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VT; .-;.ts fig: t ',. \': .1,,,,. , '. :,..:04.f,,,:-."..,:z :., ',, ,,, ',*. ,,4.'''4'.' 4;fif.'r,,?,t414 r, .9 w� ". ti a. s�� y t era. • • 'ix. .,Jr ij ,\ 'I 'f.' fix+ t .:.a.4i • t, d fir, ..° « 1,— a'` 1�\ July 9, 2013 Commissioner Georgia A. Hiller, Esq. 2335 Orange Blossom Drive Naples, FL 34109 Georgia, It is with regret that I tender my resignation from the Collier County Planning Commission for personal family reasons, effective immediately. It has been an honor and a privilege to serve as your district representative, and I want to thank you for giving me that opportunity. I remain a staunch believer in your efforts to bring transparency and clean responsible governance to our Board of County Commissioners. Respectfully, William Vo er Add On Item 10D EXECUTIVE SUMMARY Recommendation that the Board of County Commissioners direct staff to research the following economic development tools as part of the overall economic development program for the county and bring back recommendations to the board in October, 2013: 1. Consider developing a public-private partnership with the Chamber of Commerce with the county providing an operational, performance-based subsidy conditioned upon the Chamber agreeing to implement an economic development program that will serve to recruit businesses to Collier county, and, that such a Chamber program shall be led by a new Chamber executive director that has demonstrated marketing and sales skills, along with a proven track record in economic development transactions. The county would then shift its focus from business recruitment to administrative facilitation and backing. It is suggested that the County Manager meet with the new incoming Chamber Chair and new executive director to discuss such a partnership. Further consider hiring a consultant with knowledge of public-private economic development partnerships to model the relationship and recommend how new businesses would be recruited through such a partnership. 2. Consider the following economic development incentives that do not require an outlay of public tax dollars and as such will not result in an increase in taxes,nor a shift in existing program support: A. Property Tax Abatement - Both constitutionally and statutorily allowed, this program would allow for property tax abatements from 1 to up to 10 years with BCC approval, awarded based on job creation and/or possibly capital investment. Requires referendum approval by the tax payers. Already in place in numerous competing Florida counties. Consider that if the business is not drawn to the county, then the tax revenue wouldn't be generated; therefore, the county is net gaining tax revenues it would otherwise not have in the long run. B. Short Term Moratorium Countywide of Commercial Impact Fees - Consider fee credits for all commercial development to encourage new businesses growth which will allow for increased employment opportunities and future growth in property tax revenues. Again, if the business won't come to and/or build in the county because the fees are a major impediment, then future tax revenues are forfeited and employment opportunities are lost.The amount of impact fees exempted would be about$2-3 million which will be rapidly paid back by the future property taxes the new property will generate. The net result is a positive increase in overall county revenues. C. Real Estate Data Base and a Rent Abatement Program - That the county have its professional real estate department in conjunction with its outside commercial brokers list all commercial properties and land available for sale in Collier county on the county's website, much like Lee county has done. Further,that staff develop a short-term rent abatement program for emerging or recruited businesses that need to be housed pending construction or improvement of their new facilities. Incentivize based on job creation. To ensure that these programs have the intended long term financial benefit to the county, it's recommended that an outside consultant be retained to pro forma the return on these programs. Hiring a highly regarded consulting firm like a McKinsey, Boos or a Big 4 firm to quantify the impact of these incentives would help the BCC and staff develops an incentive program with substantive impact. $ Add On Item l OD 3. Federal and State Grant Procurement - The County does not currently have a fully developed federal and state grant procurement program directed at economic development. To the end that the county will be bringing in a consultant to aid in developing it's grant administration operations, there should be an overlap with the county's Office of Economic Development to allow that office to know that economic development grants will be professionally administered. For example, seeking grant funding for the construction of incubator facilities, economic development marketing etc. should be aggressively pursued. OBJECTIVE: That the Board of County Commissioners direct staff to research the following economic development tools as part of the overall economic development program for the county and bring back recommendations to the board in October,2013. CONSIDERATIONS: That staff research the following for BCC consideration: 1. A public-private economic development partnership with the Chamber 2. A property tax abatement program 3. A short term commercial impact fee moratorium 4. Develop a commercial and land data base like Lee county's and a rent abatement program 5. Development of a federal and state economic development grant procurement program FISCAL IMPACT: To be determined. LEGAL CONSIDERATIONS: That the County Attorney provide assistance with the research to ensure that legal impacts/considerations are not overlooked. RECOMMENDATION: That the Board of County Commissioners direct staff to research the following economic development tools as part of the overall economic development program for the county and bring back recommendations to the board in October, 2013: 1. Consider developing a public-private partnership with the Chamber of Commerce with the county providing an operational, performance-based subsidy conditioned upon the Chamber agreeing to implement an economic development program that will serve to recruit businesses to Collier county, and, that such a Chamber program shall be led by a new Chamber executive director that has demonstrated marketing and sales skills, along with a proven track record in economic development transactions. The county would then shift its focus from business recruitment to administrative facilitation and backing. It is suggested that the County Manager meet with the new incoming Chamber Chair and new executive director to discuss such a partnership. Further consider hiring a consultant with knowledge of public-private economic development partnerships to model the relationship and recommend how new businesses would be recruited through such a partnership. 2. Consider the following economic development incentives that do not require an outlay of public tax dollars and as such will not result in an increase in taxes,nor a shift in existing program support: A. Property Tax Abatement - Both constitutionally and statutorily allowed, this program would allow for property tax abatements from 1 to up to 10 years with BCC approval, awarded based on job creation and/or possibly capital investment. Requires referendum approval by the tax payers. Already in place in numerous competing Florida counties. Consider that if the business is not drawn to the county,then ` • ` Add On Item 10D the tax revenue wouldn't be generated; therefore, the county is net gaining tax revenues it would otherwise not have in the long run. B. Short Term Moratorium Countywide of Commercial Impact Fees - Consider fee credits for all commercial development to encourage new businesses growth which will allow for increased employment opportunities and future growth in property tax revenues. Again, if the business won't come to and/or build in the county because the fees are a major impediment, then future tax revenues are forfeited and employment opportunities are lost. The amount of impact fees exempted would be about$2-3 million which will be rapidly paid back by the future property taxes the new property will generate. The net result is a positive increase in overall county revenues. C. Real Estate Data Base and a Rent Abatement Program - That the county have its professional real estate department in conjunction with its outside commercial brokers list all commercial properties and land available for sale in Collier county on the county's website, much like Lee county has done. Further, that staff develop a short-term rent abatement program for emerging or recruited businesses that need to be housed pending construction or improvement of their new facilities. Incentivize based on job creation. To ensure that these programs have the intended long term financial benefit to the county, it's recommended that an outside consultant be retained to pro forma the return on these programs. Hiring a highly regarded consulting firm like a McKinsey, Boos or a Big 4 firm to quantify the impact of these incentives would help the BCC and staff develops an incentive program with substantive impact. 3. Federal and State Grant Procurement - The County does not have a fully developed federal and state grant procurement program directed at economic development. To the end that the county will be bringing in a consultant to aid in developing its grant administration operations, there should be an overlap with the county's Office of Economic Development to allow that office to know that economic development grants can be professionally administered. For example, seeking grant funding for the construction of incubator facilities, economic development marketing etc. should be aggressively pursued. PREPARED BY: Commissioner Georgia Hiller, Chair-District 2 Proposed Agenda Changes Board of County Commissioners Meeting July 9,2013 Add On Item 10D: Recommendation that the Board of County Commissioners direct staff to research the economic development tools(as outlined in the executive summary)as part of the overall economic development program for the county and bring back recommendations to the Board in October 2013. (Commissioner Hiller's request) Withdraw Item 16A13: Recommendation to acknowledge and allow for 2210 Vanderbilt Beach Road,LLC to proceed at their own risk in replace existing non-conforming signage on their property,while seeking a Variance from the existing sign regulations. (Staffs request) Move Item 16F3 to Item 11C: Recommendation to approve a Change Order#5 to Contract# 10- 5541 with Paradise Advertising and Marketing,Inc. for Tourism Marketing Services to reflect a requested increase for marketing services for the Office of Business and Economic Development in the amount of$75,000 and authorize the Chairwoman to execute the Change Order. (Commissioner Nance's request) Add On Item 16K1: Recommendation to approve and authorize the Chair to execute a Settlement Agreement and Amendment in the lawsuit entitled Collier County et al v. Florida Georgia Grove,LLP, et al, filed in the Twentieth Judicial Circuit in and for Collier County,Florida (Case No. 11-1640-CA)and direct County staff to commence the process of vacating any claimed public right-of-way or prescriptive easement interest to a portion of Mamie Street. (County Attorney's request) Move Item 17D to 16D5: Recommendation to approve a budget amendment recognizing and appropriating$128,900 of unbudgeted carryforward in the Museum operating fund to initiate building repairs and provide enhanced services and facilities for the public. (Staffs request) Time Certain Items: Item 13A to be heard at 9:30 a.m. Item 13B immediately following 13A Item 14A1 to be heard at 10:00 a.m. Item 14A2 to be heard in conjunction with 14A1 Item 11B to be heard at 11:00 a.m. 7/9/2013 8:20 AM Medical Director Evaluation for Dr. Robert Tober BCC - July 9, 2013 Tim Nance - Collier County Commissioner / District#5 The following is my assessment of the performance and a constructive suggestion for needed areas of improvement for Dr. Robert Tober, Collier County Medical Director. Lacking previous evaluations or any history of specific goals or areas of focus for improvement, it is personally problematic to employ the evaluation form supplied by Collier County Government, soliciting an assigned numerical grade on specific performance about which I have little direct knowledge or expertise. For my assessment I have relied on the aggregate subjective opinion of numerous citizens, health care professionals, and administrators, that in my opinion, have provided me with constructively critical observation and honest professional critique. My assessment is that Dr. Tober has given general direction to Collier County EMS that overall meets or exceeds the standard generally expected to be performed by the County Medical Director. I have no question that the requirements of Florida Statute are being met. The great preponderance of opinion, including numerous critics, indicate that in the general areas of the overall Medical Direction of the Collier County EMS, including Quality Assurance, Training, and Operational Procedures, Dr. Tober is an extremely skilled and capable Medical Director. His long term dedication to the mission of Collier EMS and emergency medical care is widely acknowledged. Using the presented standards for scoring the appraisal, in these generalized areas I would assign his performance a numerical grade of 8. That said, there is a clear need for Dr. Tober to improve his interpersonal communications skills and expand his leadership role, as Medical Director. It is my opinion that shortcomings in these non technical skill sets is unfortunately limiting his effectiveness. To fully realize the efficiencies and opportunities possible through the consolidation of Collier First Response agencies,the Medical Director must be the leader in establishing cooperation and coordination between EMS, Fire Districts, hospitals, and physicians. To achieve superior results as Medical Director going forward, Dr. Tober must dedicate himself more effectively to consensus building and conflict resolution between these professionals. A numerical grade of 6 would be appropriate for his performance in these challenging but critical areas. With recognition of outstanding record of service to Collier County, and his noteworthy achievement in the development and management of Collier EMS to date, I would assign Dr. Tober an overall numerical grade of 7 for the past year. With improvement in the aforementioned non technical management areas, a superior performance of 9 or higher is clearly possible. Likewise, failure to improve communications and team building shortcomings could result in much poorer performance. With this caveat, I am in support of extending Dr. Tober's contract as Collier Medical Director with a significant measure of concern. I am confident that a cooperative effort between Dr. Tober as Medical Director, Collier County Government staff, first responders in EMS and the Fire Districts, and health care professionals and administrators, many of whom share similar goals and challenges, will lead to improved and superior group performance for our citizens and inspire individual excellence. I am personally dedicated to this effort and have hopes and expectations of improvement across the board. CO0 F. Internal Audit Department a /5 o Audit Report 2013-5 (formerly Audit Report 2011 -2) Tourism Assets, Revenues, & Expenditures Review 1), ,,ht I . Brock Issued: July 3, 2013 Clerk o1 the Circuit Court N)O 11 I:a;t ',uitc.. -410 ypIc I 1. X411 ->74ti .�e � � «vvvv.cttllicrcicrl:.ck)m Prepared by: Ron Dortch, Senior Internal Auditor X0 Megan Gaillard, Senior Internal Auditor Report Distribution: Board of County Commissioners Leo Ochs, Jr., County Manager Jeff Klatzkow, County Attorney Mark Isackson, Director, Corporate Financial and Management Services Jack Wert, Tourism Director Len Price, Administrator, Administrative Services Joanne Markiewicz, Interim Purchasing Director Derek Johnssen, Clerk Assistant Finance Director Connie Murray, Clerk Operations Manager Cc: Dwight E. Brock, Clerk of the Circuit Court Crystal K. Kinzel, Director of Finance & Accounting Draft Audit Report Issued for Response: February 5, 2013 Management Responses Received: February 19, 2013 (by Jack Wert& Joanne Markiewicz) February 20, 2013 (by Connie Murray) February 28, 2013 (by Derek Johnssen) Revised Management Response Received: June 24, 2013 (by Jack Wert&Joanne Markiewicz) July 2, 2013 (by Kelly Green on behalf of Jack Wert) TABLE OF CONTENTS OBJECTIVES 2 SCOPE 2 BACKGROUND 3 SUMMARY 4 OBSERVATIONS, RECOMMENDATIONS, & MANAGEMENT RESPONSES 5 OTHER RECOMMENDATIONS 15 CONCLUSION 16 ADDITIONAL MANAGEMENT COMMENTS 17 1h.: 1111 , 1/4t i1/41 1/4i , 1/4,1 ;1 it N 1, 1,2 .. vI .t :ik. ,,. [`' �','! uy/(? .,.f. ,.. ..a p I i 1 1 Objectives The objectives for this review were to verify: • Contracts for tourism marketing services adhere to the Collier County Purchasing Policy; • Tourism Department expenditures were eligible transactions under the applicable contract; properly supported; correctly processed for payment; and served a valid, legal, and public purpose; • Tourist Development Tax revenues were correctly calculated and allocated to the appropriate general ledger funds; • Existence and accuracy of the petty cash fund(s) assigned to the Tourism Department; evaluate internal controls; and ensure compliance with County Petty Cash Policies and procedures; and • Fixed Assets were properly recorded. Sco e The review consisted of, but was not limited to the following tasks: • Compiling files and information from the Tourism Department, the Clerk's Finance and Accounts Payable Departments,and documents available in county public records; • Reviewing applicable Florida Statutes; • Reviewing applicable County Ordinances and Resolutions; • Reviewing applicable County Manager Administrative Policies and procedures; • Reviewing applicable BCC agendas,meetings, and minutes; • Reviewing Tourism Department RFP's, bids,and contracts; vite • Interviews with Tourism and Purchasing Department staff; • Interviews with Clerk's Finance and Accounts Payable staff; • Unannounced cash counts of the Tourism Department Petty Cash Fund; • Reviewing Certificate and Request of Imprest Funds forms and Annual Confirmations; • Reviewing fixed assets records and physical inspection of fixed assets; • Reviewing Monthly Tourist Tax Revenue Allocations for fiscal years 2004—2011;and • Reviewing a sample of Tourism Department advertising and marketing expenditures and related contracts for fiscal years 2009-2011. 2 Background Florida Statute 125.0104 - Local Option Tourist Development Act asserts that any county in the state may levy and impose a tourist development tax on the rental or lease of hotel/motel, apartment/condominium, campground, and vacation rental stays of six months or less. Per F.S. 125.0104, at least 60 days prior to levying and imposing the tourist development tax, the governing board of the county (herein referred to as the BCC) must adopt a resolution establishing and appointing members to the county tourist development council. F.S. 125.0104 also mandates that the local Tourist Development Council (TDC) prepare and submit to the BCC for its approval a plan for tourist or county development,contingent upon approval of the tourist development tax by County voters. In 1992, the BCC adopted Ordinance No. 1992-18 authorizing the formation of the TDC, subject to voter approval of a 2% Tourist Development Tax (TDT). Collier County voters approved a referendum and the BCC adopted Ordinance No. 1992-60 levying a 2% TDT on rentals within Collier County as defined by F.S. 125.0104. In 1995, Collier County voters approved a second referendum and the BCC adopted Ordinance No. 1995-46 increasing the TDT by 1%. In 2002,the BCC adopted Ordinance No. 2002-501 creating the Tourism Department. In 2005, Collier County voters approved a third referendum and the BCC adopted Ordinance No. 2005-43 increasing the TDT by an additional 1%, resulting in the current 4% TDT. The Collier County Tax Collector is responsible for collecting the 4%TDT revenue and remitting the funds to the BCC. As required by F.S 125.0104, the Collier County TDC consists of nine voting members serving staggered four-year terms. Members are appointed by the BCC and represent local government, the tourism industry, and owners/operators of establishments subject to the TDT. The TDC serves in an advisory capacity to the BCC and is responsible for developing a strategic plan for tourist development and recommending uses for TDT revenues. F.S. 125.0104 defines authorized uses for TDT revenues, while Collier County Ordinance 2005-43 details the specific uses and allocation of TDT revenues. Collier County uses TDT revenues to fund the following activities: • Improvements to beach/park facilities and beach related projects(Category A); • Advertising and marketing of local facilities and attractions(Category B); • County owned and operated museums(Category C-1); • Museums owned and operated by municipalities and not-for-profit organizations(Category C-2); and • Emergency advertising for occasions such as the Deepwater Horizon oil spill in 2010 (funded by transfers from the above categories). Three county departments separately oversee these activities. Coastal Zone Management is responsible for improvements to beach/park facilities and beach related projects. The Collier County Museum manages county owned and operated museum exhibits. The Tourism Department, operating as the Naples,Marco Island, Everglades Convention and Visitors Bureau, coordinates advertising and marketing activities, including emergency advertising and museums owned and operated by municipalities and not-for-profit organizations. Since 2003, the Tourism Department has contracted with Paradise Advertising and Marketing, Inc., a private advertising agency, to develop and execute marketing and advertising campaigns. The Tourism Department also circulates information about visiting Collier County to worldwide travel media and serves as the point of contact for meeting planners, tour operators, travel agents, and other industry professionals. In addition, the Tourism Department awards grants and sponsorships funded by TDT revenues to organizations for out-of-county marketing and promotion of cultural, sporting, and other events to attract tourists to Collier County. The Tourism Department's operating budget is funded by TDT revenues and requires BCC approval. In fiscal year 2011, the Tourism Department had seven full-time employees with an operating budget of$6,461,400. For a review of the TDT Revenue Grant Applications for fiscal year 2011-2012, see Interim Audit Report 2013-6 Limited Scope: Tourist Development Tax (TDT) Revenue Grant Applications — Fiscal Year 2011-2012 (formerly Interim Audit Report 2011-2A). ,S; 3 Summary The following observations were generated during this review: 1. Change orders caused annual tourism marketing expenditures to routinely exceed contract. 2. Changes in hourly rates and services were considered a"Zero"dollar change order. 3. Inconsistencies were noted between the County's Request for Proposal, vendor proposal, and contract for tourism marketing services. 4. Expenditures submitted by vendors were not in compliance with contract terms. 5. A donation by Paradise Advertising and Marketing, Inc. was not consistent with TDC and BCC recommendations. 6. There is a potential appearance of a Code of Ethics violation ("conduct that gives the appearance of impropriety"). 7. Certain Tourism Department expenditures were not in compliance with County Resolution, Policy, or procedure. 8. Tourism Department Petty Cash fund was not in compliance with County Policy. 9. Inaccuracies were noted in SAP vendor account information. Other Recommendations noted during the audit: • The Clerk's Finance staff should update the Monthly Tourist Tax Allocation Spreadsheet in a timely manner when the TDT rate and/or allocation percentages change. • Invoices should be date stamped, initialed, and promptly processed by Tourism Department staff. Controls over processing change orders to tourism contracts, payment of tourism expenditures, obtaining and updating vendor contact information, and the Tourism Department's petty cash fund should be reviewed, evaluated, and monitored by county staff to ensure compliance with Florida Statutes, County Ordinances and Resolutions, Policies, and Procedures. County staff should also ensure vendor proposals address RFP specifications; and terms and conditions in documents, including executive summaries and contracts,presented to the BCC are consistent. County staff should consider implementing consistent County-wide policies and procedures for donations. County officials should take care to avoid the appearance of a conflict of interest. Inadequate controls increase the risk for fraudulent payments and misappropriation of county assets. County Management Summary County staff members are committed to implementing business processes which are consistent with ensuring fiscal responsibility and integrity. County Management has made a number of changes to its business processes prior to, and, as a result of this audit, including,but not limited to: • Completed refresher training on Purchasing Card transactions with Tourism staff; • Returning the petty cash fund to the Finance Department by end of fiscal year 2013; • Updated solicitation documents to include the County's historical spend; • Report all change orders and contract amendments to the Board consistent with Purchasing Policy; and • Continue to work with the Clerk's Finance and Internal Audit Office to ensure corrections have been addressed. 4 Observations I ) Change orders caused annual tourism marketing expenditures to routinely exceed contract. Contract #06-4007 awarded to Paradise Advertising and Marketing, Inc. for Tourism Marketing Services was in effect from October 1, 2006 through March 31, 2011 for $2,350,000 annually. During the term of the contract, five change orders were processed for additional marketing services totaling $3,767,000, resulting in tourism expenditures exceeding the original contract amount by approximately 53%. Contract#06-4007 Original Term- 10/1/2006 to 9/30/2008 $ 2,350,000 Date Change Order# Purpose Amount Contract Total %Change 10/09/07 Amendment#1 Increase County Museum Advertising budget $ 70,000 $ 2,420,000 3.0% 07/08/08 Change Order#1 Additional Marketing expenditures $ 700,000 $ 3,120,000 28.9% $ 770,000 32.8% Contract Renewal#1 10/1/2008 to 9/30/2009 $ 2,350,000 Date Change Order# Purpose Amount Contract Total %Change 12/02/08 Zero Dollar#1 Replace Exhibit A-Hourly Rates $ - $ 2,350,000 - 03/09/09 Change Order#2 Additional International Marketing Expenses $ 204,000 $ 2,554,000 8.7% 04/20/09 Zero Dollar#2 Clarify Agency Fee language in contract $ - $ 2,554,000 - 07/15/09 Change Order#3 Additional Marketing Expenditures-Summer Campaign $ 918,000 $ 3,472,000 35.9% $ 1,122,000 47.74% Contract Renewal#2 10/1/2009 to 9/30/2010 $ 2,350,000 Date Change Order# Purpose Amount Contract Total %Change 04/01/10 Change Order#4 Additional Marketing Expenditures-Yearly Campaign $ 1,875,000 $ 4,225,000 79.8% Total Change Orders= $ 3,767,000 I 53. 9'0 I 43I It does not appear change orders to Contract#06-4007 were considered when the County set the $2,100,000 budget amount for RFP#10-5541,Tourism Marketing Services. Recommendation: • Going forward, County staff should ensure services solicited in the bidding documents(i.e. RFP)reflect the full services of the intended contract. County Management Response: a. "Change Orders are the mechanism that the Purchasing Department utilizes to receive BCC authorization for increases in expenditures not contemplated at the start of an agreement.In the case of Paradise Advertising and Marketing, Inc., Change Orders were requested for specific TDC recommended and BCC approved additional destination marketing expenditures. These change orders occurred during an un-anticipated downturn in tourism,for circumstances beyond the County's control; change orders were issued to reduce the negative impact on the community's economy. b. The BCC approved FY 2005-06 budget amount for tourism advertising and marketing was used in bid solicitation #06-4007. Historical spend activity is identified in solicitation documents; the County will endeavor to include information about unusual and unanticipated annual expenditures in Tourism marketing related solicitations. c. Additional funds or other moderations are approved by the Board via a Change Order, or amendment, according to the BCC approved Purchasing Policy. 5 Internal Audit Response: By under soliciting services, a concern is raised that potential respondents may be deterred from responding. This may narrow the competition, where marketing agents may be interested in large contracts. The contract amount has been increased each year through change orders to a level that may attract additional respondents. 2) Changes in hourly rates and services were considered a "Zero" dollar change order. Contract #06-4007 awarded to Paradise Advertising and Marketing, Inc. for Tourism Marketing Services was in effect from October 1, 2006 through March 31, 2011. In December 2008, a change order was processed for the "Replacement of Exhibit A specifying hourly rates for services performed on behalf of Collier County. This new Exhibit A indicates new services and rates, which will be performed within the dollar limits of the existing agreement." County staff regarded the new exhibit as a -zero- dollar change order and did not obtain BCC approval. The new Exhibit A contained five additional staffing positions related to digital/intemet services and new hourly rates ranging from $50 per hour for a Data Entry Specialist to$200 per hour for an Interactive Developer. Changes to rates and services significantly alter the original terms of the contract, which requires BCC approval. If rates increase, then service hours decrease accordingly in order for expenditures to remain within "the dollar limits of the existing agreement." Also, Contract #06-4007, section #4 - THE CONTRACT SUM: AGENCY FEE states "... All media and production costs up to $2,000,000 annually will be billed to the County at net, so that the County receives any available discount. Media and production billing over $2,000,000 annually ... will be billed at gross, reflecting a Contractor commission of 15%". County staff did not calculate the monetary impact of the new rates and additional positions. A substantial increase in digital/internet services may cause advertising and marketing costs to surpass the $2,000,000 threshold more quickly, subjecting additional expenditures to the 15% Contractor commission and increasing the cost of tourism marketing services. Recommendation: • County staff should implement procedures to ensure change orders to existing contract terms and conditions are properly evaluated and approved by the BCC. County Management Response: a. "The Tourism staff will follow the BCC approved Purchasing Policy related to change orders and amendments and work directly with the Purchasing Department to execute, and obtain approval by the Board b. In the audit for Contract #06-4007, the "new" Exhibit A did not increase rates, rather, it provided for new personnel categories, all of which (the new personnel categories)fell within the contract scope of work These new personnel categories were added in the event the department needed to utilize these skill sets in the scope of work and to enable the payment by the Clerk's Finance staff" Internal Audit Response: New services and rates have a financial impact on the contract. If the new hourly rates and positions are added and the budget remains at the same set amount, then the number of service hours may decrease in order to stay within budget. This results in a fiscal impact. "Zero"dollar change orders implies there is no fiscal impact. For example, if the advertising rate equals $10 hour and the total advertising budget is $1,000,then the total service hours cannot exceed 100 hours. If the hourly rate increases to $20 hour and the budget remains $1,000, then total service hours available is reduced to 50 hours. The County may receive fewer service hours for the same budgeted amount. The addition of new positions/services may result in the set budgeted amount being reached faster. \el>, 6 3) Inconsistencies %%ere noted between the ('ountv 's Request for Proposal, vendor- proposal, and contract for tourism marketing services. The Board of County Commissioners (BCC) awarded Contract#10-5541, Tourism Marketing Services,to Paradise Advertising and Marketing, Inc. (Paradise Advertising)on January 25, 2011.A comparison of the County's Request for Proposal (RFP), Paradise Advertising's submitted proposal, and contract approved by the BCC identified the following inconsistencies: Budget • The RFP budget was$2,100,000 plus an undetermined amount for museums. • Paradise Advertising's proposal was $2,400,000, which included a $2,100,000 annual base and a $300,000 administration fee. • The Contract was $2,350,000, which included a $2,000,000 annual base, plus a $300,000 administration fee and$50,000 in advertising and marketing services for museums. Emergency Funds • The RFP included a provision for$1,500,000 in emergency funds. • Neither Paradise Advertising's proposal nor the Contract referred to emergency funds other than Paradise Advertising will work with the County to develop an emergency advertising plan. • Paradise Advertising was paid $2,375,000 in emergency funds for advertising under the previous tourism marketing services contract(Contract#06-4007). Administration Details • The RFP required vendors to provide projected costs with estimated duration and a schedule of principals and staff. • Paradise Advertising's proposal included projections of 490 hours per month from principals and staff. Note: In December 2010, three key employees with experience working on Collier County's marketing account left Paradise Advertising, including the company's Vice President/Creative Director and an account supervisor with 20 years of industry experience. This change in staffing occurred after Paradise Advertising submitted its proposal in August 2010, but was not disclosed to the BCC prior to approving Contract #10-5541 in January 2011. The principals on Collier County's account, as detailed in Paradise Advertising's proposal, were substantially altered prior to awarding the contract without notifying the BCC. Additional Billing • The RFP allowed for creative time and out-of-pocket expenses. • Paradise Advertising's proposal included hourly rates for creative design; incremental advertising options of $1,000,000; and out-of-pocket expenses to be billed at net. • The Contract includes creative time in regular media and production costs, which are billed at net up to the $2,000,000 annual base; anything over the $2,000,000 will be billed at gross; and out-of-pocket expenses will be billed at net. Use of Subcontractors • The RFP did not allow for any mark-up and vendors were required to provide a list of subcontractors with letters of intent. • Paradise Advertising's proposal stated no subcontractors would be required, but later referred to the use of outside vendors to augment services. Paradise Advertising's proposal did not include a list of outside vendors. • The Contract requires Paradise Advertising to provide invoices from outside vendors. 7 Commission • The RFP encourages vendors to accept less than a 15%commission or charge a fee in lieu of commissions. • Paradise Advertising's proposal does not specify a commission percentage. • The Contract includes a $300,000 administrative fee, plus a 15% commission on costs over the $2,000,000 annual base. Recommendations: • County staff should ensure contracts are consistent with the documented scope of work. • County staff should use the terms and conditions detailed in RFPs and vendor proposals to prepare contracts to ensure consistency within documents presented to the BCC for approval. County Management Response: a. The Tourism Department will comply with the BCC approved Purchasing Policy for any RFP solicitations. b. Contract#06-4007 for Tourism Marketing Services was awarded to Paradise Advertising and Marketing, Inc. after an RFP process that adhered to the BCC approved Collier County Purchasing Policy. c. The contract with Paradise Advertising and Marketing Inc. was for$2,350,000 which accurately reflected the final BCC approved budget for that fiscal year for these services. d. The RFP indicated that Emergency funds of$1,500,000 could be used in the case of a declared emergency for destination advertising and marketing. Emergency marketing expenditures are used only when needed and are not reoccurring. e. The Vice President/Creative Director and an Account Supervisor left Paradise Advertising in December of 2010. Those positions were immediately filled by Paradise Advertising with seasoned professionals with credentials that exceeded those of the departing staff members. Neither Collier County, nor the Tourism Department experienced any decrease in service as a result of these staff changes. We experienced an immediate increase in account service attention and a much higher level of creativity with the new staff members. f Paradise Advertising and Marketing, Inc.is a full-service marketing company providing to its clients a wide range of in-house advertising promotion, media and other marketing services. They did not intend to use nor have they used subcontractors for their creative work or other outside services on our account under their agreement with Collier County. g. An RFP outlines the scope of services the County wishes to receive. The vendor Proposals indicate what each bidder is willing to offer related to that scope of services. The Contract is negotiated with the successful vendor to achieve the best possible arrangement for the County. For these reasons,these three documents by necessity may have a few differences and might not have complete agreement. • The Board's Purchasing Policy (VIII A 3) allows departments to use the competitive proposal methodology "Where the County is incapable of specifically defining the scope of work for which the commodity(s) or service(s)is required... " • The solicitation is used to describe the "intended scope of work/service"and the selection criteria;the vendor's proposal describes the vendor's ability to perform the intended scope of work and respond to their qualifications; and the contract is the codification of what will be performed for the stated, and agreed upon terms and conditions. The goals of each of these documents are d erenz and inter-related • Contracts that are the result of requests for proposals are negotiated with the selected vendor and may not necessarily match the solicitation and/or the vendor's submitted proposal. This negotiation is in compliance with Purchasing Policy as noted above. 8 • Each Selection Committee is provided instructions regarding the review process (including selection criteria), the solicitation document and the vendor's proposals. Internal Audit Response: Item"f"-Use of Subcontractors Miles Media was hired by Paradise Advertising to provide webhosting services for County websites. It appears Miles Media is serving in the capacity of a subcontractor of Paradise Advertising under contract #06-4007. Paradise Advertising did not disclose Miles Media's involvement in the completion of contract#06-4007 to Collier County, as required by the RFP. Miles Media has a separate contract with Collier County to provide webhosting services at a lower rate. See Observation#4 for further detail. 4) Ex )enditures submitted bV Vendors Were not in compliance with contract terms. Vendor submitted an ineligible expenditure for payment. Contract #06-4007 awarded to Paradise Advertising and Marketing, Inc. (Paradise Advertising) for Tourism Marketing Services was in effect from October 1, 2006 through March 31, 2011. Paradise Advertising submitted an invoice dated May 6, 2010 for website hosting and maintenance services related to the Tourism Department's film commission website (www.shootinparadise.com). A review of Contract #06-4007 and the invoice noted the following: • Contract#06-4007, section#2 - Statement of Work did not list website hosting and maintenance as a service provided by Paradise Advertising. • Paradise Advertising submitted an invoice for website hosting and maintenance services completed by Miles Media Group, Inc. It appears Miles Media Group, Inc. is a subcontractor for Paradise Advertising. Collier County has a separate contract with Miles Media Group, Inc. (#09-5183) for tourism website design and maintenance, including www.shootinparadise.com. • Paradise Advertising was paid for a service already contracted through Miles Media. Paradise Advertising's Invoice #983-0 in the amount of $2,100 was for 6 months of website hosting and maintenance with an average cost of$350 per month.Under Contract#09-5183, Miles Media Group,Inc. charges Collier County a monthly rate of$250 for website hosting and maintenance. It appears Miles Media submitted the invoice for the website hosting and maintenance under Paradise Advertising's contract at a higher rate than was allowed under their contract. It appears Collier County overpaid website hosting and maintenance by$100 per month. Note: During the November 28, 2011 TDC meeting, a TDC member said Miles Media Group, Inc. was a subcontractor under the Paradise Advertising and Marketing, Inc. contract and held their own contracts with the County. The Tourism Director responded "No ma'am, that's not true". At the meeting the owner of Paradise Advertising and Marketing, Inc. confirmed Miles Media Group, Inc. was not a subcontractor. The above example directly conflicts with these statements. Contract#06-4007, section#4-THE CONTRACT SUM: AGENCY FEE states"... All media and production costs ... up to $2,000,000 annually will be billed to the County at net, so that the County receives any available discount. Media and production billing over $2,000,000 annually ... will be billed at gross, reflecting a Contractor commission of 15%." The payment of ineligible expenditures under Contract #06-4007 could cause advertising and marketing costs to surpass the $2,000,000 threshold more quickly, subjecting eligible expenditures to the 15% Contractor commission and increasing the cost of tourism marketing services. Documents presented to the BCC for approval were inconsistent. The Executive Summary presented to the BCC for approval indicated Contract#10-5534, between the County and `. Alan S. Maltz, photographer, was for a series of 30 photographs to be completed"... over the next three years at an annual cost of$30,000 including travel and production expenses not to exceed $10,000 per year for a total project cost over three fiscal years of$90,000." 9 Contract #10-5534, TERM section states "This is a one (1) year agreement commencing on July 1, 2010 and terminating on June 30, 2011. The CLIENT may, at its discretion and with the consent of the ARTIST, renew the Agreement under all terms and conditions contained in this Agreement for two (2) additional one (1) year periods ... Funding is not guaranteed beyond one (1) year, and subsequent years' agreements will be based on availability of an appropriation of tourist tax funds." M F. Contract#10-5534 also contained conflicting payment terms. The RIGHTS GRANTED section states "...Payment will be at the agreed amount of two thousand dollars ($2,000) per shot up to a maximum of sixty thousand dollars ($60,000) over a three (3)year period ..." The FINANCIAL TERMS section states "... it is anticipated that a sum of sixty thousand dollars ($60,000) plus expenses ... will be paid for the services of Alan S. Maltz over a three (3) year period based on availability and appropriation of tourist tax funds ... A portion of the expenses ... and other costs associated with this project will be paid by the CLIENT up to a maximum per year of ten thousand dollars ($10,000)." Annual expenditures complied with the most restrictive contract terms; however conflicting language increases the risk of inappropriate payments to vendors or may result in the Clerk's inability to pay vendors. Recommendations: • County staff should ensure contract terms are consistent and accurately described in documents presented to the BCC for approval. • When reviewing expenditures to the contract, Clerk's Accounts Payable staff should identify any conflicting language and/or discrepancies. County Management Response: a. "Tourism staff will ensure that contact terms are consistent and accurately described in documents presented to the BCC for approval. Tourism staff acknowledges that the use of Miles Media by Paradise Advertising and Marketing Ina for website hosting was not a correct procedure and we will advise this vendor and all of our other vendors that they must use the lowest priced vendor and ensure that the selected vendor does not have a contractual relationship with the County for similar services. b. The.Alan Maltz agreement to purchase 30 images over three years has a wording conflict with the Executive Summary presented to the BCC A review of SAP records indicates the Tourism Department expended$29,905 in FY 10, $30,000 in FY 11 and$30,000 in FY 12 for the services provided by Alan Maltz. This appears to be in compliance with the Agreement terms to purchase 10 images at $2000 each plus production expenses for a total of$30,000 per year c. Tourism staff will ensure that future Executive Summaries are in direct compliance with the related agreement when presented to the BCC approval." Clerk's Accounts Payable Management Response: "Clerk's Accounts Payable staff will continue to identifr any conflicting language and/or discrepancies crossing related legal documents. Purchasing will be contacted for further clarification of content and/or possible contract amendment if required in order to make a legal payment on behalf of the Board of County Commissioners." 5) A donation b. Paradise AtI ertising and !\larketin;;, Inc. N‘as not consistent with TDC and BCC recommendations. In December 2009, the BCC approved a $1,000,000 change order for additional marketing services to Contract#06-4007 with Paradise Advertising and Marketing, Inc. In the TDC's Advisory Board Meeting on Monday, January 25, 2010, Paradise Advertising and Marketing, Inc. ti'I offered to donate up to $100,000 of the media commissions to the county contingent upon being awarded and receiving payment in full for the $1,000,000 change order for additional services. The TDC Meeting Minutes state the firm's intent was to allow the TDC to re-invest the$100,000 into marketing efforts. 10 The owner of Paradise Advertising and Marketing, Inc. noted he would rely on TDC's direction regarding the proposed $100,000 donation. The TDC encouraged the $100,000 donation to be provided to the Marco Island Museum Exhibit Project. In the BCC Meeting on Tuesday, January 26, 2010, the BCC Chairman was asked how the donation was to be allocated according to the TDC recommendation. The BCC Chairman said the donation would be allocated as follows: $50,000 to Marco Island Museum and $50,000 to be used for advertising services, rather than Paradise Advertising and Marketing, Inc. lowering their fees charged to the County for marketing services. On December 9, 2010, the donation was received by the County with $50,000 earmarked for the Marco Island Museum and $50,000 for Freedom Memorial, a project initiated by the BCC chairman. The donation was not consistent with the recommendation of the TDC and BCC Minutes. In the BCC Meeting on Tuesday, December 14, 2010, the BCC accepted the donation for $50,000 earmarked for Freedom Memorial. Recommendation: • The BCC should consider establishing a consistent County-wide donation process. County Management Response: "Tourism Department staff discussed with the Tourist Development Council (TDC) a proposal by Paradise Advertising to make a donation of a portion of their media commissions they would have earned as a result of the additional destination marketing funding approved by the BCC in response to the world-wide economic crisis that was negatively affecting tourism to our community. The TDC recommended a donation by Paradise Advertising to the Marco Island Museum. As an Advisory Board the TDC only recommends actions to the BCC The BCC in turn, is under no obligation to follow TDC recommendations." 6) 'There is a potential appearance of a Code of Ethics iolation ("con(1uc1 that gig es the a v)earance of im Collier County Ordinance 2004-05 mirrors and further elaborates Florida Statute Chapter 112 -Code of Ethics. The Ordinance indicates "Public officials shall not solicit or accept, directly or indirectly, any fee, compensation, gift, gratuity, favor, food, entertainment, loan, or any other thing of monetary value, from anyone who the public official knows or reasonably should know: a. has, or is seeking to obtain, contractual or other business or financial relations with the county department or board with which the public official is affiliated..." Collier County Ordinance 2004-05 indicates it is the responsibility of each public servant to act in a manner that contributes to ensuring the public's trust in its government. Individuals should avoid conduct that gives the appearance of impropriety in the performance of his or her public duties. Since 2003, Paradise Advertising and Marketing, Inc. has been under contract with the County to provide tourism marketing services. On January 25, 2011, Commissioner Coyle, pointed out "...Paragraph 14 of the procurement policy prohibits those kinds of interactions between companies who are bidding on contracts and commissioners... `Firms and their agents are not to contact members of County Commission for purposes such as meeting or introduction, luncheons, dinners, et cetera'... `Failure to abide by this provision may serve as grounds for disqualification for award of this contract to the firm.'" On July 25, 2011, the owner of Paradise Advertising and Marketing, Inc. had dinner with a sitting commissioner at the commissioner's home. The dinner was scheduled the night before a pending BCC (July 26, 2011) agenda item for the enrichment of the owner's company, with a change order for $800,000 of increased services and fees. This has the potential appearance of a conflict of interest according to Collier County Ordinance 2004-05. Subsequent to this audit finding, the Board of County Commissioners amended the Collier County Ordinance through the adoption of Collier County Ordinance 2013-39. 11 Recommendations: • All public servants and vendors should comply with county/state code of ethics. • Public officials should take care to avoid the appearance of a conflict of interest. County Management Response: The Tourism Department staff has and will continue to comply with County and State Code of Ethics. We have no knowledge of a dinner attended by a Commissioner and the owner of Advertising and Marketing,Inc." 7) Certain Tourism Department expenditures Nycre not in compliance «ith County RcsoIutioH. Policy, or )rocedure. Tourism purchasing card expenditures were not in accordance with County Resolution 2006-40 or County Manager Administrative(CMA)Policy#5808—Purchasing Card Program. • A review of Tourism Department purchasing card expenditures identified one transaction in which the employee e-mailed a vendor on January 21, 2011 explaining that a charge for a conference registration in mid-December 2010 did not appear on the employee's December purchasing card statement. The employee requested that the vendor wait to"... process those charges now after Feb. 1st because my January credit card limit has hit its max". County Resolution 2006-40, Section F—COUNTY PURCHASING CARD USE states"... The Purchasing Card issued to each Tourism Department staff member will have ... a maximum monthly spending limit of$10,000". Requesting vendors to hold or delay processing purchase card expenditures is a circumvention of spending limits established by County Resolution 2006-40. • 3 purchasing card expenditures for tradeshow exhibit services posted to Out of County Travel Professional Development(GL#640300). It appears Marketing&Promotion(GL#648170)is a more appropriate account. Expenditures should be appropriately classified. Tourism Department expenditure lacked proper supporting documentation. A review of Tourism Department purchasing card expenditures identified one transaction lacked an itemized receipt. The expenditure was airfare for the Tourism Director to attend a tradeshow in Washington,D.C. The receipt included with the expense report listed flight information but did not list the amount of airfare. CMA #5808, Section C(2)(h) states the cardholder agrees to "Obtain an itemized receipt for all purchases. The itemized receipt must include the quantity,a description of the item(s),the unit cost and the extended price ..." Incomplete supporting documentation and conflicting payment information on schedules and invoices increases the risk of fraudulent payments. Tourism employee expense reimbursement was overstated. A review of Tourism Department employee expense reimbursements noted an employee booked airfare for herself and a companion. The employee included the companion's $28.00 seat assignment fee resulting in an ineligible expense reimbursement. Accurate requests are necessary to ensure reimbursement of proper expenses. Recommendations: • Training should be provided to the Tourism Department Staff to ensure each person understands the policies, procedures, and forms governing Purchasing Card transactions. z • County staff should continue to review supporting documentation and expense reports to ensure expenditures are eligible; for the proper amount; and paid to the correct vendor. 12 • County staff should continue to review Purchasing Card Transactions to ensure expenditures are posted to the proper general ledger accounts. County Management Response: a. Tourism Management acknowledges that the vendor request was wrong and the tourism employee has been noted of this incorrect use of her Purchasing Card The tourism employee in question was trying to register for a trade show that was in accordance with our tourism mission and was in the best interest of the County. b. Tourism Management acknowledges the errors on three purchasing card expenditures for trade show exhibit expenses that were incorrectly posted to the wrong GL code. Tourism staff will endeavor to post these types of expenses and all other tourism expenditures to the correct GL code in the future. c. The purchasing card expenditure for airfare by the Director to Washington DC was a change fee that was necessitated by the rescheduling of a BCC tourism item that required a later departure. The Tourism Director requested Delta Airlines to provide a more detailed receipt than the one they provided, but Delta was unable to produce such a document. d The expenditure for a seat fee of$28 for a companion was an oversight on the Tourism Department employee's part and she has reimbursed the County for that$28 fee. e. The Tourism Department staff received a Purchasing Card refresher course on March 28, 2013 by the Purchasing Department staff in the proper use of the County Purchasing Card f Purchasing policies and County Manager procedures (CMA # 5808) were reviewed and acknowledgement forms signed by all Tourism Staff prior to receiving their card;an audit was conducted as recently as February /March 2012 validating credit cards were in the staff's possession. g. The Purchasing staff increased the Purchasing Card limits of some Tourism staff beyond the standard limits due to the amount of travel by staff members per Purchasing Resolution 2007-340(approved 11/27/07; #10W), which was approved and dated after BCC approval of Resolution 2006-40. The Tourism staff intends to update Resolution 2006-40 to reflect consistency between the Purchasing Policy and the Tourism Travel Resolution. 8) Petty Cash fund was not in compliance with County Police. Unannounced reviews of the Tourism Department's Petty Cash fund on April 28, 2011 and September 15, 2011 identified the following: The petty cash fund was not replenished or balanced quarterly • A Reimbursement Form dated March 7, 2011 requested reimbursement for eight purchases dating from December 2005 through December 2009. • The custodian or sub-custodian did not document each time the petty cash fund was balanced. Since records were not available for review, Internal Audit was unable to verify if the petty cash fund was balanced on a quarterly basis. County Petty Cash Policy, Item#11 states"Petty Cash accounts should be replenished and balanced quarterly". Timely submission of reimbursement requests is necessary to ensure expenses are reported in the appropriate period. Quarterly balancing of petty cash funds is key to detecting and correcting any discrepancies in a timely manner. Appears the Tourism Department did not return prior annual confirmations and returned the Fiscal Year 2011 confirmation after the designated due date Clerk's Finance Department did not receive annual confirmations for Fiscal Year 2008, 2009, and 2010. For Fiscal Year 2011,the Tourism Department's confirmation was dated August 15,2011,but the Clerk's Finance Department did not receive the confirmation until August 25,2011. 13 • County Petty Cash Policy, Item#15 states"Imprest Fund Confirmations will be done on an annual basis at the fiscal year end.The form will be sent to the departments by Finance and must be returned by the date requested." Petty cash funds may not be properly recorded if annual confirmation forms are not completed and returned by the established deadline. Fiscal Year 2011 annual confirmation did not list accurate fund information The confirmation listed the wrong physical location, custodian, and sub-custodian for the petty cash fund. The fund custodian did note the correct information on the confirmation returned to the Clerk's Finance Depaitment. County Petty Cash Policy, Item#8 states "A new Certificate of Request form must be filled out and submitted each time there is a change of the following: Director, custodian, sub-custodian, or physical location.". The Clerk's Finance Department has not received an updated Certificate and Request of Imprest Funds form. Using the Certificate and Request of Imprest Fund Form to update petty cash fund information ensures only authorized custodians and sub-custodians have access to the fund and that all funds are in the authorized location. Recommendations: Training should be provided to the custodian and sub-custodian to make certain each person understands the policies, procedures, and forms governing petty cash funds. In particular, procedures should be implemented to ensure: • Petty cash reimbursement forms are submitted at least quarterly, • Petty cash funds are balanced at least quarterly and the balancing is documented, • Annual confirmations are returned to the Clerk's Finance Department by the designated due date,and • Changes to the petty cash fund are documented on a Certificate and Request of Imprest Fund form and the original provided to the Clerk's Finance Department. County Management Response: a "Tourism staff acknowledges that the Petty Cash And is to be balanced quarterly, but due to very few if any transactions each year, this procedure was overlooked The Petty Cash Fund Custodian is now aware that the fiord must be balanced quarterly in accordance with Petty Cash Policy Item # 11, whether or not there have been transactions in the fund. b. Tourism Department staff acknowledges they did not return the annual report for FY 08, 09 and 10 due to a misunderstanding of this requirement. The lateness of the FY 11 report was due to a delay in interoffice mail delivery c. Tourism Management will update procedures to require the Custodian to contact the Clerk's Finance Department prior to the end of each fiscal year for the Petty Cash form. d Tourism Department staff feels that the Petty Cash account is no longer necessary to support our operations. The Tourism staff intends to return the $50 in the fund to Finance after completing and delivering the final report for 2013." 9) Inaccuracies Were noted in SAP Mender account information. The Purchasing Department creates a payment account in SAP for each vendor doing business with Collier County. This payment account includes the vendor's mailing address, phone number, tax identification number, and preferred payment method. The Clerk's Accounts Payable Department uses this payment account to determine where to send payments. 1 Vendor payment accounts contained inaccurate contact information A comparison of contact information on vendor invoices to vendor account profiles in the SAP financial system identified the following: 14 • Four vendors submitted invoices that did not list a mailing address or phone number. One of these vendors had a W-9 Request for Taxpayer Identification Number and Certification form on file containing the mailing information and contact phone number. Inaccurate contact or account information increases the risk of fraudulent payments. Recommendation: • The Purchasing Department should establish procedures to routinely review and update vendor account contact information and ensure current W-9 forms are on file for vendors. County Management Response: • -Both Purchasing and Accounts Payable staff have access to creating vendor accounts in SAP and both staff ff groups can make changes/updates to the Vendor Master file for company code 1000. It is therefore recommended,that both offices establish procedures prior to payment. • Purchasing staff implemented a W-9 (and substitute W-9) process for all formal solicitations and contracts during the August 2007 SAP Upgrade. The process of obtaining a W-9 or substitute W-9 continues to be used with any new vendor selected as a result of a formal solicitation/contract awarded by the Board Further, the Purchasing Department has implemented an on-going updated vendor W-9 process. • When Accounts Payable staff reports payment address discrepancies, the Purchasing Department will communicate with vendors and update addresses using obtained W-9." Clerk's Accounts Payable Management Response: "Clerk's Accounts Payable staff will continue to validate that the invoicing party and remit-to addresses are accurately reflected in the vendor master. With the advent of the new accounts payable invoice imaging software there is an appropriate built-in workflow that allows the accounts payable staff to notif purchasing of any discrepancies between current vendor master name and address to actual invoice name and remit-to address imaged in the system. Vendor master file maintenance will be segregated" Other Recommendations 10) The :11onthly Tourist Tax :kllocation Spreadsheet should be updated in a timel manner when the Tourist elo tment Tax rate or allocation )ercentages change. Clerk's Finance staff uses the Monthly Tourist Tax Allocation Spreadsheet to calculate the distribution of TDT revenues to the designated general ledger funds. Effective October 2005 (Fiscal Year 2006),the TDT rate increased from 3%to 4%. In addition,two new general ledger funds were created,which changed the allocation percentages. An inordinate number of adjusting journal entries were posted in January 2006 for the October, November, and December 2005 monthly allocations to correct the revenues distributed to the general ledger funds. The Monthly Tourist Tax Allocation Spreadsheet was not updated until February 2006, resulting in the adjusting entries for the fiscal year. The untimely update of the Monthly Tourist Tax Allocation Spreadsheet may result in the incorrect allocation of tax revenues to the specific general ledger funds and the amount available for tourism activities. Recommendation: • The Clerk's Finance staff should update the Monthly Tourist Tax Allocation Spreadsheet in a timely manner when the TDT rate and/or allocation percentages change. 15 Clerk's Finance Management Response: "The Finance and Accounting Management team understands that revenue allocation changes approved by ordinance are an immediate priority and are routinely booked Subsequent to the adoption of Ordinance 2005-43, on July 26, 200,5, master data updates were made to the financial system in August of 2005 to accommodate the additional 1%tax and its attendant allocation percentage changes. The effective date of Ordinance 2005-43 was September 1, 2005 and as of the effective date all database preparations for the new allocation were in place. However,at the time of the ordinance change adopting the 4th percent there was debate regarding the application of the new 1% to rental contracts let prior to the ordinance change. The Tax Collector's November lump sum distribution,for October receipts,provided a breakout between revenues collected under the 3%ordinance versus the 4%ordinance. Two months lapsed while our Department analyzed the data contained in the Tax Collector's revenue reports, These reports were eventually used as the basis to correct the October through January receipts, in February f 2006, and continue4 to be used as the basis for postings All corrections were made within the proper fiscal year, so there was no impact to fiscal year 2006 financial reporting. The Finance and Accounting Department's policy is to change all revenue allocations on a timely basis." l I ) ln%dices should be dale stamped, initialed, and promptly processed by Tourism Department staff. A review of tourism expenditures identified four invoices were not date stamped and initialed by Tourism staff. Without the proper date stamp and approval, it cannot be determined if the invoices were promptly processed. Recommendations: • With the implementation of the Dolphin system, invoices should be sent by vendors directly to the Clerk's Accounts Payable Department. • If the Tourism Department does receive invoices,the department should implement procedures to ensure invoices are date stamped, initialed,and promptly processed. County Management Response: a. "The new Dolphin system directs all vendors to send their invoices directly to the Clerk's Accounts Payable Department. The Tourism Department staff will direct all our contracted vendors to adhere to this new policy. b. invoices received by the Tourism Department staff staff directly from a vendor will be date stamped, initialed and promptly processed with the Finance Department for payment." Conclusion County staff should assess the monetary impact of change orders to determine proper approval and include historical spend data when preparing future RFPs. Before making recommendations to the BCC, selection committees should ensure vendor proposals and contracts are consistent with RFPs. County staff should review expenditures for proper supporting documentation and monitor compliance with Florida Statute, County Ordinance and Resolutions, contract terms,and Policies and Procedures. County staff should consider developing a consistent County-wide process for donations. County officials and County staff should take the necessary precautions to avoid the appearance of any conflict of interest. Ultimately, it is the responsibility of County management to understand and implement the proper controls in order to limit the risk of fraud, error, and misappropriation of county assets. The Clerk's Internal Audit Department may recommend improvements in audit reports, but it is the duty and decision of County management to formulate processes that ensure compliance with Florida Statutes, County Ordinances and Resolutions, Contract Terms, and County Policies and Procedures. The cooperation of the Tourism and Purchasing Department staff along with the Clerk's Finance and Accounts Payable staff during this review is greatly appreciated. 16 Additional County Management Comments: Tourism Management and Purchasing Management appreciate the time the Internal Audit team dedicated to this audit assignment. The Audit Report indicates some areas for improvement in the Tourism Department operations, implementation will be forthcoming. Additional future actions have also been identified for implementation in conjunction with the Purchasing Department. 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EE 14 1 1 2-574( ���vvv.c��llicrcler6.Loin Prepared by: Megan Gaillard, Senior Internal Auditor Report Distribution: Board of County Commissioners Leo Ochs, Jr., County Manager Jack Wert, Tourism Department Director Kelly Green, Tourist Development Tax Coordinator Jeff Klatzkow, County Attorney Colleen Greene, Assistant County Attorney Mark Isaacson, Office of Management and Budget (OMB) Director Cc: Dwight E. Brock, Clerk of the Circuit Court Crystal K. Kinzel, Director of Finance & Accounting TABLE OF CONTENTS OBJECTIVES 2 SCOPE 2 BACKGROUND 3 SUMMARY 4 OBSERVATIONS, RECOMMENDATIONS, & MANAGEMENT RESPONSES 5 CONCLUSION 9 ADDITIONAL MANAGEMENT COMMENTS 9 The draft yCFSIUU report 'villain conlidential and protected from public records rcdue,,t. during an dctivc audit under Ai(r)l(/ i. l(ihlr in 19t)N /4 of I1., Diqrici) and FloridLi Statute 1 19.0713. Work-papa:, .upportiug the obsc ry allot', noted within tllk report vV W become public record and can he made available upon request once the final audit report ha hocn i;�ncd 1 The draft interim audit report 2013-6 (formerly interim audit report 2011-2A), dated August 22, 2011, was responded to by Jack Wert,Tourism Department Director for the management response. An additional management response,from the department, was provided on January 5, 2012 for updates on progress and a revised management response on July 2, 2013. Objectives The objectives of the audit were to determine 1) grant award compliance to Category B and Category C-2 grant guidelines, Collier County Ordinance, and Florida Statute, 2) whether grant applications included all required documentation,and 3)consistency of Collier County Ordinance language to Florida Statute. Scope The audit review consisted of reviewing Tourist Development Tax Revenue Grant Applications for FY 2011-2012, including but not limited to the following tasks: • Review of Florida Statute Chapter 125.0104; • Review of Collier County Ordinance 92-60, as amended; • Review of Category B and C-2 grant guidelines; • Observe the grant application process; • Attend Tourism Grant Review Committee meeting; • Attend Tourist Development Council meetings; • Interviews with County staff; • FY 2011-2012 grant applications for Category B and Category C-2 submitted to the Tourism Department for review(100%testing); and • Review of Florida Department of State Division of Corporations records. 2 Background The Tourism Department received four Category B grant applications, five Category C-2 grant applications, and one request for funding for Fiscal Year (FY) 2011-2012. The purpose of the grant application is to provide information to County Staff for events and organizations in order to determine if the entity is qualified to receive Tourist Development Tax Revenues in compliance with Florida Statute 125.0104 and Collier County Ordinance 92-60,as amended. Ordinance 2005-43 is the most recent amendment to Ordinance 92-60. Florida Statute 125.0104(5)(a)2 for Authorized Uses of Tourist Development Tax Revenues: "to promote and advertise tourism in the State of Florida and nationally and internationally; however, if tax revenues are expended for an activity, service, venue, or event, the activity, service, venue, or event shall have as one of its main purposes the attraction of tourists as evidenced by the promotion of the activity, service,venue, or events to tourists." Collier County Ordinance 2005-43 states Category B funds are "to promote and advertise county tourism within the State of Florida,nationally and internationally,which encourages tourism with an emphasis on off-season visitors to Collier County and to fund convention bureaus, tourist bureaus, tourist information centers, and news bureaus as county agencies. If tax revenues are expended for an activity, service, venue or event,the activity, service, venue or event shall have as one of its main purposes the attraction of tourists as evidenced by promotion of the activity, service, venue or event to tourists." Florida Statute 125.0104(5)(a)1 for Authorized Uses of Tourist Development Tax Revenues: "to acquire, construct, extend, enlarge, remodel, repair, improve, maintain, operate, or promote one or more publicly owned and operated convention centers, sports stadiums, sports arenas, coliseums, or auditoriums, or museums that are publicly owned and operated or operated by not-for-profit organizations and open to the public, within the boundaries of the county or sub-county special taxing district in which the tax is levied...However, these purposes may be implemented through service contracts and leases with lessees with sufficient expertise or financial capability to operate such facilities." Collier County Ordinance 2005-43 states Category C funds are "to acquire, construct, extend, enlarge, remodel, repair,improve, maintain, operate or promote one or more County owned or operated museums or municipal owned museums or museums that are owned and operated by not for profit organizations and open to the public."Category C-2 further specifies "Municipal owned museums and Museums owned and operated by not for profit organizations open to the public." While reviewing the Tourist Development Tax Revenue grant application process was in conjunction with the Tourism Department Audit (Reference Audit Report 2013-5,formerly Audit Report 2011-2), a further review was completed on FY 2011-2012 grant applications when compliance concerns were discussed in the Tourist Development Council Advisory Board Meeting on May 27, 2011. 3 • Summary The following observations were generated during this review: 1. Florida Statute is more restrictive than the Collier County Ordinance. 2. Some applicants grant applications for Category B and Category C-2 are incomplete. 3. The Friends of Rookery Bay, Inc. does not qualify for Tourist Development Tax Revenue Funding under Category C-2. 4. The Holocaust Museum & Education Center of Southwest Florida grant application does not use the not-for-profit organization's legally registered name. 5. Request for Funding submitted by The United Arts Council was not a grant application and lacked the required documentation. 6. Collier County Ordinance 2005-43 percentage allocation should be verified for compliance when transfers of funds occur between grant categories. Grant applications need to include all documentation required by the Tourism Department. Without all required documents, County Staff cannot properly evaluate the qualifications for events and organizations, which can lead to non-compliance with Florida Statute 125.0104 and/or Collier County Ordinance 92-60, as amended. In addition, County Staff has approved and recommended funding grant applications that were not qualified to receive Tourist Development Tax Revenues under the current Florida Statute and/or Collier County Ordinance and/or internal grant guidelines. A more comprehensive report of the Tourism Department will be issued for other areas of review (Reference Audit Report 2013-5 Tourism Assets, Revenues, and Expenditures Review,formerly Audit Report 2011-2). The Interim Report was provided to the Department and County Attorney's Office to outline concerns. The concerns were discussed with Tourism Department Staff and the County Attorney Staff as resolution of grant requests was urgent due to pending agenda items. 4 Observations 1 ) Florida Statute is more restrictive than the Collier County Ordinance. Florida Statute 125.0104(5)(a)1 states the authorized uses of revenue must be "within the boundaries of the county or sub-county special taxing district in which the tax is levied." The Collier County Ordinance 2005-43 does not include this limitation. Florida Statute 125.0104(5)(a)I states funding must be to "publicly owned and operated or owned and operated by a not-for-profit organization and open to the public...However, these purposes may be implemented through service contracts and leases with lessees with sufficient expertise or financial capability to operate such facilities." Collier County Ordinance 2005-43 Category C states funding must be to "County owned or operated museums or municipal owned museums or museums that are owned and operated by not for profit organizations and open to the public." Category C-1 further states funding is to "County owned or operated Museums." Category C-2 further states funding is to "Municipal owned museums and Museums owned and operated by not for profit organizations open to the public." The Collier County Ordinance uses the word "or" making the Ordinance less restrictive than the Florida Statute which uses "and". This may cause the approval of grant funding for entities not qualified to receive Tourist Development Tax Revenues under Florida Statute. Recommendation: • The language used in the Collier County Ordinance should mirror the Florida Statutory language. County Management Response: "The Ordinance will be revised by the County Attorney to mirror Florida Statutory language when the next amendment occurs. County staff plans to present these suggested amendments to the Tourist Development Council (TDC) on September 6, 2011 and depending on the TDC recommendation, to the Board of County Commissioners (BCC)on September 13 or September 27, 2011." Internal Audit Response to County Management Response: The above County Ordinance amendment has not been completed and the County Ordinance remains less restrictive than Florida Statute. 2) Some applicants grant applications for Category B and Category C-2 are incomplete. The application for funding packets have a check list for the following items: charter, articles of incorporation, by-laws, proof of current status, minutes of meetings authorizing officers to apply for tourism tax funds, IRS determination letter, list of officers and board members with terms of position and salaries, organizational chart, copy of the most recent fiscal year's financial statement, proof of liability insurance, and letters of commitment for co-sponsors and matching fund contributions. Many of the documents required were not included by some applicants. It is important that the applicants include all of the required documents so the appropriate review can be performed by County Staff for category recommendation and qualification determinations to ensure compliance to applicable Florida Statute, Collier County Ordinances, and internal grant guidelines. Recommendations: • Future applications should include all required documentation. • When applications are not complete, the additional information should be requested by County Staff or the application should be declined. 5 County Management Response: "We obtained the required grant application documents from the applicants and have the original FY 12 grant applications with the required attachments available in our office for review." 3) The Friends of Rooker Hay, Inc. does not qualify for 'tourist Development "lax Revenue Funding under Category C-2. Rookery Bay National Estuarine Research Reserve is a component of the Florida Department of Environmental Protection, a State Agency; the reserve is state funded and operated. The Friends of Rookery Bay, Inc. operates as a 501(c) (3) not-for-profit organization, but does not own or operate the reserve. Volunteers of The Friends of Rookery Bay, Inc. provide supporting services and assistance to the reserve. Florida Statute 125.0104(5)(a)1 states the criteria for funding as follows: "Museums that are publicly owned and operated or owned and operated by not-for-profit organizations and open to the public, within the boundaries of the county." Collier County Ordinance 2005-43 Category C states: "County owned or operated museums or municipal owned museums or museums that are owned and operated by not for profit organizations and open to the public." Category C-2 further specifies: "Municipal owned museums and museums owned and operated by not for profit organizations open to the public"are qualified for TDT funding. The Friends of Rookery Bay, Inc. does not own or operate the reserve or a museum. It does not appear that the organization is qualified to receive funds under Category C-2. FY 2010-2011 Grant Funding from Category C-2 provided to The Friends of Rookery Bay, Inc. needs to be reviewed and any current outstanding funds requested put on hold until the discrepancies are reviewed and alternative funding method is available. Recommendation: • The Friends of Rookery Bay, Inc. appear to be qualified to receive Category B funding with revisions to the project expense budget and an updated application. The Friends of Rookery Bay, Inc. could make the necessary updates for information and submit under Category B. County Management Response: "The Friends of Rookery Bay, Inc. have submitted the necessary information to the tourism staff in order to prepare the submittal to the Tourist Development Council(TDC)for their September 6, 2011 meeting and then to the Board of County Commissioners on September 13, 2011. The TDC and BCC will be asked to change the funding source for the FY 11 agreement with The Friends of Rookery Bay, Inc. to Category B (Fund 184), approve an amended project scope in Exhibit F of the agreement and to waive the $25,000 limit, and the 80% multiple year request guidelines in the Category B grant application.." Internal Audit Follow-Up: The source of funding for The Friends of Rookery Bay, Inc. was revised to provide funding from Category B rather than Category C-2. The observation was resolved and closed. 4) The Holocaust Museum & Educational Center of Southwest Florida grant application does not use the not-for-profit organization's legally registered name. The Holocaust Museum & Education Center of Southwest Florida applied for grant funding under a name other than the legally registered entity name. The Florida Department of State Division of Corporations not-for-profit corporation name is "Southwest Florida Holocaust Museum, Inc." All of the Florida Department of State Division of Corporation's information for the address and president of Southwest Florida Holocaust Museum, Inc. match the information provided in the Category C-2 grant application under the name Holocaust Museum&Education Center of Southwest Florida. The Holocaust Museum & Education Center of Southwest Florida is not listed as an organization with the Florida Department of State Division of Corporations. 6 The registered legal name should be used on the grant application exactly as registered with the Florida Department of State Division of Corporations. If the name of the entity has changed, then the name should be changed with the Florida Department of State Division of Corporations. Category C-2 grants require the entity be either a municipal owned museum or a museum owned and operated by a not-for-profit organization. By not using the legally registered not-for-profit organization's name,the funding could be awarded to an unqualified entity and be non-compliant to Florida Statute and County Ordinance. Recommendation: • Applications should only be accepted in the legally registered name to avoid confusion, ensure proper award of grant funds, and to ensure proper payment for reimbursement requests. County Management Response: "We will caution all grant applicants to complete their applications using the correct legal corporate name as registered with the State of Florida." Internal Audit Follow-Up: The grant agreement was properly entered into with the entity in the entity's legal registered name. The observation was resolved and closed. 5) Request for Funding submitted by The United Arts Council was not a grant application and lacked the required documentation. The United Arts Council submitted a Request for Funding to print a Calendar of Events brochure rather than a grant application. The Tourist Development Council (in FY 2011) stated in FY 2012 the funding would not qualify for Category B funding and would need to be funded through the Tourism Department's line item budget because the program was predominately for local advertising rather than soliciting out of the area tourists. The United Arts Council appears to meet the requirements of Florida Statute 125.0104(5)(a)2 and Collier County Ordinance 2005-43 Category B, which state to promote and advertise tourism. The internal grant guidelines require out of Collier County expenditures and marketing. The requested funding for the calendar does not appear to meet the internal grant guideline requirements. The United Arts Council requested funding from the Tourism Department through a Request for Funding as recommended in FY 2011 by the Tourist Development Council rather than as a Category B grant application. The Request for Funding was then submitted as a Category B grant application by County Staff without all the required documentation needed for review and recommendation. Proper documentation is needed to ensure compliance to Florida Statute and County Ordinance. Recommendations: • Future applications should include all required documentation and should follow appropriate funding sources. • When applications are not complete, the additional information should be requested by County Staff or the application should be declined. County Management Response: "United Arts Council of Collier County, Inc. thought they were applying for marketing funding assistance from tourist tax marketing funds, not a Category B grant. This understanding was a carryover from a TDC discussion in 2010 about their FY 11 application where staff was directed to fund the United Arts cultural events calendar project as a tourism department printing project, not as a Category B grant. United Arts assumed the situation with their FY 12 application would be treated the same as the FY 11 project, so they did not feel they were required to submit 7 a Category B grant application. Their written request was in the form of a letter and brief presentation of the project and the projected budget. Their request was reviewed by the Grant Review Committee along with all the FY 12 grant applications, but ultimately this request was recommended by the TDC for funding as a tourism department printing project for FY 12, and is not included in the Category B grants line item in the FY 12 tourism department budget." Internal Audit Follow-Up: The County did not enter into a Category B grant agreement with the United Arts Council and properly entered into a vendor agreement.The observation was resolved and closed. 6) Collier County Ordinance 2005-43 percentage allocations should be verified for compliance when transfers of funds occur between grant categories. During the Tourist Development Council grants funding meeting for FY 2011-2012 on June 27, 2011, discussions were held regarding the level of category funds. The recommendation was to increase Category B (event and promotion) funding and decrease Category C-2 (museum) funding to provide additional funds to organizations that were not qualified under Category C-2 funding. Recommendation: • When the adjustments or line item budget changes are proposed, verification and reconciliation for the modifications need to occur to ensure compliance to Collier County Ordinance 2005-43 for the percentage allocations by the grant categories for Tourist Development Tax Revenue funds in order to maintain compliance with ordinances. County Management Response: "Staff fully understands that transfers between tourist tax funds cannot be accomplished without BCC approval, including a tourist tax ordinance change. The intent of the discussion at the TDC level was to reallocate funds between line items in Fund 184(Advertising and Promotion)to free up funding for applicants that better qualify for Category B grants, rather than Category C-2 grants. That was accomplished in the budget process for FY 12 and will not necessitate any transfers between funds, or ordinance changes." 8 Conclusion Grant applications submitted need to include all documentation required by the Tourism Department. Without all required documents, County Staff cannot properly evaluate the qualifications for events and organizations, which could lead to non-compliance with Florida Statute 125.0104 and/or Collier County Ordinance 92-60,as amended. In addition, County Staff has approved and recommended funding grant applications that were not qualified to receive Tourist Development Tax Revenues under the current Florida Statute and/or Collier County Ordinance and/or internal grant guidelines. Audits do not relieve management of their responsibilities. It is the responsibility of County management to understand and implement the proper procedural controls in order to reduce and limit the risk of fraud, error, and misappropriation of County assets/revenues. Internal Audit may recommend improvements in audit reports, but ultimately it is the duty and decision of County management to formulate processes and controls that ensure compliance with Federal Regulation,Florida Statute,County Ordinance,and County Policies and Procedures. Additional County Management Comments: "We completely concur that only the County Commission can approve funding. We routinely do recommend to the TDC actions related to expenditures of tourist tax funds, based on the advice and counsel of the County Attorney's Office regarding any legal interpretations of funding eligibility. We do not feel that any unqualified tourist tax grant funding was recommended to the TDC or subsequently awarded to applicants as covered under Florida Statute 125.0104. We acknowledge that a conflict exists in language between State Statute 125.0104 and County Ordinance 92-60, as amended, due to a scrivener error. That conflicting language is currently in the ordinance amendment process and will come before the County Commission for consideration in January and February 2012." Internal Audit Comments: The County Ordinance has not been amended and remains less restrictive than Florida Statute. Internal Audit gratefully acknowledges the cooperation and assistance from the Tourism Department. The Tourism Department's quick response for providing information and responses to recommendations greatly assisted Internal Audit in the interim work and resolution of findings. 9 H 0 mimill o d g -ti n rD n ...., __,)-t p W F-' . 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(7). 2 n O � CD 0_ n O CD, Ft: C r�r- c= �. -a C. -0 CD -o a _ = ai —• L0 r1- _. = 0 v) CD = a) = . * � 0 "13 �p m m n � n 7n ), 0 Report:A/R Aging Summary Page 1 of 1 7 Collier County Airport Authority N-inv-2___ A/R Aging Summary As of June 30,2013 ( 1 2 * Current 1 -30 31 -60 61 -90 91 and over Total Aguayo,Domingo • s• $0.00 Air Expeditions,Inc. 819.27 $819.27 Barkman -237.94 $-237.94 Benedetti,Joseph -534.56 $-534.56 Berens,Robert -85.41 -167.42 $-252.83 Cash Sales -157.92 $-157.92 Classic 530.00 $530.00 Collier County Sheriffs Office 1,547.03 1,280.21 1,280.21 3,840.63 $7,948.08 Collier Mosquito Control District -0.01 -0.01 $-0.02 Cruz -254.40 $-254.40 Daniels,Travis 29.68 $29.68 Dean International Inc. 2,298.30 -38.62 $2,259.68 Fetzer -253.00 $-253.00 Fletcher 29,371.53 1,720.14 -5,120.69 $25,970.98 Fogle 253.00 $253.00 Frick 142.05 $142.05 Glass 253.00 253.00 253.00 247.79 $1,006.79 Greenwalt,Steve 212.00 $212.00 Gulf Coast Design Products,Inc. 3,761.48 500.00 500.00 13,534.60 $18,296.08 Hester 253.00 $253.00 Hiller Group,Inc. -164.87 -3.46 513.81 $345.48 Immokalee Regional Raceway 2,650.00 $2,650.00 INACTIVE-Baker,P. -742.01 $-742.01 Inactive-Hoker 63.60 $63.60 Island Hoppers 656.06 510.28 390.14 $1,556.48 Kenney 1,260.00 $1,260.00 KPK Management,Inc. 144.00 563.40 $707.40 LaGrotta,V -191.12 $-191.12 Lavezzi -534.56 $-534.56 Mason,Ron 253.00 $253.00 Miromar 286.20 $286.20 My FBO 2,783.00 Vide $2,783.00 � Olson Products,Inc. IS4 -503.23 $-503.23 Raven Air,LLC DG 243.22 $243.22 Riella -506.00 -253.00 -8.20 $-767.20 �.,. Salazar Machine&Steel,Inc. 12,787.25 1-,787.25 12,787.25 $38,361.75 Serenity Construction Services 30.00 $30.00 Shepard 407.44 407.44 ,680.29 $4,495.17 Swain -380.92 $-380.92 Swasey 436.94 $436.94 Terminated-Benjamin 247.79 $247.79 TERMINATED-Murvin -196.85 $-196.85 Tipton -169.60 $-169.60 Viking Transport 941.23 $941.23 WCI Communities,Inc. 406.90 $406.90 TOTAL�O $0.00 $57,502.70 $14,275.47 $16,709.00 $19,125.44 $107,612.61 A.\)* Tuesday,Jul 02,2013 05:05:16 PM PDT GMT-4 This report was created using QuickBooks Online. file:///C:/Users/ckkinzel/AppData/Local/Microsoft/W indows/Temporary%20lnternet%20Files/Content.Outlook/... 7/9/2013 4A 31 c‘.\ Lessor s . .•_ •• - e i c property in any manner it so chooses and shall not be liable to Lessee for such disposal. ii. If Lessee fails to promptly pay, when due, any full installment of rent or any other sum payable to Lessor under this Lease, and if said sum remains unpaid for more than five (5) days past the due date, the Lessee shall pay Lessor a late payment charge equal to five percent (5%) of each such �e payment not paid promptly and in full when due. Any amounts not paid promptly when due shall also accrue compounded interest of two (2%) percent per month or the highest interest rate then allowed by Florida law, whichever is higher ("Default Rate"), which interest shall be promptly paid by Lessee to Lessor. iii. Lessor may sue for direct, actual damages arising out of such an uncured default of Lessee or apply for injunctive relief as may appear necessary or desirable to enforce the performance and observance of any obligation, agreement or covenant of Lessee under this Lease, or otherwise. Lessor shall be entitled to reasonable attorneys fees and costs incurred arising out of Lessee's default under this Lease. c. Default by Lessor. Lessor shall in no event unless access to the Premises has been denied be charged with default in the performance of any of its obligations hereunder unless and until Lessor shall have failed to perform such obligations within thirty (30) days (or such additional time as is reasonably required to correct such default) after written notice to Lessor by Lessee properly and in meaningful detail specifying wherein, in Lessee's judgment or opinion, Lessor has failed to perform any such obligation(s). d. Remedies of Lessee. In partial consideration for the nominal rent charged to Lessee, Lessee hereby waives any claim it may have to direct or indirect monetary damages it incurs as a result of Lessor's breach of this Lease, and also waives any claim it might have to attorneys' fees and costs arising out of Lessor's breach of this Lease. Lessee's remedies for Lessor's default under this Lease shall be limited to the following: i. For injunctive relief as may appear necessary or desirable to enforce the performance and observance of any obligation, agreement or covenant of Lessor under this Lease. ii. Lessee may cure any default of Lessor and pay all sums or do all reasonably necessary work and incur all reasonable costs on behalf of and at the expense of Lessor. Lessor will pay Lessee on demand all reasonable costs incurred and any amounts so paid by Lessee on behalf of Lessor, with no interest. e. No Remedy Exclusive. No remedy herein conferred upon or reserved to either party is intended to be exclusive of any other available remedy or remedies, but each and every such remedy will be cumulative and in addition to every other remedy given under Page 7 of 14 14A 3 '1" this Lease or hereafter existing under law or in equity. No delay or omission to exercise any right or power accruing upon any event of default will impair any such right or power nor be construed to be waived, but any such right and power maybe exercised from time to time and as often as may be deemed expedient. f. Non-Waiver. Every provision hereof imposing an obligation upon Lessee is a material inducement and consideration for the execution of this Lease by Lessee and Lessor. No waiver by Lessee or Lessor of any breach of any provision of this Lease will be deemed for any purpose to be a waiver of any breach of any other provision hereof or of any continuing or subsequent breach of the same provision, irrespective of the length of time that the respective breach may have continued. 18. Lease Manual. Lessee shall be provided with the Authority's Lease Manual (if any), which the Authority may be amend from time to time. The terms of this manual shall be deemed to be incorporated by reference into this Agreement, and Lessee shall be bound by the terms of this Lease Manual, as of the 1s` day of the second month Lessee receives a copy of the Lease Manual or an amended Lease Manual. With respect to any terms in this Lease Agreement which are in conflict with the Lease Manual, the Lease Manual shall control. 19. Rules and Regulations. Lessee shall comply with the Authority's published Rules and Regulations for this airport,which are on file at the address set forth above, as such regulations may be amended from time to time by the Authority including such reasonable rates or charges, as may from time to time be Ievied for airfield operational privileges and/or services provided at the Airport. Lessee shall also comply with any and all applicable governmental statutes, rules, orders and regulations. Miscellaneous Legal Matters 20. This Lease shall be construed by and controlled under the laws of the State of Florida. In the event of a dispute under this Lease, the Parties shall first use the County's then- current Alternative Dispute Resolution Procedure. Following the conclusion of this procedure, either party may file an action in the Circuit Court of Collier County to enforce the terms of this Lease, which Court the Parties agree to have the sole and exclusive jurisdiction. 21. This Lease contains the entire agreement of the Parties with respect to the matters covered by this Lease and no other agreement, statement or promise made any party, or to any employee, officer or agent of any party, which is not contained in this Lease shall be binding or valid. Time is of the essence in the doing, performance and observation of each and every term, covenant and condition of this Lease by the Parties. 22. In the event state or federal laws are enacted after the execution of this Lease, which are applicable to and preclude in whole or in part the Parties' compliance with the terms of this Lease, then in such event this Lease shall be modified or revoked as is necessary to comply with such laws, in a manner which best reflects the intent of this Lease. Page 8 of 14 14A 3 23. Except as otherwise provided herein, this Lease shall only be amended by mutual written consent of the Parties hereto or by their successors in interest. Notices hereunder shall be given to the Parties set forth below and shall be made by hand delivery, facsimile, overnight delivery or by regular mail. If given by regular mail, the notice shall be deemed to have been given within a required time if deposited in the U.S. Mail,postage prepaid, within the time limit. For the purpose of calculating time limits which run from the giving of a particular notice the time shall be calculated from actual receipt of the notice. Notices shall be addressed as follows: If to Lessor: Executive Director Collier County Airport Authority 2005 Mainsail Drive, Suite 1 Naples, Florida 34114 CC: Real Property Management 3335 Tamiami Trail, Suite 101 Naples,Florida 34112 If to Lessee: Salazar Machine& Steel Inc. 160 Airpark Boulevard Suites 9 & 10 Immokalee FL 34142 CC: Steven P. Kushner, Esq. Becker&Poliakoff,P.A. 12141 Carissa Commerce Court, Ste. 200 Fort Myers, FL 33966 Notice shall be deemed to have been given on the next successive business day to the date of the courier waybill if sent by nationally recognized overnight delivery service. 24. Lessee is an independent contractor, and is not any agent or representative or employee of Lessor. During the term of this Lease, neither Lessee, nor anyone acting on behalf of Lessee, shall hold itself out as an employee, servant, representative or agent of Lessor. Neither party will have the right or authority to bind the other party without express written authorization of such other party to any obligation to any third party. No third party is intended by the Parties to be a beneficiary of this Lease or to have any rights to enforce this Lease against either party hereto or otherwise. Nothing contained in this Lease will constitute the Parties as partners or joint ventures for any purpose, it being the express intention of the Parties that no such partnership or joint venture exists or will exist. Lessee acknowledges that Lessor is not providing any vacation time, sick pay, or other welfare or retirement benefits normally associated with an employee-employer relationship and that Lessor excludes Lessee and its employees from participation in all health and welfare benefit plans including vacation, sick leave, severance, life, accident, health and disability insurance, deferred compensation, retirement and grievance rights or privileges. Page 9 of 14 14A 3 25. Neither party to this Lease will be liable for any delay in the performance of any obligation under this Lease or of any inability to perform an obligation under this Lease if and to the extent that such delay in performance or inability to perform is caused by an event or circumstance beyond the reasonable control of and without the fault or negligence of the party claiming Force Majeure. "Force Majeure" shall include an act of God, war (declared or undeclared), sabotage, riot, insurrection, civil unrest or disturbance, military or guerrilla action, economic sanction or embargo, civil strike, work stoppage, slow-down or lock-out, explosion, fire, earthquake, abnormal weather condition, hurricane, flood, lightning, wind, drought, and the binding order of any governmental authority. 26. Lessee, without prior permission from the Executive Director or designee, will not transport, use, store, maintain, generate, manufacture, handle, dispose, release or discharge any Hazardous Materials upon or about the Leased Premises, nor permit employees, representatives, agents, contractors, sub-contractors, sub-sub-contractors, material men and/or suppliers to engage in such activities upon or about the Leased Premises. 27. In compliance with Section 404.056, Florida Statutes, all Parties are hereby made aware of the following: Radon is a naturally occurring radioactive gas that, when it has accumulated in a building in sufficient quantities, may present health risks to persons who are exposed to it over time. Levels of radon that exceed federal and state guidelines have been found in buildings in Florida. Additional information regarding radon and radon testing may be obtained from your County Public Health Department. 28. Airport Development. The Authority reserves the right to further develop or improve the landing and other areas of the Airport as it sees fit, regardless of the convenience, desires or view of the Lessee, and without interference or hindrance. 29. Airport Operations. Lessee shall prevent any use of the Premises which would interfere with or adversely affect the operation or maintenance of the Airport, or otherwise constitute an airport hazard, and will restrict the height of structures, objects of natural growth and other obstructions on the Premises to such height as comply with Federal Aviation Regulations,Part 77. 30. Nondiscrimination Clause. The Lessee for himself, his personal representatives, successors in interest, and assigns, as part of the consideration hereof, does hereby covenant and agree that (1) no person on the grounds of race, color, or national origin shall be excluded in participating in, denied the benefits of, or be otherwise subjected to discrimination in the use of the Leased Premises; (2) that in the construction of any improvements on, over or under such land and the furnishing of services thereon, no person on the grounds of race,color or national origin shall be excluded from participating in, denied the benefits of, or otherwise subjected to discrimination; (3) that the Lessee shall use the Leased Premises in compliance with all other requirements imposed by or pursuant to Title 49, Code of Federal Regulations, Department of Transportation, Subtitle A, Office of the Secretary, Part 21, Nondiscrimination in Federally assisted programs of the Department of Transportation-Effectuation of Title VI of the Civil Rights Act of 1964, as said regulations may be amended. That in the event of breach of any of the above nondiscrimination covenants, Lessor shall have the right to terminate this Lease and to re-enter and as if the Lease had never been made or issued. The provision shall not be effective until the procedures of Title 49, Page 10 of 14 • . 14A 31 Code of Federal Regulations, Part 21 are followed and completed, including exercise or expiration of appeal rights. 31. Dominant Agreements and Property Rights Reserved. This Lease Agreement is subordinate and subject to all existing agreements between the Authority and the Federal Aviation Administration, the Authority and the State of Florida, and the Authority and Collier County. During the time of war or national emergency, the Authority shall have the right to lease the landing area or any part thereof to the United States Government for military or naval or similar use, and, if such lease is executed, the provisions of this Lease Agreement insofar as they are inconsistent with the provisions of the lease to the Government, shall be suspended. This Lease and all provisions hereof are subject and subordinate to the terms and conditions of the instruments and documents under which the Airport Owner acquired the subject property from the United States of America and shall be given only such effect as will not conflict or be inconsistent with the terms and conditions contained in the lease of said lands from the Airport Owner, and any existing or subsequent amendments thereto, and are subject to any ordinances, rules or regulations which have been, or may hereafter be adopted by the Airport Owner pertaining to the Immokalee Regional Airport. 32. Lessee shall execute this Lease prior to it being submitted for approval by the Collier County Airport Authority. This Lease may be recorded by the County in the Official Records of Collier County, Florida, within fourteen (14) days after the County enters into this Lease, at Lessee's sole cost and expense. REMAINDER OF PAGE INTENTIALLY LEFT BLANK SIGNATURE PAGE TO FOLLOW Page 11 of 14 14A 3 i k IN WITNESS WHEREOF, the Lessee and Lessor have hereto executed this Lease the day and year first above written. AS TO THE LESSEE: Salazar Machine &Steel Inc. / .L.,.._..---. By: �- ' <- S-7,, ,...,.._,‘ ' itness (si:nature) Pedro Salazar III, President ,V\(-1 k t 4, (Print Name and Title) (print name) Wit (sign�re) I ti- -_ .. • • (print name) AS TO THE LESSOR: Attest: . BOARD OF COUNTY COMMISSIONERS DWIGHT E.-BRC3CK, Clerk OF COLLIER COUNTY, FLORIDA, serving as the COLLIER COUNTY AIRPORT AUTHORITY i :: , By: -��r1� At- d.�� Ii By: 1� _,.•■ _ AL Attest a to Ch&1rr , ►uty perk FRED W. COYLE, CHA ' -N signa , App s - - . orm ,vi fficiency: Jeffr:1 'i, atzkow, County Attorney r ■ Page 12 of 14 • _ PR,90-R.Oltea,n,WOW roe 1.040 U� ∎ .. ,i s R :p q .s# -Z-: R EXHIBIT A a Y e , Sri n I .> i oz O 1 !6 11 = og�t1 I w . ti 63 „: .. E€ z 0 gt \ \I .' ' -‘•-■ --„Z‘‘ ,,_ az. - I I 1 Y --- _ • i I I : a I �!� • s p e 1 t I �' w .§;• 1 e � j 119 'ii 1 1/171 5 ( ___ _aw�Ya,siMeaneu • 1 9 Rill S""'"E __''''"' 2.c.I__._.i_._.-._.-.-_._.__._--_mas,w..r '•"1O t i i i , a \ ! — e ti' 1I ,, a 1 A ,, s•. 16 ( N `5 Ii i a Is a 81 I Y rI a II C rW 1 lrl �e •�—Z 9 4�dA MB:c alvtas,..to.ea ' I I 4, E! � I g 1 lh'' t 1- §11 i . g 4 . p`!1 ° k4 a is # ` e v # 11;111.1 3 1 11 :6 111p]1 0 : . 1 1 ggg 1 b tt 1 I / 164111;`111/• :1 1 p!+11 ! e e a1 ° 1:11er 111!; 3 36' 1. 1p11lp 1 I,*Wrath tp•*I.: a III 1*1 !1Q Ig1.;II 1111/111 1111:111!II • it111p1E! \\\\\\\\\\\\\\\\\\\\\\\\\ 1 gt.i 1 a Page 13 of 14 • • 14A 3' ' EXHIBIT B APPROVED USE OF PREMISES 1. Manufacturing and repair of machinery. 2. Industrial activity associated with major and minor steel fabrication 3. Administrative activities Page 14 of 14 • y 14A3 ' COLLIER COUNTY AIRPORT AUTHORITY STANDARD FORM LEASE This Lease (hereinafter referred to .s ` ease") i entered into this k-.71- day of �Ucc�r�lcc,Y , 2012, by and betwee Salazar Machine Steel Inc., a corporation duly organized under the laws of Florida, w ose principal and ailing address is 160 Airpark Boulevard, Suites 9 & 10, Immokalee FL 'a 142, herein referred to as "Lessee", and the Collier County Airport Authority, with administrative offices located at 2005 Mainsail Drive, Suite 1, Naples, Florida 34114, hereinafter referred to as "Lessor," collectively stated as the "Parties." WITNESSETH: NOW, THEREFORE, in consideration of Ten Dollars ($10.00) and other good and valuable consideration exchanged amongst the Parties, and in consideration of the covenants contained herein, the Parties hereby enter into this Lease on the following terms and conditions: 1. Conveyance. On the terms and conditions set forth in this Lease, and in consideration of Lessee's performance under this Lease, the Lessor conveys to the Lessee the present possessory interest in the Leased Premises described below. 2. Description of Leased Premises. The Leased Premises which is the subject of this Lease is a parcel improved with a building located at the Immokalee Airport, in Collier County, Florida, with a legal description set forth in Exhibit "A," hereinafter referred to as the "Premises." 3. Conditions to Conveyance. Lessee warrants and represents to Lessor that it has examined the title and boundaries of the Premises. Accordingly, this conveyance is subject to all of the following: a. Any and all conditions, restrictions, encumbrances and limitations now recorded against the Premises; b. Any and all existing or future zoning laws or ordinances; c. Any questions of title and survey that may arise in the future; and d. Lessee's satisfactory performance of all terms and conditions of this Lease. 4. Use of Premises. Lessee shall utilize the Leased Premises in strict accordance with Exhibit `B." Lessor shall have the right to terminate this Lease should Lessee utilize the Premises in any manner inconsistent with the approved use. In the event Lessee shall cease to use the Premises for the purposes described in Exhibit `B," and such cessation of use shall continue for a period of sixty (60) days, this Lease, at the option of the Lessor, upon thirty (30) days written notice to the Lessee, shall be terminated and Lessee shall surrender and vacate the Premises to the Lessor within thirty (30) days after notice of such termination. Provided, however, said sixty (60) day period shall be tolled if such cessation is caused by events beyond the control of the Lessee such as acts of God or if such cessation is due to closing for reconstruction or repairs to the building constructed by Lessee on the Leased Premises. Page 1 of 14 i 144 3 t 5. Permissible Alterations and Additions to Premises. Lessee may not make any alterations or additions to the Leased Premises without obtaining Lessor's prior written consent, which consent may be withheld in Lessor's sole discretion. Lessee shall submit to Lessor plans and specifications for all alterations and additions at the time Lessor's consent is sought. 6. Term of Lease. The term of this Lease shall commence on the date first above written, and unless terminated earlier by the Parties, shall terminate on the 10th year anniversary date of this Lease. There is no option to renew. If Lessee holds over after the expiration of the lease term, such tenancy shall be from month to month under all of the terms, covenants and conditions of this Lease subject, however, to Lessor's right to seek legal relief to eject Lessee from the Premises as a holdover. 7. Rent. The Lessee agrees to pay the Lessor the sum of $140,000 per annum, in equal monthly installments of $11,666.67, payable no later than the first of each month of the term plus applicable sales tax. Commencing with the third anniversary of the Commencement Date, and on each anniversary date thereafter, Rent may increase; provided, however, such increases shall occur only when it shall be determined that there has been an increase in the cost of living using the official Consumer Price Index Urban Wage Earners (CPI-U) base published by the Bureau of Labor Statistics, United States Department of Labor. The Consumer Price Index to be used will be that for the South Urban Size C Area(or comparable index if such index in discontinued), hereinafter called "CPI". An increase in the monthly Base Rent for the third and successive Lease Years, if any, shall be based upon a comparison of the most recent CPI published for the current Lease Year against the most recent CPI published greater than 12 months preceding the most current CPI. The amount of the additional Base Rent shall be the percentage difference between the two preceding CPI's. In no event shall the Base Rent, once increased, be decreased, nor shall it be increased more than once in a 12 month period. 8. Net Lease. This is a fully net lease, with Lessee responsible for all costs, fees and charges concerning the Premises. Accordingly, Lessee shall promptly pay when due and prior to any delinquency all costs, fees, taxes, trash removal services, assessments, utility charges, future impact fees and obligations of any kind that relate to the Premises. Lessee will indemnify and hold Lessor harmless from any and all claims, costs and obligations arising from Lessee's use of the Premises. In case any action or proceeding is brought against Lessor by reason of Lessee's use of the Premises, Lessee shall pay all costs, attorneys' fees, expenses and liabilities resulting therefrom and shall defend such action or proceeding if Lessor shall so request, at Lessee's expense, by counsel reasonably satisfactory to Lessor. It is specifically agreed however, that Lessor may at its own cost and expense participate in the legal defense of such claim, with legal counsel of its choosing. 9. Lessee's Liens and Mortgages. Lessee shall not in any way encumber the Premises. All persons to whom these presents may come are put upon notice of the fact that the interest of the Lessor in the Premises shall not be subject to liens for improvements made by the Lessee and liens for improvements made by the Lessee are specifically prohibited from attaching to or becoming a lien on the interest of the Lessor in the Premises or any part of either. This notice is given pursuant to the provisions of and in compliance with Section 713.10, Florida Statutes. Page 2 of 14 14A 3 10. Lessee's Obligation to Maintain Premises and Comply with All Lawful Requirements. Lessee, throughout the term of this Lease, at its own cost, and without any expense to the Lessor, shall keep and maintain the Premises in good, sanitary and neat order, condition and repair, and shall abide with all lawful requirements. Such maintenance and repair shall include, but not be limited to, landscaping, painting, janitorial, fixtures and appurtenances (lighting, heating, plumbing, and air conditioning). Such repair may also include structural repair, if deemed necessary by the Lessee. If the Premises are not in such compliance in the reasonable opinion of Lessor, Lessee will be so advised in writing. If corrective action is not begun within thirty (30) days of the receipt of such notice and prosecuted diligently until corrective action is completed, Lessor may cause the same to be corrected and Lessee shall promptly reimburse Lessor for the expenses incurred by Lessor, together with a 5% administrative fee. 11. Quiet Enjoyment. Lessee shall be entitled to quiet enjoyment so long as Lessee has not defaulted on any of the terms of this Lease. Accordingly, Lessee shall have the exclusive right to use the Premises during the term of this Lease. Lessor hereby confirms that Lessee, its employees, agents, contractors, and other business invitees, shall have full and complete access to the Premises by way of appropriate roadways and entranceways providing access to the Premises from a public thoroughfare. Said access shall be available twenty-four (24) hours per day, seven (7) days per week. During the term of this Lease, Lessee may erect appropriate signage on the Leased Premises and the improvements constructed by Lessee thereon. Any such signage shall be in compliance with all applicable codes and ordinances and approved by the Lessor; Lessor's consent will not be unreasonably withheld. 12. Casualty and Condemnation a. Casualty. If the Premises are destroyed, rendered substantially untenable, or damaged to any material extent, as reasonably determined by Lessee and Lessor, by fire or other casualty, Lessee must use the insurance proceeds, hereinafter referred to as "Proceeds," to rebuild or restore the Premises to substantially its condition prior to such casualty event unless the Lessor provides the Lessee with a written determination that rebuilding or restoring the Premises to such a condition with the Proceeds within a reasonable period of time is impracticable or would not be in the best interests of the Lessor, in which event, Proceeds shall be promptly remitted to Lessor. If the Lessor elects not to repair or replace the improvements, then Lessee or Lessor may terminate this Lease by providing notice to the other party within ninety (90) days after the occurrence of such casualty. The termination will be effective on the ninetieth (90th) day after such fire or other casualty, unless extended by mutual written agreement of the Parties. During the period between the date of such casualty and the date of termination, Lessee will cease its operations as may be necessary or appropriate. If this Lease is not terminated as set forth herein, or if the Premises is damaged to a less than material extent, as reasonably determined by Lessee and Lessor, Lessee will proceed with reasonable diligence, at no cost or expense to Lessor, to rebuild and repair the Premises to substantially the condition as existed prior to the casualty. The Executive Director reserves the right to waive rental payments or a portion thereof in the case of a natural disaster that renders the building untenable. Page 3 of 14 14A 31 b. Condemnation. Lessor may terminate this Lease by written notice as part of a condemnation project. Lessor will use its best efforts to mitigate any damage caused to Lessee as a result of such termination; however, in no event will Lessor be liable to Lessee for any compensation as a result of such termination. 13. Access to Premises. Lessor, its duly authorized agents, contractors, representatives and employees, shall have the right after reasonable oral notice to Lessee, to enter into and upon the Premises during normal business hours, or such other times with the consent of Lessee, to inspect the Premises, verify compliance with the terms of this Lease, or make any required repairs not being timely completed by Lessee. 14. Termination and Surrender. Unless otherwise mutually agreed by the Parties, no later than the final day of the lease term, Lessee shall redeliver possession of the Premises to Lessor in good condition and repair. Lessee shall have the right at any time during Lessee's occupancy of the Premises to remove any of its personal property, equipment, and signs provided, however, at the termination of this Lease, Lessor shall have the option of either requiring Lessee to demolish and remove all improvements made by Lessee to the Premises upon Lessee's vacation thereof, or to require Lessee to retain said improvements with fixtures on the Premises which improvements and fixtures will become the property of the Lessor upon Lessee's vacation of the Premises. 15. Assignment. This Lease is personal to Lessee. Accordingly, Lessee may not assign this Lease or sublet any portion of the building constructed on the Premises by Lessee without the express prior written consent of the Lessor, which consent may be withheld in Lessor's sole discretion. Any purported assignment or sublet without the express written consent of Lessor shall be considered void from its inception, and shall be grounds for the immediate termination of this Lease. Lessor may freely assign this Lease upon written notice to Lessee. 16. Insurance. a. Lessee shall provide and maintain a Commercial General Liability insurance policy, approved in writing by Lessor and the Collier County Risk Management Department, for not less than Three Million and 00/100 Dollars ($3,000,000.00) combined single limits during the term of this Lease. If such amounts are less than good insurance industry practice would require, Lessor reserves the right to increase these insurance limits by providing Lessee with at least sixty (60) days' advance notice to do so. b. In addition, Lessee shall provide and maintain Worker's Compensation Insurance covering all employees meeting the then existing Statutory Limits in compliance with the applicable state and federal laws. The coverage shall include Employer's Liability with a minimum limit of One Hundred Thousand and 00/100 Dollars ($100,000.00) per each accident. If such amounts are less than good insurance industry practice would require, Lessor reserves the right to increase these insurance limits by providing Lessee with at least sixty(60) days' advance notice to do so. Page 4 of 14 14A . 1 c. Lessee shall also maintain standard fire and extended coverage insurance on the additions and improvements located on the Premises and all of Lessee's property located on or in the Premises including, without limitation, furniture, equipment, fittings, installations, fixtures (including removable trade fixtures), personal property and supplies, in an amount not less than the then-existing full replacement value. d. Business Automobile Liability Insurance, and Business Boat Liability Insurance, for automobiles and boats used by Lessee in the course of its performance under this Lease, including Employer's Non-Ownership and Hired Auto Coverage, each said policy in amounts of One Million and 00/100 Dollars ($1,000,000.00) combined single limit per occurrence. If such amounts are less than good insurance practice would require, Lessor reserves the right to increase these insurance limits by providing Lessee with at least sixty(60)days' advance notice to do so. e. Pollution Liability insurance covering the accidental discharge and clean up of pollutants shall be maintained by the Lessee in an amount of not less than One Million and 00/100 dollars ($1,000,000) per occurrence. Such coverage shall cover third party liability and clean up coverage. f. Lessor shall be named as an additional insured on the Commercial General Liability insurance policy. Lessor shall also be added as an additional insured on the Property Insurance policy as their interest may appear. The above-described insurance policies shall list and continuously maintain Lessor as an additional insured thereon. Evidence of such insurance shall be provided to Lessor and the Collier County Risk Management Department, 3311 East Tamiami Trail,Naples, Florida, 34112, for approval prior to the commencement of this Lease; and shall include a provision requiring not less than ten (10) days prior written notice to Lessor in the event of cancellation or changes in policy(ies) coverage. If such amounts are less than good insurance practice would require, Lessor reserves the right to reasonably amend their insurance requirements by issuance of notice in writing to Lessee, whereupon receipt of such notice Lessee shall have thirty (30) days in which to obtain such additional insurance. The issuer of any policy must have a Certificate of Authority to transact insurance business in the State of Florida and must be rated "A" or better in the most current edition of Best's Insurance Reports. Each insurer must be responsible and reputable and must have financial capacity consistent with the risks covered. Each policy must contain an endorsement to the effect that the issuer waives any claim or right of subrogation to recover against Lessor, its employees,representatives and agents. g. Failure to continuously abide with all of these insurance provisions shall be deemed to be a material breach of this Lease and Lessor shall have the remedies set forth below. Page 5of14 14A 31 ' 17. Defaults and Remedies. a. Defaults by Lessee. The occurrence of any of the following events and the expiration of the applicable cure period set forth below without such event being cured or remedied will constitute a "Default by Lessee" to the greatest extent then allowed by law: i. Abandonment of Premises or discontinuation of Lessee's operation. ii. Lessee's material misrepresentation of any matter related to this Lease. iii. Filing of insolvency, reorganization,plan or arrangement of bankruptcy. iv. Adjudication as bankrupt. v. Making of a general assignment of the benefit of creditors. vi. If Lessee suffers this Lease to be taken under any writ of execution and/or other process of law or equity. vii. Lessee's failure to utilize the Premises as set forth in Exhibit B. viii. Any lien is filed against the Premises or Lessee's interest therein or any part thereof in violation of this Lease, or otherwise, and the same remains unreleased for a period of sixty (60) days from the date of filing unless within such period Lessee is contesting in good faith the validity of such lien and such lien is appropriately bonded. ix. Failure of Lessee to perform or comply with any material covenant or condition made under this Lease, which failure is not cured within ninety (90) days from receipt of Lessor's written notice stating the non- compliance shall constitute a default (other than those covenants for which a different cure period is provided), whereby Lessor may, at its option, terminate this Lease by giving Lessee thirty (30) days written notice unless the default is fully cured within that thirty (30) day notice period (or such additional time as is agreed to in writing by Lessor as being reasonably required to correct such default). However, the occurrence of any of the events set forth above shall constitute a material breach and default by Lessee, and this Lease may be immediately terminated by Lessor except to the extent then prohibited by law. b. Remedies of Lessor. i. In the event of the occurrence of any of the foregoing defaults, Lessor, in addition to any other rights and remedies it may have, shall have the immediate right to re-enter and remove all individuals, entities and/or property from the Premises. Such property may be removed and stored in a public warehouse or elsewhere at the cost of and for the account of Lessee, all without service of notice or resort to legal process and without being deemed guilty of trespass, or being liable for any loss or damage which may be occasioned thereby. If Lessee does not cure the defaults in the time frames as set forth above, and Lessor has removed and stored property, Lessor shall not be required to store for more than thirty (30) days. After such time, such property shall be deemed abandoned and Page 6 of 14 EXECUTIVE SUMMARY Recommendation to approve and authorize the Chair to execute a Settlement Agreement and Amendment in the lawsuit entitled Collier County, et aL, v. Florida Georgia Grove, LLP, et aL, filed in the Twentieth Judicial Circuit in and for Collier County, Florida (Case No. 11-1640-CA) and direct County staff to commence the process of vacating any claimed public right-of-way or prescriptive easement interest to a portion of Mamie Street. OBJECTIVE: To settle the Smallwood dispute. CONSIDERATIONS: On May 26, 2011, Collier County and the owner of Ted Smallwood's Store in Chokoloskee filed suit against Florida Georgia Grove, LLP ("Developer") and T.D. Bank, N.A., a National Bank, for the illegal demolition of a portion of Mamie Street. On September 15, 2011, the Court granted the County and Ted Smallwood's Motion for a Temporarily Injunction and ordered the Developer to return the public access to the Store. The Developer appealed the Temporary Injunction Order to the Second District Court of Appeal. On August 10, 2012, the Appellate Court rendered a decision affirming the issuance of the temporary injunction. The Developer has since restored and repaved Mamie Street. This portion of Mamie Street serves the Developer, the Smallwood Store and William and Patricia Vaughn. The settlement,which was negotiated by counsel for the Smallwood Store and approved by the Vaughns, relocates Mamie Street, making it a private road. If this item is approved, Collier County will initiate the process of formally vacating any claims to an easement or public right-of-way in the relevant portion of Mamie Street, south of Chokoloskee Blvd. This is a conditional settlement. Vacation is a public process, which requires both advertising and a public hearing, and will allow anyone at that time to object to this settlement. Should the Board later decline the vacation,the settlement will be null and void. FISCAL IMPACT: Funds required for advertising and processing the petition to vacate is approximately$400. There are no other costs associated to the County. GROWTH MANAGEMENT IMPACT: None. LEGAL CONSIDERATIONS: The County Attorney has reviewed the Settlement documents, which are approved as to form and legality. This item requires majority vote for approval.—JAK RECOMMENDATION:, That the Board of County Commissioners accept the settlement in the lawsuit filed against the by Collier County, et al., against Florida Georgia Grove, LLP, et al., in the Twentieth Judicial Circuit Court, authorize the Chair to execute the Settlement Agreement and Amendment, and direct County staff to commence the process of vacating any claimed public right-of-way or prescriptive easement interest to a portion of Mamie Street. Prepared by: Jeffrey A. Klatzkow, County Attorney and Kevin L. Noell, Assistant County Attorney Attachments: 1) Settlement Agreement; 2)Amendment to Settlement Agreement 3)Release RELEASE IN CONSIDERATION OF Ten (10) Dollars, the receipt of which is hereby acknowledge, William and Patricia Vaughn ("VAUGHN") hereby releases COLLIER COUNTY, as set forth below: VAUGHN by these presents does for themselves, and/or any individual or collective heir, agent, representative, executor, successor in interest, administrator and/or assign, hereby releases, acquits, agrees to hold harmless and forever discharge, COLLIER COUNTY, of and from any and all claims for inverse condemnation, repair costs, loss of use, diminution in value, consequential damage, costs, expenses, and any other thing whatsoever on account of, or in any way related to, COLLIER COUNTY vacating and not providing any maintenance and/or repair and/or installation for access to gain entry to VAUGHN's property located at 359 Mamie Street, Chokoloskec,FL. Dated this 2 of JULY ,20 13 ,' Pr FIN • PATRICIA VAUGHN STATE OF FLORIDA COUNTY OF S• . '�-•� THIS RELEASE WAS SWORN TO and subscribed by WILLLAM and PATRICIA VAUGHN, before me on this day of Zi .--+ , 2013 . is • V, _ <<,z�r� Personally Known Signature of Not yfPPublic or Produced Identification EE r L01_ 4ti "./Z Commissioned Name of Notary Public Type of Identification Produced (Please print, type or stamp) My Commission expires: . . 2.D1 �S�t�V CN,4 DUNE FAMtA i 1 r Notary Public -glib of Florida 3. .* . My Cornet Expires Avg 6,2018 ` %1* CoosmhUloe#a 223424 CFO'„".W Bonded ThroupttR3tional Notary Assn. f , IN THE CIRCUIT COURT OF THE TWENTIETH JUDICIAL CIRCUIT IN AND FOR COLLIER COUNTY, FLORIDA CIVIL ACTION COLLIER COUNTY, a political subdivision of the State of Florida, and TED SMALLWOOD'S STORE, INC., a Florida non-profit corporation, Plaintiffs, vs. Case No.: 11-1640-CA Honorable Lauren Brodie FLORIDA GEORGIA GROVE, LLP, a Florida Limited Liability Partnership, and T.D. BANK, N.A., a national bank, Defendants. AMENDMENT TO SETTLEMENT AGREEMENT THIS IS AN AMENDMENT TO THE SETTLEMENT AGREEMENT by and among Plaintiffs, COLLIER COUNTY and TED SMALLWOOD'S STORE, INC., and Defendants, FLORIDA GEORGIA GROVE, LLP and T.D. BANK, N.A. (collectively "Parties") (the "Settlement Agreement"). It amends the Settlement Agreement and shall control in the event of a conflict with the Settlement Agreement. 1. The Parties agree that if, as, and when the Board of County Commissioners of Collier County were to vacate any claim to a public easement, right of way or dedication that thereafter Collier County will have no duty or obligation to provide any type of maintenance and/or repair of any kind to the Current Easement as it is defined in paragraph 6 of the Settlement Agreement, or to road, land, or driving surfaces located thereon, either as it now exists or with respect to the Relocated Access Area, as it is GFP 6/18/13 defined and described in the form of Easement for Ingress and Egress that is Exhibit 1 to the Settlement Agreement, if such Relocated Access Area is ever applicable. 2. It is acknowledged that by execution of the Settlement Agreement, Collier County has not vacated or abandoned its claim to a public easement or public dedication, has no obligation to do so, and that it will only decide to do so, if at all, following the conclusion of the statutory process to vacate same as described in paragraph 3 of the Settlement Agreement and by virtue of a dec;sicn made at that time by the Board of County Commissioners in their sole discretion. 3. The Approval Date in paragraph 5B of the Settlement Agreement is changed from June 6, 2013 to December 1, 2013. 4. Defendant Florida Georgia Grove, LLP ("FG") shall obtain a Subordination in the form attached hereto as Exhibits 1 and 2 to the instruments described in paragraphs 7A and 7B of the Settlement Agreement from its current mortgage holder, Highlands Independent Bank and provide same to Plaintiff, Ted Smallwood Store's Store, Inc. in conjunction with the instruments in 7A and 7B. 5. Except as hereby amended the Settlement Agreement and its addenda remain in force and effect. IN WITNESS WHEREOF, the parties by their duly authorized agents have signed this Amendment to Settlement Agreement as of the dates set forth below. ATTEST: COLLIER COUNTY, a political subdivision DWIGHT E. BROCK, CLERK of the State of Florida: By: , DEPUTY CLERK Georgia A. Hiller, Esq., Chairwoman Collier County Board of County Commissioners 2 woo igb.Amnnn//:d}ly:L!sv,'uopeWJo4u!aiow Jod'James xe�1a3eWxed Aq paA O J sEM xe4 siyl Approval for form and legal sufficiency: Attorney for Ted Sm-aliwood's Store, Inc Kevin C. Grant, Esq. evivan L. Noell, Esq. Assistant County Attorney • TED SMALLWOOD'S STORE, INC., a Florida non-profit corporation: By: AkAi Lynn S4 cMiliin, CEO FLORIDA GEORGIA GROVE, LLP, a Attorneys for ; da-Ge Florida limited liability partnership: /114.■ By: `` Steven J. Chase, Esq. • IS Printe• Na As Managing Partner James Kelly, Esq. T.D. BANK, N.A., a national bank: Attorney for T.D. Bank, N.A: By: E. Blake Paul, Esq. - Printed Name As Vice President r-XCa:etw0nMbo- 1M,nod-abnelflori a Bea prof• °m°nt4ecslamenemerg-secle+ la9ir+t-a-2doc 3 Wd bl:91:9£LOZ/OZ/9:alea £!£:abed VLC 999£98:wo%% Approval for form and legal sufficiency: Attorney for Ted Smaliwood's Store, Inc.: Kevin L. NoeII, Esq. Richard C. Grant, Esq. Assistant County Attorney TED SMALLWOOD'S STORE, INC., a Florida non-profit corporation: By: Lynn S. McMillin, CEO FLORIDA GEORGIA GROVE, LLP, a Attorneys for Fl• - -,• •ia Grove, LLP: Florida limited liability partnership: By: 11 it � Steven J. Chase, Esq. Printed N-me As Managing Partner W. James Kelly, Esq. T.D. BANK, N.A., a national bank: Attorney for T.D. Bank, N.A: By: E. Blake Paul, Esq. Printed Name As Vice President rldetatwd_liblted-small*ood-storelflorida georgla grovelceltlemerx-doeslamendment-settlement-agmnt-v-2doc 3 Approval for form and legal sufficiency: Attorney for Ted Smallwood's Store, Inc.: Kevin L. NoeII, Esq. Richard C. Grant, Esq. Assistant County Attorney TED SMALLWOOD'S STORE, INC., a Florida non-profit corporation: By: Lynn S. McMillin, CEO - FLORIDA GEORGIA GROVE, LLP, a Attorneys for Florida Georgia Grove, LLP: Florida limited liability partnership: WPS. e•OP By. Steven J. Chase, Esq. Printed Name As Managing Partner W. Jar,t s Kelly, Esq. T.D. BANK, N.A., a national bank: Attorney for T.D. Bank, N.A: By: E. Blake Paul, Esq. Printed Name As Vice President r:\da la\wd_IPolted-smalhvood-storeflorida georgte grovelsett lament-doeslamendment-setllemenl-agmnl-v-2doe 3 Approval for form and legal sufficiency: Attorney for Ted Smallwood's Store, Inc.: Kevin L. Noell, Esq. Richard C. Grant, Esq. Assistant County Attorney TED SMALLWOOD'S STORE, INC., a Florida non-profit corporation: By: Lynn S. McMillin, CEO FLORIDA GEORGIA GROVE, LLP, a Attorneys for Florida Georgia Grove, LLP: Florida limited liability partnership: By: Steven J. Chase, Esq. Printed.Name As Managing Partner W, James Kelly, Esq. T.D. BANK, N.A., a national bank: Attorne T.D. Bank, N.A: By: `��,%/: � n E. lake Paul, Esq. e J i re/ •/1)- 'i-j. ' G Printed Name As Vice President r:Metalwd_litRted-Smallwood-storeflorida georgie grove\settlement-docslamendmenl-settlement-agmnl-v-2do: 3 SUBORDINATION Highlands Independent Bank, a Florida banking corporation, the owner and holder of mortgages and assignments recorded in the following Official Records Book of the Collier County Public Records: 4916, at page 2814, as well as by virtue of any other lien, encumbrance, or interest it may have or claim on or in the Servient Estate, as described in the Easement for Ingress and Egress and Utilities to which this Subordination is attached, hereby acknowledges and agrees that this Easement and all rights of Ted Smallwood's Store, Inc., and its successors and assigns, thereunder are superior to the rights of Highlands Independent Bank as set forth in the instruments described above,or as it may otherwise claim to exist in the Servient Estate, and such rights of Highlands Independent Bank are hereby subordinated to the Easement. Executed this 10 day of June,2013. Witnesses: Highlands Independent Bank 2y) Witness#1 1 By: - • 1 T. Lvi n_Whidden Lu Edwards,Vice President Printed name of- itness 1 Witness#2 David H. Veley Printed name of Witness#2 STATE OF FLORIDA ) COUNTY OF Highlands ) §§: I HEREBY CERTIFY that the foregoing instrument was acknowledged before me this 1.0tlday of June , 2013, by . Lu Edwards , as Vice President of Highlands, Independent Bank, a Florida banking corporation, who is personally known to me or who produced as identification. ,,,,, TAMELA LIA/HIDDEN , :. _,-14._,-14.41 o�; ,e` Notary Public-State of Florida 4 ?_*-s, = -,State F Notary Public of Florida -•, , ..7_,My Comm.Expires May 22,2015 __ jrr 9 s '��'o;: Commission#EE 87312 • /4".._./)/ /,r L, - r i Bonded Through National Notary Assn. t Printed Name of Notary My Commission Expires: rl de talwd_1it11ted-smsllwood-store tforids georgic growlseNemem-doaWithhnd-bank-subordination-2docc EXHIBIT: SUBORDINATION Highlands Independent Bank, a Florida banking corporation,the owner and holder of mortgages and assignments recorded in the following Official Records Book of the Collier County Public Records: 4916, at page 2814,as well as by virtue of any other lien,encumbrance, or interest it may have or claim on or in the FG Land as the Servient Estate, as described in the Covenant and Easement to Permit Continuation of Encroachment (Covenant and Easement) to which this Subordination is attached,hereby acknowledge and agrees that the rights conferred on Ted Smallwood Store, Inc. by virtue of the Covenant and Easement are superior to all rights of Highlands Independent Bank under the forgoing instruments, and to any other rights as it may otherwise claim to exist in the Servient Estate and such rights of Highlands Independent Bank are hereby subordinated to the Covenant and Easement Executed this 10th day of lime,2013, Witnesses: Highlands Independent Bank Witnaxs Wei By: oa.ki t C T- Lynn GJt,i Lu Edwards,Vice President Printed name of winrestJ 1 P'411//ti Witness 1/2 David H. Veley Printed name of Witness 42 STA'1'h OF FLORIDA ) §§: COUNTY OF Highlands ) I HEREBY CER'1'LFF•Y that the foregoing instrument was acknowledged before me this lotday of ,T„nP , 2013, by Lu Edwards , as Vice President of Highlands Independent Bank, a Florida banking corporation, who is personally known to me or who produced as identification. ° otary Public-State of Florida .P�a, TAMELA L WH IDDEN Notary Public•State of Florida 4%"x 2,14V �/l L`«1/1=� !•� =• :•;My Comm.Expires May 22,2015 rinted Name of Notary Commission#EE 87312 Bonded Through National Notary Asn. y Commission Expires: r.\date\wd_n°lted-smillwood-nor\flcdde gcorgia grove seNemeor-doc ghland-bank-wb, i,Uioo-t.do. EXHIBIT • IN THE CIRCUIT COURT OF THE TWENTIETH JUDICIAL CIRCUIT IN AND FOR COLLIER COUNTY, FLORIDA CIVIL ACTION COLLIER COUNTY, a political subdivision of the State of Florida, and TED SMALLWOOD'S STORE, INC., a Florida non-profit corporation, Plaintiffs, vs. Case No.: 11-1640-CA Honorable Lauren Brodie FLORIDA GEORGIA GROVE, LLP, a Florida Limited Liability Partnership, and T.D. BANK, N.A., a national bank, Defendants. SETTLEMENT AGREEMENT THIS SETTLEMENT AGREEMENT made this by and between Plaintiffs, COLLIER COUNTY and TED SMALLWOOD'S STORE, INC., and Defendants, FLORIDA GEORGIA GROVE, LLP and T.D. BANK, N.A. RECITATIONS A. Plaintiffs and Defendant, FLORIDA GEORGIA GROVE, LLP have had certain differences arising out of the existence and use of Mamie Street by Plaintiffs and the public as a means of access over the property owned by Florida Georgia Grove, LLP to the property owned by Ted Smallwood's Store, Inc.; B. Defendant, T.D. BANK, N.A., was named a Defendant in this case because T.D. BANK, N.A., or its predecessor has a lien on the property owned by Florida Georgia Grove, LLP. No party has made any claims that T.D. BANK, N.A. has blocked access or consented to blocking access over any easement, access or GFP 2/26/13 T • roadway. Nor has any party claimed that T.D. BANK, N.A. has ever taken possession of the subject real property or taken any action to manage or develop said property. C. The differences between the parties have been claimed and plead in that certain case styled Collier County and Ted Smallwood's Store, Inc. v. Florida Georgia Grove, LLP and T.D. Bank, N.A., Case No. 11-1640-CA, in the Circuit Court of the Twentieth Judicial Circuit in and for Collier County, Florida (the"Court"); D. On October 20, 2011, the Court entered a Temporary Injunction against Florida Georgia Grove, LLP and T.D. Bank, N.A. (the"Temporary Injunction"); E. As ordered by the Court in the Temporary Injunction, Ted Smallwood's Store, Inc. posted a bond in the amount of$10,000 with the Clerk of Court(the"Bond"); F. On November 3, 2011, Florida Georgia Grove, LLP appealed the Temporary Injunction as claimed and plead in that certain appellate case styled Florida Georgia Grove, LLP v. Collier County and Ted Smallwood's Store, Inc., Case No. 2D11- 5636 in the Second District Court of Appeal of the State of Florida (the "Appellate Proceedings"); G. On January 10, 2012, the Court entered an Order Adjudging Contempt against Florida Georgia Grove, LLP (the "Contempt Order"), requiring Florida Georgia Grove, LLP to restore and repave Mamie Street in accordance with the Temporary Injunction entered by the Court on October 20, 2011; H. Pursuant to stipulations, the Court has entered Orders Modifying the Contempt Order to extend the compliance deadline; I. Florida Georgia Grove, LLP has restored and repaved Maime Street in accordance with the Temporary Injunction; 2 J. On August '10, 2012, the Appellate Court rendered a decision affirming the issuance of the temporary injunction subject to a hearing to quantify the bond amount; K. The parties do not admit any wrongdoing or liability, but have determined to settle and compromise all claims asserted by the parties in order to resolve their differences and avoid the financial expense and burden of protracted and complex litigation; and L. The parties desire hereby to reduce their agreement of settlement to writing so that it may be binding upon the parties, their successors and assigns. TERMS OF AGREEMENT In consideration of the foregoing recitations and the following mutual covenants, promises and agreements, the parties, with the intent to be legally bound, agree as follows: 1. The foregoing recitations are hereby incorporated into and made a part of this Settlement Agreement. 2. If, as, and when the conditions in paragraph 3 below are satisfied, this Settlement Agreement will settle all of the claims between the parties and all of the related and consequential claims and matters that the parties may have which were made or could have been included in the parties' claims. 3. This Settlement Agreement has been presently executed by all parties except Collier County. It will not be effective unless and until: (1) the Board of County Commissions of Collier County approves executing this Settlement Agreement; (ii) the Settlement Agreement is actually executed by Collier County; and (iii) if so executed by 3 1 / Collier County then Collier County thereafter formally vacates any claimed public right of way or prescriptive easement as claimed by it in this lawsuit. 4. Upon satisfaction of all conditions to its effectiveness as set forth in this Settlement Agreement, the Temporary Injunction and the Contempt Order shall be vacated and the Bond shall be returned to Ted Smallwood's Store, Inc. by the Clerk. 5. Plaintiff, Collier County, has not presently executed this Settlement Agreement because its terms and conditions have not been approved by Collier County in accordance with its applicable procedures. Concurrently with the execution of this Settlement Agreement and related documents by the other parties hereto, the other parties have arranged for Collier County to take such steps as are required for approval. If such approval is forthcoming, Collier County will notify the other parties to this Settlement Agreement and deliver to each of them a signed copy of this Settlement Agreement and the related documents of which it is a signatory. For the purposes of this Settlement Agreement, the date of such notice shall be denominated as the "Approval Date". A. The execution of this Settlement Agreement by Collier County shall constitute an acknowledgement by Collier County that it has agreed to disclaim any rights relative to (i) the Current Easement (as defined in paragraph 6 below), or (ii) any other claims for an easement or right of access over or against the property owned by Florida Georgia Grove, LLP whether by way of a prescriptive easement, a publicly dedicated road or otherwise subject, however, to the subsequent (i) initiation of the statutory process to formally vacate any such rights, and (ii) the determination by 4 the Board of County Commissioners of Collier County to actually and formally vacate such rights as hereafter provided for. B. Notwithstanding the fact that Collier County is not presently executing this Settlement Agreement, all of the other parties hereto presently executing this Settlement Agreement acknowledge and agree that they are bound by the terms and conditions hereof, as and constituting their irrevocable offer to each other, and to Collier County, which shall bind all of them if accepted and executed by Collier County. However, if Collier County shall have failed to approve this Settlement Agreement by June 6, 2013, (the "Approval Date") then this Settlement Agreement and all documents executed pursuant thereto shall be null and void and without recourse to the parties hereto. C. If the actual Approval Date does occur on or before the date set forth in paragraph 5 B above then Collier County will thereafter initiate the statutory process to vacate its claims to a public right of way and prescriptive easement. 6. The parties agree that, subject to: (i) approval of this Settlement Agreement by Collier County and (ii) the subsequent formal vacation of any claims to a prescriptive easement or public right of way by Collier County any access as shall thereafter exist in favor of Ted Smallwood Store, Inc. or to its property over the property owned by Florida Georgia Grove, LLP shall be only by the Easement for Ingress and Egress and Utilities which is attached hereto as Exhibit given Defendant, Florida Georgia Grove, LLP (the "Easement"). The Easement grants to Ted Smallwood's 5 Store, Inc. a specific access easement (the "Current Easement") and contemplates that the Current Easement may be relocated in the future. 7. Concurrently with their execution of this Settlement Agreement, Defendant, Florida Georgia Grove, LLP and Defendant, TD Bank, N.A., Plaintiff, Ted Smallwood's Store, Inc. as the case may be, have taken the following action subject, however, to the conditions in paragraph 3: A. in the case of Defendant, Florida Georgia Grove, LLP, executed in favor of Plaintiff, Ted Smallwood's Store, Inc., the Easement in the form attached hereto as Exhibit 1 and incorporated herein by reference; B. in the case of Defendant, Florida Georgia Grove, LLP, executed a Covenant and Exclusive Easement to Permit Continuation of Encroachment in favor of Ted Smallwood's Store, Inc. in the form attached hereto as Exhibit 2 and incorporated herein by reference; C. in the case of Defendant, TD Bank, N.A. executed a subordination of its rights relative to the instruments referenced in A. and B. above; D. executed a Stipulation to Vacate Temporary Injunction, Quash Contempt Order, Dismiss with Prejudice, and Reserve Jurisdiction to Enforce Settlement Agreement and Impose Sanctions for Contempt in the form attached hereto and incorporated herein by reference as Exhibit 3. Upon its approval of this Settlement Agreement Plaintiff, Collier County, shall execute the above instrument; and E. have agreed to the Court's entry of the Agreed Order Vacating Temporary Injunction, Quashing Contempt Order, Dismissing Case with 6 Prejudice, and Reserving Jurisdiction to Enforce Settlement Agreement and Impose Sanctions for Contempt in the form attached hereto as Exhibit 4 (the "Agreed Order"). F. in the case of Defendant, Florida Georgia Grove, LLP, placed in escrow its check in favor of Plaintiff, Ted Smallwood's Store, Inc. in the amount of Five Thousand Dollars which shall be deemed to be a charitable donation. All of the above documents and instruments shall be held in escrow by counsel for Florida Georgia Grove, LLP, to be recorded or filed or delivered, as the case may be, immediately following the Approval Date and such documents and instruments shall not be effective unless and until: (i) Collier County has approved and executed this Settlement Agreement and the appropriate related documents on or before the date specified in paragraph 4. B. and (ii) the formal vacation of any claims by Collier County, as set forth in paragraph 3 has taken place by the date that is not more than 120 days after the Approval Date. If no approval is given by Plaintiff, Collier County, on or before the date specified in paragraph 4. B. hereof, or if it is so approved but then thereafter the formal vacation has not taken place by the date that is not more than 120 days after the Approval Date, then, in either such case, said documents and instruments shall be null and void and the check returned and this Settlement Agreement will no longer be effective. 8. Upon the completion of all three conditions set forth in paragraph 3 hereof, 7 and the disbursal of the documents described above from escrow as contemplated above, the Plaintiffs on the one hand, and Defendant Florida Georgia Grove, LLP, on the other hand, shall be deemed to have released and forever discharged each other including their agents, servants, employees, consultants, partners, limited partners, subsidiaries, attorneys, managers, insurors, advisors, successors, predecessors, affiliated entities and affiliated corporations, releasing them from any claim or liability existing as of the date of the release, in law or in equity which either party claimed or reasonably should have known or claimed in that certain case styled Collier County and Ted Smallwood's Store, Inc. v. Florida Georgia Grove, LLP and T.D. Bank, N.A., Case No. 11-1640-CA, in the Circuit Court of the Twentieth Judicial Circuit in and for Collier County, Florida, but excluding only the rights and obligations of the parties under this Settlement Agreement and the Agreed Order and the documents listed in paragraph 7A, 7B, and 7C. 9. In addition, upon the completion of all three conditions set forth in paragraph 3 as contemplated above, the Plaintiffs shall be deemed to have released and forever discharged Defendant, T.D. BANK, N.A., and its agents, servants, employees, consultants, partners, limited partners, subsidiaries, attorneys, managers, insurors, advisors, successors, predecessors, affiliated entities and affiliated corporations, from any claim or liability existing as of the date of the release, in law or in equity which either party claimed or reasonably should have known or claimed in that certain case styled Collier County and Ted Smallwood's Store, Inc. v. Florida Georgia Grove, LLP and T.D. Bank, N.A., Case No. 11-1640-CA, in the Circuit Court of the Twentieth Judicial Circuit in and for Collier County, Florida, but excluding only the rights 8 and obligations of the parties under this Settlement Agreement and the Agreed Order and the documents listed in paragraph 7A, 7B, and 7C. Neither this Settlement Agreement nor any documents executed pursuant thereto shall be deemed a release of claims or satisfaction of any note or mortgage by or between Defendant, Florida Georgia Grove, L.L.P. and Defendant, TD BANK, N.A. which claims are specifically reserved. 10. If, as, and when Collier County approves this Settlement Agreement, the parties agree to then enter into a stipulation to request that the court enter an order staying all proceedings in this case pending the completion, or not, by the date specified in section 7F of the road vacation that is specified in section 3(iii). 11. This Settlement Agreement and the other documents referred to in it and being concurrently executed and delivered constitute the entire agreement between the parties and may not be amended or modified except in writing by each of the parties. Notwithstanding the foregoing, with the exception of T.D. BANK's agreement to subordinate its lien to the interests of the easement created by this Settlement Agreement, nothing contained in this Settlement Agreement shall amend, modify, renew or otherwise affect, in any way, any documents reflecting loan transactions between Florida Georgia Grove, LLP and T.D. BANK, N.A., including but not limited to, the December 7, 2004 Riverside Bank loan reflected by the $1,282,500.00 Promissory Note, Commercial loan agreement, and Real Estate Mortgage (recorded at O.R. Book 3693, Page 566, of the public records of Collier County, Florida, as modified on April 7, 2008 by the Change in Terms Agreement, Business Loan Agreement, and Modification of Mortgage (recorded at O.R. Book 4356, Page 2688, of the public records of Collier 9 County, Florida)), and assigned to T.D. Bank by virtue of that certain Assignment of Mortgage recorded at O.R. Book 4626, Page 600, and the December 10, 2007 Riverside Bank loan reflected by the $300,000.00 Promissory Note, Business Loan Agreement, and Mortgage (recorded at O.R. Book 4340, Page 2958, of the public records of Collier County, Florida), and assigned to T.D. Bank by virtue of that certain Assignment of Mortgage recorded at O.R. Book 4626, Page 602, of the public records of Collier County, Florida. Nor does this Settlement Agreement affect T.D. BANK's entitlement to seek reimbursement of attorney's fees and costs from Florida Georgia Grove, LLLP incurred in defending itself in the above captioned litigation and Florida Georgia Grove, LLP's right to contest same. 12. This Settlement Agreement is the joint product of the respective parties and shall not be more strictly construed against any party. 13. The parties acknowledge and agree that each is foregoing certain rights and assuming certain duties and obligations which, but for this Settlement Agreement, would not have been released or assumed. Accordingly, the parties agree that this Settlement Agreement is fully and adequately supported by consideration, is fair and reasonable, and the parties have had the opportunity to consult with and have in fact consulted with such experts of their choice as they may have desired, and they have had the opportunity to discuss the matter with counsel of their choice. 14. In the event of any default under any of the terms of this Settlement Agreement,the non-defaulting party may institute legal proceedings or avail itself of any legal remedies available to such party including, but not limited to, those provided for in the Agreed Order. in the event of any such actions, the prevailing party shall be entitled 10 to an award of reasonable attorneys' fees and costs incurred in the enforcement of same, inclusive of attorneys' fees and costs incurred on appeal. 15. This Settlement Agreement shall be governed by and construed in accordance with the laws of the State of Florida. Whenever possible, each provision of this Settlement Agreement shall be interpreted in such a manner as to be effective and valid under applicable law; but if any provision of this Settlement Agreement shall be prohibited by or be invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Settlement Agreement. 16. This Settlement Agreement may be executed in any number of counterparts (and by delivery of facsimile signature pages), each of which shall be deemed an original but all of which shall together constitute one and the same instrument. 17. This Agreement shall be binding on, and inure to the benefit of the parties and their respective successors, and assigns. IN WITNESS WHEREOF, the parties by their duly authorized agents have signed this Settlement Agreement as of the dates set forth below. COLLIER COUNTY, a political subdivision Attorney or ,E•Ilier County: of the State of Florida: L41 By: Georgia A. Hiller, Esq., Chairwoman Jeffrey •1 ^1a' ow, Esq. Collier County Board of County i Commissioners Date: , 2013 Date: , 2013 Attest: Dwight E. Brock, Clerk By: 11 , . TED SMALLWOOD'S STORE, INC., a Florida non-profit corporation: Attorney for Ted Smaliwood's Store, Inc.: By:Aquw,L- . tritegliav; Lynn eEe Richard C. Grant, Esq. Date: (-S. 2.- , 2013 Date: `--`) — 2013 FLORIDA. GEORGIA GROVE, LLP, a Attornys or Flo '• eorgia Gm. P.' rshi.: Se77. Chase, Esq. Printed Name As Managing Partner -merill W. James Date: er-7-.11/ , 2013 D- , 2013 T.D. BANK, NA, a national bank: Attorney for T.D. Bank, N.A: By - , (-&,, i IL e E. Blake Paul, Esq. Printed Name As Vice President Date: ta , 2013 Date: "i/.7 , 2013 12 EXHIBIT 1 Easement for Ingres and Egress and Utilities This instrument prepared by, and upon recordation return to: Richard C.Grant,Esq. Grant Fridkin Pearson,P.A. 5551 Ridgewood Drive,Suite 501 Naples,Florida 34108-2719 Tel 239.514.1000 FOR OFFICIAL USE ONLY EASEMENT FOR INGRESS AND EGRESS AND UTILITIES For valuable consideration,receipt of which is hereby acknowledged, and in accord with the terms of a Settlement Agreement among the parties, entered into in case no. 11-1640-CA in the Twentieth Judicial Circuit Court of Florida,in and for Collier County(the"Action"), Florida Georgia Grove, LLP, a Florida limited liability partnership ("Florida Georgia"), whose address is 3335 U.S. Highway 27 South Sebring, Florida 33870, hereby grants, bargains, sells, and conveys to Ted Smallwood's Store, Inc., a Florida not for profit corporation ("TSS"), whose address is P.O. Box 310, Chokoloskee, Florida 34138, a perpetual, non-exclusive easement (the "Access Easement") for ingress and egress over the property legally described on Exhibit "1" hereto (the "Easement Area") for the purpose of ingress and egress from Chokoloskee Drive a public road, to the property owned by TSS which is legally described on Exhibit "2"hereto (the "Dominant Estate"). The Easement Area is a potion of an overall parcel of land owned by Florida Georgia that is legally described on Exhibit "3" hereto and made a part hereof (the "Servient Estate"). As specified in section B below, this instrument also grants TSS non- exclusive easements for existing utility installations and lines located within the Servient Estate that provide water, sewer, electric,telephone,and cable services to the Dominant Estate. A. The Access Easement will exist on the following terms: 1. Florida Georgia covenants and agrees that it will keep the Access Easement and the Easement Area free from interference or damage by reason of: (i) activities, and operations conducted by Florida Georgia on the Servient Estate; (ii) any other easements it may hereafter grant to third parties which will be subordinate hereto; and (iii) damage, or destruction, or excessive wear and tear caused by any such activities or interference. 2. Florida Georgia hereby reserves the right to, and by its acceptance TSS agrees that Florida Georgia may relocate the Access Easement to another location on the Servient Estate (the "Relocated Access Area") so long as the easement provides reasonable access to the Dominant Estate. As so relocated, the rights of the parties hereunder (and all other parties benefitting from the Access Easement) shall be limited to the physical area described in the Relocated Access Area. TSS further agrees and acknowledges that the location described on Exhibit "4" hereof, ("Approved Relocated Access Area") is approved by TSS as an acceptable location for the Relocated Access Area. The modification/relocation of the Access Easement to any Relocated Access Area shall be permitted under the following conditions: (i) This Access Easement is modified by an instrument executed by both GFPAC Revision 4/2/13 parties or their successors,which specifies the physical location of the Relocated Access Area as is set forth in sub-paragraph (ii) below, in favor of TSS and executed by the then fee owner of the Servient Estate, and by any and all persons as may have an interest in it, and/or who then hold a lien upon it, and appropriate evidence thereof is provided to TSS or its successors. The instrument shall be recorded in the public records. (ii) The Relocated Access Area shall be twenty (20) feet in width and the actual paved road surface within it shall be not less than sixteen (16) feet in width, with the remaining four (4) feet to be unpaved and to be located on one or both sides of the sixteen(16) foot paved area as determined by Florida Georgia. (iii) The road located within the Relocated Access Area shall be constructed as follows: 12" compacted subbase to LBR = 40; 6" compacted lime rock base; and 11/4" type Si asphalt. (iv) Florida Georgia allows TSS to erect and install, at its expense, appropriate signage at the entrance to the Relocated Access Area along Chokoloskee Drive, identifying it as the entrance to the Ted Smallwood Store and the Dominant Estate. (v) If the Relocated Access Area is located other than in the Approved Relocated Access Area then the Relocated Access Area, inclusive of the areas specified in sub- paragraph (ii) above is properly described with a legal description prepared by a registered Florida land surveyor and with an appropriate survey demonstrating its location within the overall Servient Estate and its point of connection to the Dominant Estate showing continuity between Chokoloskee Drive to the north and the Dominant Estate to the south and contiguity to each, and that the improvements specified in subsections (ii) and (iii) above are wholly located within the Approved Relocated Access Area. The survey must be certified to TSS. (vi) TS S agrees and acknowledges that the Approved Relocated Access Area as described on Exhibit "4" is acceptable and that no further survey and/or certification as referenced in paragraph (v) above is required as to it, however, if, as, and when the improvements set forth in(ii) and (iii) are actually made to the Approved Relocated Access Area and the Access Easement is to be relocated to it, then at that time FG must have a surveyor certify that, as constructed, the improvements specified in subsections (ii) and (iii) above will have been and are then wholly located within the Approved Relocated Access Area. (vii) All of the foregoing must be done at the expense of Florida Georgia. (viii) Upon construction of the improvements specified within subsections (ii) and (iii) above within the Relocated Access Area including but not limited to within the Approved Relocated Access Area, and compliance with all other conditions in this section A 2, then all other Access Easements/Access Areas shall be deemed abandoned and shall no longer be utilized. (ix) Upon compliance with the foregoing, TSS agrees to execute appropriate documents, suitable for recording,modifying the physical location of the Access Easement to the 2 Relocated Access Area including that area depicted on Exhibit "4", and acknowledging that the rights of access and other easements and rights and obligations specified in this Access Easement apply exclusively to the Relocated Access.Area and are exclusively for the benefit of TSS, its employees, guests and invitees. (x) TSS further agrees that in addition to any and all other relief, both at law and at equity, Florida Georgia shall be entitled to injunctive relief and/or specific performance seeking the relocation of the Access Easement to a Relocated Access Area assuming compliance with the requirements set forth above. (xi) The parties have reviewed, executed, and initialed counterpart copies of a sketch prepared by Mel Hatton, P.L.S., Punta Gorda, Florida bearing a revision date of January 12, 2013„ but signed and certified on March 2, 2013, Work Order No. 11-074 ESM T2U which graphically depicts the Dominant Estate, Servient Estate, Easement Area, and the Approved Relocated Access Area. 3. Florida Georgia has no obligation to provide regular, recurring, or normal maintenance and/or repair of the Easement Area or to the road and driving surfaces thereon either as it now exists or with respect to the Relocated Access Area, if such is the case. TSS shall have the right, from time to time, at its own expense, but have no obligation, to perform regular,recurring and normal maintenance and/or repair. 4. Both Florida Georgia and TSS are, however, obligated respectively, at such party's own expense, to promptly: (i)remediate and repair any damage (other than ordinary wear and tear), injury, destruction; or (ii) provide and perform any extraordinary repairs and/or resurfacing of the paved road area within the portion of the Easement Area or the Relocated Access Area, as the case may be and/or resurfacing of the paved road within Easement Area or the Relocated Access Area, as the case may be, in either of such cases, as is, or may be caused by, or result from, such party's own activities, uses, or operations, or, in the case of Florida Georgia, those of others to whom it may grant easements, such as, but not limited to, damage or excessive or extraordinary wear and tear caused by heavy equipment or construction activities taking place, in the case of Florida Georgia on the Servient Estate or in the case of TSS on the Dominant Estate. B. Florida Georgia hereby grants to TSS the right and an easement to maintain, install, repair, and replace any and all above ground and underground utility lines and installations (the "Utility Easement") that now exist within the Servient Estate to provide utility service to the Dominant Estate, such utilities and services may include, but are not limited to water, sewer, telephone, electricity, cable tv, and internet. If any utility installation situated within the Servient Estate is not evidenced by a recorded easement, then either TSS or Florida Georgia may: (i) cause such utility installation(s) to be located by a licensed surveyor; (ii) cause such surveyor to prepare a legal description for an easement for the utility installation itself within the Servient Estate which encompasses both the utility installation and any additional areas contiguous to the utility installation required by the utility provider for access to maintain, repair, and replace it; and (iii) prepare a new non-exclusive easement to be granted for the continued location, maintenance,repair and replacement of the utility installation in question. Such new easement(s) 3 shall be executed by the persons and in accord with criteria and be substantiated as set forth in section A2(i) above and be subject to the reasonable approval of TSS and Florida Georgia and when so approved, shall be recorded in the Public Records. If any such utility installation is relocated in accordance with the terms and conditions of the following sentence, the recorded easement shall be amended accordingly. Florida Georgia reserves the right,from time to time,to relocate any such lines and installations elsewhere within the Servient Estate, including but not limited to within the Approved Relocated Access Area: (i) at its sole cost and expense; (ii) in accord with criteria, standards, and policies of the applicable utility service providers (including, if approved by the utility service provider, relocation of aboveground installations as underground installations); and (iii) without such relocation causing a disruption or break in utility service to the Dominant Estate. C. The Access and Utility Easements created hereby, and any permitted modifications/relocations thereof, are, and in the case of permitted modifications/relocations, will be,appurtenant to, and inseparable from,the Dominant Estate. They and this instrument are binding and enforceable against Florida Georgia and its successors and assigns and successor and future owners of the Servient Estate and they inure to the benefit of TSS, its successors and assigns and successor owners of the Dominant Estate. D. This instrument may only be modified, amended, or its terms varied or waived in writing executed by all parties. IN WITNESS WHEREOF this instrument has been executed this day of ,2013. Witnesses: Florida Georgia Grove,LLP Witness#1 Printed name of witness#1 By. Witness#2 as its Managing Partner Printed name of Witness#2 STATE OF FLORIDA ) §§: COUNTY OF ) I HEREBY CERTIFY that the foregoing instrument was acknowledged before me this_day of , 2013, by , as the Managing Partner of Florida Georgia Grove, LLP, a Florida limited liability partnership, who is personally known to me or who produced as identification. Notary Public-State of Florida Printed Name of Notary 4 I . My Commission Expires: SUBORDINATION TD Bank,N.A., a national banking association, the owner and holder of mortgages and assignments recorded in the following Official Records Books of the Collier County Public Records: 3693, at page 566; 4356, at page 2688; 4340, at page 2958; 4626, at page 600; and 4626, at page 602,as well as by virtue of any other lien, encumbrance, or interest it may have or claim on or in the Servient Estate, as described in the Easement for Ingress and Egress and Utilities to which this Subordination is attached, hereby acknowledges and agrees that this Easement and all rights of Ted Smallwood's Store, Inc., and its successors and assigns, thereunder are superior to the rights of TD Bank, N.A. as set forth in the instruments described above, or as it may otherwise claim to exist in the Servient Estate, and such rights of TD Bank, N.A. are hereby subordinated to the Easement. Executed this day of ,2013. Witnesses: TD Bank,N.A. Witness#1 By: ,Vice President Printed name ofwitness#1 Witness#2 Printed name of Witness#2 STATE OF FLORIDA ) §§: COUNTY OF ) I HEREBY CERTIFY that the foregoing instrument was acknowledged before me this _ day of , 2013, by , as Vice President of TD Bank, N.A., a national banking association, who is personally known to me or who produced as identification. Notary Public-State of Florida Printed Name of Notary My Commission Expires: 5 ACCEPTANCE Ted Smallwood Store, Inc. hereby accepts and agrees to the forgoing Easement for Ingress and Egress and Utilities on the terms and conditions granted. Ted Smallwood Store,Inc. By: Lynn McMillin,Executive Director STATE OF FLORIDA ) §§: COUNTY OF ) I HEREBY CERTIFY that the foregoing instrument was acknowledged before me this _ day of , 2013, by Lynn McMillin as Executive Director of Ted Smallwood Store, Inc., a Florida not for profit corporation,who is personally known to me or who produced as identification. (SEAL) Notary Public-State of Florida Printed Name of Notary My Commission Expires: 6 EXHIBIT 1 "Easement Area" PROPOSED ROADWAY EASEMENT OVER EXISTING PAVED ROAD (NEW) COMMENCING AT THE EAST 1/4 CORNED OF SECTION 36, TOWNSHIP 53 SOUTH. RANGE 29 EAST, COWER COUNTY, FLORIDA THENCE ON AN ASSUMED BEARING OF N 00' 12' 14" E, ALONG THE EAST LINE OF SAID SECTION 36, ALSO BEING THE CENTERUNE OF SMALLWOOD DRIVE (50' ROW) A DISTANCE OF 77.74 FEET TO AN IRON ROD AT THE CENTERLINE OF CHOKOLOSY.EE DRIVE (50' ROW : THENCE N 84' 57' 50" W ALONG THE CENTERLINE OF SAID CHOKO- LOSKEE DRIVE, A DISTANCE OF 169.0.1 FEET T AN ANGLE POINT IN SAID CENTERLINE OCCUPIED BY A 5/8" BOLT • THENCE N 76' 02' 51" W, ALONG SAID CENTERLINE. A DISTANCE OF 408.54 FEET TO AN ANGLE POINT IN SAID CENTERLINE OCCUPIED BY A 5/8" BOLT ON THE COMMON BOUNDARY OF LOTS 5 AND 8 OF SMALLWOODS DIVISION OF SECTION 36 AS RECORDED IN PLAT BOOK 1, PAGE 27 OF THE PUBLIC RECORDS OF COLLIER COUNTY FLORIDA: THENCE S 3' 34' 9" W ALONG SAID COMMON BOUNDARY. A DISTANCE OF 28 55 FEET TO A POINT ON THE SOUTH RIGHT OF WAY LINE OF SAID CHOKOLOSKEE DRIVE, THENCE ALONG SAID SOUTH RIGHT OF WAY UNE S 64' 52' 07" W A DISTANCE OF 231 34 FEET TO THE POINT OF BEGINNING OF THE HERErNAFTER DESCRIBED EASEMENT. BEING 17 FEET IN WIDTH AND OVER_AYING THE EXISTING PAVED ROADWAY WHICH RUNS THRU PARCEL #26.085200003 AS SHOWN HEREON THENCE LEAVING THE SAID SOUTH RIGHT or WAY UNE OF CHOKOLOSKEE DRIVE S 21' 25' 22" W A DISTANCE OF 139.12 FEET; THENCE S 25' 12' 21" W A DISTANCE OF 43.07 FEET TO THE BEGINNING OF A CIRCULAR CURVE, CONCAVE TO THE WEST AND HAVING A CENTRAL ANGLE OF 33' 52' 01", A RADIUS OF 210.04 FEET, AN ARC LENGTH OF 124.15 FEET, A CHORD LENGTH OF 122.35 FEET AND A CHORD BEARING OF S 17' 30' 17" W TO THE END OF SAID CURVE, THENCE S 01' 39' 47" E A DISTANCE OF 24.3.59 FEET: THENCE S 06' 01' 42" W A DISTANCE OF 63.42 FEET THENCE S 02' 23' 49" W A DISTANCE OF 84.43 FEET TO A POINT ON THE WEST LINE OF LOT 12, SMALLWOOD'S DIVI -'SION OF SECTION 56, AS RECORDED IN PLAT BOOK 1, PAGE 27 OF THE PUBUC RECORDS OF COLLIER COUNTY. FLORIDA THENCE ALONG SAID WEST LINE OF LOT 12 S 28' 11' 20' W A DISTANCE OF 39 07 FEET TO THE WEST LINE OF NEW 17 FOOT EASEMENT: THENCE LEAVING SAID WEST UNE OF LOT 12 N 02' 23' 49" E A DISTANCE OF' 120.15 FEET; THENCE N 06' 01' 4.2" E A DISTANCE OF 62.82 FEET: THENCE N 01' 39' 47" W A DISTANCE OF 247.77 FEET TO THE BEGINNING OF A CIRCULAR CURVE. CONCAVE TO THE WEST AND HAVING A CENTRAL ANGLE OF 33" 35' 57, A RADIUS OF 227.04 FEET . AN ARC LENGTH OF 133.14 FEET, A CHORD LENGTH OF 131.24 FEET AND A CHORD BEARING OF N 17' 17' 05" E TO THE END OF SAID CURVE; THENCE N 25' 12' 21" E A DISTANCE OF 41.17 FEET; THENCE N 21' 25' 22" E A DISTANCE OF 130 05 FEET TO THE SOUTH RIGHT OF WAY LINE OF CHOKOLOSKK£ DRIVE: THENCE ALONG SAID SOUTH RIGHT OF WAY N 84' 52' 07" E A DISTANCE OF 19.00 FEET TO THE POINT OF BEGINNING. • • • EXHIBIT 2 "Dominant Estate" Lot 12 and a portion of Lot 13, Smallwood's Division according to the plat thereof as recorded in Plat Book 1 at Page 27, of the Public Records of Collier County, Florida, which said lot and portion of said lot is more particularly bounded and described as follows: • Commencing at the last 1/4 Corner of Section 36, Township 53 South, Range 29 last, Chokoloskee, Collier County, . Florida, Run 8. 89'81•01' K. 706.17 Feet on the Line . Dividing Lots 7 and 11 of Swallwood's Division of Section 36, Township 53 South, : 29 East, as filed and recorded in Mat . • D • 27,' of the Public Records of Collie y- •,•_ , 11 to the Original Monument, Cason 6 its 6, 7, d 12, and to T4 . _• t . -. e , Thence S. 89'2 '2 K. 194.83 Feet to the Origins x• o Los 8, 12 and 13; Thence S. 27e r • W. T � y + � T• e a. 28'08'37• ;} 0� y `�yO. SF ?hflC. S - • - ' .. b • •. ginning. Together with fir; iparian rig =f- • &u,- oloskee Bay. 2j E Cal- i • . ` L. _. EXHIBIT 2 "Dominant Estate" Commencing at the east quarter corner of Section 36, Township 53 south, Range 29 east, Chokoloskee, Collier County, Florida , run south 89-12-54 west on the line dividing lot 7 and 11 of Smallwood's division of Section 36, Township 53 south,Range 29 east as filed and recorded in Plat Book 1 at page 27 of the Public Records of Collier County, Florida, for 707.27 feet to the original monument common to lot 6, 7, 11, and 12,thence south 89-12-24 west for 195.20 feet to the original monument, common to lots 6, 8, 12, and 13, thence south 28-27-54 west on the line dividing lot 12 and 13 for 127 feet to a concrete monument, THE POINT OF BEGINNING: continue south 28-27-54 west for 56.51 feet to a concrete monument, thence south 66-26-39 west, 5 feet south from the south building foundation,for 103.35 feet to a point on a seawall,thence north 23-33-21 west for 52.5 feet to a point on a seawall,thence north 66-26-39 east for 80 feet to a concrete monument, thence north 83-47-54 east for 55.50 feet to THE POINT OF BEGINNING. Together with all riparian rights to Chokoloskee Bay. As per deed in Official Records Book 1157 at page 420 of the Public Records of Collier County,Florida. Also described below: SMALLWOOD'S STORE PARCEL A PORTION OF LOT 13 OF SMALLWOODS DIVISION OF SECTION 36, TOWN SHIP 53 SOUTH, RANGE 29 EAST ON CHOKOLOSKEE ISLAND, ACCORDING TO THE PLAT THEREOF AS RECORDED IN PLAT BOOK 1, PAGE 27 OF THE PUBLIC RECORDS OF COWER COUNTY, FLORIDA, BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS: COMMENCING AT THE EAST 1/4 CORNER OF SAID SECTION 36, TOWNSHIP 53 SOUTH, RANGE 29 EAST, COLLIER COUNTY, FLORIDA RUN S 89' 01' 01" W FOR 706.20 FEET ALONG THE LINE DIVIDING LOTS 7 AND 11 OF SMALLWOODS DMSION TO THE ORIGINAL MONUMENT AT THE COMMON CORNER OF LOTS 6,7,11 AND 12; THENCE RUN S 89' 21' 26" W FOR 194.83 FEET TO THE ORIGINAL MONUMENT AT THE COMMON CORNER OF LOTS 6,8,12 AND 13; THENCE S 27' 43' 26" W FOR 27.00 FEET TO THE ORIGINAL MONUMENT ALONG THE UNE DIVIDING LOTS 12 AND 13 S 28 08' W FOR 106 10 FEET TO AN IRON PIN AND CAP, LYING 27.8 FEET EAST OF AN ORIGINAL MONUMENT AND 89.15 FEET EAST OF AN ORIGINAL MONUMENT, SAID PIN BEING THE POINT OF BEGINNING OF THE HEREINAFTER DESCRIBED PARCEL OF LAND- THENCE CONTINUE S 28' 08' 37" W FOR 75.74 FEET TO AN ORIGINAL MONUMENT • THENCE RUN 5 63' 33' 14" W FOR.60.55 FEET TO A DRILL HOLE IN CONCRETE 0.5 MORE OR LESS EAST OF CONCRETE SEAWALL; THENCE RUN N 30' 42' 24 W FOR 60.00 FEET ALONG SAID SEAWALL TO A DRILL HOLE IN THE TOP OF SAID CONCRETE SEAWALL; THENCE LEAVING SAID CONCRETE SEAWALL RUN N 49' 12' 57" E FOR 42.89 FEET TO AN ORIGINAL MONUMENT; THENCE RUN N 80' 52' 45" E FOR 89.18 FEET TO THE POINT OF BEGINNING. THIS DESCRIPTION WAS PRODUCED FROM A FIELD SURVEY AND RECOVERED CORNERS AS REFERENCED ON A SURVEY DONE BY HORACE A. WILKISON AND ASSOCIATES, INC., NAPLES, FLORIDA. DATED AUGUST 4, 1995 WITH DRAWING NUMBER 53-D-6-2. TOGETHER WITH ALL RIPARIAN RIGHTS TO CHOKOLOSKEE BAY. PARCEL PER OFFICIAL RECORD BOOK 2236, PAGE 1843. LOT 12 AND A PORTION OF LOT 13. SMALLWOOD'S DIVISION ACCORDING TO THE PLAT THEREOF AS RECORDED - IN PLAT BOOK 1 AT PAGE 27, OF THE PUBLIC RECORDS OF COWER COUNTY, FLORIDA. WHICH SAID LOT AND PORTION OF SAID LOT IS MORE PARTICULARLY DESCRIBED AS FOLLOWS: COMMENCING AT THE EAST 1/4 CORNER OF SAID SECTION 36. TOWNSHIP 53 SOUTH, RANGE 29 EAST, CHOKOLOSKEE COWER COUNTY, FLORIDA RUN S 89' 01' 01" W FOR 706.17 FEET ALONG THE UNE DMDING LOTS 7 AND 11 OF SMALLWOODS DIVISION OF SECTION 36, TOWNSHIP 53 SOUTH, RANGE 29 EAST AS FILED AND RECORDED IN PLAT BOOK 1 AT PAGE 27, OF THE PUBLIC RECORDS OF COWER COUNTY, FLORIDA, TO THE ORIGINAL MONUMENT, COMMON 'TO LOTS 6,7,11 AND 12, AND TO THE POINT OF BEGINNING; THENCE S 89' 21' 26" W 194.83 FEET TO THE ORIGINAL MONUMENT COMMON TO LOTS 6 8,12 AND 13; THENCE S 27' 38' 35" W 27.00 FEET; THENCE S 28' 08' 37" W 181.84 FEET; THENCE S 63' 33 14" W 60.55 FEET; THENCE S 30X0 42' 24" E 16.70 FEET; THENCE N 64' 31' 58"E 59.02 FEET; THENCE 5 39' 26' 45" E 224.74 FEET; THENCE N 20' 47' 21" E 402.12 FEET TO THE POINT OF BEGINNING. TOGETHER WITH ALL RIPARIAN RIGHTS TO CHOKOLOSKEE BAY. • EXHIBIT 3 "Servient Estate" S.T.O.F.PARCEL A portion of the South one-half(S 1/2)of Lot 8,together with a portion of Lot 13 of SMALLWOOD'S DIVISION of Section 36,Township 53 South,Range 29 East on Chokoloskee Island,according to the Plat thereof as recorded in Plat Book 1,Page 27 of the Public Records of Collier County,Florida,said portions lying South of the right-of-way of CHOKOLOSKEE DRIVE(50'ROW)and including all of that certain Parcel of land described in Fee Simple Deed recorded in O.R_Book 1199,Page 2278 of the aforesaid Public Records,said portions also being contiguous with and East of the P- sterly boundary of PARKWAY VILLAGE OF CHOKOLOSKEE ISLAND,a Condominium recorded in Condominium Plat Book 39,Page 31, Public Records of Collier County,Florida,and . • being contiguous with and West of those Parcels described in O.R.Book 997 .. y " _ -: and Pages 1943 and 1944,of the Public Records of Collier County, ' ' •ii • "-11• • :0 V PORTIONS being more particularly described as follow . 0 ' COMMENCE at the , . t .ne 1 .1 : f_ /4)co 'er of .'d •ection 36;thence on an assumed bearing . Nt••••*': MAW;:WT.: t ;no of said Section 36 also being the ce r i e •f ' ��t•+ + ` (40' •OW),a distance of 577.74 feet to an iro •• : • ., -M._ . .0.1.2_,K0►ril- 41:,e1.'4')RIVE(50'ROW); thence North 84°57' • �\ est,along the cen ii;ne o -. OKOLOSKEE DRIVE,a distance of .44 feet to an angle •-=t:. •. :'iu• nterline occupied by a five-eighths(5/8")inc• •• thence North 76°' &--t, along said centerline, a distance of• 1:C •• to an ailgl :•_< said centerline occupied by a five-eighths (5/8")inch :‘• �c:: • dary of Lots 6 and 8 of said Flat; thence South 23°34'59"West, • : .•• common boundary a distance of 28.55 feet to a point on the South right of-way line of said CHOKOLOSKEE DRIVE,said point also being the POINT OF BEGINNING;thence continue South 23°34'59"West along said common boundary and along the Westerly line of those certain parcels described in O.R.Book 997,Pages 1927, 1928, 1943 and 1944,Public Records of Collier County,Florida,a distance of 284.77 feet to an angle point in said common boundary,occupied by a concrete monument; thence South 26°11'00"West,along said common boundary and along the Westerly line of said Parcels,a distance of 297.23 feet to an angle point in said common boundary,occupied by a concrete monument;thence South 28°41'46"West, • continuing along said common boundary and said Westerly line,a distance of 16934 feet to the common corner of Lots 6, 8, 12,and 13 of said Plat,occupied by a punch hole in a concrete monument;thence South 27°4376"West, along the common boundary of said Lots 12 and 13,a distance of 27.00 feet to the Southeast corner of the aforesaid Fee Simple Deed parcel described in O.R.Book • EXHIBIT 3 "Servient Estate" 1199,Page 2278,Public Records of Collier County,Florida;thence South 81°59'50"West, along the South line of said Fee Simple Deed parcel, a distance of 145.90 feet to the Southwest corner thereof,said corner lying 5.32 feet West of a PK Nail and disc in a concrete monument;thence North 32°4178"West,along the West line of said Fee Simple Deed parcel,a distance of 62.54 feet to the Northwest corner thereof,said corner lying on the common boiinriary of said Lots 8 and 13 of said Plat and being North 87°28'23"West, 191.00 feet from the aforesaid common corner of said Lots 6, 8, 12 and 13;thence North 45°47'08" West,across water,a distance of 113.90 feet to an iron rod in a concrete monument being the occupied Southwest corner of said Lot 8,said monument lies within water approximately 15 feet from the shoreline of Chokoloskee Bay and is only visible at low tide;thence North 41°037T' East,along the West line of said Lot 8,a distance of 164.48 feet to an angle point in said West line,occupied by a five-eighths(5/8")inch iron rod;thence North 30°5321"East,continuing along said West line a distance of 134.99 feet to the Southeast corner of Lot 1 of said . PARKWAY VILLAGE OF CHOKOLOSKEE ISLAND, a Condominium, occupied by a five-eighths(5/8")in • :- --.-thence North 30°50'29"East, along the Easterly line of Lo L..;_': Cda. .. •ndominium,also being the West line of Lot 8 of said . .t : Li7. - of 2 A.i to an angle point on said line,said angle point o .'-:, .y a five-eighths(5/: ' inc- iron rod;thence North 21°38'29"East, along .e Tak ,.- . . : o aid P-:t an, along the Easterly line of Lots 6,7 and of-aid -on. .. . .1 ..ce of 1,2.18 feet to the Northeast Corner of .t : o . ;.z;MM.-vr, ,. ying on the South right-of-way line of . ai• so a ' a +.-' I , r • . ,. occupied by a one(1")inch iron p".=,in ...-..),.'-'- ..:., : . 841. t7 7: along said South right-of-way line, a . - of 254.48 feet to'l - P I 0:BEGINNING. C1 ctverrveinarcraMtrakhokoloskeeksta-legaLwpd i • 4r. EXHIBIT 3 , "Servient Estate" - McINTURFBOATWAYS PARCEL A portion of Lot 13 of SMALLWOOD'S DIVISION of Section 36,Township 53 South,Range 29 East on Chokoloskee Island,according to the Plat thereof as recorded in Plat Book 1,Page 27 of the Public Records of Collier County,Florida,said portion being contiguous with and South of the Parcel described in Fee Simple Deed recorded in Official Records Book 1199,Page 2278 of the aforesaid Public Records,said portion being one and the same parcel of land delineated and labeled as BOATWAYS on a survey by Horace A.Waison of Waison&Associates,Inc., Naples,Florida dated August 4,1995 with Drawing Number 53-D-6-2,said portion being more particularly described as follows: COti COMMENCE at the East ..= . ... ► . :,,`: . said Section 36, occupied by a railroad spice in asphalt cabrg - . - thence on an as -:•T:• . - '..: of South 89°01'01" West,along the comm.. .• : Lots 7 -'d u o s- Plat,a distance of 706.20 feet to the common come, of • 1 ,-_• 12 o•said Pt:t,o upied by a cut nail in a concrete monument, . At..-"i..., , .4' I-n1jyA:%1 . , common boundary of Lots 6 and 12 of said Plat, •' 1.1; • •• :4 .-tg.Ad.. •,..,..n loraer of Lots 6,8, 12 and 13 of said Plat, occn.' �� :,+.. . .. . .. -, on e- ...••...en en {� � � � t,thence South 27°30'06" West, eon.** common bons. . Lo : 13 of said Plat,a distance of 27.00 feet to the Sou ' ._: orner of the afo ..Wfr. mn. Deed Parcel,occupied by a punch hole in the conc .._• .ument,said corner a: .. :e POINT OF BEGINNING; thence South 28°08'54" .` 1) ..: alon: •.:'Or,.,on boundary of said Lots 12 and 13, a distance of 106.10 -.— I._. IT.Rie ∎'•rtherly boundary of the Smallwood Store parcel as delineated on the . o * :.: ,. ey; thence South 80°51'10"West,along the South boundary of said BOATWAYS parcel,a distance of 89.14 feet to the Southwest corner thereof,occupied by a punch hole in a concrete monument;thence North 00°39'38"West,along the West.boundary of said BOATWAYS parcel,a distance of 87.63 feet to the Northwest corner thereof,occupied by a punchhole in a concrete monument,said corner lying on the South line of said Fee Simple Deed parcel;thence North 81°4610"East,along said South line and along the North line of said BOATWAYS parcel, a distance of 140.51 feet to the POINT OF BEGINNING. Said lands situate, lying and being on Chokoloskee Island, Collier,County,Florida. ch,prm60knriagakbakoloskin tmdm.uf lcgal.wpd • EXHIBIT 4 "Approved Relocated Access Area" • PROPOSED ROADWAY EASEMENT (NEW) COMMENCING AT THE EAST 1/4 CORNER OF SECTION 35, TOWNSHIP 53 SOUTH, RANGE 29 EAST, COWER COUNTY, FLORIDA. THENCE ON AN ASSUMED BEARING OF N 00' 12 14" E, ALONG THE EAST LINE OF SAID SECTION 36, ALSO BEING THE CENTERLINE OF SMALLWOOD DRIVE ((30' ROW) A DISTANCE OF 577.74 FEET TO AN IRON ROD AT THE CENTERLINE OF CHOKOLOSKEE DRIVE (50' ROW); THENCE N 84' 57 50" W ALONG THE CENTERLINE OF SAID CHOKO- LOSKEE DRIVE, A DISTANCE OF 159.01 FEET TOO AN ANGLE POINT IN SAID CENTERUNE OCCUPIED BY A 5/8" BOLT THENCE N 76' 02' 51' W, ALONG SAID CENTERLINE. A DISTANCE OF 408.84 FEET TO AN ANGLE POINT IN SAID CENTERLINE OCCUPIED BY A 5/8" BOLT ON THE COMMON BOUNDARY OF LOTS 8 AND 8 OF SMALLWOODS DIVISION OF SECTION 36 AS RECORDED IN PLAT BOOK 1, PAGE 27 OF THE PUBLIC RECORDS OF COLLIER COUNTY, FLORIDA; THENCE S 2.3' 34' 59" W ALONG SAID COMMON BOUNDARY, A DISTANCE OF 28.55 FEET TO A POINT ON THE SOUTH RIGHT OF WAY LINE OF SAID CHOKOLOSKEE DRIVE, SAID POINT ALSO BEING THE POINT OF BEGINNING OF THE HEREINAFTER DESCRIBED NEW 20 FOOT ROADWAY EASEMENT; THENCE CONTINUE ALONG. SAID COMMON BOUNDARY S 23' 34' 59" W, A DISTANCE OF 284.77 FEET; THENCE S 25' 11' 00" W ALONG SAID COMMON BOUNDARY A DISTANCE OF 297.23 FEET THENCE S 28' 41' 46" W ALONG SAID COMMON BOUNDARY A DISTANCE OF 169 54 FEET; THENCE S 27 43' 26" W ALONG SAID COMMON BOUNDARY A DISTANCE OF 68.45 FEET; THENCE LEAVING SAID COMMON BOUNDARY LINE N 02' 23' 49" E ALONG THE WEST LINE OF THE NEW EASEMENT OVER THE EXISTING ROAD FOR A DISTANCE OF 45.62 FEET (COMMON LINE); THENCE LEAVING THE WEST LINE OF NEW EASEMENT OVER THE EXISTING ROAD N 28" 41' 46" E FOR A DISTANCE OF T75.O1 FEET; THENCE N 26' 11' DO" E FOR A DISTANCE OF 317 99 FEET; THENCE N 23' 34' 59' E FOR A DISTANCE OF 273.36 FEET TO THE SOUTH RIGHT OF WAY LINE OF' SAID CHOKOLOSY.EE DRIVE; THENCE ALONG SAID SOUTH RIGHT OF WAY LINE N 84' 52' 07" E A DISTANCE OF 22 80 FEET TO THE POINT OF BEGINNING THE EASEMENT DESCRIBED HEREIN IS FOR THE EXPRESS PURPOSE OF INGRESS AND EGRESS AND FOR CONSTRUCTION OF A 16 FOOT WIDE ACCESS ROAD • 1 EXHIBIT 2 Covenant and Exclusive Easement To Permit Continuation of Encroachment FOR OFFICIAL USE ONLY COVENANT AND EXCLUSIVE EASEMENT TO PERMIT CONTINUATION OF ENCROACHMENT For valuable consideration, receipt of which is acknowledged, and by reason of a Settlement Agreement of even date between Florida Georgia Grove, LLP, a Florida limited liability company ("Florida Georgia"), and TD Bank, N.A. a national banking association, on the one hand, and Ted Smallwood Store, Inc., a Florida non-profit corporation ("TSS") and Collier County, a political subdivision of the State of Florida ("Collier County") on the other hand, Florida Georgia makes and enters into this covenant for the benefit of TSS and its successors and assigns. Florida Georgia recognizes and acknowledges that a small portion of the building owned by TSS that is located on,lands owned by TSS as described in Exhibit 1 (the "TSS Land") encroaches over the common property line with land owned by Florida Georgia, as described on Exhibit 2(the "FG Land"). The building that is referred to is the"Ted Smallwood Store" which Florida Georgia acknowledges has existed in its present location for almost 100 years. Florida Georgia covenants and agrees that the encroachment of the building may remain and continue to exist for so long as the "Ted Smallwood Store" building exists and remains, including but not limited to,by reason of its reconstruction if it is damaged or destroyed by fire, hurricane, or other calamity. Florida Georgia hereby grants, bargains, sells, and conveys an exclusive easement to TSS over the physical area of the.FG Land that is occupied by the Ted Smallwood Store building. This easement is appurtenant to the TSS land as the dominant estate and shall pass with title to it. TSS has the right and an easement to also go on the FG Land as needed to maintain and repair the Ted Smallwood Store building. Nothing herein affords TSS any basis to claim fee title to any portion of the FG Land. This Covenant and Easement encumbers and burdens the FG Land, as the servient estate, and the building on it, and Florida Georgia and its representatives, successors, and assigns, and inures to the benefit of TSS and its representatives and assigns, and the respective successor and future owners of the TSS Land and FG Land. Executed this day of , 2013. Witnesses: Florida Georgia Grove,LLP Witness#1 By: Printed name of witness#1 as its Managing Partner Witness#2 Printed name of Witness#2 STATE OF FLORIDA ) §§: COUNTY OF ) I HEREBY CERTIFY that the foregoing instrument was acknowledged before me this _day of , 2013,by , as the Managing Partner of Florida Georgia Grove, LLP, a Florida limited liability partnership, who is personally known to me or who produced as identification. (SEAL) Notary Public-State of Florida Printed Name of Notary My Commission Expires: Page 2 of 4 SUBORDINATION TD Bank, N.A., a national banking association, the owner and holder of mortgages and assignments recorded in the following Official Records Books of the Collier County Public Records: 3693, at page 566; 4356, at page 2688; 4340, at page 2958; 4626, at page 600; and 4626, at page 602, as well as by virtue of any other lien, encumbrance, or interest it may have or claim on or in the FG Land as the Servient Estate, as described in the Covenant and Easement to Permit Continuation of Encroachment (Covenant and Easement) to which this Subordination is attached,hereby acknowledge and agrees that the rights conferred on Ted Smallwood Store,Inc. by virtue of the Covenant and Easement are superior to all rights of TD Bank, N.A. under the forgoing instruments, and to any other rights as it may otherwise claim to exist in the Servient Estate and such rights of TD Bank,N.A. are hereby subordinated to the Covenant and Easement. Executed this day of ,2013. Witnesses: TD Bank,N.A. Witness#1 By: Printed name ofwitness#1 ,Vice President Witness#2 Printed name of Witness#2 STATE OF FLORIDA ) §§: COUNTY OF ) I HEREBY CERTIFY that the foregoing instrument was acknowledged before me this _ day of , 2013, by , as Vice President of TD Bank, N.A., a national banking association, who is personally known to me or who produced as identification. (SEAL) Notary Public-State of Florida Printed Name of Notary My Commission Expires: Page 3 of 4 ACCEPTANCE Ted Smallwood Store,Inc.hereby accepts and agrees to the forgoing Covenant and Exclusive Easement to Permit Continuation of Encroachment on the terms and conditions granted. Ted Smallwood Store,Inc. By: Lynn McMillin,Executive Director STATE OF FLORIDA ) §§: COUNTY OF ) I HEREBY CERTIFY that the foregoing instrument was acknowledged before me this day of , 2013, by Lynn McMillin as Executive Director of Ted Smallwood Store, Inc., a Florida not for profit corporation, who is personally known to me or who produced as identification. (SEAL) Notary Public-State of Florida Printed Name of Notary My Commission Expires: Page 4 of 4 • EXHIBIT 1 "TSS Land" Lot 12 and a portion of Lot 13, Smallwood's Division according to the plat thereof as recorded in Plat Book 1 at Page 27, of the Public Records of Collier County, Florida, which said lot and portion of said lot is more particularly bounded and described as follows, Commencing at the Bast 1/4 Corner of Section 36, Township 53 South, Range 29 East, Chokoloskee, Collier County, . Florida, Run 8. 89'0x'01• N. 706.17 Deft on the Line . Dividing Lots 7 and 11 of Smallwood'■ Division of Section 36, Township 53 South, 29 Bast, as filed and recorded in Plat :•. 27,' of the Public Records of Collie � � -07 '1kt - to the Original Monument, Common 7 -f-ts 6, 7, - d 12, and to rhil • = Thence B. 89'2 '2. N. 194.83 Feet - tt , • to the Origin K. • • o Lo s 8, 12 and 13; Thence 8. 27' - I - • : -t; T` a 3. 28'08'37• • W. 181.84 Feet, „zit). 5 Feet 1 Thence 8. 30"42'24* . ' 1'581 3. 39.02 Feet; Thence 8. ti Thence N. 20'47'218 E. - • 'T •l -_ • t 1 , • . Together with t”, iparian rig - - •� ` oloskee Bay. G • • L . _ _ . _ EXHIBIT 1 "TSS Land" Commencing at the east quarter corner of Section 36, Township 53 south, Range 29 east, Chokoloskee, Collier County, Florida , ran south 89-12-54 west on the line dividing lot 7 and 11 of Smallwood's division of Section 36, Township 53 south,Range 29 east as filed and recorded in Plat Book 1 at page 27 of the Public Records of Collier County, Florida, for 707.27 feet to the original monument common to lot 6, 7, 11, and 12,thence south 89-12-24 west for 195.20 feet to the original monument, common to lots 6, 8, 12, and 13, thence south 28-27-54 west on the line dividing lot 12 and 13 for 127 feet to a concrete monument, THE POINT OF BEGINNING: continue south 28-27-54 west for 56.51 feet to a concrete monument, thence south 66-26-39 west, 5 feet south from the south building foundation,for 103.35 feet to a point on a seawall,thence north 23-33-21 west for 52.5 feet to a point on a seawall,thence north 66-26-39 east for 80 feet to a concrete monument,thence north 83-47-54 east for 55.50 feet to THE POINT OF BEGINNING. Together with all riparian rights to Chokoloskee Bay. As per deed in.Official Records Book 1157 at page 420 of the Public Records of Collier County,Florida. Also described below: • • SMALLW00D'S STORE PARCEL A PORTION OF LOT 13 OF SMALLWOODS DMSION OF SECTION 36, TOWN SHIP 53 SOUTH, RANGE 29 EAST ON CHOKOLOSKEE ISLAND, ACCORDING TO THE PLAT THEREOF AS RECORDED IN PLAT BOOK 1, PAGE 27 OF THE PUBLIC RECORDS OF COWER COUNTY, FLORIDA, BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS: COMMENCING AT THE EAST 1/4 CORNER OF SAID SECTION 36, TOWNSHIP 53 SOUTH. RANGE 29 EAST COLLIER COUNTY, FLORIDA RUN 5 89' 01' 01" W FOR 706.20 FEET ALONG THE UNE DMDING LOTS EAST, AND 11 OF SMALLWOODS DIVISION TO THE ORIGINAL MONUMENT AT 'THE COMMON CORNER OF LOTS 6,7,11 AND 12; THENCE RUN S 89' 21' 26" W FOR 194.83 FEET TO THE ORIGINAL MONUMENT AT THE COMMON CORNER OF LOTS 6,8,12 AND 13; THENCE S"27 43' 26" W FOR 27.00 FEET TO THE ORIGINAL MONUMENT ALONG THE UNE DMDING LOTS 12 AND 13 S 28 08' W FOR 106 10 FEET TO AN IRON PIN AND CAP, LYING 27.8 FEET EAST OF AN ORIGINAL MONUMENT AND 89.16 F t_i EAST OF AN ORIGINAL MONUMENT. SAID PIN BEING THE POINT OF BEGINNING OF THE HEREINAFTER DESCRIBED PARCEL OF LAND; THENCE CONTINUE S 28' 08' 37" W FOR 75.74 FEET TO AN ORIGINAL MONUMENT THENCE RUN S 63' 33' 14" W FOR 60.55 FEET TO A DRILL HOLE IN CONCRETE 0.5 MORE OR LESS EAST OF CONCRETE SEAWALL; THENCE RUN N 30' 42' 24" W FOR 60.00 FEET ALONG SAID SEAWALL TO A DRILL HOLE IN THE TOP OF SAID CONCRETE SEAWALL: THENCE LEAVING SAID CONCRETE SEAWALL RUN N 49' 12' 57' E FOR 42.89 FEET TO AN ORIGINAL THIS DESCRIPTITIONCWAS PRODUCED2FROM E FIELD6SURVEY AND RECOVERED CORNERS AS REFERENCED ON A SURVEY DONE BY HORACE A. WILKISON AND ASSOCIATES, INC., NAPLES, FLORIDA. DATED AUGUST 4, 1995 WITH DRAWING NUMBER 53-D-6-2. TOGETHER, WITH ALL RIPARIAN RIGF{TS TO CHOKOLOSKEE BAY. PARCEL PER OFFICIAL RECORD BOOK 2236, PAGE 1843. LOT 12 AND A PORTION OF LOT 13, SMALLWOOD'S DMSION ACCORDING TO THE PLAT THEREOF AS RECORDED • IN PLAT BOOK 1 AT PAGE 27, OF THE PUBLIC RECORDS OF COWER COUNTY, FLORIDA, WHICH SAID LOT AND PORTION OF SAID LOT IS MORE PARTICULARLY DESCRIBED AS FOLLOWS: COMMENCING AT THE EAST 1/4 CORNER OF SAID SECTION 36, TOWNSHIP 53 SOUTH. RANGE 29 EAST, CHOKOLOSKEE COLUER COUNTY, FLORIDA RUN S 89' 01' 01" W FOR 706.17 FEET ALONG THE UNE DMDING LOTS 7 AND 11 OF SMALLWOODS DMSION OF SECTION 36, TOWNSHIP 53 SOUTH, RANGE 29 EAST AS FILED AND RECORDED IN PLAT BOOK 1 AT PAGE 27, OF THE PUBLIC RECORDS OF COLLIER COUNTY, FLORIDA TO THE ORIGINAL MONUMENT, COMMON TO LOTS 6,7,11 AND 12, AND TO THE POINT OF BEGINNING; THENCE S 89' 21' 26' W 194.83 FEET TO THE ORIGINAL MONUMENT COMMON TO LOTS 558,12 AND 13; THENCE S 27 38' .35" W 27.00 FEET; THENCE S 28' 08' 37' W 181.84 FEET; THENCE S 63' 33 14" W 60.55 FEET; THENCE S 3O%D 42' 24" E 16.70 FEET; THENCE N 64' 31' 58'E 59.02 FEET; THENCE S 39' 25' 45" E 224.74 FEET; THENCE N 20' 47' 21" E 402..12 Fttl TO THE POINT OF BEGINNING. TOGETHER WITH ALL RIPARIAN RIGHTS TO CHOKOLOSKEE BAY. - i ' EXHIBIT 2 . "FG Land" S.T.O.F.PARCEL A portion of the South one-half(S 1/2)of Lot 8,together with a portion of Lot 13 of SMALLWOOD'S DIVISION of Section 36,Township 53 South,Range 29 Faet on Chokoloskee Island, according to the Plat thereof as recorded in Plat Book 1,Page 27 of the Public Records of Collier County,Florida,said portions lying South of the right-of-way of CHOKOLOSKEE DRIVE(50'ROW)and including all of that certain Parcel of Iand described in Fee Simple Deed recorded in o_ .Book 1199,Page 2278 of the aforesaid Public Records,said portions also being contiguous with and East of the Facterly boundary of PARKWAY VILLAGE OF CHOKOLOSKEE ISLAND,a Condominium recorded in Condominium Plat Book 39,Page 31, Public Records of Collier County,Florida,and - . being contiguous with and West of those— Parcels described in O.R.Book 997 -��'_ . 1, _: and Pages 1943 and 1944,of the Public Records of Collier County, 'r-s .��-r ,VE PORTIONS being more particularly described as follow . j� COMMENCE at the = . t sue r /4)Tier of -'d ection 36;thence on an assumed bearing• NP-.•is:�' :--- _U,; ;i7;,. ne of said Section 36 also being the ce., r 1'e • i'�' ,.(�,,ni I ( 0' "-OW),a distance of 577.74 feet to an iro. (od = ; IE._ . rte` KO f-o. 41:, 1RIVE(50'ROW); thence North 84°57' I ` est,along the cen e o a. • 'OKOLOSKEE . DRIVE,a distance of b feet to an angle .- : ifn d) Interline occupied by a five-eighths(5/8 )in ■ .. thence North 76"S �W..t,along said centerline,a distance of' I:Q. i.: to an arigl s•.-as said centerline occupied by a five-eighths (518")inch •: killE .. .0.. .,dary of Lots 6 and 8 of said Plat; thence South 23°34'59"West, ..•._ .:. common boundary a distance of 2855 feet to a point on the South right of-way line of said CHOKOLOSKEE DRIVE,said point also being the POINT OF BEGINNING;thence continue South 23°34'59"West along said common boundary and along the Westerly line of those certain parcels described in O.R.Book 997,Pages 1927, 1928, 1943 and 1944,Public Records of Collier County,Florida,a.distance of 284.77 feet to an angle point in said common boundary,occupied by a concrete monument;thence South 26°11'00"West,along said common boundary and along the Westerly line of said Parcels,a distance of 297.23 feet to an angle point in said common boundary,occupied by a concrete monument;thence South 28M1'46"West, continuing along said common boundary and said Westerly line,a distance of 169.54 feet to the common corner of Lots 6,8, 12, and 13 of said Plat,occupied by a punch hole in a concrete monument;thence South 27°4376"West,along the common boundary of said Lots 12 and 13,a distance of 27.00 feet to the Southeast corner of the aforesaid Fee Simple Deed parcel described in O.R Book • EXHIBIT 2 "FG Land" 1199,Page 2278,Public Records of Collier County,Florida,thence South 81°59'50"West, along the South line of said Fee Simple Deed parcel,a distance of 145.90 feet to the Southwest corner thereof,said corner lying 5.32 feet West of a PK Nail and disc in a concrete monument;thence North 32°4178"West, along • the West line of said Fee Simple Deed parcel,a distance of 62.54 feet to the Northwest corner thereof,said corner lying on the common boundary of said Lots 8 and 13 of said Plat and being North 87°2873"West, 191.00 feet from the aforesaid common corner of said Lots 6, 8, 12 and 13;thence North 45°47'08" West, across watPs,a distance of 113.90 feet to an iron rod in a concrete monijmr_nt being the occupied Southwest corner of said Lot 8,said monument lies within water approximately 15 feet from the shoreline of Chokoloskee Bay and is only visible at low tide;thence North 41°0377"East,along the West line of said Lot 8, a distance of 164.48 feet to an angle point in said West line,occupied by a five-eighths(5/8")inch iron rod;thence North 30°5371"East,continuing along cAid West line a distance of 134.99 feet to the Southeast corner of Lot 1 of said PARKWAY VILLAGE OF CHOKOLOSKEE ISLAND, a Condominium, occupied by a five-eighths(518")in • : :: --.•thence North 30°5079"East, along the Fasterly line of Lo •,`,•_- . :a.,,.. ...ndominium,also being the West line of Lot 8 of said . .•• _.1. ... of ;. et to an angle point on said lint, said ang]r.point o..- .:.4 .y a five-eighths(5/: inc- iron rod;thence North 21°3829"East,along . W, . . . : o aid P+: .•• along the Easterly line of Lots 6,7 and : of.aid 0's , ,-.. . .I ce f 1 2.18 feet to the Northeast Corner of t : Dili,: .;...N� iT .w. i. ` g on the South right-of-way line of . . .Male II r 4A rim occupied by a one(1")inch iron p-•Cm -....•)&,A1- -•.,. : • 84- t7 t, along said South right-of-way line, a • 1,T, of 254.48 feet to - P 1 '6: BEGINNING. `' 0� EC ekwpwin60....htgakhoka.stee\go .,0_,,Pd • EXHIBIT 2 . , "FG Land" McINTURFIBOATWAYS PARCEL A portion of Lot 13 of SMALLWOOD'S DIVISION of Section 36,Township 53 South,Range 29 East on Chokoloskee Wm.],according to the Plat thereof as recorded in Plat Book 1,Page 27 of the Public Records of Collier County,Florida,said portion being contiguous with and South of the Parcel described in Fee Simple Deed recorded in Official Records Book 1199,Page 2278 of the aforesaid Public Records,said portion being one and the same parcel of land delineated and labeled as BOATWAYS on a survey by Horace A.Will dson of Wllkison&Associates,Inc., Naples,Florida dated August 4,1995 with Drawing Number 53-D-6-2,said portion being more particularly described as follows: eO COM/vIENCE at the East : • o:.rr� r • ', - • said Section 36,occupied by a railroad spike in asphalt s ao..,- . -thence on an - _.:.T . a - i._ of South 89°01'01" West,along the cot•.... .. : Lots 7 ..• 11 o s-'• Plat, a distance of 70620 feet to the common co•1 • of .•. , ,jand 12 o• aid P t,o. tied by a cut nail in a concrete monument, . . `'r,.? , :? 1:s+ � •:. .:common bonnriary of Lots 6 and 12 of said Plat, .tT. ••• ■ ."r�A.IM en•Omer of Lots 6,8, 12 and � fig. i ■r 13 of said Plat, occns 'i` .:,.• Lail . , .... ..h 9..T. at thence South 27°30'06" West, aloni. h. common bound- • Lo 12':I. 13 of said Plat,a distance of 27.00 feet to the So ■ -: .rner of the afori.i ^: .I.,: - Deed Parcel,occupied by a punch hole in the co• - s.:. .....ern,said corner r „: : POINT OF BEGINNING; thence South 28°08'54" " 43 _.:.,r t:,. alo._ :. ...,on boundary of said Lots 12 and 13, a distance of 106.10 - E}2P i. o.rtherly boundary of the Smallwood Store parcel as delineated on the • o �',aey;thence South 80°51'10"West, along the South boundary of said BOATWAYS parcel,a distance of 89.14 feet to the Southwest corner thereof,occupied by a punch hole in a concrete monument;thence North 00°39'38"West, along the West.boundary of said BOATWAYS parcel,a distance of 87.63 feet to the Northwest corner thereof,occupied by a punchhole in a concrete monument,said corner lying on the South line of said Fee Simple Deed parcel;thence North 81°4630"East,along said South line and along the North line of said BOATWAYS parcel, a distance of 140.51 feet to the POINT OF BEGINNING. Said lands situate, lying and being on.Chokoloskee Icland, Collier,County,Florida EDIT 3 Stipulation to Vacate Temporary Injunction, Quash Contempt Order,and to Dismiss with Prejudice • IN THE CIRCUIT COURT OF THE TWENTIETH JUDICIAL CIRCUIT IN AND FOR COLLIER COUNTY, FLORIDA COLLIER COUNTY, a political subdivision of the State of Florida, and TED SMALLWOOD'S STORE, INC., a Florida non-profit corporation, Plaintiffs, v. Case No. 2011 CA 001640 FLORIDA GEORGIA GROVE, LLP, a Florida limited liability partnership, and T.D. BANK, N.A., a national bank, Defendants. STIPULATION TO VACATE TEMPORARY INJUNCTION, QUASH CONTEMPT ORDER, AND TO DISMISS WITH PREJUDICE THE PARTIES, by and through their undersigned counsel, hereby stipulate as follows: 1. The Plaintiffs and Defendant have entered into a Settlement Agreement dated , 2013, which is attached hereto as Exhibit 1 and incorporated herein by reference. 2. The Court shall vacate the Temporary Injunction dated October 20, 2011. The injunction bond provided by Plaintiff, Ted Smallwood's Store, Inc., shall be released from the Court Registry and returned to Ted Smallwood's Store, Inc. by the Clerk. 3. The Court shall quash the Contempt Order dated January 10, 2012, as well as any and all Orders Modifying Order Adjudging Contempt. 4. This action, and all claims by and among the parties, shall be dismissed with prejudice, each party to bear its own costs and attorneys fees. GFP 2/11/13 • 5. The parties agree that the Court shall enter the Order attached hereto as Exhibit 2. 6. This Stipulation may be executed in one or more counterparts, each of which shall be deemed an original, but all of which shall together constitute one agreement among the parties. SHUMAKER, LOOP & KENDRICK, LLP GRANT FRIDKIN PEARSON, P.A. 240 S. Pineapple Avenue 5551 Ridgewood Dr Ste 501 Sarasota, FL 34236 Naples, FL 34108 (941) 364-2708 (230) 514-1000 Steven J. Chase, Esq. Richard C. Grant, Esq. Fla. Bar No.: 210277 Fla. Bar No.: 0156041 Hunter G. Norton, Esq. Fla. Bar No.: 30534 COLLIER COUNTY ATTORNEY'S PETERSON & MYERS, P.A. OFFICE PO Box 24628 3301 Tamiami Trl E Lakeland, FL 33802 Naples, FL 341124961 (863) 683-6511 (239) 252-8400 Steven T. Williams, Esq. E. Blake Paul, Esq. Fla Bar No.: 740101 Fla. Bar No.: 86118 W. JAMES KELLY, P.A. 144 East Center Avenue Sebring, FL 33870-3501 (863) 471-9662 W. James Kelly, Esq. Fla. Bar No.: 192963 A , EXIIIBIT 4 Agreed Order Vacating Temporary Injunction, Quashing Contempt Order,and Dismissing the Case with Prejudice V w IN THE CIRCUIT COURT OF THE TWENTIETH JUDICIAL CIRCUIT IN AND FOR COLLIER COUNTY, FLORIDA COLLIER COUNTY, a political subdivision of the State of Florida, and TED SMALLWOOD'S STORE, INC., a Florida non-profit corporation, Plaintiffs, v. Case No. 2011 CA 001640 FLORIDA GEORGIA GROVE, LLP, a Florida limited liability partnership, and T.D. BANK, N.A., a national bank, Defendants. AGREED ORDER VACATING TEMPORARY INJUNCTION, QUASHING CONTEMPT ORDER AND DISMISSING THE CASE WITH PREJUDICE Upon Stipulation of the parties, IT IS ORDERED that 1. The Stipulation to Vacate Temporary Injunction, Quash Contempt Order, and Dismiss with Prejudice is approved and is adopted as the Order of this Court. 2. The Temporary Injunction dated October 20, 2011 is vacated. The Clerk is directed to release and return the injunction bond provided by Plaintiff, Ted Smallwood's Store, Inc., from the Court Registry to Ted Smallwood's Store, Inc. Payment shall be then made to Grant Fridkin Pearson, P.A. trust account, as counsel to Ted Smallwood Store, Inc. 3. The Contempt Order dated January 10, 2012, as well as any and all Orders Modifying Order Adjudging Contempt, are hereby quashed. 4. This action is hereby dismissed with prejudice, each party to bear their own costs and attorneys fees. DONE AND ORDERED in Chambers, Collier County, Naples, Florida on this day of 2013. HONORABLE LAUREN L. BRODIE Circuit Judge Conformed Copies to: Richard C. Grant, Esq. Steven J. Chase, Esq. E. Blake Paul, Esq. W. James Kelly, Esq.