property
including, but not limited to, anyfurniture, machinery, goods or supplies) of Tenant or which Tenant may have
upon or within the Premises or any fixtures installed by or paid for by Tenant upon or within the Premises or
any additional improvements which Tenant may construct, or which Landlord may construct for Tenant on the
Premises. Tenant shall, at all times during the term of this Lease, at Tenant's expense, maintain a policy or
policies of insurance with the premiums paid in advance, insuring Tenant'sfurniture, machinery, goods or
supplies, any additional improvements which Tenant may construct or Landlord may constructfor Tenant on
the Premises, furnishings, removablefloor coverings, trade equipment, signs and all other decorations placed
by Tenant in or upon the Premises, for the full insurable value thereof.
21. EMPLOYEE'S COMPENSATION
Tenant shall maintain and keep in force all employees' compensation insurance required under the laws
of the State ofFlorida, and such other insurance as may be necessary to protect Landlord against any other
liability to person or property arising hereunder by operation of law, whether such law is now in force or is
adopted subsequent to the execution hereof.
22. CONDEMNATION
If the Premises, or any part thereof, or any interest therein, be taken by virtue of (or sold under threat
of) eminent domain orfor any public or quasi -public use or purpose, this Lease and the estate hereby granted,
at the option of the Landlord, shall terminate as of the date ofsuch taking. If any part of the Building other
than the Premises be so taken, the Landlord shall have the right to terminate this Lease at the date of such
taking or within six (6) months thereafter by giving the Tenant thirty (30) days
prior written notice of the date of such termination. Any interest which Tenant may have or claim to have in
any award resulting from the condemnation proceeding shall be limited to removal expenses for Tenant's
furniture, movable fixtures, and other personal property, which shall not diminish Landlord's award. Tenant
specifically waives any other award resulting from the condemnation proceeding.
23. LOSS OR DAMAGE
Landlord shall not be liable or responsible for any loss or damage to any property or person occasioned
by theft, fire, water, wind, vandalism, rain, snow, leakage of Building or sprinkler system, act ofGod, public
enemy, injunction, riot, strike, insurrection, war, court order, requisition or order of governmental body or
authority, unavailability offuel or energy, or other matter beyond the control ofLandlord, orfor any damage or
inconvenience which may arise through repair or alteration of any part of the Building, orfailure to make such
repairs, orfrom any cause whatever, unless caused solely by Landlord's gross negligence.
24. ABANDONMENT
If the Premises are abandoned by Tenant, Landlord shall have the right, but not the obligation, to relet
the Premises for the remainder of the period covered hereby; and ifthe rent is not received through such
reletting at least equal to the rent provided for hereunder, Tenant shall pay and satisfy any deficiencies
between the amount of the rent called for and that received through reletting, and all expenses incurred by
such other reletting, including, but not limited to the cost of realtor'sfees, renovating, and altering and
decorating for a new occupant. Nothing herein shall be construed as in any way denying Landlord the right, in
7
case of abandonment of the Premises, or other breach of this Lease by Tenant, to treat the same as an entire
breach of this Lease and any and all damages occasioned Landlord thereby, or pursue any other remedy
provided by law or this Lease.
25. HOLDING OVER
In case of holding over by Tenant after expiration or termination of this Lease without Landlord's prior
written consent, Tenant will pay as rent for each month or part thereof, during such holdover period, the higher
of (1) the then prevailing market rote as determined by Landlord in its absolute discretion, or (ii) twice the rent
provided in Paragraphs 4(A), (8) and (C) above. No holding over by Tenant after the term of this Lease without
the written consent of Landlord shall operate to extend the Lease. In addition to theforegoing, Landlord, at
Landlord's sole option, shall also have the right to serve written notice upon Tenant that such hold over
constitutes a renewal of this Lease for one (1) year. Tenant also agrees to pay Landlord all damages sustained
by Landlord resulting from retention ofpossession by Tenant, including the loss of any proposed subsequent
lessee for any portion of the Premises. The provisions of this paragraph shall not constitute a waiver by
Landlord of any right ofreentry as herein set forth, nor shall receipt of any rent or other act in apparent
affirmance of the tenancy operate as a waiver of the right to terminate this Lease for a breach of any of the
terms, covenants, or obligations herein on Tenant's part to be performed.
26. LOSS BY FIRE OR OTHER CAUSES
Tenant shall, in case offire, or loss or damage to the Premisesfrom other cause, give immediate notice
thereof to Landlord. In the event of damage to the Premises by fire or other causes resulting from fault or
negligence of Tenant or Tenant's agents, employees, invitees or visitors, the same shall be repaired by and at
the sole expense of Tenant under the direction and supervision of Landlord. If the Premises shall be damaged
by fire or other casualty covered by Landlord's insurance and not resulting from the fault or negligence of
Tenant or Tenant's agents, employees, invitees or visitors, the damages shall be repaired by and at the expense
of Landlord and the rent, until such repairs shall be made, shall be apportioned according to the part ofthe
Premises which is usable by Tenant. Landlord agrees, at its expense, to repair promptly any damage of the
Premises not resulting from the fault or negligence of Tenant or Tenant's agents, employees, invitees, or
visitors, except that Tenant agrees to repair and replace its own furniture, furnishings, fixtures, personal
property, and equipment, and except that, ifsuch damage is so extensive that the replacement of more than
fifty percent (50%) ofthe Building be required, then and in that event, at the option of Landlord and by giving
written notice to Tenant within forty-five (45) days after said occurrence or damage, this Lease will be canceled
and of no force and effect from and after the date of the occurrence ofsuch damage. No penalty shall accrue
for reasonable delay which may arise by reason of adjustment of insurance on the part of Landlord, andfor
reasonable delay on account of causes beyond Landlord's control (such as described in Paragraphs 5 and 20
hereof).
27. WAIVER OF SUBROGATION RIGHTS
Anything in this Lease to the contrary notwithstanding, Landlord and Tenant each hereby waives any
and all rights of recovery, claim, action or cause of action against the other, its agents, officers or employees,
for any loss or damage that may occur to the Premises, or any improvements thereto, or the Building of which
the Premises are a part, or any improvements thereto, or any personal property ofsuch party therein, by
reason offire, the elements, or any other cause(s) which are insured against policies referred to in Paragraph
20 hereof, regardless of cause or origin, including negligence of the other party hereto, its agents, officers, or
employees. Landlord and Tenant will both exert their best efforts to cause all insurance policies to include an
endorsement to effect the provisions of this Paragraph.
To maximum extent possible permitted by law and insurance regulations, in the event of a casualty loss
occurring within the initial term of the Lease that renders the pemises unhabitable, Landlord and Tenant agree
that the parties entitlement to any insurance proceeds shall be apportioned using a ratio that is determined by
each parties contributions to the tenant improvements costs to include demolition, which are a part of this
Lease.
28. ATTORNEY'S FEES
In the event that Tenant defaults in the performance of any of the terms, covenants, agreements or
conditions contained in this Lease and Landlord places the enforcement of this Lease, or any part thereof, or the
collection ofany rent or other sum due, or to become due hereunder, or recovery of the possession of the
Premises, in the hands of any attorney, orfiles suit upon the same, Tenant agrees to pay Landlord reasonable
attorney'sfees, paralegal's fees and all costs and expenses (including those incurred at trial, arbitration and in
connection with bankruptcy and appellate proceedings), and payment of the same shall be secured in like
manner as is herein provided as to security for rent.
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29. AMENDMENT OF LEASE
This agreement may not be altered, changed, or amended, except by an instrument in writing, signed
by all parties hereto.
30. TRANSFER OF LANDLORD'S RIGHTS AND LIMITATION OF LIABILITY
Landlord shall have the right to transfer and assign in whole or in part all and every feature of its rights
and obligations hereunder and in the Building and property referred to herein. Such transfers or assignments
may be made either to a corporation, partnership, trust, individual or group of individuals, and, howsoever
made, are to be in all things respected and recognized by Tenant. In the event of any transfer of title to such
fee, the Landlord herein shall be automaticallyfreed and relievedfrom all personal liability with respect to
performance of any covenant or obligation on the part of Landlord, provided any Security Deposits or advance
rents held by Landlord are turned over to the grantee and said grantee assumes, subject to the limitation of this
Lease paragraph, all the terms, covenants and conditions of this Lease to be performed on the part of Landlord,
it being intended hereby that the covenants and obligations contained in this Lease on the part of Landlord
shall, subject as aforesaid, be binding on Landlord, its successors and assigns, only during their respective
successive periods of ownership. Notwithstanding anything to the contrary contained in this Lease, it is agreed
and understood that Tenant shall look solely to the estate and property of the Landlord in the land and
Buildings comprising the Real Property of which the Premises is a part for the enforcement of any judgment (or
otherjudicial decree) requiring the payment of money by Landlord to Tenant by reason of any default or breach
by Landlord in the performance ofits obligations under this Lease, it being intended hereby that no other assets
of Landlord shall be subject to levy, execution, attachment or other such legal process for the enforcement or
satisfaction of the remedies pursued by Tenant in the event ofsuch default or breach.
Notwithstanding anything contained in this Lease to the contrary, the parties agree and acknowledge that any
claim brought or right to recover obtained by Tenant against Landlord shall be limited to Landlord's equity
interest in the Office Building. NOTWITHSTANDING ANYTHING CONTAINED IN THE LEASE TO THE CONTRARY,
IN NO EVENT WILL LANDLORD BE LIABLE TO THE TENANT OR ANY PERSON OR ENTITY CLAIMING RIGHTS BY,
THROUGH OR UNDER THE TENANTAS A RESULT OF ANY BREACH HEREOF OR FAILURE TO PERFORM
HEREUNDER OR INDEMNITY iN CONNECTION HEREWITH FOR ANY INCIDENTAL, CONSEQUENTIAL, PUNITIVE,
SPECIAL OR OTHER DAMAGES, OTHER THAN ACTUAL DAMAGES ARISING FROM SUCH BREACH OR FAILURE
TO PERFORM OR INDEMNITY, AND INALL SUCH CASES LANDLORD'S LIABILITY HEREUNDER 1S LIMITED TO
ONE YEAR'S RENT.
31. DEFAULT BY TENANT
The following shall be deemed to be events of default under this Lease:
A) Tenant shall fail to pay when due any installment of rent or any other payment required
pursuant to this Lease.
8) Tenant shall access premises illegally.
C) Tenant shall vacate or abandon any substantial portion of the Premises.
D) Tenant shallfail to comply with any term, provision or covenant of this Lease, other than the
payment of rent, or other sum required hereunder and the failure is not cured within fifteen (15) days after
written notice to Tenant.
E) Tenant shall file a petition or be adjudged bankrupt or insolvent under the Bankruptcy Reform
Act of 1978, as amended, or any similar law or statute of the United States or any state; or a receiver or trustee
shall be appointedfor all or substantially all of the assets of Tenant; or Tenant shall make a transfer infraud of
creditors or shall make an assignmentfor the benefit of creditors; or the attachment, execution or otherjudicial
seizure of all or a substantial portion of Tenant's assets located at the Premises or of Tenant's interest in this
Lease; or the entry of ajudgment against Tenant which affects Tenant's ability to conduct its business in the
ordinary course; provided, however, to the extent that any provision of this Subparagraph 31(E) is contrary to
any applicable law, such provision shall be of no force or effect to such extent only.
F) Tenant shall do or permit to be done any act which results in a lien being filed against the
Premises.
G) The discovery by Landlord that anyfinancial statement, warranty, representation or other
information given to Landlord by Tenant, any assignee of Tenant, any subtenant of Tenant, any successor in
interest of Tenant or any guarantor of Tenant's obligation hereunder, in connection with this Lease, was
materially false or misleading when made or furnished.
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32. REMEDIES FOR TENANT'S DEFAULT
All rights and remedies of the Landlord herein enumerated in the event of defaultshall be cumulative
and nothing herein shall exclude any other right or remedy allowed by law. In the event of any default or
breach hereof by Tenant, Landlord may (butshall not be obligated) at any time thereafter, with or without
notice or demand and without limiting Landlord in the exercise ofany right or remedy which Landlord may
have by reason ofsuch default or breach:
A) Terminate Tenant's right to possession of the Premises by any lawful means, in which case this
Lease shall terminate and Tenant shall immediately surrender possession of the Premises to Landlord. In such
event Landlord shall be entitled to recoverfrom Tenant all damages incurred by Landlord by reason of Tenant's
default, including accrued rent, the cost of recovering possession of the Premises, expenses of reletting,
including necessary renovation and alteration of the Premises, reasonable attorney's fees and any real estate
commission actually paid.
8) Reenter and take possession of the Premises and relet or attempt to relet samefor Tenant's
account, holding Tenant liable in damages for all expenses incurred by Landlord in any such reletting andfor
any difference between the amount of rents receivedfrom such reletting and those due and payable under the
terms hereof. In the event Landlord relets the Premises, Landlord shall have the right to lease the Premises or
portions thereoffor such periods of time and such rentals andfor such use and upon such covenants and
conditions as Landlord, in its sole discretion, may elect, and Landlord may make such repairs and improvements
to the Premises as Landlord may deem necessary. Landlord shall be entitled to bring such actions or
proceedings for the recovery of any deficits due to Landlord as it may deem advisable, without being obliged to
wait until the end of the term, and commencement or maintenance of any one or more actions shall not bar
Landlordfrom bringing other or subsequent actions forfurther accruals, nor shall anything done by Landlord
pursuant to this Subparagraph 32(B) limit or prohibit Landlord's right at any time to pursue other remedies ofLandlordhereunder;
D) Declare all rents and charges due hereunder immediately due and payable, and thereupon all such
rents and fixed charges to the end of the term shall thereupon be accelerated, and Landlord may, at once, take
action to collect the same by distress or otherwise. In the event of acceleration ofrents and other charges due
hereunder which cannot be exactly determined as of the date of acceleration and/orjudgment, the amount of
said rent and charges shall be as determined by Landlord in a reasonable manner based on information such as
previous fluctuations in the Consumer Price Index and the like;
D) Perform any of Tenant's obligations on behalfof Tenant in such manner as Landlord shall deem
reasonable, including payment of any moneys necessary to perform such obligation or obtain legal advice, and
all expenses incurred by Landlord in connection with the foregoing, as well as any other amounts necessary to
compensate Landlordfor all detriment caused by Tenant's failure to perform which in the ordinary course
would be likely to result therefrom, shall be immediately due and payablefrom Tenant to Landlord, with
interest at the Default Rate; such performance by Landlord shall not cure the default of Tenant hereunder and
Landlord may proceed to pursue any or all remedies available to Landlord on account of Tenant's default; if
necessary Landlord may enter upon the Property after ten (10) days' prior written notice to Tenant (except in
the case ofemergency, in which case no notice shall be required), perform any of Tenant's obligations of whichTenantisindefault; and/or
E) Pursue any other remedy now or hereafter available to Landlord under state orfederal laws or
judicial decisions. Unpaid installments of rent and other unpaid monetary obligations of Tenant under the
terms hereof shall bear interest from the date due at the Default Rate (as hereinafter defined).
F) In the event that litigation is necessary to enforce the provisions ofthis Lease, both Landlord
and Tenant hereby waive their respective rights to ajury trial.
G) In the event of termination of this Lease for any reason, Landlord shall become the sole owner
of all improvements to the Premises, whether made by Tenant, Landlord or any third party.
33. WAIVER OF DEFAULT OR REMEDY
Failure of Landlord to declare an Event Of Default immediately upon its occurrence, or delay in taking
any action in connection with an Event Of Default, shall not constitute a waiver of the default, but Landlord
shall have the right to declare the default at any time and take such action as is lawful or authorized under this
Lease. Pursuit of any one or more of the remedies setforth in Paragraph 32 above shall not preclude pursuit of
any one or more of the other remedies provided elsewhere in this Lease by reason of the violation ofany of the
terms, provisions or covenants of this Lease. Failure by Landlord to enforce one or more of the remedies
provided upon an Event OfDefault shall not be deemed or construed to constitute a waiver of the default or ofanyviolationorbreachofanyoftheterms, provisions and covenants contained in this Lease.
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34. DEFAULT BY LANDLORD
Landlord shall not be in default unless Landlord fails to perform obligations required of Landlord within
a reasonable time, but in no event later than thirty (30) days after written notice by Tenant to Landlord and to
the holder of any first mortgage or deed of trust covering the Premises whose name and address shall have
theretofore been furnished to Tenant in writing, specifying the obligation that Landlord has failed to perform;
provided, however, that if the nature of Landlord's obligation is such that more than thirty (30) days are
required for performance, then Landlord shall not be in default if Landlord commences performance within such
thirty (30) day period and thereafter diligently prosecutes the same to completion. Notwithstanding any other
provision hereof, Landlord shall not be in default hereunder forfailure to perform any act required of Landlord
where such failure is due to inability to perform on account ofstrike, laws, regulations or requirements of any
governmental authority, or any other cause whatsoever beyond Landlord's control, nor shall Tenant's rent be
abated by reason ofsuch inability to perform.
35. RIGHTS OF MORTGAGEE
Tenant accepts this Lease subject and subordinate to any recorded mortgage, deed of trust, ground
lease or other lien presently existing or which may hereafter exist upon the Premises. Landlord is hereby
irrevocably vested with full power and authority to subordinate Tenant's interest under this Lease to any
mortgage, deed or trust, ground lease or other lien hereafter placed on the Premises, and Tenant agrees upon
demand to execute additional instruments subordinating this Lease as Landlord may require. Tenant'sfailure
to execute such documents within ten (10) days after written demand shall constitute material default by
Tenant hereunder, or, at Landlord's option, Landlord shall execute such documents on behalf of Tenant as
Tenant's attorney-in-fact. If the interest of Landlord under this Lease shall be transferred by reason of
foreclosure or other proceedings for enforcement of any mortgage on the Premises, Tenant shall be bound to
the transferee (sometimes called the "Purchaser") under the terms, covenants and conditions ofthis Leasefor
the balance of the term remaining, and any extensions or renewals, with the same force and effect as if the
Purchaser were Landlord under this Lease, and Tenant agrees to attorn to the Purchaser, including the
mortgagee under any such mortgage if it be the Purchaser, as its Landlord, the attornment to be effective and
self -operative without the execution of anyfurther instruments upon the Purchaser succeeding to the interest
of Landlord under this Lease. The respective rights and obligations of Tenant and the Purchaser upon the
attornment, to the extent of the then remaining balance of the term of this Lease, and any extensions and
renewals, shall be and are the same as those setforth in this Lease.
36. ESTOPPEL CERTIFICATES
Tenant agrees to furnish at any time, andfrom time to time, within seven (7) days after request of
Landlord or Landlord's mortgagee, a statement certifying that: Tenant is in possession of the Premises; the
Premises are acceptable; the Lease is in fullforce and effect; the Lease is unmodified; Tenant claims no present
charge, lien or claim of offset against rent; the rent is paidfor the current month, but is not paid and will not be
paidfor more than one (1) month in advance; there is no existing default by reason ofsome act or omission by
Landlord; and such other matters as may be reasonably required by Landlord or Landlord's mortgagee.
37. SUCCESSORS
This Lease shall be binding upon and inure to the benefit of Landlord and Tenant and their respective
heirs, personal representatives, and to the extent permitted hereunder, successors and assigns. It is hereby
covenanted and agreed that should Landlord's interest in the Premises cease to exist for any reason during thetermofthisLease, then notwithstanding the happening ofsuch event this Lease nevertheless shall remain
unimpaired and in fullforce and effect and Tenant hereunder agrees to attorn to the then owner of thePremises.
38. RENT TAX
Tenant shall pay and be liable for all rental, sales, indigent and use taxes or other similar taxes, ifany, levied or imposed by any city, state, county or other governmental body having authority, such payments to be
in addition to all other payments required to be paid to Landlord by Tenant under the terms of this Lease. Any
such payment shall be paid concurrently with the payment of the rent upon which the tax is based as set forth
above.
39. PARKING
During the term of this Lease, Tenant will not be provided appurtenant parking on any of the OneClearwaterTower's surface lots or licensed spaces in the public parking garages for its members, tenants,
11
visitors, invitees or employees. The parking plan for One Clearwater Tower and Ring Suites is attached at
Exhibit "A2".
40. SECURITY DEPOSIT
Tenant agrees to pay to Landlord at the time of execution of this Lease, the sum of $9,000.00 as a
Security Deposit". The Security Deposit shall be held by Landlord without liabilityfor interest and as security
for the performance by Tenant of Tenant's covenants and obligations under this Lease, it being expressly
understood that the Security Deposit shall not be considered an advance payment of rental or a measure of
Tenant's damages in case of default by Tenant. Landlord may co -mingle the Security Deposit with Landlord's
otherfunds. Landlord may, from time to time, without prejudice to any other remedy, use the Security Deposit
to the extent necessary to make good any arrearage of rent or to satisfy any other covenant or obligation of
Tenant hereunder. Following any such application of the Security Deposit, Tenant shall pay to Landlord on
demand the amount so applied in order to restore the Security Deposit to its original amount. If Tenant is not
in default at the termination of this Lease, the balance of the Security Deposit remaining after any such
application shall be returned by Landlord to Tenant. IfLandlord transfers its interest in the Premises during the
term of this Lease, Landlord may assign the Security Deposit to the transferee and thereafter Landlord shall
have no further liability for the return ofsuch Security Deposit. No trust relationship is created herein between
Landlord and Tenant with respect to the Security Deposit. If the monthly rent shall, from time to time, increase
during the term hereof, Tenant shall thereupon deposit with Landlord an additional security deposit so that the
amount of the Security Deposit held by Landlord shall at all times bear the same proportion to then current rent
as the original Security Deposit bears to the original monthly rent setforth in Paragraph 4 hereof.
41. INTERESTAND ADMINISTRATIVE CHARGES
Monies owed by Tenant to the Landlord shall, after due date, bear interest at the rate of eight percent8%) per annum ("Default Rate"). Payment ofsuch interest shall not excuse or cure any default by Tenant
under this Lease, provided, however, that interest shall not be payable on late charges incurred by Tenant.
Notwithstanding any other term or provision hereof, in no event shall the total of all amounts paid hereunder
by Tenant and deemed to be interest exceed the amount permitted by applicable usury laws, and in the event
of payment by Tenant of interest in excess of such permitted amount, the excess shall be applied towards
damages incurred by Landlord or returned to Tenant, at Landlord's option. In addition, in the event any
instrument for any money payment hereunder shall be dishonored for any reason whatsoever not attributable
to Landlord, Landlord shall be entitled, in addition to any other remedy available hereunder, to make an
administrative charge of One Hundred Dollars and 00/100 ($100.00).
42. NOTICES
Any rental payment, notice or document required or permitted to be delivered hereunder shall be
deemed to be delivered or given when (a) actually received or (b) signedfor or "refused" as indicated on the
U.S. Postal Service Return Receipt. Delivery may be made by personal delivery or by United States mail,
postage prepaid, Certified or Registered Mail, addressed to the parties hereto at the respective addresses set
out opposite their names below, or at such other addresses as they may hereafter specify by written noticedeliveredinaccordanceherewith:
LANDLORD: 600 Cleveland, LLC.
c/o Jacob Real Estate Services, Inc.
607 West Bay Street
Tampa, Florida 33606-2703
With a Copy to: David E. Platte, Esq.
Trask Daigneault, LLP
1001 5. Ft. Harrison Avenue, Suite 201
Clearwater, Florida 33756
Tel. (727)733-0494 Ext. 105
E Mail: david@cityattorneys.legal
Additional
Notice Copy to: Daniels lkajevs
Managing Member
600 Cleveland, LLC
331 Cleveland Street, Apt. 2502
Clearwater, Florida 33755
TENANT: The Ring Workspaces, LLC
Attn: Simee Adhikari
Managing Member
12
Additional
Notice Copy to:
600 Cleveland Street, Suite 2502
Clearwater, Florida 33755
Janelle Branch
Project Manager
The Ring Workspaces, LLC
331 Cleveland Street, Apt. 2502
Clearwater, Florida 33755
Tenant hereby appoints as its agent to receive the service of all dispossessory or distrain proceedings
and legal notices the person in charge of the Premises at the time, or occupying the Property, and if there is no
person in charge or occupying the Property, then such service or notice may be made by attaching the same on
the main entrance to the Premises.
43. CHARGES FOR SERVICES
It isfurther understood and agreed that any expenses Landlord may incurfor any materials, supplies,
services, orfor work done on the Premises by order of the Tenant, shall be promptly paid by Tenant to Landlord,
and shall be included in any lien for rent due and unpaid. Tenant agrees that Landlord may add ten percent
10%) to said expenses to cover Landlord's overhead costs incurred in providing said materials, supplies,
services or work.
44. SCHEDULES
All schedules initialed by both parties hereto and attached to this Lease shall be a part hereof whether
or not said schedules are specifically referred to in the Lease.
45. SEVERABILITY'
In the event that any provision of this Lease is held invalid, the other provisions and parts ofprovisions
shall remain in fullforce and effect.
46. GOVERNING LAWS
This Lease shall be governed by and construed according to the laws of the State of Florida.
47. CAPTIONS AND CONSTRUCTION OF LANGUAGE
Any conflict between the printed provisions hereof and the typewritten or handwritten provisions shall
be controlled by the typewritten or handwritten provisions. Headings used herein shall not affect the
interpretation hereof, being merely for convenience. The terms "Landlord" and "Tenant" shall include the
plural and the singular and all grammar shall be deemed to conform thereto. If more than one person executes
this Lease, their obligations shall be joint and several. The use of the words "include," "includes" and
including" shall be without limitation to the items which mayfollow. The terms "Lease", "Lease Agreement';
or "Agreement" shall be inclusive of each other, and shall also include renewals, extensions, or modifications of
this Lease.
48. INCORPORATION OF PRIOR AGREEMENTS; AMENDMENTS
This Lease contains all agreements of the parties with respect to any matter mentioned herein. No
prior agreement or understanding pertaining to any such matter shall be effective. This Lease may be modified
in writing only, signed by the parties in interest at the time of the modification. Except as otherwise stated in
this Lease, Tenant hereby acknowledges that neither Landlord nor any ofits employees or agents has made any
oral or written warranties or representations to Tenant relative to the condition or use by Tenant of the
Premises, and Tenant acknowledges that Tenant assumes all responsibility regarding the Occupational Safety
Health Act, the Americans with Disabilities Act, the legal use and adaptability of the Premises, and the
compliance thereofwith all applicable laws and regulations in effect during the term hereof, except as
otherwise specifically stated in this Lease.
49. LANDLORD'S LIEN
Afirst lien and security interest is hereby expressly reserved by Landlord and granted by Tenant upon
the terms of this Lease and in and to all interest of Tenant in this leasehold for the payment of rent andfor the
performance of any other obligations, and for the satisfaction of any cause of action which may accrue to the
Landlord by the provisions of this Lease. A first lien and security interest is also expressly reserved by Landlord
and granted by Tenant in and to all personal property, furniture, fixtures, improvements, and all other property
13
which Tenant may have, bring, use, erect, or put in place or that may be had, bought, used, erected, or put in
place upon the Premises by or through Tenant or other persons for the payment of rent and also for the
satisfaction of any causes of action which may accrue to Landlord by the provisions of this Lease, and Landlord
may file with the Secretary ofStatefor the State of Florida a UCC -1 Financing Statementfor the purpose of
perfecting this lien and Tenant agrees to execute same.
50. NO LIENS
Anything to the contrary, herein notwithstanding, if Tenant makes any repairs or alterations to the
Premises, whether or not with Landlord's prior consent, Tenant will not allow any lien of any kind, whether for
labor, material, or otherwise to be imposed or remain against the Building or the Premises. As provided in
Florida Statutes 713.10, the interest of Landlord shall not be subject to liens for improvements made by Tenant,
and Tenant shall notify any contractor making such improvements of this provision. An appropriate notice of
this provision may be recorded by Landlord in the Public Records of Pinellas County, Florida, in accordance with
said statute, without Tenant's joinder or consent. Notwithstanding theforegoing, if any lien isfiled against the
Premises or the Buildingfor work claimed to have been for, or materialsfurnished to Tenant, whether or not
done pursuant to this Paragraph, the same shall be discharged by Tenant within ten (10) days thereafter, at
Tenant's expense, by transferring the lien to security pursuant to the applicable provisions of the Florida
Construction Lien Law.
51. SHOWING PREMISES
Landlord shall have the right during normal business hours, and upon reasonable notice to Tenant, to
show the Premises to prospective tenants, lenders or purchasers of the Building or any part thereof at any time.
Landlord may at any time place on or about the Premises any ordinary "For Sale" signs and Landlord may at
any time during the last one hundred twenty (120) days of the term hereof place on or about the Premises any
ordinary "For Lease" signs, all without rebate of rent or liability to Tenant.
52. LEASING BROKER
Tenant warrants that it has had no dealings with any broker or agent in connection with this Lease
other than Jacob Real Estate Services, Inc. who represents the Landlord, and covenants to pay, hold harmless
and indemnify Landlord from and against any and all costs, expenses or liabilityfor any compensation,
commissions, and charges claimed by any other broker or agent (other than the broker named above) with
respect to this Lease or the negotiation thereof with whom Tenant had dealings. All brokerage fees shall be
paid by Landlord, per the terms and conditions ofa separate written agreement. The provisions of this
Paragraph shall survive the termination of this Lease.
53. RECORDING
Neither this Lease, nor any shortform hereof, shall be recorded. Tenant's recordation of this Lease or
any memorandum or shortform of it will be void and a default under this Lease.
54. RELOCATION OF TENANT
Landlord reserves the right after execution, or during the term of this lease, at its sole cost and
expense, to remove the Tenant from the Premises and relocate Tenant in some other space of Landlord's
choosing of approximately the same dimensions and size within the Bank ofAmerica Tower, which other space
shall be decorated by Landlord at Landlord's expense and, in its discretion, Landlord may use such decorations
and materials from the existing Premises, or other materials, so that the space in which Tenant is relocating
shall be comparable in its interior design and decoration to the Premises from which Tenant is removed;
provided however, that if Landlord exercises its election to remove and relocate the Tenant in otherspace
within the Bank of America Tower, which is at that time leasing for a higher rental rate, then Tenant shall not
be required to pay the difference between the then rent of the Premises and the higher rental rate ofthe space
in which Tenant is relocated. Tenant, by the execution hereof acknowledges that the rights granted herein
granted to Tenant, including, but not limited to, the right of peaceful and quiet enjoyment, shall not be deemed
or construed to have been breached or interfered with by reason of Landlord's exercise ofthe rights herein
reserved in this Paragraph 50. In the event of the removal and relocation of Tenant, Landlord's sole obligation
shall be the actual cost of relocating and decorating the space in which Tenant is relocated, and Tenant agrees
that Landlord's exercise of its election to remove and relocate Tenant shall not terminate this Lease, or release
the Tenant in whole or in partfrom Tenant's obligation to pay rents and perform the covenants and
agreements hereunder for the full term of this Lease. Simultaneously with such relocation of the Premises, the
parties shall immediately execute an amendment to this Lease stating the relocation of the Premises.
55. COVENANTS AND CONDITIONS
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Each provision hereofperformable by Tenant shall be deemed both a covenant and a condition.
56. MERGER
The voluntary or other surrender hereof by Tenant, or a mutual cancellation thereof, or a termination
by Landlord, shall not work a merger, and shall, at the option of Landlord, terminate all or any existing
subtenancies or may, at the option of Landlord, operate as an assignment to Landlord of any or all of such
subtenancies.
57. GUARANTOR
In the event that there is a guarantor hereof, said guarantor shall have the same obligations as Tenant
under this Lease.
58. AUTHORITY
If Tenant is a corporation, trust or general or limited partnership, each individual executing this Lease
on behalfof such entity represents and warrants that he or she is duly authorized to execute and deliver this
Lease on behalf ofsaid entity, and Tenant shall, within fifteen (15) days after execution hereof, deliver to
Landlord evidence of such authority satisfactory to Landlord.
59. AUCTIONS
Tenant shall not conduct, nor permit to be conducted, either voluntarily or involuntarily, any auction
upon the Premises withoutfirst having obtained Landlord's prior written consent.
60. RADON GAS DISCLOSURE
The following language is required by law in any contract involving the sale or lease of any building
within the State of Florida:
RADON GAS: Radon is a naturally occurring radioactive gas that, when it has accumulated in a
building in sufficient quantities, may present health risks to persons who are exposed to it over time. Levels of
radon that exceed federal and state guidelines have been found in buildings in Florida. Additional information
regarding radon and radon testing may be obtained from your county public health unit."
61. ENVIRONMENTAL COMPLIANCE
A) Tenant shall not use, generate, manufacture, produce, store, release, discharge or dispose of, on,
under or about the Premises, or transport to orfrom the Premises, any Hazardous Substance (as defined
below), or allow any other person or entity to do so. Tenant shall keep and maintain the Premises in
compliance with, and shall not cause or permit the Premises to be in violation of, any Environmental Laws (as
defined below).
B) Tenant shall give prompt notice to Landlord of (1) of any proceeding or inquiry by any
governmental authority (including without limitation the Florida Environmental Protection Agency or Florida
Department of Health and Rehabilitative Services with respect to the presence ofany Hazardous Substance on
the Premises or the migration thereoffrom or to other property; (ii) all claims made or threatened by any third
party against Tenant, Landlord or the Premises relating to any loss or injury resulting from any Hazardous
Substance; and (iii) Tenant's discovery of any occurrence or condition on any real property adjoining or in the
vicinity of the Premises that could cause the Premises or any part thereof to be subject to any restrictions on
the ownership, occupancy, transferability or use of the Premises under any Environmental Law or any
regulation adopted in accordance therewith.
C) Tenant shall protect, indemnify and hold harmless Landlord, its directors, officers, employees,
agents, successors and assignsfrom and against any and all loss, damage, cost, expense or liability (including
attorney's fees and costs) directly or indirectly arising out of or attributable to the use, generation,
manufacture, production, storage, release, threatened release, discharge, disposal, transport orpresence ofa
Hazardous Substance on, under, about, to orfrom the Premises, including without limitation allforeseeable
consequential damages and the costs of any necessary repair, cleanup or detoxification of the Premises, in any
way arisingfrom the acts of Tenant.
D) "Environmental Laws" shall mean any federal, state or local law, statute, ordinance or regulation
pertaining to health, industrial hygiene, or the environmental conditions on, under or about the Premises,
including without limitation the Comprehensive Environmental Response Compensation and Liability Act of1980, as amendedfrom time to time ("CERCLA"), 42 U.S.C. Sections 9601 et. seq., and the Resource
15
Conservation and Recovery Act of 1976, as amendedfrom time to time ("RCRA"), 42 U.S.C. Sections 6901 et.
seq. The term "Hazardous Substance" shall include without limitation: (1) those substances included within the
definition of "hazardous substances," "hazardous materials," "toxic substances," or "solid waste" in CERCLA,
RCRA and the Hazardous Materials Transportation Act, 49 U.S. C. Sections 1801 et. seq., and in the regulations
promulgated pursuant to said laws; (ii) those substances defined as "hazardous wastes" in any Florida Statute
and in the regulations promulgated pursuant to any Florida Statute; (iii) those substances listed in the United
States Department of Transportation Table (49 CFR 172.101 and amendment thereto) or by the Environmental
Protection Agency (or any successor agency) as hazardous substances (40 CFR Part 302 and amendments
thereto); (iv) such other substances, materials and wastes which are or become regulated under applicable
local, state orfederal law, or which are classified as hazardous or toxic underfederal, state or local laws or
regulations; and (v) any material, waste orsubstance which is (1) petroleum; (2) asbestos; (3) polychlorinated
biphenyls; (4) designated as a "hazardous substance" pursuant to Section 311 of the Clean Water Act, 33 U.S.C.
Sections 1251 et. seq., or listed pursuant to Section 307 of the Clean Water Act; (5) flammable explosive; or (6)
radioactive materials.
E) Landlord shall have the right to inspect the Premises and audit Tenant's operations thereon to
ascertain Tenant's compliance with the provisions of this Lease at any reasonable time, and Tenant shall
provide periodic certifications to Landlord, upon request, that Tenant is in compliance with the environmental
restrictions contained herein. Landlord shall have the right, but not the obligation, to enter upon the Premises
and perform any obligation of Tenant hereunder of which Tenant is in default, including without limitation any
remediation necessary due to environmental impact of Tenant's operations on the Premises, without waiving or
reducing Tenant's liabilityfor Tenant's default hereunder.
F) All of the terms and provisions of this Paragraph shall survive the expiration or termination ofthisLeaseforanyreasonwhatsoever.
62. In the event Landlord shall retake possession of the Premises from Tenant, Landlord shall be
obligated to perform and comply with all terms and provisions of that certain Development Agreement dated
the day of , 20--. A copy of said Agreement is attached hereto as Exhibit E.
63. ATTACHMENTS TO THIS LEASE
Attached hereto, and made a part hereof as fully as if copied herein verbatim, and signed or initialed by
the Landlord and Tenant as approved are the following:
A) Corporate Guaranty of Lease
B) Addendum 1—Additional Provisions
C) Exhibit "A"— Premises
D) Exhibit "8"— Tenant Finish Allowance
E) Exhibit "C" - Rules and Regulations
F) Exhibit "D" —Sign Criteria
G) Exhibit "E" — Development Agreement
SIGNATURE PAGE TO FOLLOW
16
LANDLORD AND TENANTHAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND
PROVISION CONTAINED HEREIN AND, BY EXECUTION OF THIS LEASE, SHOW THEIR INFORMED AND
VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT, AT THE TIME THIS LEASE 1S EXECUTED,
THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE AND EFFECTUATE THE INTENTAND PURPOSE OF
LANDLORD AND TENANT WITH RESPECT TO THE PREMISES.
LANDLORD:
WITNESSES: 600 Cleveland, LLC., a Florida limited liability company
1. By:
Daniels lkajevs
Managing Member
Date:
Printed Name
Printed Name
TENANT:
The Ring Workspaces, LLC, a Florida limited liability company
d/b/a The Ring
WITNESSES:
1. By:
Simee Adhikari
Managing Member
2.
Printed Name Date:
Printed Name
The undersigned corporate guarantor does hereby unconditionally guarantee Tenant's performance of all of itsobligationsundertheLeaseasCORPORATEGUARANTOR:
The Ring Workspaces, LLC, a Florida limited liability company
d/b/a The Ring
By:
Date:
Simee Adhikari
Managing Member
17
ADDENDUM I
Attached to and made a part of the ONE CLEARWATER TOWER - BANK OF AMERICA BUILDING
STANDARD LEASE AGREEMENT, dated September , 2017 ("Lease"), between 600 Cleveland, LLC, as
Landlord, and The Ring Workspaces, LLC, hereinafter referred to as the Tenant.
Notwithstanding anything contained in the attached Lease to the contrary, it isfurther understood andagreedasfollows:
1. Schedule of Base Rental: Tenant shall pay to the Landlord the sum of $2,592,000.00 plus applicable
sales tax, payable asfollows:
PER BEGIN MONTHS PSFPY Monthly Period
1 1/1/2018 12
4.$
2 1/1/2019 12 16.00 24,000.00 288,000.00
3 1/1/2020 12 16.00
IP
24,000.00 288,000.00
4 1/1/2021 12 16.00 24,000.00 288,000.00
5 1/1/2022 12 16.00
P'$
24,000.00 288,000.00
6 1/1/2023 12 16.00
P$
24,000.00 288,000.00
7 1/1/2024 12 16.00
P$
24,000.00 288,000.00
8 1/1/2025 12 16.00 24,000.00 288,000.00
9 1/1/2026 12 16.00
r$
24,000.00 288,000.00101/1/2027 12 16.00
P$
24,000.00 288,000.00
2. RENTAL ABATEMENT Rental paymentsfor the initial twelve (12) Months ("Rental Abatement Period")
of the term of the Lease shall befully abated for a total amount of abated rent of $288,000.00. Full
monthly Base Rent payments shall commence on the Rent Commencement Date (IS` day of the
thirteenth (13`h) month) and continue through the remainder of the Term as outlined in Paragraph 1
above. The Base Rent abatement described in this paragraph shall not apply to any subsequent
renewal periods. All other terms and provisions of this Lease shall, however, remain in fullforce and
effect until the occurrence of the Rent Commencement Date.
3. TENANTALLOWANCE: Landlord shall provide Tenant an allowance equal to $19.44 PSF of rentableareaofthePremises, or $350,000.00 (the "Construction Allowance"), to be applied against the Total
Construction Costs (as defined in the Work Agreement) and disbursed to Tenant in accordance withParagraph4oftheWorkAgreement.
4. TOTAL CONSTRUCTION COSTS: Tenant is provided an Improvement Allowance of $350,000.00 as setforthabove, and in the event that the total cost of tenant improvements exceeds the amount budgeted
in the tenant improvement allowance, the additional cost in excess of the allowance may befinanced
by the Landlord through the lease payable as additional base rent using an annual interest rate of6.5% interest and a ten year term, to be amortized on a straight-line basis and this additional cost factored
into the lease as additional base rent during the initial term, or at Tenant's option, Tenant can payforthedifferencedirectly. The Tenant improvement Allowance shall be appliedfirst to space planning, engineering, construction, low voltage wiring and cabling, building infrastructure upgrades, document
services and normal "hard" improvement costs associated with renovating the space and no otherpurpose.
5. OPTION TO RENEW: If Tenant is not in Default as of the date of Tenant's notice to exercise its RenewalOption, Landlord grants Tenant hall have two (2) options ("Renewal Option") to extend the Term of thisLeaseforaperiodofFIVE (5) YEARS by providing Landlord at least One Hundred Eighty (180) dayswrittennoticepriortothecommencementoftheapplicableRenewalTerm.
6. The Renewal Term shall be on all of the same terms and conditions setforth in the Lease, except that
the Base Rate for the first year of the Renewal Term and annual escalations shall be equal to the fair
market rental for the Premises, taking into consideration market rates (including annual escalationsandtenantconcessions) for similar premises in similar properties within the Clearwater CBD at the timeofTenant's written notice to Landlord to exercise Tenant's Renewal Option (the "Renewal Rent"). In the
event that Landlord and Tenant cannot agree on the Renewal Rentfor a Renewal Term within thirty30) daysfollowing Tenant's notice to exercise its Renewal Option, both Landlord and Tenant shall
submit the determination of the Renewal Rent to binding "baseball -style" arbitration by a commerciallyreasonableindependentthirdpartywhowillevaluatethetwopartiespresentationsontheRenewal
Rent and decide which presentation is determinant, following which, the decision on the Renewal Rentshallbebindingontheparties. Landlord and Tenant agree to execute an amendment to this Lease,
18
prior to the commencement of the Renewal Term, memorializing the extension of the Term and the
Renewal Rent. Notwithstanding the above, if Tenant elects to not exercise the right to exercise
Tenant's Option to Renew, this Option to Renew shall become null and void.
7. RIGHT OF FIRST OFFER: Provided that Tenant is not in Default on the day Tenant gives Landlord the
ROFO Exercise Notice (as defined below), Tenant shall have a right offirst offer (the "Right ofFirst
Offer"), to lease space on the 2d and 5t" floor and anyfloors contiguous to the floor on which the
Premises are located (the "ROFO/ROFR Floors") under the terms and conditions of this Paragraph 7.
Landlord hereby agrees that, no later than (or, at Landlord's option, up to 180 days prior to) the date
that any space on the ROFO/ROFR Floors becomes available, and prior to leasing such space, Landlord
shallfirst offer to Tenant in writing (the "Offer Notice") the opportunity to lease such space (the "Offer
Space") on the terms set forth in this Paragraph 7. The Offer Notice will identify the Offer Space and
the date which Landlord reasonably anticipates the Offer Space to be availablefor lease. Tenant may
exercise its right to lease the Offer Space by giving Landlord written notice of that exercise (the "ROFO
Exercise Notice") within ten (10) days after the effective date ofsuch Offer Notice. If Tenant provides
the ROFO Exercise Notice to Landlord, Landlord and Tenant will promptly (and in any event within ten
10) days after Landlord provides a commercially reasonable amendment to Tenant) enter into an
amendment to the Lease (the "ROFO Lease Amendment") adding the OfferSpace to the Premises upon
all the terms and Tenant shall remain liable for all terms and conditions of this Lease through the
termination date of the Lease.
8. RING SUITES DECK: Included in the Premises at no additional cost to Tenant are the exclusive rightsfor
Tenant to use the roof top space above the vault building on the east side of the building to construct
approximately 1,300 squarefeet of outdoor deck space initially, overlooking Station Square Park.
Tenant agree that it will pay as additional rent under the Lease any additional charges to the Landlord
of every kind to include real estate taxes, maintenance and insurance resulting from the construction
and use of the deck. Tenant agrees that prior to taking occupancy of the Premises, Tenant will provide
Landlord a schedule ofcharges that Tenant will charge other Tenants in One Clearwater Towerfor Ring
Suites meeting spaces including the use of the deck as well as the terms of use.
9. All capitalized terms used herein shall have the meanings ascribed to them in the Lease and its
Addenda unless otherwise provided herein. All terms of the Lease and its Addenda not in conflict with
the foregoing are hereby ratified and confirmed.
LANDLORD:
WITNESSES: 600 Cleveland, LLC., a Florida limited liability company
1. By:
Daniels Ikajevs
Managing Member
Printed Name Date:
Printed Name
WITNESSES:
TENANT:
The Ring Workspaces, LLC, a Florida limited liability company
d/b/a The Ring
1. By:
2.
Printed Name Date:
Printed Name
Simee Adhikari
Managing Member
19
EXHIBIT "A"
PREMISES
2nd Floor — 4,976rsf Highlighted Area
2nd
AVAILABLE
4,6641.8 / 5,851.5 R.S.F.
8,882.4 &ROSS FLOOR AREA
1,163.6 S.F. TOTAL VERT PEN,
1,118.8 45R055 !RENTABLE AREA
0
1,118.8 OR055 !RENTABLE AREA
1,565.2 S.F. COMMON AREA
61155.6 NET RENTABLE AREA (1).5.F.
1,118.8/6,153.6= 1.2544
25.44 CAM FACTOR)
1,565.2 S.F. COMMON AREA
4111ritlii,
fittoitl!
BANK OF AMERICA
1,485.8 / 1 ,b 13 R.S.F.
SUITE 201
James B. Mathias , A.I.A.
Archrtect
tr,7
5004 let Evelyn Drive Tampa, t.55604
615.251.4140 LICA AR0015054 8f5.637.0601 (Ax)
VERT PENETRATIONS
151.6 sr.
255.1 S.F.
224.6 5.F.
504.0 5.F.
t 251.5 5.r.
1,165,6 5. TOTAL VERT PEN.
BANK OF AMERICA
600 CLEVELAND STREET
CLEARAATER, ri_oRIDA
SCALE: 3/64" I 1-0 "
SECOND FLOOR
TENANT FLAN
20
2nd Floor Space Plan Showing Walls to be relocated
TO EXITiTAIRi
EXISTINS INTERIOR
NINDOS TO. BELOW
EXISTING
MENSTOILET
INEXISTING
r XT
EXt5TIN6
Ii
OPEN AREA
44'Xt6'
WITH EXISTING rLOOR AND GEILIN6)
EXISTING
GONF. RM.
IIkl9'
EXIST.
N1 -LO
Dl.
EXISTIN5
LADIES
TOILET
EXIOTINO
64 -ASS
DOORS
EXISTINa
ELEVATOR
LOBBY
EXIST.
VIEW RM.
EXIST.
VAULT
iTRICTED AREA
ADMITTANCE
OUT ATTENDANT
EXIS - - COMMON
MEm - NICAL AND
ELEGTRI AL ROOMS
OFPIGE
rrx12'
WOOD FLOOR)
FIRETrI STORAGE
FOR RENT
OFFICE OFFICE
4' NIDEAISLE
OFFICE
IOk9'
OFFICE
IO'Xi9'
OFFICE
T'xib'
OFFICE
10'x9'
LI L_l
BANK OF AMERICA
James 5. Mathias, A.I.A. 600 CLEVELAND STREETv`hI e t GLEARWATER, FLORIDA1SCALE: I/4"=1 r-0,1
JmosortuP ,;;
p SECOND FLOOR
SCHEME IR
8/31201-7
21
GRAPHIC SCALE
02' 10' 20'
3rd Floor — 13,024rsf
Space Plan for Construction — North is at Top of Page
sfc
1
jlir
ti•
ft
A
V:
L.;)
I 1 I I
7-1
gt1
Lf -----wiLf '11 ,
I I •
1" It1a
6+......raaildil•Min.11111mostam...er
22
4 s
Exterior Deck Space on East Side ofBuilding
Highlighted in Green is the Roof Top Terrace Space
iOr
R00.^-1'(;1'=° FE R.A(.,t
Engineer's Drawing Above Shows approximate deck location and dimensions.
23
EXHIBIT "8"
TENANT FINISH: ALLOWANCE
SUITES 200 and 300
1. Except as set forth in this Exhibit, Tenant accepts the Premises in their "as is" condition on the date that thisAgreementisenteredinto.
2. Landlord shall cause the tenant finish work to be performed in accordance with this Exhibit. The work shallbeperformedbycontractorsandsubcontractorsapprovedbyLandlord. All contractors and subcontractorsshallberequiredtoprocureandmaintaininsuranceagainstsuchrisks, in such amounts, and with such
companies as Landlord may reasonably require. The work shall be performed in a good and workmanlike
manner that is free of defects and is in strict conformance with the Drawings.
3. Tenant shall bear the entire cost of performing the work (including, without limitation, design of theImprovementsandpreparationoftheDrawings, costs of construction labor and materials, electrical usageduringconstruction, additional janitorial services, general tenant signage, related taxes and insurance costs, allofwhichcostsarehereincollectivelycalledthe "Total Construction Costs") in excess of the ConstructionAllowance (as hereinafter defined) and pay to Landlord the amount by which the estimated Total ConstructionCostsexceedtheConstructionAllowance. The consent of Tenant is required for any bid by a Contractor fortheTotalConstructionwhichexceedstheConstructionAllowance. In such cases, the Tenant shall be permittedtomodifytheworktoreducetheTotalConstructionCostbelowtheConstructionAllowanceortoworkwithLandlordinsolicitingamutuallyacceptablealternativeContractortoperformtheworkwithintheConstructionAllowance. Without limitation, upon substantial completion of the Improvements , Tenant shall pay toLandlordanamountequaltotheTotalConstructionCosts (as adjusted for any approved changes to theDrawings), less (1) the amount of the payments already made by Tenant and (ii) the amount of theConstructionAllowance.
4. Landlord shall provide to Tenant a construction allowance ("Construction Allowance") equal to $350,000.00. Following satisfaction of all claims and Landlord is in receipt of all Release of Liens by all contractors, workmen, material and service suppliers and any other persons having claims against Landlord for payment of workcompletedormaterialorservicesuppliedinconnectionwiththeTenant's Leasehold Improvements, LandlordshallprovideTenantacreditforanyfundsremainingintheConstructionAllowanceforthepurposeofoffsettingBaseRentdueduringthefirstyearoftheLeaseterm.
5. Landlord or its designee shall supervise the Improvements, make disbursements required to be made to thecontractor, and act as a liaison between the contractor and Tenant and coordinate the relationship betweenthePremises, the Building, and the Building's systems.
6. At no cost to Tenant or deduct from the Construction Allowance, Landlord or its designee shall supervise theImprovements, make disbursements required to be made to the contractor, and act as a liaison between thecontractorandTenantandcoordinatetherelationshipbetweenthePremises, the Building, and the Building'ssystems.
24
EXHIBIT "C"
RULES AND REGULATIONS
1. Sidewalks, doorways, vestibules, halls, stairways and similar areas shall not be obstructed by tenants or
their officers, agents, contractors, invitees, servants, and employees, or usedfor any purpose other than ingress
and egress to andfrom their respective leased premises andfor going from one part of the Building or PropertytoanotherpartoftheBuildingorProperty.
2. Plumbing fixtures and appliances shall be used onlyfor the purposes for which constructed, and no
sweepings, rubbish, rags or other unsuitable material shall be thrown or placed therein. Any stoppage or
damage resulting to any such fixtures or appliances from misuse on the part of a tenant or such tenant's
officers, agents, contractors, invitees, servants, and employees shall be paid by such tenant.
3. No signs, posters, advertisements, or notices shall be painted or affixed by or on behalf of any tenant
on any of the windows or doors, or other part of the Building or Property, except lettering ofsuch color, size
and style and in such places, as shall be first approved in writing by the Landlord's Property Manager. No nails,
hooks or screws shall be driven into or inserted in any part of the Building, except by building maintenancepersonnel.
4. Directories may be placed by the Landlord, at Landlord's own expense, in conspicuous places in theBuildingorontheProperty. No other directories shall be permitted.
5. Tenants shall not do anything, or permit anything to be done, in or about the Property, or bring or keepanythingthereinorthereon, that will in any way increase the possibility offire or other casualty or obstruct orinterferewiththerightsof, or otherwise injure or annoy, other tenants, or do anything in conflict with the validpertinentlaws, rules or regulations ofany governmental authority.
6. Corridor doors, when not in use, shall be kept closed.
7. All deliveries offurniture, freight, office -equipment or other materialsfor dispatch or receipt by TenantmustbemadebylicensedcommercialmoversviatheserviceentranceoftheBuildinginamannerandduringhourssetbyLandlordfromtimetotime. Prior approval must be obtainedfrom the Landlord's PropertyManagerforanydeliveriesthatmightinterferewiththefreemovementofothersthroughthepubliccorridorsoftheBuilding. All hand trucks shall be equipped with rubber tires and rubber side guards.
8. Each tenant shall cooperate with Building employees in keeping the Property, Building and theirrespectivePremisesneatandclean.
9. Nothing shall be swept or thrown into the corridors, halls, elevator shafts or stairways. No birds or
animals shall be brought into or kept in or about the Property or Building.
10. Should a tenant require telegraphic, telephonic, annunciator or any other communication service, theLandlordwilldirecttheelectriciansandinstallerswhereandhowthewiresaretobeintroducedandplaced, and none shall be introduced or placed except as the Landlord shall direct.
11. Tenants shall not make or permit any unseemly, disturbing or improper noises in the Property orBuilding, or otherwise interfere in any way with other tenants, orpersons having business with them.
12. No equipment ofany kind shall be operated in any tenant's leased premises that could in any wayannoyanyothertenantintheBuildingwithoutthepriorwrittenconsentoftheLandlord.
13. Tenants shall not use or keep on the Property or in the Building anyflammable or explosive fluid orsubstance, or any illuminating material, unless it is battery powered, UL approved.
14. Tenant and Tenant's employees, or agents, or anyone else who desires to enter the Building afternormalworkinghourswillberequiredtoclosedoorsintotheBuildingbehindthem. Locks to such doors willnotbetamperedwith.
15. All electricalfixtures hung in the Premises must be fluorescent and of a quality, type, design, bulb color, size and general appearance approved by Landlord.
16. No water cooler, air conditioning unit, space heater or system or other apparatus shall be installed orusedbyatenantwithoutthepriorwrittenconsentofLandlord.
25
17. Normal business hoursfor the Building shall be 7:00 a.m. through 6:00 p.m. on weekdays, and 9:00
a.m. to 1:OOp.m. on Saturdays, excluding legal holidays and holiday weekends.
18. References to "holidays" and "legal holidays" in the leases to tenants in the Building shall include the
following:
January 1st New Year's Day
Last Monday in May Memorial Day
July 4th Independence Day
First Monday in September Labor Day
Fourth Thursday in November Thanksgiving
December 25th Christmas
19. Pursuant to applicable law, the One Clearwater Tower— Bank ofAmerica Building is deemed to be a "no -
smoking" building and smoking is prohibited in the leased premises all interior Common Areas, and within 15
feet ofany building entrance. In addition, Landlord mayfrom time to time, designate non-smoking areas in all
or any portion of the exterior Common Areas. The designated smoking area for building Tenants and guests is
in the Station Square Park adjacent to the east ofthe building.
20. Bicycles are not permitted to be brought into the building lobby or elevators or secured in any area of
the building and grounds except the designated bicycle storage area. All bicycles brought on premises must be
parked and secured in the covered bicycle storage rack in the courtyard storage area located at the
southeastern corner of the by gate off of Garden Avenue adjacent to the south fire stairs. Bicycle owners bear
risks associated with damage or theft for any bicycles or other personal property brought onto the
premises. The building engineer or manager will issue upon request, a bicycle owner an assigned key to access
the gate into the storage area. Thefirst key will be issuedfree of charge, replacement keys will require a
25.00 key deposit or the bicycle owner paying the cost to have the lock rekeyed.
21. The Landlord reserves the right to rescind any of these rules (as to any particular tenant or as to all
tenants generally) and to make such other andfurther rules and regulations as in thejudgment of Landlord
shallfrom time to time b e needed for the safety, protection, care and cleanliness of the Property and Building,
the operation thereof, the preservation of good order therein, and the protection and comfort of its tenants,
their agents, employees and invitees, which rules when made and notice thereofgiven to a tenant shall be
binding upon such tenant in like manner as if originally herein prescribed. In the event ofany conflict,
inconsistency, or other difference between the terms and provisions of these Rules and Regulations (as now or
hereafter in effect) and the terms and provisions ofany lease now or hereafter in effect between Landlord and
any tenant in the Building, Landlord shall have the right to rely on the term or provision in either such lease or
such Rules and Regulations which is most restrictive on such tenant.
26
Exhibit K
Performance standards and Annual Reporting by The Ring Workspaces, LLC to the City of
Clearwater Community Redevelopment Agency.
The Development Agreement provides in paragraph 6.02 that the Developer must operate the co -working
facility in substantial compliance with Exhibit G. In order to provide a partial basis for determining whether the
Developer is in substantial compliance, the following performance standards are established
A) Healthy workspace and Environment
The Ring Workspaces will achieve two recognized Certifications for their Green
Business initiatives from the Green Business Certification Inc. (GBCI), "the premier
organization independently recognizing excellence in green business industry
performance and practice globally."
The Ring Workspace will achieve WELL Building Standard Certification of Silver or
higher within 2 years of opening and maintain the Silver Certification or higher
throughout the life of the Development Agreement.
The Ring Workspace will pursue the Living Building Challenge (LBC) and receive
Certification within 2 years of opening and maintain this Certification throughout the life
of the Development Agreement.
B) Optimal Productivity Focus
Provide a minimum of 1 sleep pod (Energypod or similar) for use of members. In
accordance with recommended best practices, use of the sleep pod will be limited to 20
minutes per day per person.
Beginning in 2019, lectures and classes focused on body, mind and spirit such as yoga
no Tess than 3 times a week
C) Business Development Opportunities
Opportunities for access to Venture Capitalist funding on an annual basis as described
below:
The Main Event will be Held once per year beginning 2019
1. Participants will have one (1) round of sales "Pitch" to the InvestorsNenture
Capitalists
2. Signups/participation reservations will be on a first -come -first-served basis
3. The number of participants will not exceed 50 Members
4. There will be between 3 — 7 well Accomplished Venture Capitalist
a. VC's or Investors will be selected based upon reasonable judgment by the Ring
Partners or their known accomplishments and ability to provide funding to eligible
Ring Members
5. Main Events Participants must:
a. Have a Fight Club or Higher Membership to qualify as a participant
b. Have been a member for at least 1 full year from the start date of their
membership
c. Signup to be a participant 90 day before the event date
d. Submit all relevant information regarding their project, venture or business 60
days before the event
6. The Ring will:
a. Promote the event through all social media channels
IGM17-9311-025/212389/1]
b. Help Members prepare by providing business related lectures, workshops,
seminars
c. Do all within reasonable capacity to ensure a quality and successful event
Networking or Development Events on no less than a monthly basis beginning in 2019
Work with City and its small business services partners to promote its services and
support to small businesses and entrepreneurs in every stage of development
In order to enhance the coworking experience and create additional opportunities for
business development in the downtown and prevent The Ring spaces from being
absorbed by large companies, Membership shall be limited to one Member per company
or entity. Each Member shall be limited not more than 6 offices and not more than 12
desks on average over a 12 month period. The 6 office limit shall not apply during the
first year.
D) Special Benefits- Recording Studio
The Ring Studio will include the following items:
One or more Microphones
StillNideo Capable Camera
Mic Stands
Headphones
Adequate Cabling
Speakers (May be built in and/or Portable)
DAW/Audio Interface Combo
Studio Monitors
Mixers
Digital Recorder
Tripods
Lighting
The Ring Workspaces, LLC will be required to submit an Annual Report, herein known as "The Report," to the
City of Clearwater's Community Redevelopment Agency (CRA). The Report will be due by the December 31st
of each of the following years: 2018, 2019, 2020, 2021 and 2022. The report should be submitted via email in
PDF format to the CRA Director. The information provided by The Ring Workspaces, LLC to the CRA will be
used to measure the overall performance, progress and growth of The Ring and its members.
The Report to include the following information:
A) Membership
Total number of Members per Membership Type (Virtual Address, Co -working, Fight
Club, Private Office)
Bio of Companies within The Ring
o Type, size, industry sector and number of employees and years in business
Average length of each Membership
Quarterly Occupancy Rate of Members
Success Stories
o Growth and expansion of Companies/Members internally and externally; number of
jobs created, amount of capital raised
G M17-9311-025/212389/1]
B) Events
Number and type of Ring sponsored events and classes
Number of Community sponsored events and classes
Estimated number of attendees at events and classes
C) The Ring Main Event / Venture Capital (Starting in 2019)
Results: Panel of Venture Capitalists (brief bio of each VC), entities/members funded,
amount of capital awarded and raised, and generally for what purpose
D) Marketing
Website Traffic and Analytics
o Yearly Website Traffic
o Number of Clicks per the Ring Landing Page
o Online Contact Form Inquires and Leads
o Opportunity to Leads
o Email ROI
o Deliverability (Clicked, Opens, Bounced, Delivered)
o Number of Campaign to Membership Sales/Signup conversions. Conversions may
occur onsite or directly through website and email.
Marketing, Promotion, and Campaigns KPI's
o Establishment of Social Channels - Facebook, Instagram, Twitter, Linkedln
o Overall Buzz related to the Entity - Comments, News Articles, Press Coverage
Social Media Reach and Engagement
o Number of Instagram, Facebook and Twitter Followers
Report Target Number vs. Actual Reach
o Number of Likes achieved for Annual - Main Ring Sponsored Event
SEO Activity
o Procurement of a Google Analytics Account
E) General - Lessons Learned / Indirect Benefits
Based on Membership Surveys
o How "The Ring" improves its Member recruitment, retention, amenities and
services
Indirect benefit of The Ring on Downtown Clearwater Economy
o To include quantitative and qualitative data that may provide insight on the indirect
benefits of The Ring in Downtown Clearwater
F) Partnerships
Referrals between The Ring Workspaces LLC and City of Clearwater Small Business
Services Partners
GM17-9311-025/212389/1]
G) Healthy Work Environment
Certifications received and maintained
Use of Sleep pods
GM17-9311-025/212389/1]
GUARANTY OF DEVELOPMENT AGREEMENT
This Guaranty of that certain Development Agreement, dated the day of
2017, by and between the Community Redevelopment Agency of the City of
Clearwater, Florida ("CRA") and The Ring Workspaces, LLC ("Ring") is given by 600
Cleveland, LLC, a Florida limited liability company, (hereinafter "Guarantor"), to secure the
obligations of Ring to CRA under the Agreement.
1. Obligation. In consideration of entering into the Agreement, the Guarantor
hereby guarantees to CRA, its successors and assigns, that all obligations owed by Ring to CRA
under the Agreement, shall be promptly performed in full, in accordance with the provisions
thereof
2. Successors and Assigns. This Guaranty shall be binding on the successors
and assigns of the Guarantor and inure to the benefit of all successors and assigns of CRA.
IN WITNESS WHEREOF, the undersigned have signed this Guaranty of Agreement on
the day of , 2017.
600 CLEVELAND, LLC, a Florida
limited liability company,
BY: DANIELS IKAJEVS, Managing
Member
STATE OF FLORIDA
COUNTY OF PINELLAS
The foregoing instrument was acknowledged before me this day of
2017, by DANIELS IDAJEVS, Managing Member of 600 Cleveland, LLC, a
Florida limited liability company, on behalf of such limited liability company. He is [ ]
personally known to me or has [ ] produced as identification.
SEAL) Notary Public
G M17-9311-025/211373/11
PREPARED BY AND RETURN TO:
TRASK DAIGNEAULT, LLP
David E. Platte, Esq.
1001 S. Ft. Harrison Ave., Suite 201
Clearwater, Florida 33756
RELEASE OF MEMORANDUM OF DEVELOPMENT AGREEMENT
KNOW ALL MEN BY THESE PRESENTS,
WHEREAS, the Community Redevelopment Agency of the City of Clearwater, Florida
Agency") and The Ring Workspaces, LLC, ("Developer") entered into that certain
Development Agreement (the "Agreement") dated the day of
2017; and
WHEREAS, to evidence the Agreement, Agency and Developer executed that certain
Memorandum ofDevelopment Agreement dated the day of , 2017,
the "Memorandum"), which Memorandum was recorded in the Public Records of Pinellas
County, Florida on the day of ,2017 in Official Records Book
Page ; and
WHEREAS, each of the parties has fulfilled all of their obligations under the
Agreement; and
WHEREAS, the parties desire to release each other from all terms and provisions of the
Memorandum and the Agreement.
NOW, THEREFORE, in consideration ofthe mutual promises and covenants herein
contained, the parties agree as follows:
1. Recitals. The Recitals contained hereinabove are true and accurate and are
incorporated herein.
2. Release. Agency and Developer hereby release each other and any real property
that may be encumbered by the Memorandum from all terms and provisions of the Agreement
and the Memorandum.
3. Recordation. This Release shall be recorded in the Public Records of Pinellas
County, Florida and shall operate to release and terminate any potential clouds on the title of any
real property which may be encumbered by the Memorandum and the Agreement.
IN WITNESS WHEREOF, the said parties have signed this Release as of the
day of , 20
GM 17-9311-025/211164/ 11
SIGNED, SEALED AND DELIVERED IN THE PRESENTS OF:
WITNESSES: COMMUNITY REVELOPMENT
AGENCY OF THE CITY OF
CLEARWATER, FLORIDA
BY:
Print Name: George N. Cretekos
Chairperson
Print Name:
Approved as to form:
Pamela K. Akin
City Attorney
Attest:
Rosemarie Call
City Clerk
THE RING WORKSPACES, LLC
BY:
Print Name: Daniels Ikajevs, Managing Member
Print Name:
STATE OF FLORIDA
COUNTY OF PINELLAS
The foregoing instrument was acknowledged before me this day of
20 , by Daniels Ikajevs, Managing member of The Ring Workspaces, LLC,
a Florida limited liability company. He is [ ] personally known to me or [ ] produced a valid
driver's license as identification.
Notary Public
GM17-9311-025/211164/ 1]
[GM17-9311-025/212389/1]
Exhibit K
Performance standards and Annual Reporting by The Ring Workspaces, LLC to the City of
Clearwater Community Redevelopment Agency.
The Development Agreement provides in paragraph 6.02 that the Developer must operate the co-working facility
in substantial compliance with Exhibit G. In order to provide a partial basis for determining whether the Developer
is in substantial compliance, the following performance standards are established
(A)Healthy workspace and Environment
The Ring Workspaces will achieve two recognized Certifications for their Green Business
initiatives from the Green Business Certification Inc. (GBCI), “the premier organization
independently recognizing excellence in green business industry performance and
practice globally.”
The Ring Workspace will achieve WELL Building Standard Certification of Silver or higher
within 2 years of opening and maintain the Silver Certification or higher throughout the life
of the Development Agreement.
The Ring Workspace will pursue the Living Building Challenge (LBC) and receive
Certification within 2 years of opening and maintain this Certification throughout the life
of the Development Agreement.
(B)Optimal Productivity Focus
Provide a minimum of 1 sleep pod (Energypod or similar) for use of members. In
accordance with recommended best practices, use of the sleep pod will be limited to 20
minutes per day per person.
Beginning in 2019, lectures and classes focused on body, mind and spirit such as yoga
no less than 3 times a week
(C)Business Development Opportunities
Opportunities for access to Venture Capitalist funding on an annual basis as described
below:
The Main Event will be Held once per year beginning 2019
1. Participants will have one (1) round of sales “Pitch” to the Investors/Venture
Capitalists
2. Signups/participation reservations will be on a first-come-first-served basis
3. The number of participants will not exceed 50 Members
4. There will be between 3 – 7 well Accomplished Venture Capitalist
a. VC’s or Investors will be selected based upon reasonable judgment by the Ring
Partners or their known accomplishments and ability to provide funding to eligible
Ring Members
5. Main Events Participants must:
a. Have a Fight Club or Higher Membership to qualify as a participant
b. Have been a member for at least 1 full year from the start date of their
membership
c. Signup to be a participant 90 day before the event date
d. Submit all relevant information regarding their project, venture or business 60
days before the event
6. The Ring will:
a. Promote the event through all social media channels
[GM17-9311-025/212389/1]
b. Help Members prepare by providing business related lectures, workshops,
seminars
c. Do all within reasonable capacity to ensure a quality and successful event
Networking or Development Events on no less than a monthly basis beginning in 2019
Work with City and its small business services partners to promote its services and
support to small businesses and entrepreneurs in every stage of development
In order to enhance the coworking experience and create additional opportunities for
business development in the downtown and prevent The Ring spaces from being
absorbed by large companies, Membership shall be limited to one Member per company
or entity. Each Member shall be limited not more than 6 offices and not more than 12
desks on average over a 12 month period. The 6 office limit shall not apply during the
first year.
(D)Special Benefits- Recording Studio
The Ring Studio will include the following items:
One or more Microphones
Still/Video Capable Camera
Mic Stands
Headphones
Adequate Cabling
Speakers (May be built in and/or Portable)
DAW/Audio Interface Combo
Studio Monitors
Mixers
Digital Recorder
Tripods
Lighting
The Ring Workspaces, LLC will be required to submit an Annual Report, herein known as “The Report,” to the
City of Clearwater’s Community Redevelopment Agency (CRA). The Report will be due by the December 31st
of each of the following years: 2018, 2019, 2020, 2021 and 2022. The report should be submitted via email in
PDF format to the CRA Director. The information provided by The Ring Workspaces, LLC to the CRA will be
used to measure the overall performance, progress and growth of The Ring and its members.
The Report to include the following information:
(A) Membership
Total number of Members per Membership Type (Virtual Address, Co-working, Fight
Club, Private Office)
Bio of Companies within The Ring
o Type, size, industry sector and number of employees and years in business
Average length of each Membership
Quarterly Occupancy Rate of Members
Success Stories
o Growth and expansion of Companies/Members internally and externally; number of
jobs created, amount of capital raised
[GM17-9311-025/212389/1]
(B) Events
Number and type of Ring sponsored events and classes
Number of Community sponsored events and classes
Estimated number of attendees at events and classes
(C) The Ring Main Event / Venture Capital (Starting in 2019)
Results: Panel of Venture Capitalists (brief bio of each VC), entities/members funded,
amount of capital awarded and raised, and generally for what purpose
(D) Marketing
Website Traffic and Analytics
o Yearly Website Traffic
o Number of Clicks per the Ring Landing Page
o Online Contact Form Inquires and Leads
o Opportunity to Leads
o Email ROI
o Deliverability (Clicked, Opens, Bounced, Delivered)
o Number of Campaign to Membership Sales/Signup conversions. Conversions may
occur onsite or directly through website and email.
Marketing, Promotion, and Campaigns KPI’s
o Establishment of Social Channels - Facebook, Instagram, Twitter, LinkedIn
o Overall Buzz related to the Entity - Comments, News Articles, Press Coverage
Social Media Reach and Engagement
o Number of Instagram, Facebook and Twitter Followers
Report Target Number vs. Actual Reach
o Number of Likes achieved for Annual - Main Ring Sponsored Event
SEO Activity
o Procurement of a Google Analytics Account
(E) General -Lessons Learned / Indirect Benefits
Based on Membership Surveys
o How “The Ring” improves its Member recruitment, retention, amenities and
services
Indirect benefit of The Ring on Downtown Clearwater Economy
o To include quantitative and qualitative data that may provide insight on the indirect
benefits of The Ring in Downtown Clearwater
(F) Partnerships
Referrals between The Ring Workspaces LLC and City of Clearwater Small Business
Services Partners
[GM17-9311-025/212389/1]
(G)Healthy Work Environment
Certifications received and maintained
Use of Sleep pods
Cover Memo
City of Clearwater City Hall
112 S. Osceola Avenue
Clearwater, FL 33756
File Number: ID#18-5521
Agenda Date: 1/14/2019 Status: Agenda ReadyVersion: 1
File Type: Action ItemIn Control: Community Redevelopment Agency
Agenda Number: 4.2
SUBJECT/RECOMMENDATION:
Approve the Purchase Contract for the City of Clearwater Community Redevelopment Agency
(CRA) to purchase real property located at 701 Franklin Street, Parcel
No.15-29-15-54450-011-0010, with a purchase price of $525,000 and total expenditures not to
exceed $540,000 including closing-related costs and preparation of the site and authorize the
appropriate officials to execute same, together with all other instruments required to affect
closing.
SUMMARY:
The subject property, Parcel Identification Number 15-29-15-54450-011-0010, is owned by The
Cepcot Corporation (Seller). Seller’s property has a total land area of approximately 11, 513
square feet and is developed with a 5,600 square foot warehouse. The property has
approximately 63 ft. of linear frontage on Franklin Street and approximately 185 ft. of linear
frontage on East Avenue. The subject property is adjacent to a city owned vacant lot to the east
and a privately-owned day spa to the south.
With the acquisition of the subject property, the City and CRA will move closer to full assembly
of two blocks that will allow for the redevelopment of this area as outlined in the 2018
Clearwater Downtown Redevelopment Plan. This site has been identified for use as a
multi-modal center, potential City Hall location, a public parking facility or a mixed-use
development. No changes to the site are anticipated until the City County joint use study for an
administrative building has been completed. This site is a critical component for downtown
redevelopment.
Jim Millspaugh and Associates, Inc. performed an independent appraisal on the property in
August 2018 that values the property at $525,000.
Summary of costs for the purchase of the subject property are as follows:
Purchase price $525,000
Closing related costs (not to exceed) $15,000
TOTAL $540,000
APPROPRIATION CODE AND AMOUNT:
County TIF funds are available in CRA project 388-94714, Downtown Redevelopment Fund, to
fund this purchase.
Page 1 City of Clearwater Printed on 1/4/2019
File Number: ID#18-5521
Page 2 City of Clearwater Printed on 1/4/2019
CONTRACT FOR PURCHASE OF REAL PROPERTY
BY
THE CITY OF CLEARWATER, FLORIDA
COMMUNITY REDEVELOPMENT AGENCY
PARTIES: THE CEPCOT CORPORATION whose mailing address is P.O. Box 6025, -Clearwater, Fl
33758 (herein "Seller"), and the COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF
CLEARWATER, FLORIDA, a public body corporate and politic of the State of Florida (herein "Buyer" or
"CRA"), whose post office address is 112 South Osceola Avenue, Clearwater, FL 33756, (collectively
"Parties") hereby agree that the Seller shall sell and Buyer shall buy the following real property
("Property") upon the following terms and conditions.
1. PROPERTY DESCRIPTION
701 Franklin St Clearwater, Fl 33756
Real Property ID No: 15-29-15-54450-011-0010
As more particularly described in Exhibit "A" and depicted in Exhibit "B" (attached hereto and
incorporated herein),
PERSONALTY: NONE
FULL PURCHASE PRICE $525,000.00
MANNER OF PAYMENT: Wire in U.S. funds at time of closing
PURCHASE PRICE
The full Purchase Price as shown herein has been reached through negotiations with the Seller by City
staff. James Millspaugh and Associates, Inc. performed an appraisal of the Property on behalf of the
Buyer.
TIME FOR ACCEPTANCE; APPROVALS
Following execution of this contract by Seller, the price, terms and conditions as contained herein shall
remain unchanged and be held unconditionally open for a period of 45 days following delivery in
duplicate original to Executive Director of the Community Redevelopment Agency of the City of
Clearwater (CRA) for acceptance and approval, counter-offer, or rejection by action of the Clearwater
City Council ("Council") serving in its capacity as the governing board of the CRA. If this agreement is
accepted and approved by the CRA, it will be executed by duly authorized City officials and delivered to
Buyer within 10 days thereafter. If a counter-offer is approved by the CRA, it shall be delivered to Seller
in writing within 10 days of such action by the CRA, and Seller shall have 10 days thereafter to deliver
to Buyer written notice of acceptance or rejection of such counter-offer. If written notice of acceptance
is not timely delivered, or if the counter-offer is rejected by Seller, this contract shall thereafter be null
and void in all respects. If this contract is rejected by the CRA upon initial presentation to the CRA, this
contract shall be null and void in all respects and Buyer shall be so informed in writing within 5 days of
such action.
1
TITLE
Seller warrants legal capacity to and shall convey marketable title to the Property by Statutory Warranty
Deed, subject only to matters contained in Paragraph 7 acceptable to Buyer. Otherwise title shall be
free of liens, easements and encumbrances of record or known to Seller, but subject to property taxes
for the year of closing; covenants, restrictions and public utility easements of record; and no others
provided there exists at closing no violation of the foregoing and none of them prevents Buyer's
intended use of the Property. Seller warrants and represents that there is ingress and egress to the
Property sufficient for the intended use as described herein.
TITLE EVIDENCE
Buyer shall, at Buyer expense and within 15 days prior to closing date deliver a title insurance
commitment issued by a Florida licensed title insurer agreeing to liens, encumbrances, exceptions or
qualifications set forth in this Contract, and those which shall be discharged by Seller at or before
closing. Seller shall convey a marketable title subject only to liens, encumbrances, exceptions or
qualifications set forth in this Contract. Marketable title shall be determined according to applicable Title
Standards adopted by The Florida Bar and in accordance with law. Buyer shall have 5 days from
receiving evidence of title to examine it. If title is found defective, Buyer shall, within 3 days thereafter,
notify Seller in writing specifying defect(s). If the defect(s) render title unmarketable, Seller will have
120 days from receipt of notice within which to remove the defect(s), failing which Buyer shall have the
option of either accepting the title as it then is or withdrawing from this Contract. Seller will, if title is
found unmarketable, make diligent effort to correct defect(s) in title within the time provided therefor,
including the bringing of necessary suits.
SURVEY
Buyer, at Buyer's expense, within time allowed to deliver evidence of title and to examine same, may
have Real Property surveyed and certified to the Buyer by a registered Florida land surveyor. If survey
shows any encroachment on Real Property, or that improvements located on Real Property encroach
on setback lines, easements, lands of others, or violate any restrictions, contract covenants or
applicable governmental regulation, the same shall constitute a title defect. The survey shall be
performed to minimum technical standards of the Florida Administrative Code and may include a
description of the property under the Florida Coordinate System as defined in Chapter 177, Florida
Statutes.
CLOSING PLACE AND DATE
Buyer shall designate closing agent and this transaction shall be closed in the offices of the designated
closing agent in Pinellas County, Florida, within 120 days of the effective date unless extended by other
provisions of this contract including but not limited to time allotted for the removal of title defects as
provided for in Paragraph 7 above. If either party is unable to comply with any provision of this contract
within the time allowed, and be prepared to close as set forth above, after making all reasonable and
diligent efforts to comply, then upon giving written notice to the other party, time of closing may be
extended up to 60 days without effect upon any other term, covenant or condition contained in this
contract.
[A04-1313R /226420/1]
CLOSING DOCUMENTS
Buyer shall furnish closing statements for the respective parties, deed, bill of sale (if applicable),
mechanic's lien affidavit, assignments of leases, tenant and mortgage estoppel letters, and corrective
instruments.
CLOSING EXPENSES
Documentary stamps on the deed, unless this transaction is exempt under Chapter 201.24, Florida
Statutes, shall be paid by the Seller. Seller shall also pay the costs of recording any corrective
instruments. Recordation of the deed shall be paid by Buyer.
PRORATIONS; CREDITS
Taxes, assessments, rent (if any) and other revenue of the Property shall be prorated through the day
before closing. Closing agent shall collect all ad valorem taxes uncollected but due through day prior to
closing and deliver same to the Pinellas County Tax Collector with notification to thereafter exempt the
Property from taxation as provided in Chapter 196.012(6), Florida Statutes. If the amount of taxes and
assessments for the current year cannot be ascertained, rates for the previous year shall be used with
due allowance being made for improvements and exemptions. Assessments for any improvements
that are substantially complete at time of closing shall be paid in full by Seller.
OCCUPANCY
Seller warrants that there are no parties in occupancy other than the Seller, or as otherwise disclosed
herein. If Property is intended to be rented or occupied beyond closing, the fact and terms thereof shall
be stated herein, and the tenant(s) or occupants disclosed pursuant to Paragraph 15. Seller agrees to
deliver occupancy of the Property at time of closing unless otherwise stated herein. If occupancy is to
be delivered before closing, Buyer assumes all risk of loss to Property from date of occupancy, shall be
responsible and liable for maintenance from that date, and shall be deemed to have accepted Property
in its existing conditions as of the time of taking occupancy unless otherwise stated herein or in
separate writing.
LEASES
Seller warrants there are no tenants occupying the Property and that no leases exist, recorded or
unrecorded, authorizing such occupancy and any authorized tenancy or lease for use of the property
created by Seller prior to closing or prior to the expiration hereof, shall constitute a material breach of
this Contract. Seller shall, at Buyer's request, furnish Buyer copies of all written leases and estoppels
letters from each tenant specifying the nature and duration of the tenant's occupancy.
PROPERTY CONDITION
Seller shall deliver the Property to Buyer at time of closing in its present "as is" condition, ordinary wear
and tear excepted, and shall maintain the landscaping and grounds in a comparable condition. Seller
[A04-1313R /226420/11
makes no warranties other than is disclosed herein in Paragraph 21 ("SELLER WARRANTIES") and
marketability of title. Buyer's covenant to purchase the Property "as is" is more specifically represented
in the following paragraph.
a. As Is With Right of Inspection: Buyer may, at Buyer expense within 60 days following the
effective date hereof ("Inspection Period"), conduct inspections, tests, environmental and any other
investigations of the Property Buyer deems necessary to determine suitability for Buyer's intended use.
Upon Seller's execution hereof, Seller shall grant reasonable access to the Property to Buyer, its
agents, contractors and assigns for the purposes of conducting the inspections provided, however, that
all such persons enter the Property and conduct the inspections and investigations at their own risk.
Seller will, upon reasonable notice, provide utilities services as may be required for Buyer's inspections
and investigations. Buyer shall not engage in any activity that could result in a mechanics lien being
filed against the Property without Seller's prior written consent. Buyer may terminate this contract by
written notice to Seller prior to expiration of the Inspection Period if the inspections and/or investigations
reveal conditions which are reasonably unsatisfactory to Buyer. In the alternative, at the Buyer's sole
discretion, if Seller offers to repair or otherwise remedy such conditions to Buyer satisfaction, Buyer
may accept such offer; or Buyer, at its option, may elect to accept a credit at closing of the total
estimated repair costs as determined by a licensed general contractor of Buyer's selection and
expense. If Buyer terminates this contract, and this transaction does not close, Buyer agrees, at Buyer
expense, to repair all damages to the Property resulting from the inspections and investigations and
return the Property to its present condition.
WALK-THROUGH INSPECTION
At a time mutually agreeable between the parties, but not later than the day prior to closing, Buyer may
conduct a final "walk-through" inspection of the Property to determine compliance with any Seller
obligations and to insure that all Property is in and on the premises. No new issues may be raised as a
result of the walk-through.
SELLER HELD HARMLESS
Buyer is self insured, and subject to the limits and restrictions of the Florida Sovereign immunity statute,
F.S. 768.28, agrees to indemnify and hold harmless the Seller from claims of injury to persons or
property during the inspections and investigations described in Paragraph 15(a) resulting from Buyer's
own negligence only, or that of its employees or agents only, subject to the limits and restrictions of the
sovereign immunity statute.
RISK OF LOSS
If the Property is damaged by fire or other casualty before closing and cost of restoration does not
exceed 3% of the assessed valuation of the Property so damaged, cost of restoration shall be an
obligation of the Seller and closing shall proceed pursuant to the terms of this contract with restoration
costs escrowed at closing. If the cost of restoration exceeds 3% of the assessed valuation of the
improvements so damaged, Buyer shall have the option of either taking the Property "as is", together
with any insurance proceeds payable by virtue of such loss or damage, or of canceling this contract.
PROCEEDS OF SALE; CLOSING PROCEDURE
The deed shall be recorded upon clearance of funds. Proceeds of sale shall be held in escrow by
[A04-1313R /226420/1]
Buyer's attorney or by such other mutually acceptable escrow agent for a period of not longer than 5
days from and after closing, during which time evidence of title shall be continued at Buyer's expense to
show title in Buyer, without any encumbrances or change which would render Seller's title
unmarketable from the date of the last title evidence. If Seller's title is rendered unmarketable through
no fault of the Buyer, Buyer shall, within the 5 day period, notify the Seller in writing of the defect and
Seller shall have 30 days from the date of receipt of such notification to cure the defect. If Seller fails to
timely cure the defect, all funds paid by or on behalf of the Buyer shall, upon written demand made by
Buyer and within 5 days after demand, be returned to Buyer and simultaneously with such repayment,
Buyer shall vacate the Property and reconvey it to Seller by special warranty deed. If Buyer fails to
make timely demand for refund, Buyer shall take title "as is", waiving all rights against Seller as to any
intervening defect except as may be available to Buyer by virtue of warranties contained in the deed.
The escrow and closing procedure required by this provision may be waived if title agent insures
adverse matters pursuant to Section 627.7841, F.S. (2014), as amended.
DEFAULT
If this transaction is not closed due to any default or failure on the part of the Seller, other than to make
the title marketable after diligent effort, Buyer may seek specific performance or unilaterally cancel this
agreement upon giving written notice to Seller. If this transaction is not closed due to any default or
failure on the part of the Buyer, Seller may seek specific performance. If a Broker is owed a brokerage
fee regarding this transaction, the defaulting party shall be liable for such fee.
SELLER WARRANTIES
Seller warrants that there are no facts known to Seller that would materially effect the value of the
Property, or which would be detrimental to the Property, or which would effect Buyer's desire to
purchase the property except as follows: (Specify known defects. If none are known, write "NONE")
Ah
Buyer shall have the number of days granted in Paragraph 15(a) above ("Inspection Period") to
investigate said matters as disclosed by the Seller, and shall notify Seller in writing whether Buyer will
close on this contract notwithstanding said matters, or whether Buyer shall elect to cancel this contract.
If Buyer fails to so notify Seller within said time period, Buyer shall be deemed to have waived any
objection to the disclosed matters and shall have the obligation to close on the contract.
RADON GAS NOTIFICATION
In accordance with provisions of Section 404.056(8), Florida Statutes (2014), as amended, Buyer is
hereby informed as follows:
RADON GAS: Radon is a naturally occurring radioactive gas that, when it has
accumulated in a building in sufficient quantities, may present health risks to persons
who are exposed to it over time. Levels of radon that exceed federal and state guidelines
have been found in buildings in Florida. Additional information regarding radon and radon
testing may be obtained from your county public health unit.
CONTRACT NOT RECORDABLE; PERSONS BOUND
Neither this contract nor any notice of it shall be recorded in any public records. This contract shall bind
and inure to the benefit of the parties and their successors in interest. Whenever the context permits,
[A04-1313R /226420/11
singular shall include plural and one gender shall include all.
NOTICE
All notices provided for herein shall be deemed to have been duly given if and when deposited in the
United States Mail, properly stamped and addressed to the respective party to be notified, including the
parties to this contact, the parties attorneys, escrow agent, inspectors, contractors and all others who
will in any way act at the behest of the parties to satisfy all terms and conditions of this contract.
ASSIGNABILITY; PERSONS BOUND
This contract is not assignable. The terms "Buyer", "Seller", and "Broker" (if any) may be singular or
plural. This Contract is binding upon Buyer, Seller, and their heirs, personal representatives,
successors and assigns (if assignment is permitted).
ATTORNEY FEES; COSTS
In any litigation arising out of this contract, the prevailing party shall be entitled to recover reasonable
attorney's fees and costs.
TYPEWRITTEN OR HANDWRITTEN PROVISIONS
Typewritten or handwritten provisions shall control all printed provisions of contract in conflict with them.
BROKER REPRESENTATION
If either Party chooses to be represented by a Licensed Real Estate Broker upon Seller's execution
hereof, then that Party solely shall be responsible for any such Broker fee or expense due to said
Broker.
COMPLIANCE WITH SECTION 286.23, FLORIDA STATUTES
Owner shall execute and deliver to the City the "Disclosure of Beneficial Interests" required pursuant to
Section 286.23, Florida Statutes.
EFFECT OF PARTIAL INVALIDITY
The invalidity of any provision of this contract will not and shall not be deemed to affect the validity of
any other provision. In the event that any provision of this contract is held to be invalid, the parties
agree that the remaining provisions shall be deemed to be in full force and effect as if they had been
executed by both parties subsequent to the expungement of the invalid provision.
GOVERNING LAW
It is agreed by and between the parties hereto that this contract shall be governed by, construed, and
enforced in accordance with the laws of the State of Florida.
COUNTERPARTS; FACSIMILE COPY
[A04-1313R /226420/1]
Attest:
By:
a (f_ FMCS
Corporation
This contract may be executed in two or more counterparts, each of which shall be deemed an original
and all of which together shall constitute one instrument. A facsimile copy of this contract, including any
addendum, attachments and any written modifications hereof, and any initials or signature thereon shall
be deemed an original.
33. ENTIRE AGREEMENT
Upon execution by Seller and Buyer, this contract shall constitute the entire agreement between the
parties, shall supersede any and all prior and contemporaneous written and oral promises,
representations or conditions in respect thereto. All prior negotiations, agreements, memoranda and
writings shall be merged herein. Any changes to be made in this agreement shall only be valid when
expressed in writing, acknowledged by the parties and incorporated herein or attached hereto.
74 EXECUTED this day of 11 6-1/-el" , 2018 by Seller.
Print Name
Print Name
APPROVED BY BUYER & EFFECTIVE this day of , 2018.
THE COMMUNITY REDEVELOPMENT AGENCY
OF THE CITY OF CLEARWATER, FLORIDA
By:
George N. Cretekos
Chairperson, Board of Trustees
[A04-1313R /226420/1]
Approved as to form: Attest:
Laura Lipowski Mahony
Assistant City Attorney
Rosemarie Call
City Clerk
[A04-1313R /226420/1]
EXHIBIT "A"
A PART OF LOTS 1,2,9 AND 10, BLOCK "11", MAGNOLIA PARK, AS RECORDED IN
PLAT BOOK 3, PAGE 43 OF THE PUBLIC RECORDS OF PIN ELLAS COUNTY, FLORIDA
DESCRIBED AS FOLLOWS:
FROM THE SOUTHWEST CORNER OF SAID BLOCK "11", RUN THENCE EAST, 15.0 FT. ;
THENCE RUN N 0°42' 00" W, PARALLEL WITH AND 15.0 FT. EAST OF THE EAST RIGHT-
OF- WAY LINE OF EAST AVE, 129.0 FT. FOR THE POINT OF BEGINNING; THENCE
CONTINUE N 0°42'00" W, ALONG SAID LINE, 185.40 FT. TO THE SOUTH RIGHT-OF-WAY
LINE OF FRANKLIN STREET ALSO BEING THE NORTH LINE OF SAID BLOCK "11";
THENCE S 89°58'00" E, ALONG SAID NORTH LINE OF BLOCK "11", 63.68 FT.; THENCE S
0°15'12" W, 185.16 FT.; THENCE S 89°49'30" W, 60.60 FT. TO THE POINT OF BEGINNING.
Exhibit "B"
_rill
CLEARWATER
CEPCOT CORP to CRA Purchase
701 Franklin St
Parcel Number: 15-29-15-54450-011-0010
N
w-< E :>--
S
Scale: N.T.S.
Prepared by: Engineering Department
Geographic Technology Division 100 S. Myrtle Ave, Clearwater, FL 33756
Ph: (727)562-4750, Fax: (727)526-4755 www.MyClearwater.com Map Gen By: WD Reviewed By: Date: 10/17/2018 Grid #: 286B S-T-R: 15-29s-15e
Document Path: VAGIS \Engineering \Location Maps \CEPCOTCORPtoCRAPurchase.mxd
APPRAISAL REPORT
DOWNTOWN STORAGE WAREHOUSE
701 FRANKLIN STREET
CLEARWATER, FLORIDA
DATE OF VALUATION
AUGUST 15, 2018
PREPARED FOR
MR. JAMES BENWELL
CITY OF CLEARWATER
REAL ESTATE SERVICES COORDINATOR
100 S. MYRTLE AVENUE, SUITE 220
CLEARWATER, FLORIDA 33756
E-MAIL: ROBERT.BRZAK@MYCLEARWATER.COM
PREPARED BY
JAMES M. MILLSPAUGH, MAI
JAMES MILLSPAUGH & ASSOCIATES, INC.
110 TURNER STREET
CLEARWATER, FL 33756-5211
JAMES MILLSPAUGH & ASSOCIATES, INC.
REAL ESTATE APPRAISERS & CONSULTANTS
LICENSED REAL ESTATE BROKER
110 TURNER STREET, CLEARWATER, FLORIDA 33756-5211 PHONE: (727) 461- 2648 FAX: 442-8922
E-MAIL: jim@millspaugh-appraisals.com | WEBSITE: www.millspaugh-appraisals.com
August 31, 2018
Mr. James Benwell
City of Clearwater
Real Estate Services Coordinator
100 S. Myrtle Avenue, Suite 220
Clearwater, Florida 33756
E-Mail: Robert.Brzak@Myclearwater.Com
RE: Downtown Storage Warehouse
701 Franklin Street
Clearwater, Florida
Dear Mr. Benwell:
At your request, I have made an appraisal of the current market value of the fee simple
estate of the above referenced real property. The property and methods utilized in arriving at the
final value estimate are fully described in the attached report, which contains 28 pages and
Addenda.
This Appraisal Report has been made in conformance with and is subject to the
requirements of the Code of Professional Ethics and Uniform Standards of Professional Practice
of the Appraisal Institute and the Appraisal Foundation. The Appraisal Report and final value
estimate are subject to all attached Contingent and Limiting Conditions.
I have made a careful and detailed analysis of the subject property and after analyzing the
market data researched for this report, I estimate that the market value of the referenced real
property only and subject to the stated limitations, definitions and certifications as of August 15,
2018, was:
FIVE HUNDRED TWENTY-FIVE THOUSAND DOLLARS
($525,000)
Respectfully submitted,
JAMES MILLSPAUGH & ASSOCIATES, INC.
____________________________
James M. Millspaugh, MAI
JMM:sg
JAMES M. MILLSPAUGH, MAI
State-Certified General Real Estate Appraiser RZ58
TABLE OF CONTENTS
INTRODUCTION
Title Page
Letter of Transmittal
Table of Contents
Site Photographs
DESCRIPTIONS, ANALYSES AND CONCLUSIONS
Identification of the Property 1
Census Tract Location/Zip Code 1
Flood Zone Location 1
Environmental Audit Data 1
Objective and Intended Use/Users of the Appraisal 1
Exposure Period Estimate 2
Statement of Ownership and Recent Sales History 2
Scope of the Appraisal 2
Definition of Market Value 3
Standard Contingent and Limiting Conditions 3
Certification 6
Area Description 7
Site Data 9
Assessment and Tax Data 10
Zoning and Land Use Data 10
Description of the Improvements 11
Highest and Best Use 11
Land Value Estimate 13
Land Sales Analysis and Conclusion 21
Sales Comparison Approach 22
Sales Comparison Analysis and Conclusions 27
Reconciliation 28
ADDENDA
Qualifications of the Appraiser
Standard Definitions
Legal Description
EXISTING CONDITIONS
DOWNTOWN STORAGE WAREHOUSE
701 FRANKLIN STREET
CLEARWATER, FLORIDA
DATE OF PHOTOGRAPHS: AUGUST 15, 2018
BUILDING VIEW FROM EAST AND FRANKLIN
FRANKLIN STREET SCENE LOOKING WEST TOWARD SUBJECT ON LEFT
EXISTING CONDITIONS
DOWNTOWN STORAGE WAREHOUSE
701 FRANKLIN STREET
CLEARWATER, FLORIDA
DATE OF PHOTOGRAPHS: AUGUST 15, 2018
BACK VIEW FROM SUBJECT SITE
EAST AVENUE STREET SCENE LOOKING NORTH TOWARD SUBJECT ON RIGHT
IDENTIFICATION OF THE PROPERTY:
The subject is located at the southeast corner of Franklin Street and East Avenue along
the eastern fringe of the Downtown Core district. It is legally described in brief as follows and in
detail in the Addenda.
Parts of Lots 1-2 and 9-10, Block 11,
Magnolia Park Subdivision, Plat Book 1, Page 70
CENSUS TRACT LOCATION/ZIP CODE: #259.01/33756
FLOOD ZONE LOCATION: Pinellas County, Florida
Map No. 12103C0108H
Effective Date: May 17, 2005
The subject property and majority of the surrounding district are located in an X flood
zone, which is not a special flood hazard area.
ENVIRONMENTAL AUDIT DATA:
The Appraisal has been performed without benefit of an environmental audit and
presumes that no problems exist, however, I reserve the right to review and/or alter the value
reported herein should a subsequent audit reveal problems. Given the adjacent railroad track
location and past use of the subject block for citrus processing and distribution, any transfer of
the property would prompt at a minimum a level one environmental audit.
OBJECTIVE AND INTENDED USE/USERS OF THE APPRAISAL:
The objective of the appraisal report is to estimate the current market value of the fee
simple interest of the subject real property only as of August 15, 2018 (date of inspection and
photographs). It is my understanding that the intended use of the report is to provide valuation
guidance to the City of Clearwater in their pending purchase negotiation for the subject in an
ongoing assemblage of the total block for a public transit center and that the intended users of the
report are the City of Clearwater representatives and no others.
2
EXPOSURE PERIOD ESTIMATE:
This is the past period of time required to have sold the subject at my value estimate on
the appraisal date. Based upon the brisk sale/development market surrounding and including the
downtown core and the similar pace for the economy, modest interest rates and the public
outlook, it appears this property would only have required a relatively short period of less than
three months to market.
STATEMENT OF OWNERSHIP AND RECENT SALES HISTORY:
The property is owned by Cepcot Corporation that acquired title in May 1998 at recorded
$180,000 price (recorded O.R. Book 10084, Page 1685). The building was reportedly purchased
for storage uses in support of the owners other business entity in downtown Clearwater. There
have been no subsequent transfers of the property that would impact the current market value.
SCOPE OF THE APPRAISAL:
The extent of my research effort has focused on the downtown Clearwater market
specifically and North Pinellas in general for the sale of vacant and/or marginally improved
parcels similar to the subject. While the facility has served as warehouse/storage for the past
multiple decades, that concept does not represent the area use trend or the highest and best use
concept and is specifically excluded from the zoning/land use regulations. The basic shell,
however, would likely be suitable for conversion to a variety of current prospects for the
downtown core.
Specifically, I have researched the public records in the Pinellas Property Appraiser’s and
Clerk’s data bases, the local MLS data, various business periodicals and my newspaper clipping
files. I have also thoroughly inspected the market, viewed the comparable transactions and
verified the details with a related party. The report will include Sales Comparison Approaches
for the land and the improvements that are the most reliable for this type of property. An Income
Analysis will also be considered for the warehouse use concept, plus consideration of the
obvious assemblage potential being conducted by the adjacent City of Clearwater ownership. I
appraised this property previously in March, 2010.
3
DEFINITION OF MARKET VALUE:
The most probable price which a property should bring in a competitive and open market
under all conditions requisite to a fair sale, the buyer and seller each acting prudently and
knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in the
definition is the consummation of a sale as of a specified date and the passing of title from seller
to buyer under conditions whereby:
(1) Buyer and seller are typically motivated;
(2) Both parties are well informed or well advised, and acting in what they consider
their own best interests;
(3) A reasonable time is allowed for exposure in the open market;
(4) Payment is made in terms of cash in US dollars or in terms of financial
arrangements comparable thereto; and
(5) The price represents the normal consideration for the property sold unaffected by
special or creative financing or sales concessions granted by anyone associated with
the sale.
-------------------------------------------
1 Federal Deposit Insurance Corporation, 12 CFR, Part 323, RIN 3064-AB05, August 20, 1990,
Section 323.2, Definitions.
STANDARD CONTINGENT AND LIMITING CONDITIONS:
This Appraisal is subject to the following limiting conditions and contingencies:
This Appraisal Report in no way represents a guaranty or warranty of estimated market
value as reported herein. The Appraisal Report represents the opinion of the undersigned as to
"one figure" based upon the data and its analysis contained herein.
The legal description furnished is assumed to be correct and unless otherwise noted, no
survey or title search has been made. No responsibility is assumed by the Appraiser(s) for these
or any matters of a legal nature and no opinion of the title has been rendered. The property is
appraised as though under responsible ownership and management. The Appraiser(s) believe(s)
that information contained herein to be reliable, but assume(s) no responsibility for its reliability.
4
The Appraiser(s) assume(s) there are no hidden or unapparent conditions of the property,
subsoil, or structure which would affect the value estimate. Unless otherwise noted, the
Appraiser(s) has not commissioned termite or structural inspection reports on any improvements
nor subsoil tests on the land.
The attached photos, maps, drawings, and other exhibits in this report are intended to
assist the reader in visualizing the property and have been prepared by the Appraiser(s) or his
staff. These exhibits in no way are official representations/surveys of the subject property.
Any distribution of the total valuation in this report between land and improvements
applies only under the existing program of utilization. Separate valuations for land and buildings
must not be used in conjunction with any other appraisal and are invalid if so used.
In this appraisal assignment, the existence of potentially hazardous material used in the
construction or maintenance of the building, such as the presence of urea-formaldehyde foam
insulation, and/or the existence of toxic waste, which may or may not be present on the property,
was not observed by the Appraiser; nor does he/she have any knowledge of the existence of such
materials on or in the property. The Appraiser, however, is not qualified to detect such
substances. The existence of urea-formaldehyde insulation or other potentially hazardous waste
material may have an effect on the value of the property. The Appraiser urges the client to retain
an expert in the field if desired.
The Appraiser(s) will not be required to appear in court unless previously arranged. The
Appraiser's duties pursuant to his employment to make the Appraisal are complete upon delivery
and acceptance of the Appraisal Report.
Possession of this report or copy thereof does not carry the right of publication. Neither
all nor any part of the contents of this report (especially any; conclusions as to value, the identity
of the Appraiser(s), or the firm with which he is connected, or any reference to the Appraisal
Institute or to the MAI or SRA designation) shall be disseminated to the public through
advertising media, public relations media, news media, sales media, or any other public means of
communication without the prior written consent and approval of the undersigned.
5
The Americans with Disabilities Act ("ADA") became effective January 26, 1992. The
Appraiser(s) has (have) not made a specific compliance survey and analysis of this property to
determine whether or not it is in conformity with the various detailed requirements of the ADA.
It is possible that a compliance survey of the property, together with a detailed analysis of the
requirements of the ADA, could reveal that the property is not in compliance with one or more of
the requirements of the Act. If so, this fact could have a negative effect upon the value of the
property. Since the Appraiser(s) has (had) no direct evidence relating to this issue, the
Appraiser(s) did not consider possible noncompliance with the requirements of ADA in
estimating the value of the property.
6
CERTIFICATION
The undersigned does hereby certify that, except as otherwise noted in this appraisal report:
1. As of the date of this report, I, James M. Millspaugh, have completed the requirements under
the continuing education program of the Appraisal Institute.
2. I have personally inspected the subject property and have considered all factors affecting the
value thereof, and to the best of my knowledge and belief, the statements of fact contained in this
appraisal report, upon which the analyses, opinions and conclusions expressed herein are based,
are true and correct, subject to all attached Contingent and Limiting Conditions.
3. I have no present or contemplated future interest in the real estate that is the subject of this
appraisal report.
4. I have no personal interest or bias with respect to the subject matter of this appraisal report or
the parties involved.
5. My fee for this appraisal report is in no way contingent upon my findings. The undersigned
further certifies that employment for this appraisal assignment was not based on a requested
minimum valuation or an approval of a loan.
6. This appraisal report sets forth all of the limiting conditions (imposed by the terms of my
assignment or by the undersigned) affecting the analyses, opinions, and conclusions contained in
this report.
7. This appraisal report has been made in conformity with and is subject to the requirements of
the Code of Professional Ethics and Uniform Standards of Professional Practice of the Appraisal
Institute and the Appraisal Foundation and may be subject to peer review. Further, I have met
USPAP's competency provision and am capable of completing this appraisal assignment.
8. No one other than the undersigned prepared the analyses, conclusions and opinions
concerning the real estate that are set forth in this appraisal report.
9. In my opinion, the estimated current market value of the fee simple estate of the subject real
property only and subject to the stated limitations, definitions and certifications as of August 15,
2018, was:
FIVE HUNDRED TWENTY-FIVE THOUSAND DOLLARS
($525,000)
_____________________________
James M. Millspaugh, MAI
State-Certified General Real Estate Appraiser RZ58
7
AREA DESCRIPTION:
The downtown Clearwater district has shifted from its Central Business District (CBD)
status of the pre-1970 period to a near total institutional market dominated by governmental and
church groups. While traditional corporate and local office users continue to create space
demand here, it is a small segment of the total demand. Further, the existing retailers here are
primarily business-convenience and/or food service and cater to the daily employee lunch crowd
and the growing presence of the Church of Scientology (COS) educational campus. There are
hopes for a retail rebound; however, it is predicated on a higher proximate permanent residential
base. At this point, both of the modern major residential condo towers have sold-out during the
past four to five years and a long-awaited rental apartment complex (the Nolen) has recently sold
and continues to lease-up at the Prospect Lake site on Cleveland Street plus the long-stalled
Strand mixed-use complex at MLK Jr. and Cleveland Street is under construction. Further, the
Garden Trail apartment complex was recently completed at N. Garden Avenue and Seminole
Street. There are also numerous vacant sites available with past multi-family approvals, several
of which are now being marketed along N. Ft. Harrison Avenue and at MLK and Laura. As
such, while true retailing here is not favorable currently, there is growing belief that increasing
population locally as well as Church-related will improve during the longer-term (two to five
years plus) foreseeable future. This long-held belief in downtown Clearwater has strongly
influenced the noted long-term control buyers that dominate the best locations in the Core
District.
The district, like most throughout Tampa Bay downtowns, has received extensive public
investment to the infrastructure during the past several decades. The new Memorial Causeway
Bridge accessed via Court/Chestnut Streets, the redeveloped US 19-A shift to Myrtle Avenue,
the Prospect Lake drainage system, the upgraded Cleveland Street streetscape, downtown
monumental light posts/signage plus a City-approved public docking facility built on the
bayfront are all favorable, but have collectively resulted in modest net change to the district’s
reputation/demand. In addition to these public infrastructure improvements, the City had also
favored the two downtown condo towers (Water’s Edge and Station Square) plus the Marriott
Hotel and has funded the Capitol Theater rehabilitation and supported the Dolphin Tale exhibit
in the Harborview Center. They have also acquired the adjacent former St. Pete Times facility
plus adjacent warehouse/office building at Court and Myrtle for use as a public transit center.
8
9
The ultimate addition of permanent population downtown would be favorable for
retailing, but to date, in late Summer 2018, no major trend has been noted. A shift to the
Court/Chestnut beach corridor, however, continues with the recent demolition of former
warehouses/retail office buildings for a new Walgreen’s for most of the block bounded by
Myrtle, Court, East Avenue and Chestnut. This assemblage for a private re-development has
been a boost for that locale and has augmented the Marriott, 7-Eleven and most recently the St.
Luke’s Eye Clinic at Chestnut/S. Ft. Harrison where an earlier acquisition by the COS from
Pinellas County included two major segments north of Court on both sides of Ft. Harrison and
adjacent to the COS Campus. Further, an assemblage for a high rise mixed-use complex fronting
S. Ft. Harrison Avenue from Court to Chestnut Street has been completed and is widely expected
to be a major positive for the downtown once developed.
The city also hopes to spur development along the bluff in downtown and up to the
Seminole boat ramps, however, to date only one acquisition has been completed for a townhome
complex at Seminole Street and N. Fort Harrison while recent land closings at Seminole Street
west of N. Ft. Harrison and at the Clearwater Bay Marina create potential developer activity
during the foreseeable future. Further, any bluff redevelopment in the core district will require
numerous approvals that collectively are a slow and cumbersome process. The city, however, has
made it clear by deed and intention, that the downtown core redevelopment has its full attention
and support.
In conclusion of the downtown market, it now is beginning to show signs of
improvement after a decade of decline and mostly public/institutional support. Further, the
national, state and local economies have notably improved along with employment and income
levels. Clearly, this district is continuing to struggle in attracting population and retail services
with 2017 appearing to have been something of a turning point subject to uncontrollable political
and economic turmoil.
SITE DATA:
The site is roughly rectangular in shape with dimensions from the legal description
including 63.68’ on the south side of Franklin Street, 60.6’ on the southern boundary, 185.4’
along East Avenue and 185.16’ on the eastern boundary. These calculate to a total site size of
11,513 SF or .264 acre MOL.
10
The site is level, even with adjacent lands, is slightly above the roadway grades and, as
such, does not appear to have any extraordinary drainage problems beyond what is considered
typical for this locale that has a central storm drainage system. Franklin Street is a narrow, two-
lane back roadway that extends from Prospect to S. Fort Harrison with no traffic lights on either
nearby main roadway. East Avenue is a one-lane north only roadway sharing the right-of-way
with the active railroad line and the Pinellas Trail (recreational). The exposure of the subject to
either Myrtle or Court Street is minor and the property, like all in downtown, has all public
(water, sanitary sewer and natural gas) and private (telephone, electricity and cable television)
utilities.
Surrounding properties include a partially assembled acreage parcel to the east, modern
Walgreens and 7/11 convenience store to the south, COS modern parking garage to the west and
municipal complex (police, city offices, and vacant lot) to the north. None of these adjacent uses
or those in this locale are considered detriments to the subject or the Downtown Core in general.
The site is a relatively small, back street parcel fronting the one-way, one-lane East
Avenue where it appears the greatest demand would be from its assemblage with the balance of
the block for use by some proximate municipal and/or COS activity centers. This locale feature
is considered to represent its best value attribute.
ASSESSMENT AND TAX DATA:
Parcel # 2017 Assessment 2017 Gross Tax*
15-29-15-54450-011-0010 $230,000 $4,918.55
*If paid early at 4% discount. The tentative 2018 assessment is reported at
$237,000.
ZONING AND LAND USE DATA:
The subject site and the entire CBD are zoned D for Downtown and classified for CBD or
Central Business District on the Comprehensive Land Use Plan. The zoning intention is to
create a mixed-use development of residential, retail, office, beverage sales, restaurants,
hotels/motels, etc. amongst public/institutional uses, which would customarily be found in a
downtown area. The regulation creates wide latitude of density, height and uses for larger
assembled properties and the City has created multi-family density pools that are also available.
11
The subject is also located in the Downtown Core District where no height restriction exists and
density is at 70 units per acre or 95 hotel units per acre and a maximum FAR of 4.0. This
parcel’s narrow configuration and relatively small site size would restrict most benefits from
these regulations, but would alternately promote its assemblage with adjacent properties to form
a larger and more usable tract of land.
DESCRIPTION OF THE IMPROVEMENTS:
These comprise a 5,600 SF (40’ x 140’) dock-high masonry-built storage warehouse that
was reported built in 1966. The interior is demised into a northern 45’ segment (1,800 SF) that
includes an approximate 550 SF office, two-piece restroom and storage closet. There is also a
storage mezzanine above the office area with no stairway access.
Basic construction details include a concrete foundation, five block high slab plus 22’
wall height to top of eave (roughly 20.5’ interior clear span) that supports a pre-stressed concrete
roof deck having a composition roof cover. The interior demising walls are not load bearing.
The building includes minimal electric service for the HVAC in the office, lighting, fire alarm
and outlets plus plumbing only for the two-piece restroom. The office space has carpeted floors,
drywall walls and ceiling plus the mezzanine storage has drywall walls and dropped acoustical
ceilings. There is a code compliant firewall and metal doors enclosing the northern 45’ section, a
modern roll-up door and grade level door to the loading dock area on the south side of the
building. Other previous doors have been blocked-up. The only notable site improvement is the
loading dock and miscellaneous paving, shell, and concrete walks.
Aside from exterior painting, the building is in very good condition with no noted major
deferred maintenance items.
HIGHEST AND BEST USE: (Defined in Addenda)
After a thorough building and area inspection, it is my conclusion that assemblage with
the adjacent acreage parcel represents this concept. This has been and continues to be a long-
term trend in the downtown core as the larger parcels can take full advantage of the zoning rules
that in turn, restrict use of smaller parcels similar to the subject. Alternately, individual use of the
subject for auxiliary uses with contiguous or nearby parcels is a possibility but does not seem
12
likely. The basic structure is clearly useful for storage and could also be readily converted to a
variety of allowed uses, however, any change of use would prompt enforcement of parking and
on-site retention rules.
As a standard warehouse, the building would rent in the $6.00-$7.00 PSF range or say
$6.50 PSF on a gross basis where the landlord expenses would include real estate taxes, basic
fire and extended insurance, exterior/site maintenance, management fees and some allowance for
building reserves for the replacement of building components. These basic details can be
compiled as follows:
Projected Income/Expense Statement
701 Franklin Street
Clearwater, Florida
As Of August 15, 2018
Building Rental: 5,400 SF@ $6.50 PSF = $35,100
Vacancy and Collection Loss: 3% $ 1,100
Effective Gross Income $34,000
Less: Expense
R.E. Tax $4,700
Insurance ($.75 PSF) $4,000
Maintenance ($.20 PSF) $1,100
Management 5% $1,700
Reserves ($.30 SF) $1,600
Total Expenses $13,100
Indicated NOI $20,900
Basic small property cap rates are currently falling in the 7% to 8% range for this
property type unless they are under long-term rentals to a credit-rated tenant. I would capitalize
this projected net operating income (NOI) at 7.5%.
NOI $20,900
------------------------------------ = --------------------
Capped At 7.5% .075
Indicated Value $278,667
ROUNDED AT $300,000
13
As the following Land Value estimate will reveal then, the property value as part of an
assemblage exceeds this price level and as such, is considered to verify that the existing
warehouse use is not the highest and best. Further, the following Sales Comparison Approach
indicates a total value below the noted assemblage value.
In summary then, the improvements are physically possible with standard features but
relatively short parking/access for the building. They are not legally allowed per the current
zoning rules but are grandfathered-in as long as the use would be by the current owner or
ancillary to nearby owners. They also lack financial feasibility and maximally productive
concepts as it is apparent that assemblage would most likely result in the greatest current value.
These improvements can not be re-built currently for this or other uses, as there is inadequate
land to accommodate parking and onsite storm retention.
LAND VALUE ESTIMATE:
This methodology values the site by comparison to proximate parcel sales of similar
zoning, size and location. These examples are the best known to me, are described here on
separate detail sheets and then analyzed and adjusted below in relation to the subject. I have also
considered an extensive list of downtown transactions during the past three to four years during
which demand/activity has increased. Unless otherwise noted, they sold for cash or terms
equivalent and did not require adjustment for cash equivalency. The most common unit of
comparison is the price PSF of the land value as the zoning allows a wide range of uses that are
currently being expanded with greater site intensity.
14
15
LAND SALE #1
Location: East side of East Avenue from Chestnut to Court Street, Clearwater
Legal Description: Lots 1, 2, Parts of 3, 8, 9 and 10, Block 14, Magnolia Park Subdivision,
Plat Book 3, Page 43
Date of Sale: December 2015
Sales Price: $1,875,000 + $80,000 = $1,955,000
Size: 139.765' x 319.843' or 44,703 SF
Price PSF: $43.73
Grantor/Grantee: East Development Associates/PV Court, LLC.
Recording Data: O.R. Book 19032, Page 0542
Sale Confirmed With: D. Brinson, Broker
Zoning: D, Downtown, Clearwater
Comments: This marginally improved property (older masonry warehouses of roughly
26,400 SF) were purchased as part of an assemblage for development of a Walgreens drugstore.
An added parcel fronting the signalized Myrtle/Court corner was also acquired at
$892,000/$46.97 PSF to form the total parcel. The redevelopment interest of this complex began
in 2012 and had included the total block, however, business negotiations and public zoning rules
delayed the redevelopment and excluded the NW quarter of Chestnut/Myrtle. The buyer of the
Walgreens site subsequently demolished the existing improvements to allow development of a
16,510 SF building plus a 63 space parking lot with total land and demolition cost approximating
$45.00 PSF.
16
LAND SALE #2
Location: 630 Laura Street, Clearwater
Legal Description: Lots 13-18, Block 18, Gould & Ewing’s, 2nd Addition, Plat Book 1,
Page 52
Date of Sale: October 2016
Sales Price: $450,000 plus $30,000 closing costs
Size: 298’ x 125’, 36,186 SF
Price PSF: $13.26
Grantor/Grantee: Bank of America/630 Laura, LLC
Recording Data: O.R. Book 19373, Page 0682
Sale Confirmed With: J. Jacob, Grantee Rep.
Zoning: D, Downtown, Clearwater
Comments: This property was marginally improved with a 1975-built, drive through
banking facility that formerly served the nearby Bank of America branch on Cleveland Street.
The improvements included some 1,300 SF enclosed space plus roughly 5,900 SF of canopy
space and drive lanes. BOA terminated its use and offered the property in an online auction.
The buyer is the owner of the BOA building on Cleveland Street that is pursuing re-development
potential.
17
LAND SALE #3
Location: Southwest quadrant Drew Street and Myrtle Avenue, Clearwater
Legal Description: Lots 1-3, Block 14, Lots 1-7 and Lots 12-16, Block 15, Lots 7-22, Block
16, Lots 1-4, Block 17, all in Gould and Ewings Second Edition, Plat
Book H-1, Page 52 plus parts of Block B, Nall-Mortenson Subdivision
Plat Book 21, Page 8.
Date of Sale: February, 2017
Sales Price: $9,000,000
Size: 3.04 Acres MOL (Excludes Alley and Roads)
Price PSF: $68.01
Grantor/Grantee: Clearway Properties, LLC./Myrtle Development, LLC.
Recording Data: O.R. Book 19516, Page 1980
Sale Confirmed With: S. Onkelos, Grantor Rep.
Zoning: D, Downtown, CBD Land Use, Clearwater
Comments: This site had been assembled earlier in the decade by out-of-state investors
with it having been on the market for several years prior to this transfer at $12 million. Many of
the parcels had been improved with older retail/service buildings that were mostly demolished
with several buildings remaining. This assemblage was divided by East Avenue which surrounds
the active railroad right-of-way and the Pinellas Trail in a north-south direction and by two
public roads (Grove Street 50’ x 280’ and Laura Street 50’ x 280’), an alley and two interior
parcels (100’ x 125’ and 155’ x 105’) owned by others. The site had been advertised as having
3.84 acres but apparently included the alley and east-west roadways. Subsequently, the buyers
acquired four additional parcels having 65,275 SF for $5,900,000/$90.39 PSF that increased the
total to $14,900,000/$75.40 PSF. All of the additional parcels were improved with usable one-
story buildings.
18
LAND SALE #4
Location: Court, Chestnut, S. Ft. Harrison and Garden assemblage
Legal Description: Lots 28-33, Lot 34 and 52 S. of Court Street plus Lots 47-51, Court Square
Subdivision, Plat Book 5, Page 53
Date of Sale: September 2017, January 2018 and March 2018
Sales Price: $4,650,000 aggregate
Size: 43,685 SF platted plus vacations to total 87,120 SF MOL
Price PSF: $52.37
Grantor/Grantee: Besim Enterprises, et al./IBP Funding
Recording Data: O.R. Book 19788, Page 2678, Book 19920, Page 0869, Book 20000, Page
2284
Sale Confirmed With: K. Fuller, Broker
Zoning: D, Downtown, Clearwater
Comments: This assemblage required roughly 3 years to complete and included an
older one story restaurant with parking, a three-story historic office building with parking and an
older gasoline station. The latter had contamination/code violation problems that delayed the
final closing. The City favored the effort due to the prime location that appeared ideal for a
multi-story mixed-use complex with parking deck, ground-level retail, hotel and potential upper
floor condos. The building/alley vacations are key to the concept and enticed the developers to
proceed for what would be the first high rise after the Waters Edge complex at Cleveland and
Osceola in the mid 2000s.
19
LAND SALE #5
Location: West side of S. Prospect Avenue from Pierce to Franklin Street, Clearwater
Legal Description: Lots 1-10, Block 9, Aiken Subdivision, Plat Book 14, Page 45
Date of Sale: September 2017
Sales Price: $440,000
Size: 266’ x 110’ MOL; 29,370 SF
Price PSF: $14.98
Grantor/Grantee: Hearst Communications/Zano Team 2, LLC.
Recording Data: O.R. Book 19793, Page 1435
Sale Confirmed With: A. Barrett, Broker
Zoning: D, Downtown, Clearwater CBD Land Use
Comments: This vacant tract had been available for multiple years with a 2016 price of
$1,180,000 for this parcel plus a Franklin Street parcel that extended to Myrtle Avenue. The site
has formerly been used by the Clearwater Sun newspaper for office and printing functions with
the Myrtle parcel being improved with the former building slab. This sale then was acquired by
a speculator for expected future residential development due to its view into the Prospect Lake
retention facility. The maximum density here of 30 units per acre would indicate 20 units or
$22,000 per unit that sets a high level for the past several years.
20
LAND SALE #6
Location: Southeast corner of South Washington Avenue and Cleveland Street,
Clearwater
Legal Description: Metes and Bounds Parcel #21/02 located in the NE/4 of the NW/4 of
Section 15, Township 29 South, Range 15 East.
Date of Sale: December 2017
Sales Price: $175,000
Size: 58’x 100', plus 53’ x 113’; L-shaped 11,789 SF
Price PSF: $14.84
Grantor/Grantee: J. C. Rembert/1130 Cleveland, LLC.
Recording Data: O.R. Book 19868, Page 2123
Sale Confirmed With: W. Witter, Broker
Zoning: D, Downtown, Clearwater
Comments: This small irregular shaped parcel was purchased by the adjacent owner to
complete an assemblage by an active owner/investor in this locale directly across from the Strand
complex. The same buyer acquired 1115 Cleveland Street (Douglas Aluminum) of roughly
6,800 SF for $425,000 plus the rear adjacent lot fronting Washington Avenue for $100,000
($15.50 PSF) to round out their ownership to the west on MLK Jr. Avenue and to the east on
Madison Avenue.
21
Land Sales Re-Cap Chart
Sale # Date Of Sale Sales Price Site Size In SF Price PSF
1 12/15 $1,955,000 44,703 $43.73
2 10/16 $ 480,000 36,186 $13.26
3 2/17 $9,000,000 132,333 $68.01
4 9/17 $4,650,000 87,120 $53.37
5 9/17 $ 440,000 29,370 $14.98
6 12/17 $ 175,000 11,789 $14.84
Subject -- -- 11,513 --
LAND SALES ANALYSIS AND CONCLUSIONS:
This group of far-ranging examples is representative of the downtown market where
institutional, public and private speculators are the most active. It is not evident to me that Sale
#3 is an arm’s-length transaction as the indicated pricing is substantially outside of the market
history. Sale #2 that is essentially adjacent to Sale #3 sold in the same time frame at only $13.26
PSF as compared to $68.01 PSF for a notably larger partially-assembled site. The high price
from Sale #3 is not considered to illustrate the assemblage concept for the downtown core.
The smaller transactions #2, #5 and #6 sold within a reasonably close range from $13.26
to $14.98 PSF with the subject being located near one of the most active intersections in the core
district. Sale #2 apparently sold in a favorable deal to the Bank of America building owner but
had a back street location where assemblage was not likely. The other two sales have inferior
locations in the Town Lake district with the subject having a superior core location amongst
public/institutional owners that are known to conduct assemblages. From review of the smaller
transactions, it appears that the subject land value without any assemblage premium is reasonable
in the $25.00-$30.00 PSF range or say $27.50 PSF for the 11,513 SF or $316,608 rounded to
$320,000.
As a part of an obvious assemblage for what amounts to a “holdout” position, the best
examples are Sale #1 and #4 that support roughly $45 PSF plus for the Myrtle/Court/Chestnut/
East parcel and $53.37 PSF for the S. Fort Harrison/Court/Chestnut/Garden site that is
considered superior to the Myrtle Avenue. Interestingly enough, the holdout parcel located on
the northwest corner of Myrtle/Chestnut sold to a speculator in April 2018 for $750,000 or
$44.45 PSF based on a 16,866 SF land size. The site was improved with 17,136 SF of space in
22
the 1949-built structure that had some mezzanine space. Based upon the quoted building size, the
property sold at $43.77 PSF with the property manager reporting that the structure will be
converted to mixed-use with interior parking and onsite retention. In any event, the sale value on
the basis of land area sold near the assembled Walgreens site roughly 2.5 years later (recorded O.
R. Book 20007, Page 1504) while in reality, the buyer will use the structure that indicates some
contributory value for the improvements and, therefore, a lower land value.
Based upon consideration of these best available transactions, I would estimate the
subject value to fall in the $45.00-$47.50 PSF range that is a slight premium due to the holdout
ownership scenario. Therefore, the subject site value as part of the obvious assemblage can be
calculated as follows:
11,513 SF @ $45.00 PSF = $518,085
11,513 SF @ $47.50 PSF = $546,868
ROUNDED TO $525,000
SALES COMPARISON APPROACH:
This methodology values the subject by direct comparison to similar properties that have
sold recently. These examples are the best known to me, are described here on separate detail
sheets and then analyzed and adjusted in relation to the subject. Unless otherwise noted, they
sold for cash or terms equivalent and did not require adjustment for cash equivalency. The most
common unit of comparison for this property type is the overall price PSF of building area
including the supporting land.
23
24
SALE COMPARISON #1
699 ½ LAKEVIEW ROAD, CLEARWATER
APRIL 22, 2018
Sale Price: $495,000
Date of Sale: May 2016
Grantor/Grantee: Lakeview 699, LLC./D.P. Haagsma
Recording Data: O.R. Book 19194, Page 1031
Data Confirmed With: B. Andrus, Broker
Land Size and Value: 120’ x 174’ Average; 20,875 SF $125,000
Description of the Improvements: 1979-built, metal insulated warehouse having some 11,250
SF. The building was fully fire sprinklered with ample overhead doors to roughly 16’ eave
height plus roughly 1,000 SF of office space. The building was in good basic condition at the
time of sale ad was purchased by a user. The site was accessed off a backstreet road plus
easement off Lakeview Road just beyond an active railroad right-of-way.
Overall Price PSF: $44.00 ($495,000/11,250 = $44.00)
25
SALE COMPARISON #2
404 S. MLK JR. AVENUE, CLEARWATER
APRIL 18, 2018
Sales Price: $579,900
Date of Sale: March 2018
Grantor/Grantee: Genroc Group, Inc./Dyna Fire Park, III, LLC.
Recording Data: O.R. Book 19998, Page 0489
Sale Confirmed With: P. Anderson, Broker
Land Size and Value: 151’ x 150’; $335,000
Description of the Improvements: 1960-built, masonry building of some 10,240 SF divided into
three units of 7,000, 1,500 and 1,500 SF. The building had formerly housed an auto parts business
but was fully built-out during the mid-2000s to accommodate upscale office space for an
advertising company that later moved to a larger space in the Clearwater Industrial Park. This
space has recently housed a family member’s business but was listed for sale at $649,900 and sold
in roughly four months for use by this new firm to the Clearwater market. The site is fairly
cramped with only 27 front parking spaces supplemented by a leased back unpaved lot that fronts
Ewing Avenue for $200 monthly and added 24 spaces. The facility was in good basic condition
but required re-roofing by the seller.
Overall Price PSF: $56.63 ($579,900/10,240 = $56.63)
26
SALE COMPARISON #3
1050 HARBOR LAKE DRIVE, SAFETY HARBOR
AUGUST 21, 2018
Sales Price: $530,000
Date of Sale: August 2018
Grantor/Grantee: Cariba International Corp. et al./1050 Harbor Lake Drive, LLC.
Recording Data: O.R. Book 20161, Page 0237
Sale Confirmed With: Klein and Hutchen Realty
Land Size and Value: 100’ x 193’; $150,000
Description of the Improvements: 1984-built, single tenant masonry warehouse built on grade and
including some 7,000 SF of gross space. Roughly 1,100 SF was in finished office space with the
warehouse space having ample access doors to a fenced outside paved storage area. The property
was in good basic condition at the time of sale and included mostly original building components.
It had been priced at $595,000 and required roughly 3 months to sell.
Overall Price PSF: $75.71 ($530,000/7,000 = $75.71)
27
SALES COMPARISON RECAP CHART
Sale # Date of Sale Sales Price Building Size
In SF
FAR* Price PSF
1 5/16 $495,000 11,250 .54 $44.00
2 3/18 $579,900 10,240 .45 $56.63
3 8/18 $530,900 7,000 .36 $75.71
Subject -- -- 5,400 .49 --
* Floor Area Ratio (Floor Area/Land Area)
SALES COMPARISON ANALYSIS AND CONCLUSIONS:
These examples are considered representative of the value for smaller stand-alone
buildings sited on small land parcels. This segment of the downtown market is exceptionally
small with many former properties having been purchased for assemblage. While standard
warehouse/industrial type uses are not allowed, the structure would be suitable for a variety of
allowed uses that are favored in downtown. The parking would restrict many concepts, however,
the zoning intention favors even smaller properties similar to the subject.
The sales sold from $44.00-$75.71 PSF that is considered to bracket the subject value as
improved. Sale #1 is the most recent warehouse sale in the general district and was purchased for
continued storage/service use concepts. Sale #3 is another grade level warehouse located in the
superior Safety Harbor district just off McMullen Booth Road. This example is the best physical
comparison but has superior building features and location. Sale #1 has a fringe location off the
roadway and a cramped site that sold two years earlier in a weaker market period. That $44.00
PSF price then requires upward adjustment in relation to the subject.
Sale #2 is a former warehouse/sale facility built-out with office finishes. Given a slightly
inferior location but larger site area and the added build-out, this sale at $56.63 PSF is considered
superior to the subject.
After review of this scant data in downtown and a large variety of recent warehouse sales
located in mostly industrial settings in the $40.00-$60.00 PSF range, I would value the subject
within the $50.00-$55.00 PSF range.
28
5,400 SF @ $50.00 PSF = $270,000
5,400 SF @ $55.00 PSF = $297,000
ROUNDED TO $285,000
RECONCILIATION:
Land Value As Assembled $525,000
Income Analysis $300,000
Sales Comparison Approach $285,000
It is clear from review of these approaches that assemblage as part of the adjacent block
represents this concept. In addition to the known attempt by the city to relocate the CPTA bus
depot here, the major trend in downtown remains assemblage for gaining greater utility/density
in most sections of downtown.
My final value estimate then is the $525,000 figure.
ADDENDA
QUALIFICATIONS OF THE APPRAISER
JAMES M. MILLSPAUGH, MAI
APPRAISAL EXPERIENCE:
Appraisal experience in Pinellas County, Florida since 1968 when associated with Ross A.
Alexander, MAI of Clearwater. Formed James Millspaugh & Associates, June 1980, in
Clearwater. The firm concentrates the majority of its appraisal activities in Pinellas County with
experience throughout the Tampa/St. Petersburg/ Clearwater MSA.
APPRAISAL PLANT DATA:
In addition to maintaining its location near the main Pinellas County Courthouse complex for
easy access to governmental offices and the official public records maintained in the Clerk’s
office for in-depth background research, the firm maintains historical data from Real Estate Data
Services for Pinellas County, monthly CD data from First American Real Estate Solutions
(FARES), online service from Tampabayrealtor.com, the weekly Business Journal (Tampa Bay),
the monthly Maddux Report, the University of Florida Bureau of Economic and Business
Research, the St. Petersburg Times, the Marshall Valuation Service Cost Data, and national
surveys on lodging, food service, office, industrial parks, mini-storage and shopping center
markets.
COMMERCIAL APPRAISAL ASSIGNMENTS performed include golf courses, postal
facilities, commercial buildings, shopping centers, warehouse/manufacturing buildings, mobile
home and R.V. parks, financial institutions, nursing homes, motels, timeshares, restaurants,
houses of worship, office buildings, apartment buildings, commercial and residential
condominium projects (both proposed and conversions), marinas, theaters, fraternal buildings,
school facilities, seaport facilities, railroad corridors, easements, leasehold and leased fee estates,
life estates, vacant sites, including environmentally sensitive lands, and condemnation cases
involving partial and total takings. Feasibility/market studies have been performed for industrial,
office, retail, residential and timeshare markets.
APPRAISAL EDUCATION:
American Institute of Real Estate Appraisers (AIREA) courses successfully completed:
I-A: Basic Principles, Methods and Techniques - 1973
VIII: Single Family Residential Appraisal - 1973
I-B: Capitalization Theory and Techniques - 1974
II: Urban Properties - 1975
IV: Condemnation - 1978
: Standards of Professional Practice - 1992, Parts A & B
Society of Real Estate Appraisers (SREA) courses successfully completed:
301: Special Applications of Appraisal Analysis – 1980
JAMES M. MILLSPAUGH, MAI
(Qualifications Continued)
RECENT SEMINARS ATTENDED: Sponsored by The Appraisal Institute
Valuation of Wetlands, 2004.
Commercial Highest and Best Use – Case Studies:, 2005.
Uniform Standards (Yellow Book) for Federal Land Acquisitions, 2007.
Condominiums, Co-Ops and PUDS, 2007.
Analyzing Distressed Real Estate, 2007.
Appraisal Curriculum Overview, Two-Day General, 2009.
Cool Tools: New Technologies for Real Estate Appraisers, 2010.
Valuation of Detrimental Conditions, 2010.
Analyzing Tenant Credit Risk/Commercial Lease Analysis, 2011.
Fundamentals of Separating Real and Personal Property and Intangible Business Assets,
2012.
Marketability Studies: Advanced Considerations and Applications, 2013.
Lessons From the Old Economy: Working in the New, 2013.
Critical Thinking in Appraisals, 2014.
Litigation Appraising, 2015.
Webinars on the FEMA 50% Rule, Wind Turbine Effects on Value and Contamination and The
Valuation Process, 2015.
Florida State Law Update, 2018.
National USPAP Update, 2018.
Business Practice and Ethics, 2017.
Parking and its Impact on Florida Properties, 2018.
Solving Land Valuation Puzzles, 2018.
EDUCATION:
Bachelor of Science in Business Administration, University of Florida
Associates of Arts, St. Petersburg Junior College
PROFESSIONAL AFFILIATIONS AND CERTIFICATION
Member: Appraisal Institute with the MAI designation, Certificate #6087, awarded April,
1980. Mr. Millspaugh is a past President of The Gulf Atlantic Florida Chapter of the AI
(formerly Florida Chapter No. 2), served as an admissions team leader for the West Coast
Florida Chapter, is the past Chairman for the National Ethics Administration Division of the
Appraisal Institute and served as the Region X Member of the Appellate Division of the
Appraisal Institute. Mr. Millspaugh is a State-Certified General Real Estate Appraiser (RZ58)
and has served as a pro-bono expert witness for the Florida Real Estate Appraisal Board.
Member: Pinellas Realtors Organization, National Association of Realtors
Note: The AIREA and SREA merged into one organization on January 1, 1991, that is now
known as the AI - Appraisal Institute.
STANDARD DEFINITIONS
HIGHEST AND BEST USE:
1. The reasonably probable use of property that results in the highest value. The four criteria
that the highest and best use must meet are legal permissibility, physical possibility,
financial feasibility, and maximal productivity.
2. The use of an asset that maximizes its potential and that is possible, legally permissible,
and financially feasible. The highest and best use may be for continuation of an assets
existing use or for some alternative use. This is determined by the use that a market
participant would have in mind for the asset when formulating the price that it would be
willing to bid. (IVS)
3. [The] highest and most profitable use for which the property is adaptable and needed or
likely to be needed in the reasonably near future. (Uniform Appraisal Standards For
Federal Land Acquisitions)
FEE SIMPLE ESTATE: Absolute ownership unencumbered by any other interest or estate,
subject only to the limitations imposed by the governmental powers of taxation, eminent domain,
police power, and escheat.
LEASEHOLD INTEREST: The right held by the lessee to use and occupy real estate for a stated
term and under conditions specified in the lease.
LEASED FEE INTEREST: The ownership interest held by the lessor, which includes the right
to receive the contract rent specified in the lease plus the reversionary right when the lease
expires.
REPLACEMENT COST: The estimated cost to construct, at current prices as of a specific date,
a substitute for a building or other improvements, using modern materials and current standards,
design and layout.
REPRODUCTION COST: The estimated cost to construct, at current prices as of the effective
date of the appraisal, an exact duplicate or replica of the building being appraised, using the same
materials, construction standards, design, layout and quality of workmanship and embodying all
the deficiencies, super-adequacies, and obsolescence of the subject building.
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2. Appraisal Institute, The Dictionary of Real Estate Appraisal - Sixth Edition, 2015. pages
109, 90, 128, 197 and 198.