Concession Agreement

CONCESSION AGREEMENT FOR OPERATION OF
NONEXCLUSIVE DUTY AND TAX FREE CONCESSION,
TERMINAL BUILDING, MIAMI INTERNATIONAL AIRPORT


Miami Airport Duty Free Joint Venture
-----------------------------------------------------
Tenant


-----------------------------------------------------
Effective Date


PMD No. 000036
Reso. No. __________
Cust. No. __________
Lease No. __________ 2
CONCESSION AGREEMENT FOR OPERATION OF
NONEXCLUSIVE DUTY AND TAX FREE CONCESSION,
TERMINAL BUILDING, MIAMI INTERNATIONAL AIRPORT


Page
---- ARTICLE 1 Term and Premises.................................................................................... CA-1
1.01 Term............................................................................... CA-1
1.02 Extensions......................................................................... CA-1
1.03 Premises........................................................................... CA-1
1.04 DBE Subconcession.................................................................. CA-4
1.05 Addition or Deletion of Premises................................................... CA-4
1.06 Nonexclusivity..................................................................... CA-5
1.07 Proposal Incorporated.............................................................. CA-5


ARTICLE 2 Use of Premises...................................................................................... CA-5


ARTICLE 3 Rentals, Payments and Reports........................................................................ CA-6
3.01 Annual Rental...................................................................... CA-6
3.02 Rental Rate Adjustment............................................................. CA-10
3.03 Minimum Annual Guarantee........................................................... CA-10
3.04 Recalculations of Minimum Annual Guarantee......................................... CA-10
3.05 Monthly Opportunity Fee............................................................ CA-11
3.06 No Negotiations.................................................................... CA-11
3.07 Late Payment Charge................................................................ CA-11
3.08 Worthless Check or Draft........................................................... CA-11
3.09 Gross Revenues..................................................................... CA-11
3.10 Address for Payments............................................................... CA-12
3.11 Minimum Annual Guarantee Security.................................................. CA-13
3.12 Records and Reports................................................................ CA-13
3.13 Revenue Control Procedures......................................................... CA-13
3.14 Monthly Statement Required......................................................... CA-13
3.15 Annual Audit....................................................................... CA-14
3.16 Right to Audit..................................................................... CA-14
3.17 Utilities.......................................................................... CA-15
3.18 Purchase of In Place Assets........................................................ CA-15
3.19 Assignable Contracts/Agreements.................................................... CA-15
3.20 Joint Marketing or Advertising Programs............................................ CA-15


ARTICLE 4 Improvements to the Premises......................................................................... CA-16
4.01 Improvements to Premises........................................................... CA-16
4.02 Design of Improvements............................................................. CA-16


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4.03 Certain Construction Contract Terms................................................ CA-17
4.04 Improvements Free and Clear........................................................ CA-17
4.05 Construction Bonds and Insurance Required.......................................... CA-17
4.06 Other Requirements................................................................. CA-17
4.07 Review of Construction............................................................. CA-18
4.08 Cost Documentation................................................................. CA-18
4.09 Reimbursement of Improvement Costs................................................. CA-18


ARTICLE 5 Standards of Operation............................................................................... CA-19
5.01 Operating Hours.................................................................... CA-19
5.02 Pricing............................................................................ CA-19
5.03 Change Making...................................................................... CA-20
5.05 Prior Approval Required............................................................ CA-20
5.06 Personnel.......................................................................... CA-20
5.07 Monitoring Services................................................................ CA-20
5.08 Delivery of Goods for Off-Airport Duty Free Permittees............................. CA-21
5.09 Security........................................................................... CA-21
5.10 Security Identification Display Areas Access -- Identification Badges.............. CA-21
5.12 Alcohol and Drug Testing........................................................... CA-22
5.13 Special Programs................................................................... CA-22
5.14 Vehicle Permit and Company Identification.......................................... CA-22
5.15 Federal Agencies Right to Consent.................................................. CA-22
5.16 AOA - Right to Search.............................................................. CA-23
5.17 Control of Employees............................................................... CA-23


ARTICLE 6 Services to be Provided by the County................................................................ CA-23


ARTICLE 7 Equipment Furnishings and Fixtures................................................................... CA-24
7.01 Tenant Responsibilities............................................................ CA-24
7.02 Equipment, Furnishings and Fixtures:............................................... CA-24
7.03 Disposal of Equipment, Furnishings and Fixtures.................................... CA-24


ARTICLE 8 Maintenance and Utilities............................................................................ CA-25
8.01 Cleaning........................................................................... CA-25
8.02 Removal of Trash................................................................... CA-25
8.03 Maintenance and Repair............................................................. CA-25
8.04 Failure to Maintain................................................................ CA-25


-ii- 4
Page
---- ARTICLE 9 Assignment, Subletting and Ownership................................................................. CA-25
9.01 No Assignment or Subletting........................................................ CA-25
9.02 Ownership of the Tenant............................................................ CA-25
9.03 Subcontracting..................................................................... CA-26


ARTICLE 10 Indemnification...................................................................................... CA-26


ARTICLE 11 Insurance............................................................................................ CA-26
11.01 Insurance Required................................................................. CA-26
11.02 Insurance Certificates Required.................................................... CA-27
11.03 Tenant Liable...................................................................... CA-28
11.04 Right to Examine................................................................... CA-28
11.05 Personal Property.................................................................. CA-28


ARTICLE 12 Termination by County................................................................................ CA-28
12.01 Termination for Abandonment........................................................ CA-28
12.02 Payment Default.................................................................... CA-28
12.03 Other Defaults..................................................................... CA-28
12.04 Habitual Default................................................................... CA-29
12.05 Drug-Free Workplace Default........................................................ CA-29
12.06 Family Leave Program Default....................................................... CA-30


ARTICLE 13 Claims and Termination by Tenant..................................................................... CA-30
13.01 Claims Procedures.................................................................. CA-30
13.02 Penalty............................................................................ CA-30
13.03 Abatement.......................................................................... CA-30
13.04 Termination........................................................................ CA-31


ARTICLE 14 Nondiscrimination.................................................................................... CA-31
14.01 Employment Discrimination:......................................................... CA-31
14.02 Nondiscriminatory Access to Services............................................... CA-31
14.03 Breach of Nondiscrimination Covenants.............................................. CA-32
14.04 Affirmative Action and Disadvantaged Business Enterprise Programs.................. CA-32
14.05 Disadvantaged Business Enterprise Participation Plan............................... CA-32


ARTICLE 15 Rules, Regulations and Permits....................................................................... CA-33
15.01 Rules and Regulations.............................................................. CA-33


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Page
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15.02 Violations of Rules and Regulations................................................ CA-33
15.03 Permits and Licenses............................................................... CA-33
15.04 U.S. Customs Penalties............................................................. CA-34


ARTICLE 16 Civil Actions........................................................................................ CA-34
16.01 Governing Law; Venue............................................................... CA-34
16.02 Notice of Commencement of Civil Action............................................. CA-34
16.03 Registered Office/Agent; Jurisdiction:............................................. CA-34


ARTICLE 17 Actions at Termination............................................................................... CA-35
17.01 Surrender of Premises.............................................................. CA-35
17.02 Removal of Personal Property....................................................... CA-35
17.03 Failure to Vacate.................................................................. CA-35
17.04 Right to Show Premises............................................................. CA-35


ARTICLE 18 Trust Agreement...................................................................................... CA-35
18.01 Incorporation of Trust Agreement by Reference...................................... CA-35
18.02 Adjustment of Terms and Conditions:................................................ CA-36
18.03 Tenant Right to Terminate:......................................................... CA-36


ARTICLE 19 Other Provisions..................................................................................... CA-36
19.01 Payment of Taxes................................................................... CA-36
19.02 Alterations by Tenant.............................................................. CA-36
19.04 Security........................................................................... CA-37
19.05 Rights of County at Airport........................................................ CA-37
19.06 Federal Subordination.............................................................. CA-37
19.07 Notices............................................................................ CA-37
19.08 Severability....................................................................... CA-38
19.09 Rights Reserved to County.......................................................... CA-38
19.10 Lien............................................................................... CA-38
19.11 Authorized Uses Only............................................................... CA-38
19.12 No Waiver.......................................................................... CA-38
19.13 Right to Regulate.................................................................. CA-38
19.14 Inspections........................................................................ CA-38
19.15 Radon Disclosure................................................................... CA-38
19.16 Trademarks and Licenses............................................................ CA-39
19.17 Destruction of Premises............................................................ CA-39
19.18 Headings........................................................................... CA-40
19.19 Binding Effect..................................................................... CA-40


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Page
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19.20 Entirety of Agreement.............................................................. CA-40
19.21 Addendum to Agreement.............................................................. CA-40


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CONCESSION AGREEMENT FOR OPERATION OF
NONEXCLUSIVE DUTY AND TAX FREE CONCESSION,
TERMINAL BUILDING, MIAMI INTERNATIONAL AIRPORT,
BETWEEN DADE COUNTY, FLORIDA AND
MIAMI AIRPORT DUTY FREE JOINT VENTURE


THIS AGREEMENT ("Agreement") is made and entered into as of the ______ day of ____________, 1995, by and between the BOARD OF COUNTY COMMISSIONERS OF DADE COUNTY, FLORIDA ("County") and MIAMI AIRPORT DUTY FREE JOINT VENTURE, a joint venture corporation, authorized to do business in the State of Florida ("Tenant").


W I T N E S S E T H:


NOW, THEREFORE, for and in consideration of the premises and the mutual covenants herein contained, the parties agree as follows:


ARTICLE 1
Term and Premises


1.01 Term: The County hereby leases to the Tenant for a term of five years, commencing on December 1, 1995 and ending on November 30, 2000, unless otherwise terminated as provided for herein, certain premises described below and do hereby grant to the Tenant a nonexclusive Duty Free Concession ("Concession") in the Terminal Building at Miami International Airport ("Airport"), as more fully described in Article 2 hereof.


1.02 Extensions: The County reserves the right, in its sole discretion, to extend this Agreement for five separate terms of one year each, upon the terms and conditions contained herein. Such right may be exercised by the Aviation Department of the County ("Department") on behalf of the County. In the event the Department elects to extend this Agreement, the Tenant shall be notified, in writing, at least 300 days prior to the then scheduled termination date of this Agreement. In the event the Department does not give such notice, this Agreement shall terminate accordingly. The Tenant shall, within 30 days following receipt of notice from the Department, have the right to reject any such extension by written notice to the Department and, if so rejected, this Agreement shall terminate as provided in Article 1.01 (Term) above or upon the termination of any extension thereof, as appropriate. Failure of the Tenant to respond to the Department within the 30-day period shall automatically constitute acceptance of the extension.


1.03 Premises: The County hereby leases to the Tenant the premises ("Premises") on the first, second and third floors of the Terminal Building, all as shown on Exhibit A, and


CA-1 8 further identified by Dade County Aviation Department identification number(s) ("ID#") as follows:


2,037 square feet of air-conditioned
Class I space
Exhibit A, Store #1, ID# 6E2180


4,583 square feet of air-conditioned
Class I space
Exhibit A, Store #2/9, ID# 6F2636


3,905 square feet of air-conditioned
Class I space
Exhibit A, Store #3/4, ID# 6B2464


2,075 square feet of air-conditioned
Class II space
Exhibit A, Store #5, ID# 6S3847


367 square feet of air-conditioned
Class II space
Exhibit A, Store #6, ID# 6S2545


1,821 square feet of air-conditioned
Class II space
Exhibit A, Store #7, ID# 6B2848


1,430 square feet of air-conditioned
Class II space
Exhibit A, Store #8, ID# 6D2875


947 square feet of air-conditioned
Class II space
Exhibit A, Store #10, ID# 6E2778


621 square feet of air-conditioned
Class II space
Exhibit A, Store #11, ID# 6F2852


60 square feet of air-conditioned
Class II space
Exhibit A, Cart #12, no ID#


CA-2 9
536 square feet of air-conditioned
Class II space
Exhibit A, Store #14, ID# 6C2769


153 square feet of air-conditioned
Class II space
Exhibit A, Store #15, ID# 6D3601


614 square feet of air-conditioned
Class II space
Exhibit A, Store #16, ID# 6B3872


1,178 square feet of air-conditioned
Class II space
Exhibit A, Store #17, ID# 6C2001


48 square feet of air-conditioned
Class II space
Exhibit A, Store #18, no ID#


227 square feet of air-conditioned
Class II space
Exhibit A, Store #19, ID# 6D2957


176 square feet of air-conditioned
Class II space
Exhibit A, Store #20, ID# 6F3898


4,116 square feet of air-conditioned
Class II space
Exhibit A, Store #21, ID# 6A2141


711 square feet of air-conditioned
Class II space
Exhibit A, Store #22, ID# 6A3154


3,414 square feet of air-conditioned
Class II space
Exhibit A, Store #27, ID# 6G2190


256 square feet of air-conditioned
Class II space
Exhibit A, Store #30 Kiosk


CA-3 10
48 square feet of air-conditioned
Class II space
Exhibit A, Booth #32


48 square feet of air-conditioned
Class II space
Exhibit A, Booth #33


5,795 square feet of air-conditioned
Class III space
Exhibit A, Office, ID# 3E3870


10,327 square feet of air-conditioned
Class III space
Exhibit A, Warehouse, ID# 3E1839


1,930 square feet of air-conditioned
Class III space
Exhibit A, Bulk Warehouse, ID# 3E1775


4,547 square feet of air-conditioned
Class III space
Exhibit A, Warehouse, ID# 6A1157


2,555 square feet of air-conditioned
Class III space
Exhibit A, Storage, ID# 3C1759


TOTAL SQUARE FOOTAGE: 54,269


1.04 DBE Subconcession: One or more stores may be designated by the Tenant as a disadvantaged business enterprise store and the Tenant may enter into a sublease agreement with a certified Disadvantaged Business Enterprise ("DBE"), approved by the County, from which such DBE shall operate a duty and tax free concession. Such sublease arrangement shall be in accordance with the Proposal submitted by the Tenant, under which this Concession was awarded, pursuant to Article 1.07 hereof.


1.05 Addition or Deletion of Premises: The Department reserves the right to delete, relocate or modify any of the Premises at its sole discretion due to Airport Terminal construction or operational necessity. Relocated space may not be similar in size or configuration to the Premises leased herein. In the event of any such Department required deletion, relocation or modification, the Department shall pay any unamortized construction costs of the Tenant of the existing premises, pursuant to Article 4.09 (amortized on a 60-month


CA-4 11 straight line basis from the effective date of this Agreement) and the Tenant shall pay the construction costs for the new or modified premises.


The Department and the Tenant may, by mutual agreement, add other premises hereunder for such rental rates as set forth in Articles 3.01 and 3.02, and subject to the Monthly Opportunity Fee payments in accordance with Article 3.05 hereof, and all costs associated therewith shall be paid by the Tenant. The Department and the Tenant shall agree to the length of the amortization schedule, but not to exceed 60 months calculated from the date of beneficial occupancy, of any added premises based on the investment and profitability of the facility.


This Agreement shall be administratively revised to reflect any deletions, modifications, relocations, or additions, upon 30 days' written notice to the Tenant by the Department. Such notification will include a revised Exhibit A and appropriate changes to premises in Article 1.03 and rentals due in Articles 3.01 and 3.02. The Department and the Tenant may, by mutual agreement, adjust the Minimum Annual Guarantee for any deleted premises. Such deletion shall not affect the Monthly Opportunity Fee payments due hereunder.


1.06 Nonexclusivity: This Agreement is nonexclusive in character and in no way prevents the County from authorizing the sale or offering of competitive services, products or items by other tenants or others in other premises at the Airport. The Tenant shall have no rights to any other concession or concession space that may be made available by the County.


1.07 Proposal Incorporated: The Tenant acknowledges that it has submitted to the County a proposal ("Proposal") that was the basis for the award of this Agreement and upon which the County has relied. IN THE EVENT THERE ARE ANY CONFLICTS BETWEEN PROVISIONS OF THE PROPOSAL AND THE CONCESSION AGREEMENT, THE TERMS OF THE CONCESSION AGREEMENT SHALL GOVERN. The Proposal of the Tenant is hereby incorporated into this Agreement by reference ...