2013-28239 Reso RESOLUTION NO. 2013-28239
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI
BEACH, FLORIDA, APPROVING AND AUTHORIZING THE MAYOR AND CITY
CLERK TO EXECUTE AMENDMENT NO. 3 TO THAT CERTAIN RETAIL LEASE
AGREEMENT BY AND BETWEEN THE CITY OF MIAMI BEACH, THE MIAMI BEACH
REDEVELOPMENT AGENCY (COLLECTIVELY, LANDLORD), AND PENN 17, LLC
(TENANT), DATED SEPTEMBER 16, 2011, INVOLVING THE LEASE OF
APPROXIMATELY 7,655 SQUARE FEET OF GROUND FLOOR RETAIL SPACE AT
THE PENNSYLVANIA AVENUE GARAGE, 1661 PENNSYLVANIA AVENUE, MIAMI
BEACH, FLORIDA; AND FURTHER APPROVING, FOLLOWING A DULY NOTICED
PUBLIC HEARING AS REQUIRED BY SECTION 142-362 OF THE CITY OF MIAMI
BEACH CODE, AN ENTERTAINMENT COMPONENT, WHICH WILL BE ADDED AS
AN ADDITIONAL USE OF THE LEASED PREMISES IN CONJUNCTION WITH
TENANT'S RE-OPENING AND RE-BRANDING OF SUCH PREMISES.
WHEREAS, on April 13, 2011, the Mayor and City Commission adopted Resolution No.
2011-27647, approving a Lease Agreement (the "Lease"), between the City, the RDA
(collectively, City/RDA or Landlord) and Penn 17 LLC. (Tenant), having a term of nine (9) years
and 364 days, for use of approximately 7,655 square feet of ground level retail space at the
Pennsylvania Avenue Garage, 1661 Pennsylvania Avenue, Miami Beach, Florida, for a
restaurant (primary use), with ancillary uses for a bakery, a bar/cafe, and a book and gift shop
(the "Leased Premises" or "Premises"), which Lease was subsequently amended by First
Amendment to the Lease (Resolution No. 2012-0000) and Second Amendment to the Lease
(Resolution No. 2012-27925); and
WHEREAS, the Premises, which housed the Cooper Avenue Restaurant, have been
closed since December 17, 2012; and
WHEREAS, following Tenant's request for a rent reduction and other relief, on
December 20, 2012, and January 24, 2013, the City's Finance & Citywide Projects Committee
(FCWPC) expressed support for providing some level of relief to the Tenant, subject to the
inclusion of specific release language absolving the City of any liability regarding Tenant's cost
overruns and claims related to loss of business, and therefore recommended in favor of the
following terms: 1) applying one-third (1/3) of the Tenant's existing Security Deposit,
representing $47,844, towards Base Rent owed for the month of November, 2012; 2) deferring
$8,474 for Common Area Maintenance (CAM) for November, 2012, and Base Rent, plus CAM,
for December 2012, in the total amount of $64,792 (Back-Due Rent); 3) approving an
abatement of 50% of the Base Rent and Common Area Maintenance (CAM) due for the six (6)
month period commencing January 13, 2013 through July 12, 2013; 4) deferring fifty percent
(50%) of the Base Rent and CAM for the six (6) month period, commencing July 13, 2013
through January 14, 2014 ("Deferral Period"), to be repaid by the Tenant in twenty four (24)
equal monthly installments, commencing in the sixth year of the Lease Term and ending on the
last day of the seventh year of the Lease Term; and 5) providing for re-payment by Tenant of
the one-third security deposit in the amount of $47,844 and re-payment of the Back-Due Rent
for November and December, 2012, in the amount of $64,791, to be repaid in twelve (12) equal
monthly installments commencing in the fifth year of the Lease Term and ending on the last day
of the fifth year of the Lease Term.
WHEREAS, on March 13, 2013, Mayor and City Commission adopted Resolution No.
2013-28167 (in conjunction with RDA Resolution No. 592-2013), accepting the FCWPC's
recommendation, and approving, in concept, the proposed terms for an Amendment No. 3 to
the Lease (which amendment, upon future final approval by the City/RDA, would include a
limited rent reduction and deferral plan, as well as a plan for Tenant's re-opening of the
Premises); and
WHEREAS, as further consideration for the City Commission's adoption of Resolution
No. 2013-28167, and conceptual approval for the rent reduction and deferral schedule, the
City/RDA required (and Tenant agreed to provide) a general release from Tenant, releasing the
City/RDA from any and all claims under the Lease; and
WHEREAS, Tenant's plan to re-open the Premises included a plan to "re-brand" the
Premises under a different restaurant concept, which proposed including an entertainment
component (i.e. Tenant contemplated using part of the Premises as a lounge, featuring a
combination of a deejay and live music); and
WHEREAS, as required by City Code Section 142-362, the proposed entertainment use
requires City Commission approval, following a duly noticed public hearing; accordingly, as part
of its approval of Resolution No. 2013-28167, the City Commission set a public hearing for April
17, 2013, to consider approval of Tenant's proposed entertainment use; and
WHEREAS, as of April 17, 2013, Tenant had not been able to solidify its plans for re-
opening the Premises and resolving other outstanding Lease issues; in order to allow Tenant
more time to resolve such outstanding issues, the City agreed to continue the public hearing
(and consideration of Amendment No. 3)to May 8, 2013; and
WHEREAS, on May 8, 2013, following Tenant's execution and delivery(on May 3, 2013)
of the general release to the City/RDA, the City opened and continued the public hearing (and
consideration of Amendment No. 3)to June 5, 2013; and
WHEREAS, thereafter, Tenant failed to adequately resolve the following outstanding
Lease issues: 1) Tenant failed to satisfy and/or otherwise resolve two (2) liens that had been
placed on the Premises (one of these liens resulting in the filing of a lawsuit against the City to
reclaim the unpaid monies); and 2)Tenant breached the Work Letter and Escrow Agreement by
failing to maintain its required minimum $50,000 Construction Deposit in the Lease Construction
Fund; and (3) failed to pay the May and June, 2013 rent; and (4) Tenant's managing member,
Amir Ben-Zion, advised the City, on May 15, 2013, that it had no intention of re-opening the
Leased Premises; and (5) unbeknownst to the City/RDA and without their required approval
under the Lease, subsequent to the execution of the Lease, Tenant's managing member, Mr.
Ben-Zion, transferred a 50% interest in Penn 17 LLC, to a Mr. Roman Cherstvov.
WHEREAS, on or about May 14, 2013, the City was notified of a sale proposal to sell
Mr. Ben-Zion's 50% managing interest in Penn 17 LLC (the Tenant entity), to a new entity, OBK
Project LLC (OBK), whereby Penn 17 LLC would continue as the Tenant under the Lease
(without Mr. Ben-Zion as a manager member), and Mr. Cherstvov and OBK would each have a
fifty percent (50%) membership interest in the Tenant entity; and
WHEREAS, in consideration of the City's agreement to set aside Tenant's default;
approval of OBK as a new owner/member of the Tenant entity (along with Mr. Cherstvov);
approval of a limited entertainment use on the Premises (which use, as proposed by Tenant,
would be in conjunction with, and only during, operation of the restaurant); and approval and
execution of Amendment No. 3 (including the limited rent reduction and deferral schedule
conceptually approved pursuant to City Resolution No. 2013-28167 and RDA Resolution No.
592-2013), Tenant agreed to:
1. pay the past due rent for May and June, 2013 and subsequent rent/Lease
obligations;
2. allow the disbursement of the outstanding balances of rent for November and
December, 2012 from the Security Deposit, and replenishing said disbursement over
a period of six (6) months, commencing on .October 1, 2013, and ending March 1,
2014;
3. re-deposit the minimum required $50,000 Construction Deposit into the Tenant
Construction Fund (under the Escrow Agreement);
4. be solely responsible for paying and prosecuting the work related to Tenant's prior
request to re-locate the Premises' air conditioning units to the roof of the
Pennsylvania Avenue Garage;
5. resolve and/or otherwise satisfy any outstanding contractor and sub-contractors liens
against the Premises; and
6. provide the City/RDA with an updated general release, releasing City/RDA from any
and all claims under the Lease.
NOVA, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City
Commission hereby approve and authorize the Mayor and City Clerk to execute Amendment
No. 3 to that certain Retail Lease Agreement by and between the City of Miami Beach, The
Miami Beach Redevelopment Agency (collectively, Landlord) and Penn 17, LLC. (Tenant),
dated September 16, 2011, involving the lease of approximately 7,655 square feet of ground
floor retail space at the Pennsylvania Avenue Garage, 1661 Pennsylvania Avenue, Miami
Beach, Florida; and further approving an entertainment component, which has been the subject
of a public hearing as required by Section 142-362 of the City of Miami Beach Code, which will
be added as an additional use of the Leased Premises, in conjunction with Tenant's re-opening
and re-branding of such Premises.
PASSED AND ADOPTS TH DAY OF JUNE, 2013.
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MAYOR
ATTEST: " INCORP ORATED:
CWY CLERK N��� 2-6
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APPROVED AS TO
TAAGENDA\2013\June 5\Penn 17 LLC CMB RESO.doc FORM &LANGUAGE
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EXHIBIT"1"-REVISED RENT SCHEDULE
NOTES:
September,2012 deferment($20,000)Re.Letter Agreement
of 9-10-2012 re relocation of Kitchen exhaust system.
June,2012 Min.Rent was abated per Amend.No.2
(1)Repayment of July 2012 and August 2012 Rent($95,688.00)
per Amend.No.2,paid years 3-5
50%Min.Rent abatement for Jan.2013-June,2013 per Amend.No.3
(2)Repayment of July 2013-Dec.2013 deferred Rent($171,106.59)
per Amend.No.3,paid years 6-7
(3)Replenish Tenant Deposit for application of funds
to Nov.and Dec.,2012 Min.Rent and Cam($112,636.00)
per Amend.No.3,paid Oct,2013-March,2014
Penn 17,LLC Proposed Rent Schedule
Lease Commencement October 13,2011 Rent Commencemen t: April 14,2012
Lease termination: October 11,2021
Current Revised
Lease Years:1 and 2 Rent Rent Total Monthly Total Monthly
Minimum Rent Repayment Repayment CAM('") Abatement Deferment Payment Payment
$ 21,716.67 $ 4,393.07 $ 26,1 09.74
5/1/2012 $ 47,844.00 $ 8,237.00 $ 56,081.00
6/1/2012 $ 47,844.00 $ 8,474.00 $ (47,844.00) $ 56,318.00 $ 8,474.00
7/1/2012 $ 47,844.00 $ 8,474.00 $ (47,844.00) $ 56,318.00 $ 8,474.00
8/1/2012 $ 47,844.00 $ 8,474.00 $ (47,844.00) $ 56,318.00 $ 8,474.00
9/1/2012 $ 47,844.00 $ 8,474.00 $ (20.000.00) $ 56,318.00 $ 36,318.00
10/1/2012 $ 47,844.00 $ 8,474.00 $ 56,318.00
11/1/2012 $ 47,844.00 $ 8,474.00 $ 56,318.00
12/1/2012 $ 47,844.00 $ 8,474.00 $ 56,318.00
01/01/13 $ 47,844.00 $ 8,474.00 $ (28,159.00) $ $ 56,318.00 $ 28,159,00
02/01/13 $ 47,844.00 $ 8,474.00 $ (28,159.00) $ $ 56,318.00 $ 28,159.00
03/01/13 $ 47,844.00 $ 8,474.00 $ (28,159.00) $ $ 56,318.00 $ 28,159.00
04/01/13 $ 47,844.00 $ 8,474.00 $ (28,159.00) $ $ 56,318.00 $ 28,159.00
05/01/13 $ 47,844.00 $ 8,474.00 $ (28,159.00) $ $ 56,318.00 $ 28,159.00
06/01/13 $ 47,844.00 $ 8,474.00 $ (28,159.00) $ $ 56,318.00 $ 28,159.00
07/01/13 $ 47,844.00 $ 8,474.00 $ $ (28,159.00) $ 56,318.00 $ 28,159.00
08/01/13 $ 47,844.00 $ 8,474.00 $ $ (28,159.00) $ 56,318.00 $ 28,159.00
09/01/13 $ 47,844.00 $ 8,474.00 $ $ (28,159.00) $ 56,318.00 $ 28,159.00
Total: $ 835,064.67 $ 76,266.00 $(168,954.00) $ (84,477.00) $506,862.00 $ 253,431.00
Current Revised
Lease Year:3 Rent Rent Total Monthly Total Monthly
Minimum Rent(•) Repayment(1) Repayment(3) CAM(•') Abatement Deferment Payment Payment
$ 49,279.32 $ 2,658.00 $ 18,772.67 $ 8,474.00 $ $ (28,876.53) $ 60,411.32 $ 50,307.46
11/01/13 $ 49,279.32 $ 2,658.00 $ 18,772.67 $ 8,474.00 $ $ (28,876.53) $ 60,411.32 $ 50,307.46
12/01/13 $ 49,279.32 $ 2,658.00 $ 18,772.67 $ 8,474.00 $ $ (28,876.53) $ 60,411.32 $ 50,307.46
01/01/14 $ 49,279.32 $ 2,658.00 $ 18,772.67 $ 8,474.00 $ $ $ 60,411.32 $ 79,183.99
02/01/14 $ 49,279.32 $ 2,658.00 $ 18,772.67 $ 8,474.00 $ $ $ 60,411.32 $ 79,183.99
03/01/14 $ 49,279.32 $ 2,658.00 $ 18,772.67 $ 8,474.00 $ $ $ 60,411.32 $ 79,183.99
04/01/14 $ 49,279.32 $ 2,658.00 $ 8,474.00 $ $ $ 60,411.32 $ 60,411.32
05/01/14 $ 49,279.32 $ 2,658.00 $ 8,474.00 $ $ $ 60,411.32 $ 60,411.32
06/01/14 $ 49,279.32 $ 2,658.00 $ 8,474.00 $ $ $ 60,411.32 $ 60,411.32
07/01/14 $ 49,279.32 $ 2,658.00 $ 8,474.00 $ $ $ 60,411.32 $ 60,411.32
08/01/14 $ 49,279.32 $ 2,658.00 $ 8,474.00 $ $ $ 60,411.32 $ 60,411.32
09/01/14 $ 49,279.32 $ 2,658.00 $ 8,474.00 $ $ $ 60,411.32 $ 60,411.32
Total: $ 591,351.84 $ 31,896.00 $ 101,688.00 $ $ (86,629.59) $724,935.84 $ 638,306.25
Current Revised
Lease Year 4 Rent Rent Total Monthly Total Monthly
Minimum Rent(•) Repayment(1) Repayment(3) CAM(") Abatement Deferment Payment Payment
$ 50,757.70 $ 2,658.00 $ 8,474.00 $ $ $ 61,889.70 $ 61,889.70
11/01/14 $ 50,757.70 $ 2,658.00 $ 8,474.00 $ $ $ 61,889.70 $ 61,889.70
12/01/14 $ 50,757.70 $ 2,658.00 $ 8,474.00 $ $ $ 61,889.70 $ 61,889.70
01/01/15 $ 50,757.70 $ 2,658.00 $ 8,474.00 $ $ $ 61,889.70 $ 61,889.70
02/01/15 $ 50,757.70 $ 2,658.00 $ 8,474.00 $ $ $ 61,889.70 $ 61,889.70
03/01/15 $ 50,757.70 $ 2,658.00 $ 8,474.00 $ $ $ 61,889.70 $ 61,889.70
04/01/15 $ 50,757.70 $ 2,658.00 $ 8,474.00 $ $ $ 61,889.70 $ 61,889.70
05/01/15 $ 50,757.70 $ 2,658.00 $ 8,474.00 $ $ $ 61,889.70 $ 61,889.70
06/01/15 $ 50,757.70 $ 2,658.00 $ 8,474.00 $ $ $ 61,889.70 $ 61,889.70
07/01/15 $ 50,757.70 $ 2,658.00 $ 8,474.00 $ $ $ 61,889.70 $ 61,889.70
08/01/15 $ 50,757.70 $ 2,658.00 $ 8,474.00 $ $ $ 61,889.70 $ 61,889.70
09/01/15 $ 50,757.70 $ 2,658.00 $ 8,474.00 $ $ $ 61,889.70 $ 61,889.70
Total: $ 609,092.40 $ 31,896.00 $ 101,688.00 $ $ $742,676.40 $ 742,676.40
Page 1 of 3
Current Revised
Lease Year 5 Rent Rent Total Monthly Total Monthly
Minimum Rent(•) Repayment(1) CAM(") Abatement Deferment Payment Payment
$ 52,280.43 $ 2,658.00 $ 8,474.00 $ $ $ 63,412.43 $ 63,412.43
11/01/15 $ 52,280.43 $ 2,658.00; $ 8,474.00 $ $ $ 63,412.43 $ 63,412.43
12/01/15 $ 52,280.43 $ 2,658.00 $ 8,474.00 $ $ $ 63,412.43 $ 63,412.43
01/01/16 $ 52,280.43 $ 2,658.001, $ 8,474.00 $ $ $ 63,412.43 $ 63,412.43
02/01/16 $ 52,280.43 $ 2,658.00, $ 8,474.00 $ $ $ 63,412.43 $ 63,412.43
03/01/16 $ 52,280.43 $ 2,658.00'' $ 8,474.00 $ $ $ 63,412.43 $ 63,412.43
04/01/16 $ 52,280.43 $ 2,658.00 $ 8,474.00 $ $ $ 63,412.43 $ 63,412.43
05/01/16 $ 52,280.43 $ 2,658.00 $ 8,474.00 $ $ $ 63,412.43 $ 63,412.43
06/01/16 $ 52,280.43 $ 2,658.00 $ 8,474.00 $ $ $ 63,412.43 $ 63,412.43
07/01/16 $ 52,280.43 $ 2,658.00 $ 8,474.00 $ $ $ 63,412.43 $ 63,412.43
08/01/16 $ 52,280.43 $ 2,658.00 $ 8,474.00 $ $ $ 63,412.43 $ 63,412.43
09/01/16 $ 52,280.43 $ 2,658.00 $ 8,474.00 $ $ $ 63,412.43 $ 63,412.43
Total: $ 627,365.16 $ 31,896.00 $ 101,688.00 $ - $ - $760,949.16 $ 760,949.16
Current Revised
Lease Year 6 Rent Rent Total Monthly Total Monthly
Minimum Rent(•) Repayment(2) CAM('") Abatement Deferment Payment Payment
$ 53,848.84 $ 7,129.44 $ 8,474.00 $ $ $ 62,322.84 $ 69,452.28
11/01/16 $ 53,848.84 $ 7,129.44 $ 8,474.00 $ $ $ 62,322.84 $ 69,452.28
12/01/16 $ 53,848.84 $ 7,129.44 $ 8,474.00 $ $ $ 62,322.84 $ 69,452.28
01/01/17 $ 53,848.84 1 7,129.44 $ 8,474.00 $ $ $ 62,322.84 $ 69,452.28
02/01/17 $ 53,848.84 $ 7,129.44 $ 8,474.00 $ $ $ 62,322.84 $ 69,452.28
03/01/17 $ 53,848.84 $ 7,129.44 $ 8,474.00 $ $ $ 62,322.84 $ 69,452.28
04101117 $ 53,848.84 $ 7,129.44 $ 8,474.00 $ $ $ 62,322.84 $ 69,452.28
05/01/17 $ 53,848.84 $ 7,129.44 $ 8,474.00 $ $ $ 62,322.84 $ 69,452.28
06101117 $ 53,848.84 $ 7,129.44 $ 8,474.00 $ $ $ 62,322.84 $ 69,452.28
07101117 $ 53,848.84 $ 7,129.44 $ 8,474.00 $ $ $ 62,322.84 $ 69,452.28
08/01/17 $ 53,848.84 $ 7,129.44 $ 8,474.00 $ $ $ 62,322.84 $ 69,452.28
09/01/17 $ 53,848.84 $ 7,129.44 $ 8,474.00 $ $ $ 62,322.84 $ 69,452.28
Total: $ 646,186.08 $ 85,553.28 $ 101,688.00 $ $ $747,874.08 $ 833,427.36
Current Revised
Lease Year 7 Rent Rent Total Monthly Total Monthly
Minimum Rent(•) Repayment(2) CAM(") Abatement Deferment Payment Payment
-�� $ 55,464.31 $ 7,129.44 $ 8,474.00 $ $ $ 63,938.31 $ 71,067.75
11/01/17 $ 55,464.31 $ 7,129.44 $ 8,474.00 $ $ $ 63,938.31 $ 71,067.75
12/01/17 $ 55,464.31 $ 7,129.44 $ 8,474.00 $ $ $ 63,938.31 $ 71,067.75
01/01/18 $ 55,464.31 $ 7,129.44 $ 8,474.00 $ $ $ 63,938.31 $ 71,067.75
02/01/18 $ 55,464.31 $ 7,129.44 $ 8,474.00 $ $ $ 63,938.31 $ 71,067.75
03/01/18 $ 55,464.31 $ 7,129.44 $ 8,474.00 $ $ $ 63,938.31 $ 71,067.75
04/01/18 $ 55,464.31 $ 7,129.44 $ 8,474.00 $ $ $ 63,938.31 $ 71,067.75
05/01/18 $ 55,464.31 $ 7,129.44 $ 8,474.00 $ $ $ 63,938.31 $ 71,067.75
06/01/18 $ 55,464.31 $ 7,129.44 $ 8,474.00 $ $ $ 63,938.31 $ 71,067.75
07/01/18 $ 55,464.31 $ 7,129.44 $ 8,474.00 $ $ $ 63,938.31 $ 71,067.75
08/01/18 $ 55,464.31 $ 7,129.44 $ 8,474.00 $ $ $ 63,938.31 $ 71,067.75
09/01/18 $ 55,464.31 $ 7,129.44 $ 8,474.00 $ $ $ 63,938.31 $ 71,067.75
Total: $ 665,571.72 $ 85,553.28 $ 101,688.00 $ $ $767,259.72 $ 852,813.00
Page 2 of 3
�c 0 ED
Y
Lease Year:8 Total Monthly
Minimum Rent(`) CAM(`) Payment
$ 57,128.23 $ 8,474.00 $ 65,602.23
11/01/18 $ 57,128.23 $ 8,474.00 $ 65,602.23
12/01/18 $ 57,128.23 $ 8,474.00 $ 65,602.23
01/01/19 $ 57,128.23 $ 8,474.00 $ 65,602.23
02/01/19 $ 57,128.23 $ 8,474.00 $ 65,602.23
03/01/19 $ 57,128.23 $ 8,474.00 $ 65,602.23
04/01/19 $ 57,128.23 $ 8,474.00 $ 65,602.23
05/01/19 $ 57,128.23 $ 8,474.00 $ 65,602.23
06/01/19 $ 57,128.23 $ 8,474.00 $ 65,602.23
07/01/19 $ 57,128.23 $ 8,474.00 $ 65,602.23
08/01/19 $ 57,128.23 $ 8,474.00 $ 65,602.23
09/01/19 $ 57,128.23 $ 8,474.00 $ 65,602.23
Total: $ 685,538.76 $ 101,688.00 $ 787,226.76
Lease Year:9 Total Monthly
Minimum Rent(•) CAM(`•) Payment
$ 58,842.08 $ 8,474.00 $ 67,316.08
11/01/19 $ 58,842.08 $ 8,474.00 $ 67,316.08
12/01/19 $ 58,842.08 $ 8,474.00 $ 67,316.08
01/01/20 $ 58,842.08 $ 8,474.00 $ 67,316.08
02/01/20 $ 58,842.08 $ 8,474.00 $ 67,316.08
03/01/20 $ 58,842.08 $ 8,474.00 $ 67,316.08
04/01/20 $ 58,842.08 $ 8,474.00 $ 67,316.08
05/01/20 $ 58,842.08 $ 8,474.00 $ 67,316.08
06/01/20 $ 58,842.08 3 8,474.00 $ 67,316.08
07/01/20 $ 58,842.08 $ 8,474.00 $ 67,316.08
08/01/20 $ 58,842.08 $ 8,474.00 $ 67,316.08
09/01/20 $ 58,842.08 3 8,474.00 $ 67,316.08
Total: $ 706,104.96 $ 101,688.00 $ 807,792.96
Lease Year:10 Total Monthly
Minimum Rent(`) CAM("") Payment
�a 1l3G..... $ 60,607.34 $ 8,474.00 $ 69,081.34
11/01/20 $ 60,607.34 $ 8,474.00 $ 69,081.34
12/01/20 $ 60,607.34 $ 8,474.00 $ 69,081.34
01/01/21 $ 60,607.34 $ 8,474.00 $ 69,081.34
02/01/21 $ 60,607.34 $ 8,474.00 $ 69,081.34
03/01/21 $ 60,607.34 $ 8,474.00 $ 69,081.34
04/01/21 $ 60,607.34 $ 8,474.00 $ 69,081.34
05/01/21 $ 60,607.34 $ 8,474.00 $ 69,081.34
06/01/21 $ 60,607.34 $ 8,474.00 $ 69,081.34
07/01/21 $ 60,607.34 $ 8,474.00 $ 69,081.34
08/01/21 $ 60,607.34 $ 8,474.00 $ 69,081.34
09/01/21 $ 60,607.34 $ 8,474.00 $ 69,081.34
10/1/2021(11 days) $ 21,505.83 $ 3,006.90 $ 24,512.73
Total: $ 748,793.91 $ 104,694.90 $ 853,488.81
NOTE:Section 2.3 of the Lease("Percentage Rent")additionally requires percentage rental payments-
(2%of gross sales for each lease year in excess of$8,000,000/3%for gross sales in excess of$9,000,000)
NOTE:Minimum Rent,Cam and Repayment amounts contained herein do not include applicable sales tax.
NOTE:Minimum Rent(`)Commencing on the third anniversary of the Lease Commencement Date,and at
the beginning of each succeeding year thereafter,during the Term of the Lease,Minimum Rent shall be
increased annually in increments of three percent(3%)per year.
NOTE:CAM(")-CAM rate is subject to adjustment commencing Year 3 of the Lease to reflect Tenant's
pro-rata share of common area maintenance,which also includes,without limitation,real estate taxes and
insurance costs(estimated by Landlord,as Landlord self-insures).
Landlord Initials:
Landlord Initials:
Landlord Initials:
Landlord Initials:
Tenant Initials:
Tenant Initials:
Tenant Initials:
Page 3 of 3
COMMISSION ITEM SUMMARY
Condensed Title:
Resolution approving and authorizing the Mayor and City Clerk to execute a Third Amendment to that certain Retail Lease Agreement
by and between the City, RDA(Collectively, Lessor), and Penn 17, LLC (Lessee), dated September 16, 2011, involving the lease at
the Pennsylvania Avenue Garage, 1661 Pennsylvania Avenue, Miami Beach, Florida ("Lease"); and further approving, following a
duly noticed Public Hearing,an entertainment component,as an additional use for said Premises.
Resolution of the Mayor and City Clerk approving the transfer/sale of 100% ownership interest in Penn 17, LLC from Current
managers, Amir Ben Zion and Roman Cherstvov to Roman Cherstvov and OBK Project LLC; Further waiving by 5/7ths vote, the
competitive bidding requirements,finding such waiver to be in the best interest of the City,and authorizing the City Manger to execute
an agreement with Halloran Construction Inc, in an amount not to exceed$250,000.00,to relocate the kitchen exhausts stem.
Key Intended Outcome Supported:
Increase resident satisfaction with the level of services and facilities.
Supporting Data(Surveys, Environmental Scan, etc.):
Approximately 40%of retail businesses surveyed, rank Miami Beach as one of the best places to do business and 61%of the same
group would recommend Miami Beach as a place to do business.
Issue:
Shall the City commission authorize the execution of Amendment No.3 to the Lease and further approve an entertainment
component,as an additional use for the Premises? Shall the City Commission authorize the transfer/sale of 100%ownership interest
in Penn 17, LLC;and further waive the competitive bidding requirements,permitting City Manager to execute an agreement with
Halloran Construction Inc.for the relocation of the kitchen exhaust venting system for a fee not to exceed$250,000.00?
Item Summa /Recommendation:
Following receipt of an executed General Release by Penn 17 LLC on May 3,2013,the City agreed to open and continue the above-
referenced Resolution/agenda item at the May 8th,2013 City Commission meeting.
On May 17, 2013, the City issued written notice of default to Penn 17 LLC,for failing to pay rent for the month of May($30,130.23);
failing to maintain the Premises open for business;failure to pay lienors;(A&P Air Conditioning claim of lien and suit against the City,
totaling $73, 693; Cors-Air debt owed $3,001.92); failure to show proof of the construction deposit( $50,000); and failure to notify the
City of a transfer of interest in Penn 17, LLC,to Roman Cherstovov,subsequent to Lease execution.
On May 14, 2013 Staff was provided with a Binding Letter of Intent, setting forth the terms of the sale of Amir Ben-Zion's interest in
Penn 17, LLC to OBK Project, LLC ("OBK"), which sale would remove Amir Ben-Zion as a managing member and leave Roman
Cherstvov and OBK as managing members. Staff has requested financials and other qualification verifications. To date, OBK has
provided proof that its managing members have experience in the food/restaurant business and also have sufficient funds to cure the
existing Lease defaults and operate the restaurant.
Recommendation:
The Administration recommends approval of Resolution No. 1, approving Amendment No. 3 to the Retail Lease Agreement by and
between the City, the Miami Beach Redevelopment Agency (as Landlord), and Penn 17, LLC (as Lessee); which Amendment
includes terms and conditions for a proposed rent abatement, as approved by the Finance and Citywide Projects Committee
(FCWPC);and also includes the approval of an entertainment use on the Leased Premises.
Prior to, and as a condition to, approving Resolution No. 1, however, the Administration recommends that the City Commission first
approve Resolution No.2,which approves a transfer under the Lease in the controlling ownership interest in Penn 17, LLC,from Amir
Ben-Zion and Roman Cherstvov, the current managers/members of Penn 17 (Transferors), to Roman Cherstvov and OBK Project,
LLC (Eugene Alekseychenko and Oleg Elyutin, Managing Members), the proposed purchasers of Penn 17 (Transferees); subject to
and conditioned upon Transferees' satisfaction of the conditions set forth in Resolution No. 2 (which should also be satisfied prior to
the City's execution of Amendment No. 3 to the Lease).
Finally, the Administration recommends that the Mayor and Commission waive by a 5/7ths vote, the formal competitive bidding
requirements, finding that such waiver to be in the best interest of the City, and authorize the City Manager, or his designee, to
negotiate and execute an agreement with Halloran Construction Inc., in an amount not to exceed $250,000 to address the relocation
of the kitchen exhaust venting system installed by Penn 17,LLC.
Advisory Board Recommendation:
Finance&Citywide Projects Committee recommended approval of revised rent schedule on January 24,2013
Financial Information:
Source of Funds: Amount
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...................... ...
Financial Impact Summary:
City Clerk's Office Legislative Tracking:
Max Sklar, Ext. 6116
Sign-Offs:
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MEW MIAMIBEACH AGEIrlDk DATE -, 2 DATE (e �-t 1—
MIAMI BEACH
City of Miami Beach, 1700 Convention Center Drive,Miami Beach, Florida 33139,www.miamibeachfl.gov
COMMISSION MEMORANDUM
TO: Mayor Matti Herrera Bower and Me ers of th ity Commission
FROM: Jimmy L. Morales, City Manager
DATE: June 5, 2013 PUBLIC HEARING
SUBJECT:
(OPENED AND CONTINUED
FROM MAY 8, 2013)
1. A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI
BEACH, FLORIDA, APPROVING AND AUTHORIZING THE MAYOR AND CITY
CLERK TO EXECUTE AMENDMENT NO. 3 TO THAT CERTAIN RETAIL LEASE
AGREEMENT BY AND BETWEEN THE CITY OF MIAMI BEACH, THE MIAMI BEACH
REDEVELOPMENT AGENCY (COLLECTIVELY, LESSOR), AND PENN 17, LLC
(LESSEE), DATED SEPTEMBER 16, 2011, INVOLVING THE LEASE OF
APPROXIMATELY 7,655 SQUARE FEET OF GROUND FLOOR RETAIL SPACE AT
THE PENNSYLVANIA AVENUE GARAGE, 1661 PENNSYLVANIA AVENUE, MIAMI
BEACH, FLORIDA; AND FURTHER APPROVING, FOLLOWING A DULY NOTICED
PUBLIC HEARING AS REQUIRED BY SECTION 142-362 OF THE CITY OF MIAMI
BEACH CODE, AN ENTERTAINMENT COMPONENT, WHICH WILL BE ADDED AS
AN ADDITIONAL USE OF THE LEASED PREMISES IN CONJUNCTION WITH
TENANT'S RE-OPENING AND RE-BRANDING OF SUCH PREMISES.
NEW ITEM)
)
2. A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI
BEACH, FLORIDA, APPROVING THE TRANSFER, AS SUCH TERM IS DEFINED IN
THE LEASE AGREEMENT (THE LEASE) BY AND BETWEEN THE CITY OF MIAMI
BEACH, THE MIAMI BEACH REDEVELOPMENT AGENCY (COLLECTIVELY,
LESSOR), AND PENN 17, LLC (LESSEE), OF A 100% CONTROLLING OWNERSHIP
INTEREST IN PENN 17, LLC FROM THE CURRENT MANAGERS/MEMBERS, AMIR
BEN-ZION AND RAMON CHERSTVOV (TRANSFERORS), TO THE PROPOSED
PURSHASERS OF PENN 17, ROMAN CHERSTVOV AND OBK PROJECT LLC
(TRANSFEREES); WITH APPROVAL OF SUCH TRANSFER SUBJECT TO AND
CONTIGENT UPON THE PARTIES' EXECUTION OF AMENDMENT NO. 3 TO THE
LEASE AND, FURTHER, SATISFACTION BY TRANSFEREES OF THE FOLLOWING
CONDITIONS (TO BE SATISFIED PRIOR TO AND AS A CONDITION OF LESSOR'S
EXECUTION OF AMENDMENT NO. 3): 1) PAYMENT 'OF OUTSTANDING RENT FOR
THE MONTHS OF MAY AND JUNE, 2013; 2) SATISFACTION OF ANY AND ALL
LIENS AGAINST THE LEASED PREMISES INCLUDING, WITHOUT LIMITATION,
LIENS AND/OR CLAIMS FILED BY A & P AIR CONDITIONING AND CORS-AIR; 3)
DISMISSAL, WITH PREJUDICE, OF THE LAWSUIT FILED BY A & P AGAINST THE
CITY TO COLLECT THE A & P LIEN; 4) RE-PAYMENT OF THE REMAINING
City Commission Memorandum
Penn 17, LLC-Retail Lease Amended Rent Schedule
June 5, 2013
Page 2 of 8
BALANCE OF RENT AND CAM FOR NOVEMBER AND DECEMBER 2012, IN THE
AMOUNT OF $120,519.98; 5) REPLACEMENT OF THE REQUIRED $50,000
MINIMUM BALANCE INTO THE LESSEE CONSTRUCTION FUND; 6) RE-LOCATION,
AT TRANSFEREES' SOLE COST, OF THE LEASED PREMISES A/C UNITS TO THE
ROOF OF THE PENNSYLVANIA GARAGE; AND 7) EXECUTION OF A GENERAL
UNCONDITIONAL RELEASE IN FAVOR OF THE CITY AND RDA; AND FURTHER
WAIVING, BY 5/7THS VOTE, THE FORMAL COMPETITIVE BIDDING
REQUIREMENTS, FINDING SUCH WAIVER TO BE IN THE BEST INTEREST OF THE
CITY, AND AUTHORIZING THE CITY MANAGER, OR HIS DESIGNEE, TO
NEGOTIATE AND EXECUTE AN AGREEMENT WITH HALLORAN CONSTRUCTION,
INC., IN AN AMOUNT NOT TO EXCEED $250,000.00, TO ADDRESS THE
RELOCATION OF THE KITCHEN EXHAUST VENTING SYSTEM INSTALLED BY
PENN 17, LLC.
ADMINISTRATION RECOMMENDATION
Following opening and continuing of Resolution No. 1 above at the May 8, 2013 City
Commission Meeting, the Administration recommends approval of Amendment No. 3 to the
Retail Lease Agreement by and between the City, the Miami Beach Redevelopment Agency (as
Landlord), and Penn 17, LLC (as Lessee); which Amendment includes terms and conditions for
a proposed rent abatement, as approved by the Finance and Citywide Projects Committee
(FCWPC); and includes the addition of an entertainment use on the Leased Premises.
As a condition of (and prior to) approval of Resolution No. 1, however, the Administration
recommends that the City Commission first approve Resolution No. 2, which approves a
transfer under the Lease in the controlling ownership interest in Penn 17, LLC, from Amir Ben-
Zion and Roman Cherstvov, the current managers/members of Penn 17 (Transferors), to
Roman Cherstvov and OBK Project, LLC (Eugene Alekseychenko and Oleg Elyutin, Managing
Members), the proposed purchasers of Penn 17 (Transferees); and that such approved
transfer, and the City's execution of the proposed Amendment No. 3 be further subject to
Transferees' satisfaction of the conditions set forth in Resolution No. 2.
Finally, the Administration recommends that the Mayor and Commission waive by a 5/7ths vote,
the formal competitive bidding requirements, finding that such waiver to be in the best interest of
the City, and authorizing the City Manager, or his designee, to negotiate and execute an
agreement with Halloran Construction Inc., in an amount not to exceed $250,000 to address the
relocation of the kitchen exhaust venting system installed by Penn 17, LLC.
BACKGROUND
On January 24, 2013, the FCWPC recommended in favor of the following re-negotiated Lease
terms, as proposed by staff:
1) applying one-third (1/3) of the Lessee's existing Security Deposit, representing
$47,844, toward Base Rent owed for the month of November, 2012;
2) deferring $8,474 for Common Area Maintenance (CAM) for November, 2012, and
Base Rent plus CAM for December 2012, leaving a balance in the total amount of
$64,791 (Back-Due Rent) to be repaid in twelve (12) equal monthly installments,
commencing in January 2014 and ending in December 2014,
3) granting an abatement of 50% of the Base Rent and Common Area Maintenance
City Commission Memorandum
Penn 17, LLC-Retail Lease Amended Rent Schedule
June 5, 2013
Page 3 of 8
(CAM) due for the six (6) month period commencing January 2013, through July 2013;
4) granting a deferral of fifty percent (50%) of the Base Rent and CAM for the six (6)
month period, commencing July 2013 through January 2014 ("Deferral Period"), to be
repaid by the Lessee in twenty four (24) equal monthly installments, commencing in
the sixth year of the Lease Term and ending on the last day of the seventh year of the
Lease Term;
5) reimbursement of the Security Deposit amount applied to Back-Due Rent, in the
amount of $47,844, to be repaid in twelve (12) equal monthly installments,
commencing in the fifth year of the Lease Term and ending on the last day of the fifth
year of the Lease Term.
A schedule reflecting the revised rent schedule, as recommended by FCWPC, is included as
Exhibit "A" to this Memorandum.
The FCWPC also requested that any agreement with the Lessee be subject to the inclusion of
release language absolving the City/RDA of any liability. As requested by Commissioner Libbin
during the January 24, 2013 FCWPC meeting. Lessee provided the Administration with its
preliminary business plan for re-opening the Leased Premises (which had been closed since
December 2012). Lessee proposed an additional use, a lounge/bar component, which was not
permitted under the Lease. This proposed entertainment use (i.e. which contemplates a
combination of a deejay and live music), is also not a main permitted use in the Civic and
Convent i on Center (CC
C) zoning district, and therefore not only requires City Commission
approval under the Lease, but also approval following a public hearing, as required under
Section 142-362 of the City Code.
On March 13, 2013, the Mayor and Commission adopted Resolution No. 2013-28167 (in
conjunction with RDA Resolution No. 592-2013), which accepted the FCWPC's
recommendation pertaining to the proposed Amendment No. 3 to the Lease. The City
Commission and RDA also set a public hearing for April 17, 2013, regarding Lessee's proposal
to add an entertainment component as an additional use under the Lease.
During the March 13th discussion, the City Commission again requested that Amendment No. 3
also include: 1) a general release by Lessee waiving any claims against the City/RDA including,
without limitation, those with regard to the ventilation and to the placement and/or re-location of
the Leased Premises air conditioning units; 2) an additional clause that Lessee admits and
acknowledges that, but for approval of Amendment No. 3, it is in default of the Lease; and 3)
additional language regarding an "expedited" eviction procedure and, to the extent possible,
including certain waivers of defenses by Lessee. The Lessee was also requested to provide a
general release in conjunction with the City's preliminary approval of the proposed revised rent
schedule.
As of April 17, 2013, the Lessee had not been able to solidify its concept plan or provide a site
plan, as requested by staff, in time to submit the necessary information for City Commission
consideration at the scheduled public hearing for the proposed entertainment use. Lessee had
met with representatives of the New World Symphony (NWS) and provided staff with a
confirmation letter from NWS, dated March 18, 2013, stating that "...in the expectation of future
on-going mutual cooperation between your operating staff and NWS to ensure that your
activities do not adversely affect NWS events and Wallcasts, NWS has no issues with respect to
the entertainment license..." The Lessee expressed concerns with the Planning Department's
requirement to install a vestibule area within the Premises, as a condition of the proposed
entertainment component.
City Commission Memorandum
Penn 17, LLC-Retail Lease Amended Rent Schedule
June 5, 2013
Page 4 of 8
At the May 8, 2013 City Commission meeting, and following Lessee's delivery of an executed
General Release to the City on May 3, 2013, the City agreed to open and continue Resolution
No. 1, to allow the City and Penn 17 additional time to resolve the outstanding Lease issues.
However, following the continuation of Resolution No. 1 at the May 8, 2013 City Commission
Meeting, Penn 17 LLC has failed to adequately address the remaining Lease issues, which the
City in its letter to Penn 17, dated April 26, 2013, and which were also outlined in the May 8,
2013 City Commission Memorandum (See Attachment "B" for City's letter to Penn 17 LLC,
dated April 26, 2013). Additionally, Penn 17 LLC has failed to pay its May rent and, on May 17,
2013, the City issued a Notice of Default to Penn 17 LLC. As of the date of this Memorandum,
June 2013 Rent is also past due.
PROPOSED TRANSFER OF CONTROLLING INTEREST IN PENN 17, LLC
On May 14, 2013, an attorney representing Roman Cherstvov, who, unbeknownst to the City
(and without the City's required consent of same) became a 50% managing partner of Penn 17
LLC after the execution of the Lease , provided a copy of a "Binding Letter of Intent," dated April
25, 2013, by and among Penn 17, LLC, OBK Project, LLC. (OBK), a Florida limited liability
company, and Amir Ben-Zion, setting forth the terms of the proposed sale of 50% of the
membership interest in Penn 17 to OBK (See Attachment "C"). As with the prior transfer to Mr.
Cherstvov (which was not consented to by the City), the proposed transfer to OBK requires the
City's prior written consent under the Lease.
In an effort to obtain more information regarding the proposed transfer, the Administration
requested additional information on Mr. Cherstvov, as well as information regarding the
principals of OBK Project, LLC, Eugene Alekseychenko, and Oleg Elyutin, who are the
prospective buyers of Amir Ben-Zion's remaining 50% ownership (The Administration's request
for information is attached as Attachment "D" hereto). On May 21, 2013, a response was
received from Scott S. Levine (the attorney representing Mr. Cherstovov) which included
information regarding Mr. Alekseychenko's and Mr. Elyutin's background in the restaurant
business (See Mr. Levine's letter, dated May 21, 2013, attached as Attachment "E").
Notwithstanding the preceding, and since any transfer of an interest in the Lease (including the
sale or transfer of a controlling ownership interest) requires the City's prior written consent, the
City has: 1) no obligation to recognize the initial, unauthorized transfer to Mr. Cherstvov; and 2)
any future proposed transfer, including the proposed sale of an ownership interest to OBK
Project LLC, would be subject to prior City Commission approval (which approval is at the
Commission's sole discretion).
PENN 17 LLUS DEFAULT UNDER THE LEASE
On May 15, 2013, Amir Ben-Zion indicated to the City that he had no intention of re-opening the
restaurant within the near future, and effectively advised the City of his abandonment of the
Leased Premises (See Attachment "F").
On May 17, 2013, the City provided Penn 17 LLC with written notice (See Attachment "G") of
the following defaults under the Lease (Note: the cure period for each default condition is
shown after each item in parenthesis):
City Commission Memorandum
Penn 17, LLC-Retail Lease Amended Rent Schedule
June 5, 2013
Page 5 of 8
1. failure to pay rent for the month of May, in the amount $30,130.00, which was due on
May 1, 2013' (five day cure period);
2. failure, under Section 3.5 of the Lease, to maintain Lessee's business on the Leased
Premises open for business to the public, fully fixtured, stocked, and staffed (30 day cure
period);
3. in violation of Section 5.6 of the Lease, a lien was recorded against the Premises by
A&P Air Conditioning (dated December 12, 2012, and recorded in O.R. Book 28396,
Page 3630 of the Public Records of Miami-Dade County, Florida; hereinafter referred to
as the "A&P Lien"), in the amount of $73,693. A&P has also filed suit against the City
(the "A&P Lawsuit"), demanding payment of the aforestated unpaid sum (15 day cure
period);
4. despite prior written notice from the City, failure to provide the City with evidence that a
prior claim by Cors-Air, in the amount of$3,001.92 (the "Cors-Air Claim"), has been paid
(15 day cure period); and
5. despite prior written notice from City, and as required under Section 5.2(n) of the Lease,
failure to provide the City with evidence that Lessee has deposited, and/or otherwise
maintained, the minimum required $50,000 Construction Deposit in the Lessee
Construction Fund (as such term is defined in the Work Letter and Escrow Agreement,
which was incorporated into, and made a part of, the Lease) (30 day cure period).
The prior unauthorized transfer to Mr. Cherstvov, and the proposed transfer to OBK, if not
approved by the City, also represent potential additional events of default under the Lease. As
of the date of this Memorandum, Penn 17, LLC has failed to pay its May 2013 Rent within the
stated cure period; Rent for June 2013 will be on June 10. Additionally, Penn 17 has failed to
cure the defaults in Item Nos. 3 and 4 above within the respective cure periods.
At this time, and in light of Penn 17 LLC's multiple uncured defaults, the City has the right to
declare the Lease in default and proceed to avail itself of any and all available remedies under
such Lease, including re-taking possession of the Leased Premises.
NEGOTIATIONS WITH PROPOSED NEW PURCHASERS/TRANSFEREES
Without waiving any of its rights under the Lease (as a result of Penn 17 LLC's default), on May
29, 2013 the City Administration met with Mr. Cherstvov, and the principals of OBK Project LLC,
Messrs. Mr. Alekseychenko's and Mr. Elyutin's, and their respective counsel. As an alternative
to the City's proceeding with the default against Penn 17, the proposed new
Purchasers/Transferees propose the following, in exchange for the City Commission's approval
of the proposed transfer under the Lease (to Transferees), and approval and execution of the
proposed Amendment No. 3 (including the new payment schedule that was recommended by
the FCWPC and approval by the City Commission on March 13, 2013):
1 The aforestated rental amount represents 50%of the May rent originally set forth in the Lease. The City Commission's adoption
of Resolution No. 2013-28167 recommended approval - subject to and contingent upon the City Commission's subsequent
approval of a proposed Amendment No. 3 to the Lease-of a 50%rent abatement,from January 13, 2013,to July 12, 2013. Since
the City Commission has never finalized its approval of Amendment No. 3 to the Lease, and has therefore not finalized its approval
of the more favorable revised rent abatement schedule, the City has, to date, held off on demanding the current total rent due
(absent the City Commission's final approval of Amendment No.3 and of the revised rent abatement schedule),of$342,074.61 (the
full amount rent due through May 30, 2013) by, notwithstanding the preceding, reserves any and all rights to reclaim the FULL
amount of rent due under the Lease.
City Commission Memorandum
Penn 17, LLC-Retail Lease Amended Rent Schedule
June 5, 2013
Page 6 of 8
1. payment of the requested rent for May and June 2013, in the amount of $60,260.00,
(This is based upon the rent payment schedule set forth in proposed Amendment No. 3
to the Lease),
2. re-payment of the remaining balances of Rent ($95,687.50), CAM ($16,948.00) and
applicable sales tax ($7,884.48) for the months of November 2012 and December 2012,
which total $120,519.98;
3. deposit of the minimum required Construction Deposit balance, in the amount
$50,000.00, into the Lessee Construction Fund, under the Escrow Agreement;
4. release of the A&P Air-Conditioning lien, and or the posting of $73,693.00 in an escrow
account to cover payment of this lien;
5. proof of payment to Cors-Air, in the amount of$3,001.92,
6. payment for the relocation of the air conditioner units to the roof of the parking garage.
7. Contractor's Affidavit from Halloran that there are no other outstanding liens or claims for
labor, materials, or equipment.
Mr. Levine has confirmed that funds, totaling $157,000.00, have been deposited into his trust
account and will be released and wired to the City upon the City Commission's approval of the
proposed transfer to Transferees. In addition, funds for the June rent payment, in the amount of
$30,130.00, shall be deposited into his trust account during the week of June 3, 2013.
Assuming the City Commission is satisfied with the due diligence information which the
proposed Purchasers/Transferees have provided to the Administration, approval of the
proposed transfer would be in the best interest of the City. The proposed
Purchasers/Transferees are proposing more favorable terms in that the are agreeing to a
p p 9 � Y 9 9 pay
the balance of Rent and CAM payments owed for November and December of 2012 a the
P Y � pay
past-due May (and June) 2013 Rent; and pay all known and unpaid lienors; all for a total
additional value of $257,474.90. The Transferees have the financial ability to cure all the
existing defaults under the Lease, as well as the experience to open and run a restaurant
business. This is an opportunity for the City to save the expenses associated with securing a
new Lessee, which expenses could include real estate commissions, plus a minimum of six (6)
months of rent loss.
VENTILATION SYSTEM RECONFIGURATION
On August 17, 2012, as the build-out of Cooper Avenue was nearing completion, the City was
contacted by the New World Symphony (NWS), which expressed major concerns over the
venting locations of the Lessee's kitchen exhaust and steam vent from the dishwashers, which
both direct into the service alley between the Garage and NWS. The NWS believes the kitchen
exhaust could potentially permeate the performance hall every time the loading dock doors are
opened (which are directly opposite the kitchen exhaust vent).
Following an extensive series of meetings with representatives from the NWS and the Lessee's
management and design team to figure out options for mitigating odors emanating from the
City Commission Memorandum
Penn 17, LLC-Retail Lease Amended Rent Schedule
June 5,2013
Page 7 of 8
exhaust venting, the NWS instead demanded that the City and Lessee explore design
alternatives for redirecting the kitchen exhaust in its entirety, away from the alley. Although the
discussions centered on the fact that the City could not yet know whether or not there was a
problem, in an abundance of caution the City authorized the Lessee to direct his architect to
develop several alternatives to address the NWS concerns.
On September 10, 2012, the City entered into a Letter Agreement with the Lessee pertaining to
the engagement of architectural/engineering services, at a not-to-exceed cost to the City of
$25,000, in order to develop conceptual design options and preliminary pricing estimates to
modify the exhaust venting system for the City's consideration and approval; and further to
include services for the preparation of detailed plans and specifications (including any layouts,
architectural, mechanical, structural, electrical and other plans, drawings and construction
documents in sufficient detail to obtain any and all appropriate regulatory permits), as may be
reasonably required by the City's Building Department in order to process and review Lessee's
permit application for such modification as approved.
Subsequent to the opening of the Cooper Avenue restaurant it was determined that there is
odor in the alleyway between the garage and concert hall. While it is not known if the odors
would permeate the inside of the performance hall, in order to address a potential negative
impact the Administration suggest that the Commission consider relocating the vents.
In an effort to mitigate this situation, the Administration identified savings from the original
construction budget of the Pennsylvania Avenue Garage (RDA Fund 365) for the relocation of
the ventilation system. The City Commission adopted Resolution No. 2012-28067 in
conjunction with the Redevelopment Agency's (RDA) Resolution No. 590-2012.
The City subsequently contracted with TLC Engineering for Architecture (TLC) to review the
design of the ventilation system, issue a report with construction cost estimates and alternative
designs to relocate the ventilation system exhaust termination point to the Pennsylvania Avenue
Garage vehicle exit. The alternatives were reviewed by the City, NWS and Halloran
Construction Inc (Halloran) who was the contractor for Penn 17, LLC for the restaurant build
out. All parties agreed with the design recommended by TLC, which included carbon filter
scrubbers.
Halloran will be contracted by Penn 17, LLC to relocate the air conditioning compressors from
its current location to the roof of the garage. The ventilation system improvements will take
approximately eight (8) weeks to manufacture, deliver and install. In an effort to expedite the
work and have the restaurant re-open, the Administration recommends the Mayor and
Commission, and Members of the Redevelopment Agency, waive by a 5/7ths vote, the formal
competitive bidding requirements, finding that such waiver to be in the best interest of the City,
and authorizing the City Manager, or his designee, to negotiate and execute an agreement with
Halloran Construction Inc., in an amount not to exceed $250,000 to address the relocation of
the kitchen exhaust venting system installed by the Pennsylvania Avenue Garage Retail
Lessee, Penn 17, LLC. Securing the services of the existing Contractor would be more cost
effective since Contractor is already familiar with the development and therefore can expedite
the completion of the final modifications, allowing for an earlier opening date.
RESTAURANT CONCEPT
Attached is a pro-forma for the restaurant concept proposed by Penn 17, LLC, if the transfer is
approved by the City Commission.
City Commission Memorandum
Penn 17, LLC-Retail Lease Amended Rent Schedule
June 5,2013
Page 8 of 8
CONCLUSION
The Administration recommends approval of Resolution No. 1, approving Amendment No. 3 to
the Retail Lease Agreement by and between the City, the Miami Beach Redevelopment Agency
(as Landlord), and Penn 17, LLC (as Lessee); which Amendment includes terms and conditions
for a proposed rent abatement, as approved by the Finance and Citywide Projects Committee
(FCWPC); and also includes the approval of an entertainment use on the Leased Premises.
Prior to, and as a condition to, approving Resolution No. 1, however, the Administration
recommends that the City Commission first approve Resolution No. 2, which approves a
transfer under the Lease in the controlling ownership interest in Penn 17, LLC, from Amir Ben-
Zion and Roman Cherstvov, the current managers/members of Penn 17 (Transferors), to
Roman Cherstvov and OBK Project, LLC (Eugene Alekseychenko and Oleg Elyutin, Managing
Members), the proposed purchasers of Penn 17 (Transferees); subject to and conditioned upon
Transferees' satisfaction of the conditions set forth in Resolution No. 2 (which should also be
satisfied prior to the City's execution of Amendment No. 3 to the Lease).
Finally, the Administration recommends that the Mayor and Commission waive by a 5/7ths vote,
the formal competitive bidding requirements, finding that such waiver to be in the best interest of
the City, and authorize the City Manager, or his designee, to negotiate and execute an
agreement with Halloran Construction Inc., in an amount not to exceed $250,000 to address the
relocation of the kitchen exhaust venting system installed by Penn 17, LLC.
JLM\KGB\MAS\GT
Attachments:
A—April 26, 2013 Letter to Penn 17 LLC outlining deficiencies
B — May 14, 2013 Email from Scott S. Levine, Esq. and Binding Letter of Intent
C - May 14, 2013 Email to Scott S. Levine, Esq., requesting additional information
D — May 21, 2013 Letter from Scott Levine, P.A.
E - May 15, 2013 Email from Amir Ben-Zion
F - May 17, 2013 Default Letter to Penn 17, LLC
G — May 24, 2013 E-mail from Scott Levine, Esq. to Kathie Brooks
T:\AGENDA\2013\June 5\Penn 17 Memo 06052013.docx
.l
i9
t
EXHIBIT A
JC711L4 lU 13 `
NOTES:
(1)Repayment of remaining Nov/Dec 2012 balance($64,791)
(2)Repayment of July 2012 and August 2012 rent($95,688.00)per
Second Amendment '
i
(3)Repayment of security deposit($47,844)
(4)Repayment of July 2013 through December 2013 deferred rent
($171,106.23)
Penn 17,LLC Rent Schedule
Lease Commencement: October 13.2011 Rent Commencement:April 14.2012
Current Proposed
Lease Year:2 Rent Rent Total Monthly Y Total Monthly
Base Rent Repayment CAM Abatement Deferment Payment Payment
01/13/13 $ 47,843.75 $ $ 8,474.00 $ (28,158.88) $ - $ 56,317.75 $ 28,158.87
02/13/13 $ 47,843.75 $ - $ 8,474.00 $ (28.158.88) $ - $ 56.317.75 $ 28,158.87
03/13/13 $ 47,843.75 $ $ 8,474.00 $ (28,158.88) $ - $ 56,317.75 $ 28,158.87
04/13/13 $ 47,843.75 $ - $ 8,474.00 $ (28,158.88) $ - $ 56,317.75 $ 28,158.87
05/13/13 $ 47,843.75 $ $ 8,474.00 $ (28,158.88) $ - $ 56,317.75 $ 28,158.87
06/13/13 $ 47,843.75 $ $ 8,474.00 $ (28,158.88) $ - $ 56,317.75 $ 28,158.87
07/13/13 $ 47,843.75 $ $ 8,474.00 $ - $ (28,158.88) $ 56,317.75 $ 28,158.87
08/13/13 $ 47,843.75 $ $ 8,474.00 $ - $ (28,158.88) $ 56,317.75 $ 28,158.87
09/13/13 $ 47,843.75 $ $ 8.474.00 $ - $ (28,158.88) $ 56,317.75 $ 28,158.87
Total: $ 430,593.75 $ $ 76,266.00 $ (168,953.28) $ (84.476.64) $ 506,859.75 $ 253,429.83
Current Proposed
Lease Year:3 Rent Rent Total Monthly Total Monthly
Base Rent Repayment(1 and 2) CAM Abatement Deferment Payment Payment
$ 49,279.06 $ 2,658.00 $ 8,474.00 $ $ (28,876.53) $ 60,411.06 $ 31,534.53
11/13/13 $ 49,279.06 $ 2,658.00 $ 8,474.00 $ $ (28,876.53) $ 60,411.06 $ 31,534.53
12/13/13 $ 49,279.06 $ 2,658.00 $ 8,474.00 $ $ (28,876.53) $ 60,411.06 $ 31,534.53
01/13/14 $ 49,279.06 $ 8,057.00 $ 8,474.00 $ $ - $ 65,810.06 $ 65,810.06
02/13/14 $ 49,279.06 $ 8,057.00 $ 8,474.00 $ $ - $ 65,810.06 $ 65,810.06
03/13/14 $ 49,279.06 $ 8,057.00 $ 8,474.00 $ $ - $ 65,810.06 $ 65,810.06
04/13/14 $ 49,279.06 $ 8,057.00 $ 8,474.00 $ $ $ 65,810.06 $ 65,810.06
05/13/14 $ 49,279.06 $ 8,057.00 $ 8.474.00 $ $ - $ 65,810.06 $ 65,810.06
06/13/14 $ 49,279.06 $ 8,057.00 $ 8,474.00 $ $ - $ 65,810.06 $ 65,810.06
07/13/14 $ 49,279.06 $ 8,057.00 $ 8,474.00 $ $ - $ 65,810.06 $ 65,810.06
08/13/14 $ 49,279.06 $ 8,057.00 $ 8,474.00 $ $ - $ 65,810.06 $ 65,810.06
09/13/14 $ 49,279.06 $ 8.057.00 $ 8,474.00 $ - $ - $ 65,810.06 $ 65,810.06
Total: $ 591,348.72 $ 80,487.00 $ 101,688.00 $ $ (86,629.59) $ 773,523.72 $ 686,894.13
Current Proposed
Lease Year:4 Rent Rent Total Monthly Total Monthly
Base Rent Repayment(1 and 2) CAM Abatement Deferment Payment Payment
$ 50,757.43 $ 8,057.00 $ 8,474.00 $ $ $ 67,288.43 $ 67,288.43
11/13/14 $ 50,757.43 $ 8,057.00 $ 8,474.00 $ $ - $ 67,288.43 $ 67,288.43
12/13/14 $ 50,757.43 $ 8,057.00 $ 8,474.00 $ $ $ 67,288.43 $ 67,288.43
01/13/15 $ 50.757.43 $ 2,658.00 $ 8,474.00 $ $ $ 61,889.43 $ 61,889.43
02/13/15 $ 50,757.43 $ 2.658.00 $ 8,474.00 $ $ - $ 61,889.43 $ 61,889.43
03/13/15 $ 50,757.43 $ 2,658.00 $ 8,474.00 $ $ $ 61,889.43 $ 61,889.43
04/13/15 $ 50,757.43 $ 2,658.00 $ 8,474.00 $ - $ $ 61,889.43 $ 61,889.43
05/13/15 $ 50.757.43 $ 2,658.00 $ 8,474.00 $ - $ $ 61,889.43 $ 61,889.43
06/13/15 $ 50,757.43 $ 2,658.00 $ 8,474.00 $ - $ $ 61,889.43 $ 61,889.43
07/13/15 $ 50,757.43 $ 2,658.00 $ 8,474.00 $ - $ $ 61,889.43 $ 61,889.43
08/13/15 $ 50,757.43 $ 2,658.00 $ 8,474.00 $ - $ $ 61,889.43 $ 61,889.43
09/13/15 $ 50,757.43 $ 2,658.00 $ 8,474.00 $ - $ $ 61,889.43 $ 61,889.43
Total: $ 609,089.16 $ 48,093.00 $ 101,688.00 $ - $ - $ 758,870.16 $ 758,870.16
Page 1 of 2 EXHIBIT A
EXHIBIT A
JC111l4•LUIS
NOTES:
(1)Repayment of remaining Nov/Dec 2012 balance($64,791)
(2)Repayment of July 2012 and August 2012 rent($95.688.00)per
Second Amendment
(3)Repayment of security deposit($47,844)
(4)Repayment of July 2.013 through December 2013 deferred rent
($171,106.23)
Penn 17,LLC Rent Schedule
Lease Commencement- October 13,2011 Rent Commencement:April 14,2012
Current Proposed
Lease Year:5 Rent Rent Total Monthly Total Monthly
Base Rent Repayment(2 and 3) CAM Abatement Deferment Payment Payment
$ 52,280.15 $ 6,645.00 $ 8,474.00 $ $ - $ 63,412.15 $ 67,399.15
11/13/15 $ 52,280.15 $ 6,645.00 $ 8,474.00 $ - $ $ 63,412.15 $ 67,399.15
12/13/15 $ 52,280.15 $ 6,645.00 $ 8,474.00 $ $ - $ 63,412.15 $ 67,399.15
01/13/16 $ 52,280.15 $ 6,645.00 $ 8,474.00 $ - $ $ 63,412.15 $ 67,399.15
02/13/16 $ 52,280.15 $ 6,645.00 $ 8,474.00 $ $ - $ 63,412.15 $ 67,399.15
03/13/16 $ 52,280.15 $ 6,645.00 $ 8.474.00 $ $ - $ 63,412.15 $ 67,399.15
04/13/16 $ 52,280.15 $ 6,645.00 $ 8,474.00 $ - $ $ 63,412.15 $ 67,399.15
05/13/16 $ 52,280.15 $ 6,645.00 $ 8,474.00 $ $ $ 63,412.15 $ 67,399.15
06/13/16 $ 52,280.15 $ 6,645.00 $ 8,474.00 $ - $ $ 63,412.15 $ 67,399.15
07/13/16 $ 52,280.15 $ 6,645.00 $ 8,474.00 $ $ - $ 63,412.15 $ 67,399.15
08/13/16 $ 52,280.15 $ 6,645.00 $ 8,474.00 $ - $ - $ 63,412.15 $ 67,399.15
09/13/16 $ 52,280.15 $ 6,645.00 $ 8,474.00 $ - $ $ 63,412.15 $ 67,399.15
Total: $ 627,361.80 $ 79,740.00 $ 101,688.00 $ $ $ 760,945.80 $ 808,789.80
Current Proposed
Lease Year:6 Rent Rent Total Monthly Total Monthly
Base Rent Repayment(4) CAM Abatement Deferment Payment Payment
�- $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ $ 62,322.56 $ 69,451.99
11/13/16 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ $ 62,322.56 $ 69,451.99
12/13/16 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ - $ 62,322.56 $ 69,451.99
01/13/17 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ $ 62,322.56 $ 69,451.99
02/13/17 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ - $ 62,322.56 $ 69,451.99
03/13/17 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ $ 62,322.56 $ 69,451.99
04/13/17 $ 53,848.56 $ 7,129.43 $ 8.474.00 $ - $ - $ 62,322.56 $ 69,451.99
05/13/17 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ - $ 62,322.56 $ 69,451.99
06113117 $ 53,848.56 $ 7,129.43 $ 8,474,00 $ - $ - $ 62,322.56 $ 69,451.99
07113117 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ - $ 62,322.56 $ 69,451.99
08/13/17 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ - $ 62,322.56 $ 69,451.99
09/13/17 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ $ 62,322.56 $ 69,451.99
Total: $ 646,182.72 $ 85,553.16 $ 101,688.00 $ - 5 - $ 747,870.72 $ 833,423.88
Current Proposed
Lease Year:7 Rent Rent Total Monthly Total Monthly
Base Rent Repayment(4) CAM Abatement Deferment Payment Payment
10/13/17 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ $ - $ 63,938.02 $ 71.067.45
11/13/17 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ $ - $ 63,938.02 $ 71,067.45
12/13/17 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ $ $ 63,938.02 $ 71,067.45
01/13/18 $ 55.464.02 $ 7,129.43 $ 8,474.00 $ $ $ 63.938.02 $ 71,067.45
02/13/18 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ $ $ 63,938.02 $ 71,067.45
03/13/18 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ $ $ 63,938.02 $ 71,067.45
04/13/18 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ - $ - $ 63,938.02 $ 71,067.45
05/13/18 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ - $ $ 63,938.02 $ 71,067.45
06/13/18 $ 55,464.02 $ 7,129.43 $ 8,474,00 $ - $ $ 63,938.02 $ 71,067.45
07/13/18 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ - $ - $ 63,938.02 $ 71,067.45
08/13/18 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ $ $ 63,938.02 $ 71,067.45
09/13/18 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ $ $ 63,938.02 $ 71,067.45
Total: $ 665,568.24 $ 85,553.16 $ 101,688.00 $ - $ - $ 767,256.24 $ 852,809.40
Page 2 of 2
............ .
_ MIAMI BEACH
City of Miami Beach,1700 Convention Center Drive,Miami Beach,Florida 33139,www.miamibaochfl.gov
REAL ESTATE,HOUSING&COMMUNITY DEVELOPMENT j
Tel:(305)673-7000—(3051673-7033
BY CERTIFIED MAIL RETURN RECEIPT REQUESTED
April 26, 2013
Amir Ben Zion Copy sent via electronic mail to:
Managing Member amir.ben-zionDfcsny.com
Penn 17, LLC shai DcooDeravenue.com
1861 Pennsylvania Avenue, Suite 6
Miami Beach, FL 33.139
Re: Lease Agreement(the "Lease") between the.City of Miami Beach, Florida, the
Miami Beach •Redevolopment Agency (hereinafter.collectively referred to as
"Landlord"),and Penn 17, LLC("Tenant"),involving the lease of approximately
7,666 square feet of,ground floor retail space at the Pennsylvania Avenue Garage,
1661 Pennsylvania Avenue,Miami Beach, Florida("Premises")
Dear Mr.Ben-Zion: .
As you•may be aware, the Public Hearing that had originally been scheduled before the City
Commission.on April 17,2013,.to consider a proposed chanye.of use to the Premises,as well
as to consider the proposed Amendment No.3.to the Lease,was re-scheduled to be heard at
the'City Commission meeting on May 8,2013.This was due to the fact that you were unable to
comply_with ..certain outstanding issues .which needed. to be resolved prior to the.City
Commission's consideration of the aforestated items.As of the date of this letter,these same
g
issues remain outstanding,as follows:
1. The City requires.a recorded copy of:an.Order by the Court,dismissing with prejudice ART
Drywall's lawsult against the'.0ity. i
2. The deficiencies in Tenant's .Construction Fund, originally identified in .the City's
correspondence,dated.Ma 26, 2013(a copy of which Is attached as Exhibit"A":hereto),still i
need to be 'resolved. Specifically, the City has not yet agreed to accept the copies of
checks/payments made from Tenant's own.construction.account(provided to us by Tenant's
EscrowAgent in its written response to the_City,dated April 3,2013),as satisfying the$1 Million
Tenant ,-Improvement. threshold requirement specified in the 'Work Letter and.Escrow {
Agreement. i
3. in the.City's some correspondence(referenced In item 2 above),we informed you that the
Tenant's Construction Fund was-not to be reduced to less than$50,000, until such time that
Tenant's work.has been substantially completed,as determined by the.Landlord,In its sole and
reasonable discretion,
4. Pursuant to the April 3,2013 response from Tenant's Escrow Agent(attached as Exhibit"R"
hereto),the Tenant was to deposit. $64,828,92 into the Tenant Construction Fund by April 15,
2013, to cover two(2)outstanding claim notices,as well as the original Notice of Lien filed by
ART Drywall, noted as follows:
FXHIRIT R
Mr.Amir Ben Zion
April 26, 2093
Page 2 of 3 j
1
i
i
Date Contractor/Supplier Amount Correspondence
10/27/11 Cors-Air $ 3,001.92 Notice of Non-Payment
12/14/11 Art Drywall $53,927.00 Notice of Non-Payment
01/24/12 1 MP Firestop Co $ 7,900.00 Notice of Lien
As stated in Item No. 1,the City requires that the ART Drywall lien(which has now resulted In
ART's filing of a lawsuit against the City),be satisfied via an Order of dismissal. We will require
satisfaction of liens and releases for the other two(2)liens(Cors-Air and MP Firestop Corp).
.5. As a condition of the.City's approval of Resolution No.2013-28167(attached as Exhibit"C"
hereto),Tenant verbally agreed at the March 13,2013 City Commission meeting to execute a
General Release, attached as Exhibit"D"hereto,waiving any and all claims against the City ;
including,without limitation,those with.regards to the kitchen ventilation and-relocation of the air
conditioning system.
6.' Site plans were to be submitted to the City prior to the Public Hearing in connection with
Tenant's proposed entertainment use. The plans were to reflect certain conditions required by
the Planning Department,attached as Exhibit"E"hereto.
It Is-Imperative that you either comply with or,where noted,provide the City with the Information
requested In, Item Nos. 1-6 above,by no later than April 30,2013,so that we may advise the
City Commission accordingly, and determine whether to proceed with the May 8,2013 Public
Hearing and consideration of Amendment No. 3. Failure to do so may result in the proposed
May 8,2013 Items being withdrawn from the City Commission meeting agenda,and In Tenant
being placed In default.of the Lease,which remedies may Include the return of the Premises to
the bity;-the acceleration of rent due and payable through the remaining term of the Lease,
Including all rent deferral amounts to date;the initiation of legal proceedings;and-the recovery of
any costs and reasonable attorney's fees resulting therefrom.
PLEASE.GOVERN YOURSELF ACCORDINGLY
Sincerely,
Kathie G.Brooks
Assistant City Manager
AP:KOB
Attachments
i
Mr.Amir Ben Zion
April 26, 2413
Page 3 of 3
Copies to:
' Mr. Steven E. McNeff Mr.Amir Ben-Zion ,
Registered Agent 585 N.E.-58t'Street
Penn 17,LLC Miami, FL 33137
45 N.E. 41 Street
Miami, FL 33137
i
cc: Jimmy L. Morales, City Manager
Jose Smith, City Attorney
Raul Aguila, Chief Deputy City Attorney
Anna P:arekh, Director of•Housing/Community Development
Kent O:Bonde, Interim Leasing Specialist
F:%$A1Msset%Pennsy1van1a Ave Garage Leases%Penn 17,LLC%Penn 17—Penn 17 Outstanding Issues 04.25-2013
a
. i
• I
' '. . • i EXHIBIT A
MIAMIBEACH
Cry of/NIMM MWke 17W Convention Cmbr Orbs,Ramr Beach,AW&33139,www.mlarA9=ftw Nto
REAL WAR..HMitG A COMMU Nmm DRrEtoPMEW � np
'Tah post 673,E193-i WJ&WO33 N �o
Cn
March 28,2013
t' nto*1=
Mr.Amlr Son Zion Jeffrey A.Rynor,Esq. a
Managing Member Mftranf,Rynor,Adamsky&Toiand,
PAS
Penn 17,LLC. 301 Arthur Gm trey Road,PH
1 13B1 Pennsylvania Avenue,Suite 0 Mlarnl Beach,FL 33140
•Miami Beach,FL 33139
CW W9 Via OI dmIc rna11,remlo requaW ft
'1m1rd oetj,=;
• lE�(nor�rnrlre_nl,00in - .
RE: Work:Letter and Rscrow r'eemot (Work 1.ette and between the C of
� .. . �.by hY
Miami Beach Miami Beach Redevelo-�ment en p
ci
o t d
. - p Ag cy( lecthre y i.an ford and
Penn 17, ).LC ("Tenant% and Mitrant, Rynor,*Ada maky A Toland, PA ("Escrow
Aperit"),dated Au00st 290 2011
NOTICE OF NON-COMPLIANCE
Dear Sirs:
As you know, Landlord and Tenant are r ume*negotiating a proposed Third Amendment to
Lease, whiff.M echodufad to be.preset ed to the Moyor and City Commission it.Its,Aprb 17th
M eeting. .. .81noe, throughout the bourse of ne9dations :(Which .have 'Included :various
prreser tatl o before the.City's,Finance and Cftywkle.i�ro)ei�s-Committee'nd, most-r+iw tly,
conetaletation by the iqi Commloslort of the proposed rent abatement.and deferral sahWule at ,
the,1�Rar�ch iS, .2013 b ltyornmisilon tne0tinp), the Clty�10ornmisston has peen Clear and
ooneistent that, aside#irotn(hp lss�es heir.;nepotlated,the Tenant rriuet be odterwiae M good
stendtn.g : i1d:lam 'ftm *fauh -tin the Sher-pn�Visions of #ha:Leaas*nol et:l$eus in;tho
negotlatlan8).: 4ccordlnplY,' P i loq thr,pi'aseiitat(on of the Third Amendment at the�9pol
City C�ryimisston rrie. ng,;'the.;Clot dmintstratlor� has been reviewing the rematnirtg ts>;<se
terms to.onpum that T"nf:has beer!oom same.
To this end, the purpose of phis Notice.is to advise_you of certain.compliance-related.bsues
relafted to the above-Wor pnoed Work Letter which requUe your Jmmediate abh lon,.as totlaws:
1. Ajticle 1, iectlon 2. =The City has no.record of Tenant's second deposit Into the Tenant
Construction Fund, m the,1imount of.l�5p0 00.This amount shotlkl heVA been Oepositpd pn or
before:45.d+sYe after Ailgust.29,2011(the Effective Date of the Work Letter). The Eeorrow�igent
waso.have provided ha pity with wn#ten:nodoe ear receipt of each payment used on the
steternQrlt repetved from the crow Apent,dated ooh f 2,2013,and attached as Exhibit-W i
hereto, 4t.appears.the;Intdal 100)jobo 'the first half at the Tenant Conatructlon Fund) was �
deposited Into the Tenant t►onetrl.�oNon Fund j. reinafter TCF)on dept 19,3D11. HoiNever,the
only other A90oait made Into the T- CF occurred on February 1, 2012, to the amount of
$160;797, Ieaving a balance due of$349,203.
AM1r86n Zl!n
Penn 170 LLC
MaMh 26,2013
Pete 2 of
i
Aeffon Regal .- Within seven M days of the date of-this-Notice, Tenant must provide City
with proof of payment(and deposit with Escrow Agent)of the remains balance due into the !
TCF. Failure to do so constitutes a default under the Work Letter and,consequently,the Lease.
I Article f, fttlon I - The TCF was expressly intended only to pay actual 11ard Costa"of
Tenant's construction work. No portion of the TCF was to be used to.fund `Soft Costa,'as
same are defined M Article 1, Section 2, page 2 of.the Work Letter. Based on our review of
Exhibit"A,'-there are two(2)disbumem"that were not approved by the City that were used
to pay for kerns specifically defined as Soft Costs as follows:
Table I
Date 1 o Pa Yee I Amount I Demo
t>8/20/12 1687 Miami Beach B14g Mt I if 2 M 02 I Permit Fees
LOWD/121 1688 1 City of Miami Beach'Si De 8 804.48 Con ourron oyfew
Tote 1 BO 27. 6
Aellon Paqulred: In A000rdance wlth-Artide.i, Paragraph.2,on page 2 of the Work.i etber,"All
Soft :Coate Mail..be paid.as and when due from-Tenait's own funds other than the Tenant
Construction Fund."-Aebordingly,the eforestated Soft dolts,In the amount of$60,827.55,must
be replaced In the TCF. ,
3. Based an the C8y's reconciliation of the TCF,which recandllatlon k attached as Exhbl"B"
hereto,the 1!ollowlne Otscnap nit es*wiere noted; .
(1) As of May.B,20121 the Cityreflectss the ropelpt of requests fpr,payment(l.a•,In."form of
Draw Reiuests approved by the Clq�,:totaling$723,268,_'Ho0io* the TCF.otenwnit(Exhibit
"A').-*tly reflects disburreemeWpaymente":made by Tenant to.taling $860,787, fbr a bot
difference.of, 72,469. . Ths.dliferein eppaers 4o fie.in three (3):Oraw Requests that were
approved by the City, but were never disbursed form.the.'TGF,totallnp $133,106.64.(and as
noteol In Fable `2:beta ;.coupled: the iwo,unauthorized ed.payhient8, In eta Bmotmt of
$60,827.35,•t's�fererioed in`Table 1 of this Notice,
Table 2
10 ate pay" I amount Memo
110/27/11 -Sky Builders I I 0,8DIDO labor B metertais
12114/11 -Hellorari ne'truction 11 26 ,00 Labor&materials !
9/24/12 Haliorinn Construction 100 548.84 Labor&nWWals
Total e183 66:84
(11),Pursctant to the M'e reconciliation In Exhlbtt'S,"sand subject to Tonant's comolk oe wfth
Acdor►Items 1 And.2 hfof,the TCF.rahould reflect a balance of..$276,733, pending Tenant's ?
submission.of any additional Draw Requests to.be approved by the Clty.
Additionally, -you should also be more that section 5.2 (n) of the Lease Agreement by and
between the C1ty of Miami Beach,the Miami Beach Redevelopment Agency and Penn'1171 LLC,
dated .$epte tuber 16, 2011-(the."Leasep), ipsOcelly requires that in no event shall the
Construction .Daposit.,into the TCF be-reduced to less than $60,600, until such time ea the I
Tenant's work has been substantially completed,as determined by the Landlord, In Its sole and
• r
AmIr Son Zia
Penn /7,LL C
a amh,26,2013
Pbp S of 4
reasonable discretion; and, shall only be released upon Issuance of a final Cerfifiub of
Ocarpency(CO), with proof that all pemlts have been dosed,together vM final tan waterers
I
and contractor's affidavit reflecting that .all contractor's, sub-contractors, bbmn and
matertalmen have been pold In full.
I
I
Action Required: Tenant and Escrow Agent shsli.provide written darification,within seven(7)
aof the date of this Notice,as to the dlecrepandes between the TCF statement(ExhM'Al
the .Clay's reconoillation Exhibit TT such ciarlfication, confimft that the aforeatated
balances remain.0 the TCF.
4. ..Arg* t% Siodlen..1.- -Tenant...shail.Maguire. Its _Contractor.to.provide uncond�(onal
performance,Arid;payment bonds_coverin;the totst.value of.Tenant's work Issued by a surely
aooeptoble gip.:LandlQrd..,:Aold,bonds,shall:.pe':issued.for each"boontrector, porhotor.or
m4tertairnan furntshtrtp material ot�ovidin�lebor-oi sondoes to-the Premfsos and shat! Herne
0 ..
L.andlo d u.:ran:arddttlonal obliges'X11)*be in.an mount 1n form .content, and Issbse by
sureties,saflsfactory to Urdiord and,{iq)be In.compllance with applicable laws.
Action Regdbr dw Tonsnt.ohs#provide,within.seven(7)days ofthe date of ft Notice,copies
of any i n*d,all,performance find payment.bonds ps required.
S. To date,010.0y.has mwjved fonnai.notii ootlon of two (2)dalm'notloes,as well as a Notice
of Lien,-jor rion-Oaymbnt of work and/or m-terlals related to Tenant's Improvements.es noted In
Table 3 below;
Table 2
ate '�-• ContraatoNBu tier Amount Correa ondence
10/27/11 = cors_Vr ° . . . $ 3.00112 A Notice of tj2n: -
12/14/11 JAAP ll "327.00 'Nodoe of Non-Pa nt
01/2412 .. MP-Fftitoo Corp 7 9D0.00 Nodca of Lien
Ac,loti: . �►vld. . n :er;no#!ce of nt for :
T eeqq► ye , 1�0n ymd JabAr, r materials on accoirnt.of
ei`lpOro:1Norlf, aheill.be�lee�e� iii dot i��oved, eattsfba or�ib'bond, an Evbrit of
Def�t,ilt-Irri -er'the iNork..Ler:i�nd the lraas li�eorrnt, :iCOrd(rly, 'erjent Intret prove to
the. tty,:1iv�#hinen{f7� Faye iaf the. #ate. #his:jVotke, doauntetlon af.peymer�t or other
fbft of sefisfist4on 0 fa gM$anglrl�j Reims enumerated M Yabt®��bova:
Again, while lsridfArd oondnues:to work udh Tenant touverrl propene on end presentation an
April) #the.7)Vrd Ambndmei ;to.the Leese, I.(egeln).�emphaelze.fit s Cry:irornmission'8
final cotis� tfoh A..d; ppro�ral.io 4he-.T- hlyd Mindrrtrant,.wtdch`.v*' tend.to ant ON' �
-:
Aprii 7,; 0 3 ► orrimlisstpD.me11p`is licated hi corioltlori#het Tenant but for i
failurro to:pay iient In the.grrlpilnts� rrre�it�y rieguiW.under the lease,is!tt good stehdlns and
free.from defauk with free of to other.Lease visions ndudl
he.. . Id.. fl :np,:ibut�rnttation,the terms
and oondi Ions of the'Work Leiter,witch is inc tpbn ted a�a an+exhibit fo the!.ease), i
it is 444fore 1Mpbrative'that �rou'Prompffy provide.fie City with theAnfonnotion requested 1
hereln,-tndludip'.* :phy.Apure Miasma requlred by-the Cky, so that we.May advise the-PHy
Comrrilssion .(when`.piiibnfing the Third Amendment) that the Tenant is compljring v�lth the
terms#the Work Letter. Aocordfnply, please respond to the CiVe'Actlon Required"Items,as
AffifrBen Bon
Penn fT,LL
March 26,2013
Pepe 4 of 4
get forth herein,by no later than seven(7)days from the date of-this Notice,or by ApdI 2,2013.
Failure to do so may result In the Tenant being placed In default under the Work Letter and the
Lane.
t
Please govern yourselves ac oordln&
slncenefy,
Anna Parekh
Director
ARWO
Atxaohments
Co:Kathie 0,Brooke,Interim City Manager
Max Sklar,Acting Assistant City Manager
Raul Agulfa,Chief Deputy City Attomey
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a
EXHIBIT B
- --
M ITRANI RYNOR
ADAMS ICY TOLAND
Alit
I
ATTORNEYS -
301
our 094W�
.
AMuW lewh R 89146
T80U MMM
F 8Qlt.868.05b0
wwNrwaMaeaorn ,
Fort Lwdadol.OIP= Apcli 3,7013
88iIM4Wi Iq Comma=ft"
Weft F! 89926
. haoioom
Anna PatdA Dhicim
isspi J.Aguila, Doputy C by AftW
1700 Gbnvian*w C kg ta'Ddw
Four�Flocr .
Mlami B04 Florida 33139
Res Lowap"ON PRO bet"die CYO 41`mawBasok FloAk
?lysMaardBAWJl RedOwAPMof*Ni 'MOWN 4A V adeiWw&
AOrrfed Jq orZas&ro adPanx 17,4$COi i,hvdWkgdw
kwu . � , a '66Suorat R1vaxdAO ia�oo �' a �vow
GarVe,166ZPM* bwkAWAU4
mod AM&F!W&OM
Dw Us.ft*h and Mr,Agttiiat
Tfds letter rd
paonO to your Nadoo of11 wok mpHww dated)Am&269 2013.
,trou ],ano�r, the
TM Mt IM.: wau .10 �aa W".�rf 90 :Ono Mini= Dom
tad the Testa '
lsa `onsEtuobou. ,:beoeuse t>te�'aaat vvacp��o the
r+detauremt: e tfttl'as por able,pW,�'vlde=p4rwl" e ,
vo, ai'v3ao,"1a�pt�ar to.600a�pbeh#his. oat, tho how�a 000n�ibeted
=6 ind spared no eme tn 6esign ttnjim. oe t .Qo rho
ey ! daooltt ,oad. a butid-aut of the yy much
Otis.mint the twimt.put Into the ,to 00il t#tam a gatW end provide
an ara'hitectural r&h& ;
Mth this in mind,to TenEnt reeponda to the oomplis,w related inues ss fbllows;
Y. Attiade 1,f..00Ow 2,-The Taint provided a d 1
epaeit of$.500,0 atl 3e�eaabac �
190 70i 1 and-;, SQ,796.82.4opook an pebnwe %20121br t;total off'sdo,796.$2.'Tl e
Taunt .Paid,:ft gpnftoft.,.caste 1a $he aummm'..old $1,2811614.12 t Retbu
Cc B6rtiobtca Joao. In ad italon,ihe.T*a*paid$9179489.41 fi*idbohm
ooat i ltoa ts .3e Tasn ao toms l , . btpmMt md
ft' yaM
*M&Daft
eppt+aa ete�1Y$IZO^pint ft Ag f tie(,$130r004)and eraW*tui ($128,dQ0).
Alm.fie TeuAat did not dgxw t.the�g Wow of$349,203 it aaQtd*
•complied w th the 's raquir rM9 regarding doi?et<uation byp Wigg for the
..i7 .
MITRANI RY.NOR.
ADAMS KY TO LAN D
Alit �rPnl.n�.l �y PYYi�Y���ryti�1Y1.r�M
J ATTORN FYS
WnMwdm ooet as reflaoted in the one involves and ahem attwW hwdo es
Hc>zibit 1.
2. Ad& 1, Becdon 2'— Altho* the Tenant pW City of Miami Bomb
ldigg Delparttnant paamit Rees and oommmoy fba%the additional abeaks that have
bow.applied as Exhibit t to this latter nfiect that the Tangy has paid fbr bward colt
bgwd the&tnd Woilty eatioipaWd$n the TCF.Gbnsegt�anetly,dw Tenant would
ptopoee tint the bard axe dwt wen paid to the senecal,Ombe tor, a wet sup Xfo-
aoitotoxe,be at+ ited towards tLe hard vests,
3. Attacr Wpleaae,flnd u I Ghibit2,the dfel, -w t of the ftmds.
4. Archie 9,you 3,--,As.you arrow the ocntraoW has pwb=d under the
ooj*avt and oamplated 9w pdwie L Umndldmw lwhmaw.siad payment bonds
M not X4dily siyatlabie lbr its, Howew,the.Pimuft pznoase are isodl as a
simple visual impeattan will oaaflrm that ft wads has been o=pleted.
3 -Tiro Tama wO deposit in awow$A,828.92 by April 1S,2013,as it Ialatas to
the. comas refs men to is ester In
t oe. yew'�. the meandme,the Tend bas already boon
is wntw t:with'jhe drywO oon;W and it is w3liiag to agree to an c.taufon, if
wry to the,00anpWat,to aadubly resoalvo this matter. B should be ned dot @se
Tanaht disputes there Oa!me,but a+lll resolve them u coati as possible.
Very
�' f
2
EXHINT C
REBOLV'MN NO-6. 2013-28167
A IiMOLUTtON OF MAYOR AND CITY COMMINION OF THE CRY OF NMI
BRACH,PLORM& ACCItP"M THE RECOMMEMDA"M Of ME MNANCE
• AND MWIDE PROJECTS COMM PERTAINING TO THAT CERTAIN
RL'T'AILL,IMIAORLEMENT SYAND BOWSEN THE OITYOF MIAW MM¢
TM MIIAMI 00014 RLDEV9LOPIMENYAGENCYAND PENN 171 LTC(LM881
DATRED.BEP I MMQER 1Q,X19,INVOLVING THE LMASL OF APPROXNAIM,
y,8da :,SQUARE . OF GROUND.FUM MAIL-$PAGE-AT THE
PaNmiVOrAmA Avmum vABAGM,-lNI MNNSxI.VANIA AVONL%IMAMI
BEACH,PLORIGA; ORANMO'!M.LM89b THE POLU Mi11NO AMENDED
801441OULAE OF RLNn 1) "NO 0101`.1101 1118)Ot.."I L 188Ee'8
0 •R7G18'RNO,�eCURI.'IY.;bE�081T; �4T,84+R,�OMYAIID: p
lIBNT OftD.010 I' MOWN OF,HOMIER..AV.I ;�00.0.. NO X8,47'4 1
OIL oNAIWA"NTmN�Nc chugpol:Na ER2o1$ Iabase
Ii,,pure 0^ D0601BEt kt IMTHI�IbYALAMOUNrOP
ptBPERR�ti7'+0.8 TIC K�biJE I4APPROVO AN
Ii1WA' AMEN. .P �+!gR4t5NT:(II�i)OF�'HL.�A��N'I'.AND 4AM WA .
I R.. HE*,INX �A106 D.;�MING ,iIANUARY Up lols
x'!'blOIJON iRILY 1,�1,: SI DI9R8!R INtt p1F1Y=PBRCE1�l'1', IId96 OF'THM
E •A D aAMll POR THB IX Q YON' 1 COW G ULY i
Imo' O Ptiod dtQN
44 012 :T'NOUN N "VARY'48,014;-AND,A)PI OVIPIN0>VO'R:l
PAYMBNT.,Y, 188ft OP?�''k{e Rb. BCU�!{TY.�BP08s'i' 1ND Rp-
..•PA lt"T•OP THE NAACK DUe RENT PM NOVP BMtANIb 6MtNB%XI21
ALL IN-A*OCH; MCN AIM ME 40WUL,E.ATrAOH®D.AB
�U�I�'!!yA". IBRRTO;I�I,JIRYHeCt 99triia OFA PUNU O IMUNG,BY THE '
�!w Pc*APAL 4T,�Ii,ItL9QIUP,DINO 888'8 PROP08A1:`=ADb AN
..,MN'�WrAIR MEt�lT OWPONRNY,;AS A NIW PROPOOW UOB ON THI LSME
: SIJB('AND A8 PARY JbF L888W8 OMM AL-TO'!Rd4RAII OW-AND
pRN' a PREMIB ),ANb AS Mi�4U1RED�Y idC't'IV !IOU O�THE
:. NIN81ip 1,oft` t Ml.l8, 1.9,.#�e►.MsyorAnd O6MM r"iftp`ted Reeois n Na,
a flt M��aAd wru,�b19 l�Al�IW�vu�rouYv*l
.,
: .47.UP. 9uhh ot~nine 8 484 dagie,iW40 of
•P I a. ofprouitd I+�sY riots p 8ia P WaniaAWne eQ1 Pr ► !AM1+ i1iott;i *�Tor tri#(p 1y Yueni
for N biki±ry,*�,Erin a bgalc td rop. >irtd
-''lAY r onFsft'g,80'18, Iln lfa"Wind ft. dommleotlon!�dopbsd ReeaA sort No.
20194D001.0 ►1rNI a I?i Amvtidm,... its 1,eslae;; eaM llt��r+aw hirt�bir loll irpaae
tl'0lTI .,$07 8quam 1 bo 7, squam as wsA praVldirlp for curt pondfng I t1 11n i
�rrti�il,atl Haas RsN!lkprrl. ,6281'4,1. ,and the oval o!QanFnon Area N1e�nl�erutr�oi►(CAj,
ffrom' 1Q0�87b
' irt�.itear ,iitr�se;612;lbsl ,hnd orommierifonodopa Isoli�lloi�No� .
,lt7oZ ,RpproVlnp3eoond Atriwmettt Via.its Levee;�) M> Lease 4 ons,�1)iinlh
��bt� and Ain�ddlliansit�o n�nlhe'o�'.BeiesRanito he l�by�he .
'1,+urieelgkft ��0Ih"v=*,�qupl t1n.Qnt Y nteMwi�ents •w h.l+e Lmr.p of
r±Ah� sung Oom*nArsiMaintirbads j,bo nmsro lnh �fllie erm
MO 0h orllhil it6y'6fthe�fE ., w'd�N Iii i s germ; I r" ino I eb,i�Of be Le6ee'e
Addbru AN"( 4 o*),*e d46l In eikon x,11.. Sts LAieare,40 Include an addftn0 ,
?B4 iqu er>tgr ei ruw 1bw obor+r a off. bulidlr 'a f ood p hele;'8))Inat ualny the
' ohwo . Coon Meintlel a(C�I�J}from ,8lsQ '�egr to�iQ1 t, to,wed the
inoreass h nfxe o1'thsAOcWonolAnm;*itd.4)oonsb%i'llnQ,�the l eeeee'e epld octal and most s,
,
a hew rWaoerrwnt errolosurs fbr the storsp of flood panels, subject and pumuant to the
satlsfaation and approval of the Lessor;and
Yl HERM,the LmW Pmmlees,which housed the CooperAvenue Reebaurant,have been
obsed slnoe Deoember 17,2012;and
i
VYHEI AE to Lam M now reguaeting teat relief in oonneWon with oataln operatlorrall
oompiloodons rosu vom the falluro of ft AIr oondlBoning system;and '
WHERNW,on Downber20,2012,snd January 24,2018,#*Cat's Flurm 8 Ckwlds
Comrrrbm{FCW PO)expraseed support for prwMing come!oval of rollef fa the L m, ,
r eu cot to�ths indu of rolease Mnpusee abadvin0 the Clay of any kWk np rft
Leseae's aost-aywam WW d*M.talated tc Is of bWr*$ r and ,
WHOW11#WPDWPGreaamrrlended Intavorofthdfdowin to m 1) rpor d
1/3)of Lesees'eixWnq.&m*Dop .f!p #47,844, 15mme owradfor
' .fno�tft pt,Novw bqt,X012; ,'�defarrin0 ,47.4 for Am wls� bane-OW for
Ndwtr�ibat' 101 wind ee Aim �e
. a. ,t oortlbM'�0'lAs In the.W amourd ofd!M
(Baak�bue errtj;: j wpP .Am.iNba>terr W.c,f Oft of the Rsre.And�Cotimm
t fulatnirutfrrroe(Q dtis tbrs sbE(8)n�ori� tiod.cmmmenop Janirury'(a St04lhnh Ju ►1�,
2013;#j t flltY p0*9-(e0 16f file wave bent end CAM fbr the rlbc month.period,
oommehp p Ju�r 1312013 1h%uEh.Januiuy 14,,2x14 rpah d!'irlod�I.- .btr,"—w -y t
Lsvee h tMrengr bur 04)rguat monthly InsteNrnents=ftUm n hi the fablt r bt'}he
'Form end ending o"is .d�ayy bf ire seve d . Tian; and 6)pr6,Mlnp f ro�
Iran*-Due.eht.by t.esass.of the.orte�tit�nd e4ou*'doposh In the-amount of$47 844 and ne a, . ,Rent for No""mW and Okimbar,2012,1n the of 14701 1 1a be Mold in
tVwslw 1
e ue1 mrfg meta 1
.p !mere oam�msnoh�In the f yaarof#he Lame Ts'm and erdng
on the•fast day pt year of the:Ls Term;all u�rrther cat forth In lsx?xhl6it'A'lo pia
Reeduttleon;and
MI'HON"tat the N.qL*or the Pow,t o Leoeso.-tw prgvidsd the Adtrtinlstratlon
with,et prallmtnory bustrrou plan wM proposes.m-bn kW and re-openlna of I*Lreaesd
Pnrnises by.14r{y 1�,Zo92;end : : .'' . . ' -- . - . - .' . •
:WHIMM,Less®e propoaes.that_the, ees,When d,will how three )
Ir>dfuldtial 4onasptta,,Nm At�ohor',feptaurpnt fgolnp 17..��et,involving peaces a rstooatlon
eort�.8tr►ret {aunt" #oaAted4it tha'fo lrc> 68. MY chef loto-nlghtteat
oair�fal�ey.11; oer�sr iAotla.0 of tai iplroa;find(subject ta�Cl r irPpro±!�,a ioui�elbsr!n tfre : !
salatitip bet w�ea;iihd
® I
t .
sinbs ores -e
'.IA.Nt REA$, oQm ro yin. rdertsinment �fiioh E not .
pp �,
a,psnrrtbed, 'in.t��. o;and� GCC)�oonll?n:dlsttid, a publb Iwarlrip M '
tyrqulr ,ilntta'.escott'1+42«e�Z dt the Ofty a to.4pprays.euoh rye.
•-1VQtiV',TFI �QR�,0E I'!'.pUl.1f'R®BC�L.11�b pY.'i7I�.�MAYtNtANb-CI'fY1813#C1N �
t2p INS
!'Yp. tA�f#bEt14CH,�#ARII),A,, # the ll& orand CMy Cpmmlesian g0or�t
tom:t~ioot msndardon the a #�trioixlir bnd �°deals contprilttee.pmnT to a w.i6d Amsndr»4r �Vo. !certain. !..epee 'r+eemerit,hy sr0d MrNdi'. ►oT
=W .
. i. the l�lllar'r11 Pesoh,fitsctsyslopribn!�►pb►x�(�lecth►aly,l�iiao , r,L0.
,4 f.10 .100 19 the Ismo of rmpas l3d5. of
EnoWmd Sir rr a moil at the PenneYlvanla AvehiA tmm- 198 pas Trite Avsnue;i► W
Beech,-t?lof tde;nvoomtrier ttiirl,-As jW d(esld Amendment;the l�ey�r Arid V opMrob"
slpprpv the totlowsnp wed schedule sif t 1)�Ipp in t !bird{1/8j ot!!ie t.osess'm ienrlrl� I
dop*kr the iaYroW.af,447,844 #oaiwrrds:ba�lus.tent:amours'owed:'br the �lbttths.o
Nowlmber,�Q11; 1)doff t�8,474ter'Carrmori�Maintbe►nanoe(OW fbit
flea iter�t,:pi►m?c !►idl,lhr-Deciemberr; 01�, dpi mino�snt r�-{B aolcrs ;$y
vlrro 0 abetofnam of f flt�t peroe"t(OR of the bus Rent Om natr Ar*e Il nar"
( Mj br the e1*MA ps W oomrnenbft Winr�y 18 thnor�ltt J*12,-2018;4)dslerrlr�of toy
I
peroent(6096)of ihs Bees Md and GAM for the W*mw th period oommenoft July 1$through
Je�nuary 12,2014; end 6)v*vldlnp for n-peiyment by Lesese of the one third seou*dspook end
ro•peyrnenlofft Baoc-Dus Kent fofNovember and December,2012;el( In aomdonoe With t to
April N 20 81 u s shed� I N Whervio;**or Waft of a public haeft by the"tr ;
8 e' proposal to add an entertainment=Vonent m a rowpropoad
use on the Lease Premises(and as part of I me Is proposal to%-brand'and re-open the
Pwrilmesl and as re4ulted by seatlon 14240 of the cry Code.
PAS89D AND ADOPTED THIS !$TM
DAY OR INARftH,201a.
1 MAYOR ,
ATM T.- .
CR'Y CLt:RIC
t KGB.'M&APKOB.
1rAMtDu1N MM lsbawrM Pant 17 WO off@ R880AC
APPwOVIDA00
KAM&LANGUAGIS
} tPM W=0N
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G�E��R
.,
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This Instrument Prepared By.
City Attorney's ice
City of Miami Beach
1700 Convention Center Drtve
Fourth Floor
Miami Beach,Florida 33139
I
GENERAL RELEASE
As consideration for the Mayor and City Commission of the City of Miami Beach, Florida's
adoption of Resolution No. 2013-28167 on March 13, 2013, PENN 17 LLC, a Florida limited
liability company, for itself and its officers, directors, shareholders and principals (collectively
"Tenant"), and AMIR BEN ZION, personally and individually,-by execution hereof, hereby fully
i and unconditionally release the City of Miami Beach, Florida, and its commissioners,
employees, administrative executives, staff, attorneys, and their respective successors and
assigns (collectively "City"), from any and all manner of actions, causes of action, contracts,
agreements, covenants, controversies, claims, and demands whatsoever, whether legal or
equitable, known or unknown, fixed or contingent(collectively,the"Claims"),from the beginning
of the world until the Effective Date of this Release (as set forth in page 2 hereof), and relating
to that certain retail lease agreement by and between the City of Miami Beach,the Miami Beach
Redevelopment Agency (as "Landlord"), and Tenant, dated September 16, 2011, involving the
lease of approximately 7,655 square feet of ground retail space at the Pennsylvania Avenue
Garage, 1661 Pennsylvania Avenue, Miami Beach, Florida (the "Premises"), including, without
limitation, any Claims resulting from the (1) ventilation system, and/or (ii) the air conditioning ,
system on the Premises.
The provisions of this Release shall survive any termination or expiration of the Lease.
This Release contains-the entire agreement between the parties, hereto., and the terms of the
Release are contractual and not a mere recital. ;
k
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, I have hereunto set our hand and seal this
day of ,A.D.,2013("Effective Date"). ;
TENANT:
ATTEST: PENN 17, LLC
By: By:
Secretary General Partner
Print Name Print Name
STATE OF FLORIDA )
SS:
COUNTY OF MIAMI-DADE )
The foregoing instrument was acknowledged before me this day of
2013, by as of Penn 17, LLC, a
limited liability entity. He/she Is personally known to me or produced valid Florida driver's
licenses as identification.
Name:
(Print Name)
Notary Public—State of Florida
My Commission Expires:
s
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2
ATTEST: AMIR BEN ZION
i
l
By: By:
Amir Ben Zion
I
Print Name Print Name '
STATE OF FLORIDA )
SS:
COUNTY OF MIAMI-DADE )
I
The foregoing instrument was acknowledged before me this day of
l , 2013, by Amir Ben Zion. He/she is personally known to me or produced valid
Florida driver's licenses as identification.
Name:
Print Name)
�m )
Notary Public—State of Florida
My Commission Expires:
I
3
��e�� �
;\
. . �.
:\
\`�t
�.
��
`,
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��
Damien, Elizabeth
From: Lorber, Richard
Sent: Thursday,March 14,2013 7:10'PM
To: Parekh,Anna
Cc: ' Agulla, Raul; Gomez,Jorge
Subject: RE: Penn 17-Conditions
Anna,
As we discussed earlier, here are some conditions:
• A double door vestibule shall be created and maintained at the main entrance of the establishment.
• The ground floor windows facing Pennsylvania Avenue shall be sufficiently transparent to afford views
of the interior of the facility.
• The applicant_shall be responsible for maintaining the areas adjacent to the facility,such as the
sidewalk-and the areas of the street adjacent to the property.When sweeping the area in front of the
establishment, the personnel doing the sweeping shall ensure that they do not merely push the refuse
In front of another building, but pick up all trash and dispose of it appropriately.
• In the event there Is queuing of people to gain entrance to the establishment, stanchions shall delineate
the area to allow for the free-flow of pedestrians. Security staff shall monitor the crowds to ensure that
they do not interfere with the.free-flow of pedestrians on the public sidewalk.
• Street flyers and handouts shall not.be,permitted, including handbills from third-party promotions.
• All "wet T-shirt,""thong"or"bikini"events shall be.prohibited.
• Security staff shall take measures to strictly enforce patron_age restrictions in the City Code at all times.
From: Parekh,Anna
Sent:Thursday, March 14, 2013 3:42 PM
To::L pib-er,_Richard. ;
Cc:.Agulla, Raul;sonde, Kent J
Subject:;Fw: Penn 17 -Notice Public Hearing.doc .
Richard,
Are.you OK with this proposed language?
Anna
. N
Fromm: Sonde, Kent a
Sent:Thursday, March 14,2013 03:36 PM.
To:Agulla,'Raul; Parekh,Anna a
Subject: Penn 17-Notice Public Hearing.doc y
Raul,Anna
Have drafted the attached Public Hearing notice.re Penn 17's proposed Change of Use for the entertainment
component.Please advise of any changes,before forwarding to the City Clerk.
Parekh, Anna
From: Scott Levine[sslevine@msn.com] {
Sent: Tuesday, May 14,2013 11:49 AM J
To: Parekh,Anna l
Subject: Penn 17/Cooper Avenue Letter of Intent
Attachments: Scott Levine.vcf, Penn 17 Cooper Ave Executed Letter of Intent.pdf
i
Anna,
Sorry for the delay, I was out of my office this morning. I would a like few minutes with you this afternoon, if
possible.Additionally,one of the principals of OBK Project, LLC, owns and operates 12 restaurants already.
Please call me on my cell (954) 709-2583 after you receive this email.
Thank you,
SCOTT S. LEVINE, ESQ.
i
SCOTT S. LEVINE, P.A.
1555 North Park Drive,Suite 102
Weston,Florida 33326
Telephone: (954)616-1132
Facsimile: (866)703-5508
The information in this e-mail is confidential and may also be attorney-client privileged.The information is
intended
only for the use of the individual or entity to whom it is addressed. If you are not the intended recipient,or the
agent
or employee responsible for delivering it to the intended recipient,you are hereby notified that any use,
dissemination,
distribution or copying of this communication is strictly prohibited. If you have received this e-mail in error,
please notify
my office immediately by e-mail SSlevine@msn.com.Thank You.
1
FXHIRIT C:
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I.;�i1te�a;r�c i�c3lticnsctl: �/
'Ct:i•.Jolliet;i.ntietik:ttt dittrtl:tti ttl' .r.
t' 1iT il_ p Ml I. b,. and ;litttl y Pi..-nn 17. y
l.t.C,a Eit.►rl{i:r 1imttitt~►1 liah411%wtstilri,t�tthr.. •tm i �,�.ORK I'Mi.xi.I.1.C.a I'londa limited
lmattr;:t� %;timpani ttttii: r. m&d ftm ti.'ti-Ann,a r4•siJimt of Out Slaw of Fletrl&i I-Nn
jj i *� $m 10m;itw z.+ivndal trmi%or the propv%rxf-%.St:of.01Ma cif i1w members-hip imcrestc in
0%. Co mp.m. 111V -%'Im e•.."f. �uivfi ltly 4►t4meJ I%%- ner-Imn w ,ho 13tiver ulxtn the t¢rm•t and
s;nYt fii'ttitt �i�, titt tit hermit in thin Agrmiria►:1 wid that�Cem in NL'it~ (,lic " c►�"l.
dateki;►e tat Aptti„„_;1111 4.-aid attaciv.-d ttcrteto 05 Fth'ttt A I1114;'•;1,ylg un"), 11w Compam•
vvms till of itit iight, lille alld intcriclit ra coati to"trborwr Avenkic"resat urmii located in Miami
' h'l+t►i►ij rt1iC"Itce�t;it�ruttt"l,
Ilse pwic-, t„tt. d Ihm Apt enwnt tit be hindimr.awl anftitvmt►It:. acid th:►t 11 •III murc to Ow
hell itt of lhv tumics.and 11wir&VIPWive 3tloeesSttr:,aixt•7�tiiE•ns.
1.Ptort;hatn wiJ Salc ne SI,wm,�. Strhimk tit the terms and conditions sifthis Agmtmmtrttl.the Now
and delintttve ijoculiclitatlon.at the 0{s5111r.Ui Ilic Tranaa.;imi ttltc"t.'.in ').the Pgvr 4-all
ptimhaw it mi Itevri•Am.and t1•LKt lwn i toll.yell to the Bv%Vr.the Sham. The datc on m hich
till t'lo...ing iNgutte is rel"M d 111 11e9eein mi liw, "'t,`lomill;
:ow-illimmiding anything to the t:tttttruq set foah in thls Aeirimie tt.tike
Mite of any litter 4hwa vent. tlw nu}-cf�ihitll Cart asi mw an; Nabilitirs itr tl6u;or Iiiemt-lion or
the t"ttrtitmn�.except s s spe itic dly.;:t i'►irih ill t1w c :frtihivo immatciion dticumentt.
m •r`s dw� ; _ p y a as„ e t .
ctili��`nct rL°tits�t. %tar 11P.Pivgatce putc:hase prim• liar dw Simms tthc "f'ureh•► • _ 't:te`)Q%211 be
5500.1100,pat. is to 11ra-.1n?t4 in ivinwtilkael% avail ible tundA oil 11w Claiiiib Date. Upon thn:
cvtew+iu,+ti of i1sis Nth:crtt vm.tits Rover shalt deliver let tea:ticikeC ittrm edi-met±avait,•tble funds in
the U8101mmtl of S1 0O.WU I.Irwirt iinm tlir S40D.Orxi i. It Wing fond'rslood and
;ti;n-%i il►ett%Mil Cttm:tic 111;111 bQ med h% tim A-141cr Mattel} to rvjmi wi l retim Ow dehls st't lotth in
Smiao $crf lhix 'tl* `ute dort ttiim rvquivo mftaymisrn.if the'I'm.nsuction 0m;e'.. t-n
►-11101 cuss 1.401.01311 ahall be tr:imlii wd w,attic• S.-AWc ilk C harti-A: Ctrs h!2; 4411"•'siittrw in ilt"
Cot; pny Ali% i tilum 1_+% [lie Suitcr to cttn4lN with iii%t:tkvL`rtmtS.agmtiiric►t1+.reprie-As wtiians
or tthlipitialt.<. ill tins Al.9%:+•m ilt. he ;-ttttc or thi tiefrtthive dot:vlrwetittitivmtti sled:ec►witulc not
im,nzwtliatr bre;kh ttl'this,qtr.:t�,wil.the Stelirt %hall be 1tm-411ilc�tl to 111111 i iatc1% R*pay lilt,NOIC
in 11111 lit the I�tt4cr. alld 11ic: tiuticer.hall ho entitlyd to all applmrahlie rvill Wics al 1m v Intl ill
eat,iq. For 9w avvidatti;v At'diluht. in the v Mont that .he "I ntnsactiun doc. wl clt►fit fin act}
rl`il ilm %liabi.�t t.'r.11w Note shalt iiv.im;jwdi;ttrl,, ;x:t elcrak'd am i evo-no dite :iritl pqablt rot
filli.
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(;C►LVn:MI._ As mwoi m Ct-r'tNe ilia-paitiub.w ill use their hL-!,4 c.ff srt:s to ablain all
tic'cs'wiq ihird•flany and gw.c mat ew ctxrwnt,!mciuding all certificate.im ttdt,and approvals
r uir i In ctlrm T11011%%ilh t o •t ylion.ot'tlw com m� mW 1110 ule orl SI:arc-t lion+uncla:t 1
� i t 3tc pt, � lye i �
The uvattcr, of the Restaurant. incltttiinL the: Sellc,r. ►fill contiam to upcnati tne C'titt>>;�1tt}'s
tV1ar!rtnv-.-. ill a malirfe-f C1111':6tit4`1ti mrilh pair praciiev hl'Sv\i,'Vn Ilic;Jate r?1'11111:1ymancm a1w the
von't immatitm of the 'I rttli:etinn. Th+,• pattio :al r w td 1weivirc. rwrpikiiv aml cxccutc a
mmtbcr_;hzp lxtrchasc aitd sill• ar.m:tttcttl. tchkh %►ill IVNNI 1110 RTMS set f(gth in this
Ae cttacrtt and will commie cum mars repmwitiations. cm-mams and itidL•umili4,.
5.C i)ditians_ 1!w flatkvr and iho Seller%a341 not t+c:obligmtz!tat(.'trtt_{ummatc the ptrrrt:;w im w.&
the tniliminy cwldiming pnect•tient(tare 1+1.`(.'11 uwi ur x%aived in%monZ:tan• ih0 Atnrr prior to ilia'
041%illp Ossc•
a. The Buyer xltut:tv.amlil:d with tl,c rt:tilelts of it'.duc dilipmw
b. Ac 4Wlcr.%hall have received all conifit ucs.periiirts atui ippras•aas thm aw r gi6rad
in cone-Minn with IIw t3ttr ePq am-nerlhip of the Sham-& and alit L"Vration Of the ;
t'tiltlpan�'a bustl�,�.�.
c. The p.mk m,hull havc secured a heat;wren k;tu• t'mttt 11W ltatldlotxi tit`Ilia. hltildin& in
which the comp,anyN lxrtiuc..'.ti is upsnavil, at•illt all ri1.lTtt;tfil, lazes and twilled
amums fully paid and up to clrlty. A Ion;tcrtyk Wis.d z,%v%utc4 b; ihv.landl.otdf with
tlaytitenrs up in dote.
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J. 1,110 Selkns-thalt haw Completrh v.'ulcd and ohtuiived w1e.-:ws Mining to thr l:mo niv,
bi_ 11v ctuttraclor. Wallbatttr. Birk. and ant- (4her mitsL u dint claims, :amounts or
t;31,110 011';1001`14 &tt 1tinch Vic Seller %hall he respunsible. ;tad the Seller jhall '
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tvr wrtle aatillcn pnlat In talc Buyer of.,,em kinvilt :1110! ta.•1caws.. '11:R' IN)c1• laid its
rcpr(.�t ntati�es AU111 K.i+c,nziit,•d to p.micip•ite in an% such sctticmc tst,valid relcascc.
t
r. All 4+11W llmie6al them pjti debts nt the•Consixaty s9i,,111 lit►c41m ►.rx l)-repaid by the f
&01kw. mcludinp acithmil limiLik-1111, asltnttnls i►wed to real V.;tIme :te,*0ttts. bmku1�.
fiuppliers,utiluq 111tivitic m. and rely alltcr 11ct5azi auej*rioncy i
kv having it chain at;airast the C c+t11(any.
C 1110 Scller .h:03 provide the 1311+cr:t Lomplele alld t;tu+ilxi Ilensive list t+t'..111 t+s'Ow
C'tnttE1u11�'� ;at-wli uy-shit': u mh the m.-mem W4Lk::',k'd itt zhr (tilt' riilil-VOCC ilst
delivered b% the titiver it)tilt scriivi
V, All iulvil>.'c Uml prrlx nN ore wd h• 1110 Company mud's remain uac twj h%. the
t'mnrm oy. Wowing flit' ►1:rn•a1:ti(rt7. Ins. it:-Olet,tu;atil property i►wswil itadiwidual?r i
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h} ih,:Selki-shall be ir.'in4itrjvd to the Buyer on tee.awl twulilioiv,u eptablo to
tsu`13u t cr.
it. t ollouing thr vow utwunation of the Tr:noclion.die Compum %hailI imnunix.•tO own
all rit-hi.ittle suid rn:rt i to and k+the itc%i uirant.
i. The nuver shall -*lVv a weturivt : uVor p4cJgv agswo£nt. pletipsig, to the Ruyt:r
to my twment t?tl°-al of his nwrttiklr%hip intercxt tit the Cutitp;tny.which shares shall
be Ire told cis-ar of all tiewi .ual cocumbrances. nn cir licfutc tlW C'lusinr lyato, Ilk
kinkur to Mr ide ilk.•13uver vvtih ikktlttato�ccurhv under ttu•ytily. i
;. The pirliv-6. .h:sl) c-itahlivO an vwnnt or a"hold b;wrk" frotis the IN(chase Price io
t:ut i:r lk*iSilks tt•l~ttatid w itic C ompivn'-.6u%ive%% thu may exist as cif the Closing
Irstc. its tlr► aggred ate atotint of$I 50.0W. Such ainowlt siutll bC held h) thr
13u+'er'1 C(i}ttit-wl. 13n}d rt'..i�•nerrttr. 1'..'l.. :er a etttul tai nittCi� t�(3I ti:ty� tiiltntkiny,
ttia t'4i:yittt Date in�w+3t r 14)tulxi a�q dhOosmi tit istKlivt;rased liaibililics fiu wfikh the
Huyer may Iv Will re.sponsihic.
I;. Oil thr(loving Date,llte Set ler shall deliver to ttte Ruvcr(tic Shams five and clear of
-111 liens.CIWUmhrtrwvs or o lscr liabilittv%%
S.-Iletr shall 1liavide tht:11u%W vihh flit•prtxsf iiiat the Cite or TOlami Reach has
:t,yvckl to pu% 11x• ttntittubt of S23S.000 tBrecilN to its selei.`ed contructo: for the
r6vattcin tsf th4 ot:tne•;(~(gill tti lltc nuWtsl 1110 t'c±a:ip.iit t',tsvlldtnt:.
zit. The Stilt?5ihall wt luve Mbulled tut tine Now.
11. The Parties s4i ttt llte Closing tic)triter than May 15,11!13. �
tl Compliance h% lite 1 01101-with all of its ttk>sip1;atis under this At;reeni,cnt ;mod the
Now. I
p. I by Ncll r %hAl ux(11-C ltifid-i reilstvicd b) the NvAt,to.srdw to�ttitlC dCW.lack%tti1q
utttl ot1w hAitiii-^told for no other wwwa i'!x 5ellt;r Sltatl kt"tri Litt Ru4if.1pprlKt�1
K+1'am %itch tinter»-'(:(and:ssr rt IM)MC%tti'debi-i Faill v b% tite Otlycr to ctsittply
++ith 11%k covenaul.ball N.•yrntind,;for act:cf eratiug ata:tntatint.uuvd under the Note.
fiouvinsinp. ttst thi: iisscl-- -tibieNt tit the Sc'cttritr A)v", icnt and termimainu the
'fs a»sacikv,
6. t • i i,v)j r The%-01cr aprccs w.tooMrsiv.•toit lix;13utve%due ditil!eacr invativition 41'
tlw C'unitxtn;`% .(till tit Ivil•it'a Ow 11tiver and its repre'sentiliiA-, with prompt and
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reallo -W,o acce,.O to Lvv c:►i phlytIt's and h► txxtik5. t't'ilm1%, vole m s a0d tclt-wr isrformation
?.CI!j i •nq1ltt):N!i Lion.'rhe Ruder iml'vmv Ole clue dittrrw inAirmation vI iv far
Ow,purpose of the 13u�cr's due•thiry-c-wc inveslig,'ttion of ilw Compam's hw it>im and unkmY and
rinds Ills: plush,,', c:unPIumrltale the• 't 11MIM.3 tic>tt. the 114tym. its affillatt-,, dsrcetors, officm,
emplow-cs. adtisms. mid al,:m; itl:t• 1'U)Cr s ..Rcv ,• t, hove sale accv%� to tA-':
tlttc dtht:�ncc iitl�+rntalrr+t� '
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�.L'i►rt S;r�i ti lnli rortati�-n.'i N.�3u���r 1 -11 dl%Ousc Ilk,dtte tit gx'tice itMfi mtalwit only to those•
ltt:l�rtr�cttt.�titry of the Otr},,•r u-ho ivc-4 to i<tt«cr -wh inhirmulion liar the puipm of �
wilwisu»atinp the i'nslisaction. 'l In• tiu;cr agrok-% to ttc respun-thin fi►r an y bmwir Lt!' this
paxmgmpll K h� art). of Ilse HU%-C 5, In the evcni -.lr%: Itaasaction iK smi
consailm"aled. L1110 1 fryer will mum to the SOW :tits Iraittrial, wiltaining due dilipejwe
tnibmfation. or will 4MLity in mililti!that all:.101 Owtt'rmiq nr eopies of such materials havv
lVvIt dcstroyrd. TIw WINcr•atatr itiii!not wiv arty dw diliplt,-rxv inforination to vompete in ith the
Seller In tits l Ys:ttt that thr I muss ion i--full t:c>ttst►titman-A The pre►vmow.of this pamytaph 9
w iih sure iVe the termll"Olon Oflhtt:'l reensmlk.\otwill-AlI dims the fAregoinp.%W'Scllcrshall tv
portltsur%1.silk n pnor nwii;o to the tiny,r.to ditictm.ru potlatc,ant walc debt. %Nith third paxtieN
prior to t1w f latiing.
n. C'ttitttr►rutti ittpl���,er, Until the ccr.i.immation of t:re Tranwlm. or in ilk- evem ftt Ow
;�:u1ic�c:t?last,tur+ttttltn�Zt thv Tfamactlttn!ilir Buyer%ctll Writ-.-Aicit or muruitt lk,emrlo)c:es Of
tli�i.'arY�l�;r�tv'x}►tt;rits�:ti-
10.L&eJusive ikstjit g.Frum the date hereon until the o(King butt:,Ott ScIler will riot enux tutu ;
arty iij! wtnertt.disrty lion. or tiwtoutiation c%sth.or provlll4'ntihrmatimi its,tir wlicrt,t lcouraag.
vnierlain or consillt-r any tntluit iv;or pnspo►als front,ar}tatter curpomlion.lirm or usher pt:r_cm
Stith wSpect tit t:tl size p&:-4ime clispowtion of any mt-snhat Chip it►t4mm-; in the CmnMnv or a
material rmetion of ihs- ivwts oi'dw t'ttittpuly. or th)and• humily%-t combilullmil in olvi"O 11V
C'umjmn�. w1wilier by scary .,W aw rgm Cotmolidation. %hury ckchattt!e or other imti%nanion.
1 t. ill is :fir: wLwgmrnl. All pr"s rcaeww% and pk6lw mmouncrtnrntti telating io Ow
Tritlsacmill %%ilk k- gvwd to and prep and jiiirttl� t}y the Sollvr am) the h3u}w•r.
`tthjcvl to Ox-,pmv kions of 4 ol'ihis-Agioemem.L,wh party.gill jxt% all
t+t it•, cx;vnw-i, ir>,:ittt ing icF;at tats. inter Yzd in t►trtrc:cti�m% v6tl� the Fra i%v. tion.
!3. d'tttuiI'a i m: I tw Seller ripee vntt,attd ctarrf .its Mit Ow Hisy.•r will rill ieu;tir any Imbilily '
ill ctttulection wilh fix:Consummation of dw Tuans-z-a wn in aav shirij parts•with tcltoln the ticilet
or o%.tt5mim bay a Nbo di Q6timom rc•pruding Ow di,.pm%hiom(Willa-Shines.amt 11u:Seller agrct%to
tndvillitir'S.dolrlid vuld hold hannlrct the liuNer.its otlicrrs.tlinviors.sttK UnWeis. Witticrs and
aftili=4 from :ut} clainiY Ive ctt liabilittss Its such third parties. ire hltlling asst Iced or Over
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c%pcn%c., incurmc!in comwetion w0 div JcfQnsc of kitsch ciaim% The co,,onatat.contaivied in �
Ikk 1xi ctg+raph 12 sill s-civive tEtr Clrt:ing Uaw or thc tcminaacion of thm Aencmcnt,►%hh;hCvcr ?
ot;cun curl tct•_
1.1. %v}„a&Mt; U iut, tcmn or$mniaion ot'tl►iK t1gre�cnxmt w iavallld, iltt:l-al or urtenfarccabic
itt;tttt jt r:stitt;lturt.�trclt im;bilitt.KI-gp1t1►tit shall imn;ttlil;t any c:tli t term or
I`-�t)►•i�ii+ts a!1hi�:��r�Mnu`ut. .
tttti._,��v tti T � aty 1;a tt :an�K- Tyis Au t
+wnt shall tx: binclit►g upon
utki shall inum,10 IN!be-writ ati'llu:parties sUU1 tltcir tCgN'ct:+•c UMCCOW4.uid.Wialls. 'Vo putty
may abbign ltc right% of obliptic+uti hcreundo %%ithout the Prior written consult of IN-6 other ;
pattic..
16.A,1 IJ ,amt cttki_ ►, _fi•sti��.tt;,, { ,'Tilts:1prteme nt may only btc amended.mm Ul'atal or
*uppleniemcd b> ;sit agnc emit is►whim;signed b3 mch Imip. ltt•row.+
17 fi+,ljZrt inS l,pt;,Sp ttisstan 1+,.i�ttiu4icti+t�,t,,.�,, Kvr,t' tr►;'!'n;+l.
tryt 't1tt:. Ayiecilumt %h;all tv govttttixi bx mid contittnd in a coniance uilh 11
1.11140ni tl Iw2;of tln•51:130 of Chwida atliztaut rcli,Vewc to conflict•+t law prntctpltn".
�hI .�n�t• I.EsCi►t►t. :�1111•, hc-TION OR PROC.•LEDlied; .rR�.�mu U+_I•r or ok
ItASt'Cl UPON TIMS .hi';kfCME:NT tilt "fill: SIA'I-'E RS COXI'I-EMPLAT1:13 11E?E>CHY OR
Tll]: L13Y MAY E311-. iks,1'ITf:rro N; 1'I It, C"()t;R1'1: 01= '1'Ith 3'I ATE. 01- FLORIDA 1..4
L. 1t CAS1. t,t1i.'X131) 1N' MIAMI-DARE (:()I!NIY, II-OKIDA. ANO I'.AVI1 PARTY
I{titL-WWARLY !►t:li'►I ITS 1,0111F #:?CLUSINI.1 JV•RISDICTION 01' St.01 t'()(MI S IN
A*IY °(XI1 10.11. ACTION OR 1llliO{'t-EDIN6 I*ACH SUCH PARVY IRREV1CAHLY
AND LINCONIXI ItJNALLY WAIVES ANY KIGII I IT NJAY IIAV1i TO A TRIAL HY JURY
IN RE:SPE:C"l' OF ANY I.i,CjAl., AC ON ARMING OM OF OR Itl:L,A*riN(; TU '1111%
AOR1:P.RWN'I'011 1111*MA 1.11:RS ONTE:M1'3.,i.'1'r~D IJLR1:RY-
i11, %Aa".". ,.%ithmanding,anything cis(lic contnn vtt ftrrth h+.-rein,Sectiom ?.«. 6,
7,$:Q. 10, t 1. ;1 ',x I.L. Is. 16 at►+l l7;,hail survNe the ternsitta:ion or this AgmVin`nt atxdw
the&f i mil ivc wansaclkin ducutnmU
1�l. ,Io�tit;�,y�,lh�t►t�►It. :1 1?►:lalltt 1.7�tl�tillt,�Ili[ivv!ti�ltt)1�y ,hc'�ctlir at'.7tty vl'1;tit c�r►•t!raant.�.
In tits 11%.0le of ut1, of its t,�,rc:t!tU:Ftt�rtl4, CoVea►:aats or agp-mient in tha+ itilmaicrit slui1
custmit.um an im atdiale Default (as da liimi.in the*400)by the Selivr. atul ;a:z►4rtty-foist (1-4)
Mull notice perntul 4m it ap111) lean'. Iki�
%LxI1 wlt ttyc+n the crpiraaautt of m hick%ltc 4111 mmiimt
mving artier die Notc shalt becamr l m odiatelS due and pkN We.
ETHE REMAINDER OF PAGW TNTEN-110NALLY LEVI'I3E._ NKI
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Its ITNI VVI 11-10 OF. Ibc P;Lclik:., (sinter Ila%%!
of the Jaw r1j.,j %%rjuvu above b% ;heir ufl*tcc dull
011t
!7.1.1 C
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Parekh, Anna
From: Parekh,Anna
Sent: Tuesday, May 14,2013 1:27 PM
To: 'sslevine @msn.com'
Cc: Smith, Jose;Aguila, Raul; Morales, Jimmy; Brooks, Kathie;Torres, Gisela;Amir Ben-Zion
Subject: FW: Penn 17/Cooper Avenue Letter of Intent
Attachments: Penn 17 Cooper Ave Executed Letter of Intent.pdf
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Mr.Levine,
Thank you for the attached Binding Letter of Intent(LO1). By copy hereof,I am forwarding your email and the LO1 to the
City Attorney's Office for review and advice. In the meantime,as we discussed at great length on the telephone
yesterday and again today,the City must have an opportunity to conduct due diligence prior to consenting to any
change In the tenancy. Since the attached LO1 refers to OBK Project, LLC's acquisition of 50%of Penn 17 LLC's leasehold
Interest,I will appreciate it if you will send me the following additional information:
1. What is the proposal for the payment of back rent due to the City? As we discussed,the proposed Amendment
No.3 has not been approved by the City Commission.
2. Will your client,Roman Cherstovov,who recently became a manager of PENN 17, LLC, remain as a manager of
PENN 17,LLC.?
3. If so,what is Mr.Cherstovov's background in restaurant management?
4. What will Mr.Cherstovov's role be in the tenancy?
S. What is Eugene Alekseychenko's(manager of OBK Project,LLC,which incorporated on April 21,2013)
experience in the restaurant business?
6. What is Oleg Elyutln's(manager of OBK Project,LLC)experience in the restaurant business?
7. What Is the Business Plan regarding the proposed operation of the leased space?
8. What is the proposed re-opening date?
MIAMI BEACH
Anna Parekh,Director
Ofllos of Real Estate,Housing&Community Development
1700 Convention Center Drive,Miami Beach,FL 33139
Tel: (305)873-7280/Fax:(305)873-7772
Web site: www.mlamibea"mov
We are oommitted to providing excellent public servloe and safety to all who live,work and play In our vibrant,tropical historic community.
From: Scott Levine fmaiito:sslevinegbmsn,com1
Sent:Tuesday, May 14, 2013 11:49 AM
To: Parekh,Anna
Subject: Penn 17/Cooper Avenue Letter of Intent
Anna,
Sorry for the delay, I was out of my office this morning. I would a like few minutes with you this afternoon, if
possible.Additionally,one of the principals of OBK Project,LLC, owns and operates 12 restaurants already.
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Please call me on my cell (954)709-2583 after you receive this email.
Thank you, j
1
EXHIBIT n
LAW OFFICES OF SCOTT LEVINE, P.A.
Attorney at Law
1555 NORTH PARK DRIVE TELEPHONE (954)616-1132
SUITE 102 FACSIMILE (866)703-5508
WESTON,FLORIDA 33326
May 21,2013
I
Anna Parekh,Director i
Office of Real Estate,Housing&Community Development
The City of Miami Beach
1700 Convention Center Drive
Miami Beach,Florida 33139 1
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Re: Penn 17,LLC,Lease Agreement
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Dear Ms.Parekh:
I apologize for the delay in getting this to you. However, I wanted to be sure that any fiirther
discussions between the City of Miami Beach and Penn 17,LLC,would be fruitful.As I previously
informed you, I represent Roman Cherstovov, who began working with Amir Ben-Zion in April
2012. At the present time, Eugene Alekseychenko and Oleg Elyutin are negotiating to purchase
Amir Ben-Zion's interest in Penn 17, LLC. Together, Mr. Cherstovov, Mr. Elyutin, and Mr.
Alekseychenko, have more than 20 years of combined experience in restaurant ownership,
management,food purveying and food sales.Moreover,based upon their combined experience and
knowledge in the restaurant industry,Mr.Cherstovov,Mr.Elyutin,and Mr.Alekseychenko believe
they have a business model which will work.
Most important,Mr.Cherstovov,Mr.Elyutin,and Mr.Alekseychenko(the"Parties")want to work
from a"clean slate."Therefore,as part of the negotiations with the City of Miami Beach,all monies
owed to Halloran Construction, and or any subcontractors of Halloran construction and or
materialmen which performed work at the Penn 17,LLC, location will be resolved,and any present
liens and accompanying actions will be dismissed.The Parties want to obtain a final CO,so there
are no further issues of this type.
As to the questions you posed concerning
Penn 17 LLC and its leasehold the answers ar e
set
forth below.
1. What is the proposal for the payment of back rent due to the City?
I
With regard to payment of the back rent to the City,even though,the third proposed
lease amendment has not yet been approved by the City Commission, Penn 17,LLC,
wishes to take advantage of this third proposed amendment to the lease. Penn 17,
LLC,stands ready to pay all amounts due per the third proposed lease addendum.
I
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FXHIRIT F
i
May 21,2013
Penn 17,LLC,Lease Agreement
Page 4
7. What is the Business Plan regarding the proposed operation of the leased
space?
Cooper Avenue will be relaunched under a new name. It will be a completely
different style of restaurant.The specifics of this plan are best discussed in person.
If the City of Miami Beach is in agreement with the new direction of the proposed
business. A formal business plan will be submitted, and renovations will begin
thereafter.
8. What is the proposed re-opening date?
Penn 17,LLC,would like to reopen tomorrow.However,the proposed reopening
date will occur in conjunction with the relocation of the air-conditioning system to
the roof of the parking garage,and the installation of the new kitchen ventilation
system. Specifically, it will take 6 to 8 weeks to fabricate the approved kitchen
ventilation system,and another 2 weeks to install the same.As such,once approval
for all work has been given by the City of Miami Beach,the members of Penn 17,
LLC,plan to reopen and relaunch the restaurant by September 1, 2013,provided
all work has been completed.The Parties are confident that if all work is done in
a timely fashion,including any modifications to the restaurant,a final CO can be
issued by September 1,2013. As stated above the Parties will settle all debts of
Penn 17, LLC, and do not want City of Miami Beach concerned about the
possibility of any further litigation from any unpaid contractors or subcontractors.
Please call me upon your review of this email,so can schedule a meeting at your office to discuss
these matters in greater detail. I can be reached on my cell phone(954)709-2583.
Very truly yours,
SCOTT S.LEVINE
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MIAMI BEACH
City of Miami Beach,1700 Convention Center Drive,Miami Beach,Florida 33139,www.miamibeachfl.gov
REAL ESTATE, HOUSING&COMMUNITY DEVELOPMENT
Tel:(305)673-7193—(305)673-7033
CERTIFIED MAIL RETURN RECEIPT REQUESTED
May 17, 2013
Mr.Amir Ben Zion Copy sent via electronic mail to:
Managing Member amir@fcsny.com
Penn 17, LLC Benami.shai @gmail.com
1661 Pennsylvania Avenue, Suite 6 jrynor@mitrani.com
Miami Beach, FL 33139
RE: Lease Agreement (the "Lease") between the City of Miami Beach, Florida, the
Miami Beach Redevelopment Agency (hereinafter collectively referred to as
"Landlord") and Penn 17, LLC ("Tenant"), Involving the lease of approximately
7,655 square feet of ground floor retail space at the Pennsylvania Avenue Garage,
1661 Pennsylvania Avenue, Miami Beach, Florida("Premises")
Dear Mr. Ben-Zion:
The City has continuously proceeded in good faith with Penn 17 LLC(Penn 17 or Tenant)in an
attempt to resolve Tenant's ongoing defaults under the Lease, and execute the proposed
Amendment No. 3 to Lease. Unfortunately,we are now at impasse and,accordingly,the City
hereby provides Tenant with its written notice of the following defaults under the Lease:
1. Failure to pay rent for the month of May, in the amount $30,130.23 (said amount,
inclusive of State sales tax, representing $25,596 in Minimum Rent, and $4534 in
Common Area Maintenance),which was due on May 1, 2013;
2. Failure, under Section 3.5 of the Lease,to maintain Tenant's business on the Leased
Premises open for business to the public, fully fixtured, stocked, and staffed. The
Leased Premises have been closed for business since December 17, 2012 and, by e-
mail to the City dated May 15,2013(see Attachment"A"hereto),Tenant has indicated
that it has no intention of re-opening within the near future and effectively advised the
City of its abandonment of the Leased Premises;
3. In violation of Section 5.6 of the Lease, a lien was recorded against the Premises by
A&P Air Conditioning (dated December 12, 2012, and recorded in O.R. Book 28396, `
i
1 The aforestated rental amount represents 50%of the May rent originally set forth In the Lase.The City Commission's adoption of 1
Resolution No.2013-28167 recommended approval-subject to and contingent upon the Clty Commission's subsequent approval
of a proposed Amendment No.3 to the Lease-of a 50%rent abatement,from January 13,2013,to July 12,2013.Notwithstanding
the above,we take this opportunity to remind you that since the City Commission has not yet finalized Its approval of Amendment No.
3 to the Lease,and has therefore,not fnalized its approval of the more favorable revised rent abatement schedule,the City has,to
date,held off on demanding the current total rent due,absent the City Commission's final approval of Amendment No.3(and of the
revised rent abatement schedule),of$342,074.61(the full amount rent due through May 30,2013). Notwithstanding the preceding,
the City reserves any and all rights to reclaim the FULL amount of rent due under the Lease.
EXHIBIT F
Mr.Amir Ben Zion
May 17, 2013
Page 2 of 2
Page 3630 of the Public Records of Miami-Dade County,Florida;hereinafter referred to
as the"A&P Lien"), in the amount of$73,693. A&P has also filed suit against the City i
(the"A&P Lawsuit"), demanding payment of the aforestated unpaid sum;
4. Despite prior written notice from the City , Tenant has still not provided the City with
evidence that a prior claim by Cors-Air,in the amount of$3001.92(the"Cors-Air Claim"),
has been paid; and
5. Despite prior written notice from City,and as required under Section 5.2(n)of the Lease,
Tenant(or Tenant's Escrow Agent) has not provided City with evidence that it has
deposited, and/or otherwise maintained, the minimum required $50,000 Construction
Deposit in the Tenant Construction Fund(as such term is defined in the Work Letter and
Escrow Agreement,which was incorporated into,and made a part of,the Lease).
In addition to the above referenced defaults,the City received an e-mail on May 14,2013,of a
proposed "Binding Letter of Intent" purporting to sell Tenant's (and your personal) interest in
Penn 17 to OBK Project,LLC(the Buyer). Under Section 8.1 of the Lease,the Tenant shall not
enter Into,consent to,or permit any Transfer of the Lease without the prior written consent of the
Landlord. The term"Transfer'includes the transfer of a controlling interest. Until May le,the
City was neither aware of a proposed Transfer,nor has it consented to any Transfer including,
without limitation,the proposed sale to Buyer. If consummated without the City's prior written
consent,the proposed sale to Buyer shall be deemed an unauthorized Transfer,and therefore
result in a further breach/default of the Lease.
Accordingly, with respect to Item No. 1 of this Notice, pursuant to Sections 9.1(i)and(ii)of the
Lease, Landlord hereby makes demand for payment of past due May rent, in the amount of
$30,130.23,which rent must be received by Landlord within five(5)days of the date of this
Notice.
With respect to Item Nos. 3 and 4 of the Notice, pursuant to Section 5.6 of the Lease,Tenant
shall discharge the A&P Lien and provide evidence of satisfaction of the Cors-Air Claim,within
fifteen (15) days of this Notice. Additionally, Tenant shall provide Landlord with an Order
dismissing the A&P Lawsuit,with prejudice,within fifteen(15)days of the Notice. Failure to
do so within the time period specified in this paragraph shall also be deemed a default under
Section 9.1 (iii)of the Lease. f
i
With respect to Item Nos. 2 and 5 of this Notice, pursuant to Section 9.1 (iii) of the Lease, '
Tenant shall remedy the breaches set forth in the afforested Item Nos.2 and 5 within thirty(30)
days of the date of this Notice; provided, however,that with regard to the breach set forth in
Item No. 2, if such breach cannot be remedied within thirty (30) days , then Tenant shall `
commence to remedy and thereafter proceed diligently to remedy such breach with thirty(30) '
days of the date of this Notice.
TENANT'S FAILURE TO CURE THE DEFAULTS SPECIFIED IN ITEM NOS. 1 —5 OF THIS t
NOTICE,WITHIN THE RESPECTIVE TIME PERIODS PROVIDED ABOVE,SHALL ENTITLE
LANDLORD TO AVAIL ITSELF OF ANY AND ALL RIGHTS AND REMEDIES UNDER
SECTION 9.2 OF THE LEASE INCLUDING, WITHOUT LIMITATION, CANCELLING THE
LEASE;RE-TAKING POSSESSION OF THE PREMISES(INCLUDING ANY PROPERTY OF
TENANT THEREON); THE ACCELERATION OF RENT DUE AND PAYABLE UNDER THE
REMAINDER OF THE LEASE TERM; AND THE INITIATION OF LEGAL PROCEEDINGS
AGAINST TENANT TO ENFORCE THE PROVISIONS OF THIS LEASE, INCLUDING THE
RECOVERY OF COSTS AND REASONABLE ATTORNEY'S FEES.
t
We are committed to providing excellent puNic servfce and safety to all who ltve,work,and play in our vibrant,tropical,historic community.
I
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Mr.Amir Ben Zion
May 17, 2013
Page 2of2
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PLEASE GOVERN YOURSELF ACCORDINGLY. ,
Sincerely,
Anna Parekh
Director
AP:GNT
Copies to:
Mr. Steven E. McNeff Mr.Amir Ben-Zion
Registered Agent 585 N.E. 58t'Street
Penn 17, LLC Miami, Florida 33137
45 N.E.41 Street
Miami, FL 33137
Jeffrey A: Rynor, Esq. Mr. Roman Cherstvov
Mitrani Rynor Adamsky Toland 17001 Collins Avenue,Apt.4005
301 Arthur Godfrey Rd., Penthouse Sunny Isles, FL 33160
Miami Beach, FL 33140
Scott S. Levine, Esquire
Scott S. Levine, P.A.
1555 North Park Drive, Suite 102
Weston, Florida 33326
Cc: Jimmy L. Morales, City Manager
Kathie Brooks,Assistant City Manager
Jose Smith, City Attorney
Raul Aguila, Chief Deputy City Attorney
Gisela Nanson Torres, Leasing Specialist
F:IRHCDI$alNmn4almsset\Pennsylvania Avenue Garage Leases\Penn 171Late Rent and Default Notice May 16,2013 with May
rent only
We are committed to providing excellent public service and safety to all who live,work,and play in our vibrant,tropical,historic community.
Parekh, Anna
From: Amir Ben-Zion[amir @fcsny.com]
Sent: Wednesday, May 15,2013 10:29 PM
To: Parekh,Anna
Cc: Aguila, Raul;kbonde @miamibeachfi.com;Welthorn, Deede;Amir Ben-Zion
Subject: Status report
a
Anna,
I
I wanted to update you and the gang on what's going on at Penn17, it's actually good news for
the city.....
Roman Cherstvov, who has been my partner since May 2012, and invested $3.214 into Penn17,
doesn't see the reopening of Penn17 as I do, he wants a more proper restaurant , Deli and Bar
place , more high end, similar to Milos and I am on the casual rock and roll side......as you
can imagine since the closing in December it has been a finger pointing game....
finally 2-3 weeks ago, Roman introduced me to his friend and they offered me an exit, Roman
and his friend Oleg, who has extensive restaurant experience, He owns 12 restaurants I
believe ......Roman's background is in supermarkets and food distribution, both of these guys
are wealthy and good business people...with many wealthy friends.... In my opinion they will
invest more, stick around longer and try harder to make it a success....in all honesty I am
not so motivated right now, my father is in critical condition in NYC , we are a close
family, and my attention needs to focus on him and my mother, this Friday my father will
undergo an open heart operation and at his age, 80, it's a long recovery, I am actually
looking to relocate my parents to Miami soon and my plate is full... ..
My point is clear I believe....if the city authorizes this ownership shift, and it needs to
be done fast, rent continues, penn17 opens, the so called new operator is wealthy and ready
to spend, they run nice beautiful restaurants, the crowd that is connected to the NWS will
love them, they love me less, and every issue will get resolved, vendors paid, AC relocated,
50K back in escrow, rent paid in a day or two and the city is better off....on a business
level it's much better then 2 partners who no longer get along.. .. ,
I am departing to NYC for several days tomorrow morning...feel free to reach me on my cell
Thanks for listening
amir
J
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l
S
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4
ATTACHMENT "A"
Sklar, Max
From: Brooks, Kathie
Sent: Friday, May 24, 2013 10:36 AM
To: Sklar, Max
Subject: FW: Penn 17
MIAMIBEACH
(Kathie G. Brooks
1700 Convention Center Drive,Miami Beach,FL 33139
Tel:305-673-7010 / Fax:305-673-7782/ www.miamibeachfl.aov
We are committed to providing excellent public service and safety to all who live,work and play in our vibrant,tropical,historic community.
From: Scott Levine rmailto:sslevineOmsn.com]
Sent:Thursday, May 23, 2013 2:09 PM
To: Brooks, Kathie
Subject: Fwd: Penn 17
Dear Ms. Brooks,
I understand that your schedule is very hectic right now. However, I believe this
matter can be resolved with only a few minutes of your time. Specifically, with
regard to the City of Miami Beach's letter of default against Penn 17, LLC, dated
May 17, 2013. The funds for payment of the expenses outlined in the letter of
default have been deposited into my trust account. These funds can be
immediately released and wired to the City upon the approval ("Approval")of
the transfer of the membership interest in Penn 17, LLC, pursuant paragraph 8.1
of the Penn 17 lease agreement. Moreover, and as verified by Anna Parekh, my
client has been acting in good faith and working diligently to discover the costs
involved with reopening the restaurant, including the costs set forth in the City's
letter of default. As such, and further evidence of my client's good faith,my client
proposes the following:
1. The immediate payment of the requested rent for May 2013, in the amount
of$30,130.23, (This is based upon the rent payment schedule set forth in third
proposed amendment to the Penn 17, LLC, lease
agreement).
FXHIRIT G
1
i 1
2. The immediate negotiation and release of the A&P Air-Conditioning lien,
and or the posting of$75,000.00 in an escrow account to cover payment of this
lien.
3. The immediate posting of a$50,000.00, construction escrow deposit.
4. The enclosed proof of payment to Cors-Air. It should be noted Cors-Air
forwarded their release to A&P Air-Conditioning.
Compliance with the City is my client's foremost goal, and once the"green light"
has been give for the transfer of the membership interests in Penn 17, LLC, the
above recited funds will be immediately wired or a cashier's check delivered to
the City. However, for my client to blindly forward a payment in the amount of
$155,130.23,without an Approval or an acknowledgement that an Approval is
forthcoming would be negligent, and only result in my daughter not going to
college,because of the malpractice judgment I will have to pay.
I believe the City and my client are seeking the same goals,the issuance of a final
CO issued, and the restaurant reopened as soon as possible. As testament to my
client's resolve, in addition to the payment schedule set forth above,my client
stands ready to absorb the following costs. Approximately, $260,000.00 for
payment to the contractor and any subs,this includes the payment for the moving
of the air conditioner units to the roof of the parking garage, repayment of the
remaining rental balances for the months of November 2012 and December 2012,
which total $64,791.00, and the replenishment of the security deposit, which
amounts to $47,844.00. All totaled,my client is going to incur over$528,000.00
dollars in debt. Expenses which the City might otherwise be forced to absorb.
This amount does not include any renovations, or future rental payments.
In conclusion, I am hopeful that I will receive a telephone call from you this
evening or tomorrow morning. I can be contacted on my cell phone at(954) 709-
2583. Both my client and I are available, and would prefer a face to face meeting
as soon as possible. I await your call.
Very truly yours,
SCOTT S. LEVINE
SCOTT S. LEVINE, ESQ.
SCOTT S. LEVINE, P.A.
1555 North Park Drive, Suite 102
Weston, Florida 33326
Telephone: (954) 616-1132
Facsimile: (866) 703-5508
The information in this e-mail is confidential and may also be
2
attorney-client privileged. The information is intended only for the
use of the individual or entity to whom it is addressed. If you are
not the intended recipient, or the agent or employee responsible for
delivering it to the intended recipient, you are hereby notified that any use,
dissemination, distribution or copying of this communication is strictly
prohibited. If you have received this e-mail in error,please notify my office
immediately by e-mail SSlevine@msn.com. Thank You.
i
3
EXHIBIT G - REVISED RENT SCHEDULE PURSUANT TO NEGOTIATIONS WITH NEW TRANSFEREES
05-Jun-13 NOTES:
(1)Repayment of July 2012 and August 2012 rent($95,688.00)per
Second Amendment
(2)Repayment of July 2013 through December 2013 deferred rent
($171,106.23)
Penn 17,LLC Proposed Rent Schedule
Lease Commencement: October 13,2011 Rent Commencement:April 14,2012
Current Proposed
Lease Year:2 Rent Rent Total Monthly Total Monthly
Base Rent Repayment CAM(*) Abatement Deferment Payment Payment
01/13/13 $ 47,843.75 $ - $ 8,474.00 $ (28,158.88) $ - $ 56,317.75 $ 28,158.87
02/13/13 $ 47,843.75 $ - $ 8,474.00 $ (28,158.88) $ - $ 56,317.75 $ 28,158.87
03/13/13 $ 47,843.75 $ - $ 8,474.00 $ (28,158.88) $ - $ 56,317.75 $ 28,158.87
04/13/13 $ 47,843.75 $ - $ 8,474.00 $ (28,158.88) $ - $ 56,317.75 $ 28,158.87
05/13/13 $ 47,843.75 $ - $ 8,474.00 $ (28,158.88) $ - $ 56,317.75 $ 28,158.87
06/13/13 $ 47,843.75 $ - $ 8,474.00 $ (28,158.88) $ - $ 56,317.75 $ 28,158.87
07/13/13 $ 47,843.75 $ - $ 8,474.00 $ - $ (28,158.88) $ 56,317.75 $ 28,158.87
08/13/13 $ 47,843.75 $ - $ 8,474.00 $ - $ (28,158.88) $ 56,317.75 $ 28,158.87
09/13/13 $ 47,843.75 $ - $ 8,474.00 $ - $ (28,158.88) $ 56,317.75 $ 28,158.87
Total: $ 430,593.75 $ - $ 76,266.00 $ (168,953.28) $ (84,476.64) $ 506,859.75 $ 253,429.83
Current Proposed
Lease Year:3 Rent Rent Total Monthly Total Monthly
Base Rent Repayment(1) CAM(*) Abatement Deferment Payment Payment
-._ $ 49,279.06 $ 2,658.00 $ 8,474.00 $ - $ (28,876.53) $ 60,41 1.06 $ 31,534.53
11/13/13 $ 49,279.06 $ 2,658.00 $ 8,474.00 $ - $ (28,876.53) $ 60,411.06 $ 31,534.53
12/13/13 $ 49,279.06 $ 2,658.00 $ 8,474.00 $ - $ (28,876.53) $ 60,411.06 $ 31,534.53
01/13/14 $ 49,279.06 $ 2,658.00 $ 8,474.00 $ - $ - $ 60,411.06 $ 60,411.06
02/13/14 $ 49,279.06 $ 2,658.00 $ 8,474.00 $ - $ - $ 60,411.06 $ 60,411.06
03/13/14 $ 49,279.06 $ 2,658.00 $ 8,474.00 $ - $ - $ 60,411.06 $ 60,411.06
04/13/14 $ 49,279.06 $ 2,658.00 $ 8,474.00 $ - $ - $ 60,411.06 $ 60,411.06
05/13/14 $ 49,279.06 $ 2,658.00 $ 8,474.00 $ - $ - $ 60,411.06 $ 60,411.06
06/13/14 $ 49,279.06 $ 2,658.00 $ 8,474.00 $ - $ - $ 60,411.06 $ 60,411.06
07/13/14 $ 49,279.06 $ 2,658.00 $ 8,474.00 $ - $ - $ 60,411.06 $ 60,411.06
08/13/14 $ 49,279.06 $ 2,658.00 $ 8,474.00 $ - $ - $ 60,411.06 $ 60,411.06
09/13/14 $ 49,279.06 $ 2,658.00 $ 8,474.00 $ - $ - $ 60,411.06 $ 60,411.06
Total: $ 591,348.72 $ 31,896.00 $ 101,688.00 $ - $ (86,629.59) $ 724,932.72 $ 638,303.13
Current Proposed
Lease Year:4 Rent Rent Total Monthly Total Monthly
Base Rent Repayment(1) CAM(*) Abatement Deferment Payment Payment
$ 50,757.43 $ 2,658.00 $ 8,474.00 $ - $ - $ 61,889.43 $ 61,889.43
4
11/13/114 $ 50,757.43 $ 2,658.00 $ 8,474.00 $ - $ - $ 61,889.43 $ 61,889.43
12/13/14 $ 50,757.43 $ 2,658.00 $ 8,474.00 $ - $ - $ 61,889.43 $ 61,889.43
01/13/15 $ 50,757.43 $ 2,658.00 $ 8,474.00 $ - $ - $ 61,889.43 $ 61,889.43
02/13/15 $ 50,757.43 $ 2,658.00 $ 8,474.00 $ - $ - $ 61,889.43 $ 61,889.43
03/13/15 $ 50,757.43 $ 2,658.00 $ 8,474.00 $ - $ - $ 61,889.43 $ 61,889.43
04/13/15 $ 50,757.43 $ 2,658.00 $ 8,474.00 $ - $ - $ 61,889.43 $ 61,889.43
05/13/15 $ 50,757.43 $ 2,658.00 $ 8,474.00 $ - $ - $ 61,889.43 $ 61,889.43
06/13/15 $ 50,757.43 $ 2,658.00 $ 8,474.00 $ - $ - $ 61,889.43 $ 61,889.43
07/13/15 $ 50,757.43 $ 2,658.00 $ 8,474.00 $ - $ - $ 61,889.43 $ 61,889.43
08/13/15 $ 50,757.43 $ 2,658.00 $ 8,474.00 $ - $ - $ 61,889.43 $ 61,889.43
09/13/15 $ 50,757.43 $ 2,658.00 $ 8,474.00 $ - $ - $ 61,889.43 $ 61,889.43
Total: $ 609,089.16 $ 31,896.00 $ 101,688.00 $ - $ - $ 742,673.16 $ 742,673.16
Page 1 of 3
EXHIBIT G - REVISED RENT SCHEDULE PURSUANT TO NEGOTIATIONS WITH NEW TRANSFEREES
05-Jun-13 NOTES:
(1)Repayment of July 2012 and August 2012 rent($95,688.00)per
Second Amendment
(2)Repayment of July 2013 through December 2013 deferred rent
($171,106.23)
Penn 17,LLC Proposed Rent Schedule
Lease Commencement: October 13,2011 Rent Commencement:April 14,2012
Current Proposed
Lease Year:5 Rent Rent Total Monthly Total Monthly
Base Rent Repayment(1) CAM(*) Abatement Deferment Payment Payment
$ 52,280.15 $ 2,658.00 $ 8,474.00 $ - $ - $ 63,412.15 $ 63,412.15
11/13/15 $ 52,280.15 $ 2,658.00 $ 8,474.00 $ - $ - $ 63,412.15 $ 63,412.15
12/13/15 $ 52,280.15 $ 2,658.00 $ 8,474.00 $ - $ - $ 63,412.15 $ 63,412.15
01/13/16 $ 52,280.15 $ 2,658.00 $ 8,474.00 $ - $ - $ 63,412.15 $ 63,412.15
02/13/16 $ 52,280.15 $ 2,658.00 $ 8,474.00 $ - $ - $ 63,412.15 $ 63,412.15
03/13/16 $ 52,280.15 $ 2,658.00 $ 8,474.00 $ - $ - $ 63,412.15 $ 63,412.15
04/13/16 $ 52,280.15 $ 2,658.00 $ 8,474.00 $ - $ - $ 63,412.15 $ 63,412.15
05/13/16 $ 52,280.15 $ 2,658.00 $ 8,474.00 $ - $ - $ 63,412.15 $ 63,412.15
06/13/16 $ 52,280.15 $ 2,658.00 $ 8,474.00 $ - $ - $ 63,412.15 $ 63,412.15
07/13/16 $ 52,280.15 $ 2,658.00 $ 8,474.00 $ - $ - $ 63,412.15 $ 63,412.15
08/13/16 $ 52,280.15 $ 2,658.00 $ 8,474.00 $ - $ - $ 63,412.15 $ 63,412.15
09/13/16 $ 52,280.15 $ 2,658.00 $ 8,474.00 $ - $ - $ 63,412.15 $ 63,412.15
Total: $ 627,361.80 $ 31,896.00 $ 101,688.00 $ - $ - $ 760,945.80 $ 760,945.80
Current Proposed
Lease Year:6 Rent Rent Total Monthly Total Monthly
Base Rent Repayment(2) CAM(*) Abatement Deferment Payment Payment
10/13/16 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ - $ 62,322.56 $ 69,451.99
11/13/16 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ - $ 62,322.56 $ 69,451.99
12/13/16 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ - $ 62,322.56 $ 69,451.99
01/13/17 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ - $ 62,322.56 $ 69,451.99
02/13/17 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ - $ 62,322.56 $ 69,451.99
03/13/17 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ - $ 62,322.56 $ 69,451.99
04/13/17 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ - $ 62,322.56 $ 69,451.99
05/13/17 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ - $ 62,322.56 $ 69,451.99
06/13/17 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ - $ 62,322.56 $ 69,451.99
07113117 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ - $ 62,322.56 $ 69,451.99
08/13/17 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ - $ 62,322.56 $ 69,451.99
09/13/17 $ 53,848.56 $ 7,129.43 $ 8,474.00 $ - $ - $ 62,322.56 $ 69,451.99
Total: $ 646,182.72 $ 85,553.16 $ 101,688.00 $ - $ $ 747,870.72 $ 833,423.88
Current Proposed
Lease Year:7 Rent Rent Total Monthly Total Monthly
Base Rent Repayment(4) CAM(*) Abatement Deferment Payment Payment
10/13/17 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ - $ - $ 63,938.02 $ 71,067.45
11/13/17 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ - $ - $ 63,938.02 $ 71,067.45
12/13/17 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ - $ - $ 63,938.02 $ 71,067.45
01/13/18 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ - $ - $ 63,938.02 $ 71,067.45
02/13/18 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ - $ - $ 63,938.02 $ 71,067.45
03/13/18 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ - $ - $ 63,938.02 $ 71,067.45
04/13/18 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ - $ - $ 63,938.02 $ 71,067.45
05/13/18 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ - $ - $ 63,938.02 $ 71,067.45
06/13/18 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ - $ - $ 63,938.02 $ 71,067.45
07/13/18 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ - $ - $ 63,938.02 $ 71,067.45
08/13/18 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ - $ - $ 63,938.02 $ 71,067.45
09/13/18 $ 55,464.02 $ 7,129.43 $ 8,474.00 $ - $ - $ 63,938.02 $ 71,067.45
Total: $ 665,568.24 $ 85,553.16 $ 101,688.00 $ - $ - $ 767,256.24 $ 852,809.40
Page 2 of 3
EXHIBIT G - REVISED RENT SCHEDULE PURSUANT TO NEGOTIATIONS WITH NEW TRANSFEREES
05-Jun-13 NOTES:
(1) paymen August 2012 rent($95,688.00)per
Se d Amendment :...g.
(2)Repayment of July 2013 through December 2013 deferred rent
($171,106.23)
Penn 17,LLC Proposed Rent Schedule
Lease Commencement: October 13,2011 Rent Commencement:April 14,2012
Lease Year:8 Total Monthly
Base Rent CAM(*) Payment
--� $ 57,127.94 $ 8,474.00 $ 65,601.94
11/13/18 $ 57,127.94 $ 8,474.00 $ 65,601.94
12/13/18 $ 57,127.94 $ 8,474.00 $ 65,601.94
01/13/19 $ 57,127.94 $ 8,474.00 $ 65,601.94
02/13/19 $ 57,127.94 $ 8,474.00 $ 65,601.94
03/13/19 $ 57,127.94 $ 8,474.00 $ 65,601.94
04/13/19 $ 57,127.94 $ 8,474.00 $ 65,601.94
05/13/19 $ 57,127.94 $ 8,474.00 $ 65,601.94
06/13/19 $ 57,127.94 $ 8,474.00 $ 65,601.94
07/13/19 $ 57,127.94 $ 8,474.00 $ 65,601.94
08/13/19 $ 57,127.94 $ 8,474.00 $ 65,601.94
09/13/19 $ 57,127.94 $ 8,474.00 $ 65,601.94
Total: $ 685,535.28 $ 101,688.00 $ 787,223.28
Lease Year:9 Total Monthly
Base Rent CAM(*) Payment
1013/19 $ 58,841.78 $ 8,474.00 $ 67,315.78
11/13/19 $ 58,841.78 $ 8,474.00 $ 67,315.78
12/13/19 $ 58,841.78 $ 8,474.00 $ 67,315.78
01/13/20 $ 58,841.78 $ 8,474.00 $ 67,315.78
02/13/20 $ 58,841.78 $ 8,474.00 $ 67,315.78
03/13/20 $ 58,841.78 $ 8,474.00 $ 67,315.78
04/13/20 $ 58,841.78 $ 8,474.00 $ 67,315.78
05/13/20 $ 58,841.78 $ 8,474.00 $ 67,315.78
06/13/20 $ 58,841.78 $ 8,474.00 $ 67,315.78
07/13/20 $ 58,841.78 $ 8,474.00 $ 67,315.78
08/13/20 $ 58,841.78 $ 8,474.00 $ 67,315.78
09/13/20 $ 58,841.78 $ 8,474.00 $ 67,315.78
Total: $ 706,101.36 $ 101,688.00 $ 807,789.36
Lease Year:10 Total Monthly
Base Rent CAM(*) Payment
10/13/20 $ 60,607.03 $ 8,474.00 $ 69,081.03
11/13/20 $ 60,607.03 $ 8,474.00 $ 69,081.03
12/13/20 $ 60,607.03 $ 8,474.00 $ 69,081.03
01/13/21 $ 60,607.03 $ 8,474.00 $ 69,081.03
02/13/21 $ 60,607.03 $ 8,474.00 $ 69,081.03
03/13/21 $ 60,607.03 $ 8,474.00 $ 69,081.03
04/13/21 $ 60,607.03 $ 8,474.00 $ 69,081.03
05/13/21 $ 60,607.03 $ 8,474.00 $ 69,081.03
06/13/21 $ 60,607.03 $ 8,474.00 $ 69,081.03
07/13/21 $ 60,607.03 $ 8,474.00 $ 69,081.03
08/13/21 $ 60,607.03 $ 8,474.00 $ 69,081.03
09/13/21 $ 60,607.03 $ 8,474.00 $ 69,081.03
Total: $ 727,284.36 $ 101,688.00 $ 828,972.36
NOTE: CAM(*)-Pursuant to Section 18 of the Lease Summary, the CAM rate is subject to adjustment
to reflect the actual pro-rata share of Property Taxes and Insurance costs incurred by the Landlord
during the previous calendar year.
Page 3 of 3
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ASSUMPTIONS PENN 17
1st&2nd Month Calculations
AVG
Covers Check Total
Restaurant Ba 200 $12.00 $2,400.00
Dinner 280 $35.00 $9,800.00
Lunch 150 $22.00 $3,300.00
TOTAL 630 $15,500.00 x 30 $465,000.00
days
TOTAL $465,000.00
3rd&4th Month Calculations
AVG
Covers Check Total
Restaurant Ba 240 $12.00 $2,880.00
Dinner 360 $35.00 $12,600.00
Lunch 330 $22.00 $7,260.00
TOTAL 930 $22,740.00 x 30 $682,200.00
$0.00
TOTAL $682,200.00
5th&6th Month Calculations
AVG
Covers Check Total
Restaurant Ba 260 $12.00 $3,120.00
Dinner 380 $35.00 $13,300.00
Lunch 300 $22.00 $6,600.00
TOTAL 940 $23,020.00 x 30 $690,600.00
days
Catering $0.00 $0.00
TOTAL $690,600.00
7th Month to 12th Month Calculations
****Revenue is increased by 5%across the board
2nd Year and 3rd Year Calculations
****Revenue is increased by 5%across the board
4th Year and 5th Year Calculations
****Revenue is increased by 5%across the board
ASSUMPTIONS PENN 17
1st&2nd Month Calculations
AVG
Covers Check Total
Restaurant Ba 200 $12.00 $2,400.00
Dinner 280 $35.00 $9,800.00
Lunch 150 $22.00 $3,300.00
TOTAL 630 $15,500.00 x 30 $465,000.00
days
TOTAL $465,000.00
3rd&4th Month Calculations
AVG
Covers Check Total
Restaurant Ba 240 $12.00 $2,880.00
Dinner 360 $35.00 $12,600.00
Lunch 330 $22.00 $7,260.00
TOTAL 930 $22,740.00 x 30 $682,200.00
$0.00
TOTAL $682,200.00
5th&6th Month Calculations
AVG
Covers Check Total
Restaurant Ba 260 $12.00 $3,120.00
Dinner 380 $35.00 $13,300.00
Lunch 300 $22.00 $6,600.00
TOTAL 940 $23,020.00 x 30 $690,600.00
days
Catering $0.00 $0.00
TOTAL $690,600.00
7th Month to 12th Month Calculations
****Revenue is increased by 5%across the board
2nd Year and 3rd Year Calculations
****Revenue is increased by 5%across the board
4th Year and 5th Year Calculations
****Revenue is increased by 5%across the board