267-97 RDA Incomplete
I
RESOLUTION NO.
A RESOLUTION OF THE CHAIRMAN AND MEMBERs OF THE MlAMr
BEACHREDEVELOPl\1ENT AGENCY (THE "AGEN~ AUTHORIZING
THEAGENey TO ACQUIRE THE SHORE CREST HOTEL LEASEHOLD
INTEREST; AUIlIORIZING THE AGENCY TO PAY$3J. MILLION FOR
SUCH ACQUISmoN; AUTHORIZING TBE CHAI:Rl\1::ANAND SECRETARY
TO.EXEcUl:E THE SIIORECREST OPTION AGREEMENT AITACBED
HERETO.~ INCORPORATED~; AND AUTHoRIZING THE
TAKlNG OF:ALLINCIDENTAL ACITONS; BUT ALL OFTHE ABOVE
SUBJECrrO'TElEPRIORAPPRQV AL OF THE EXECUTIVE DIREcrOR
. AND GENERAL COUNSEL OF THE AGENCY.
267-97
"WlIEREAS. on March 5" 1997" the Miami Beach Redevelopment Agency (the
"Agency")" the CityofJ.\.fiamiBeach (the."'CityJ7 RDP Royal Palm Hotel Limited
Company ("RDJ?") and RDP Shorecrest Hotel Limited Company entered into that certain.
. .
Letter offutent (the .~OY'). which sets fo:tth" among other things. the general teno.s of
proposed definitive agreements concernmg the development and operation of an
African-AmericanOVJIted convention hOlel (the "Hotel") on the Royal Palm Hotel
property. which. is 'o""Ded by the Agency. and the Shorecrest Hotel property. which is to
be owned by theAgency; and
WHEREAS" the LOr contemplates that the Agency will become the owner o~
among other P~Perty. the leasehold interest pertaining to the Shorecrest Hotel property
(the "Leaseholdj; and .
WHEREAS, the LOr :further contemplates that the Agency will acquire the
Leasehold by 'virtue. of the assignment from RDP or an affiliated entity to the Agency of a
purchase ~ 'sale agreement pertaining to the Leasehold and the conslIID.ImItion of that
agreeme:o.tbetween the Agency. as purchaser; ,and the seller; and
WlIEREAs~ the agreement to purchase the Leasehold provides for a closing on
Or before March 3171997 and there are no regularly scheduled Agency Board meetings in
March after the M~ 19 meeting; and
WHEREAS~ there are various conclit:ions to the closing on the acquisition of the
Leasehold which must be met by the seller; and
WHEREAs, the Agency and RDP have negotiated the teJ:I:r:1S of that certain
Sho:rec.rest Option Agreemen~ attached hereto and incorporated herein; and
WHEREAS" the acquisition of the Leasehold and the development of the hotel
are parts of and are consistent with the City Center Historic Convention Village
j
"
Redevelopment and Revif~ f17;>tion Pian and will eliminate slum and blight in the City
Center Historic Convention Village Redevelopment and Revitalization Area; and
WHREAS, the acquisition of the Leasehold and the development of the Hotel are
necessary, are public purposes and will benefit the public by, among other things,
increasing the number of convention quality hotel rooms in the City, assisting the City in
attracting conventions and increasing the utilization of the Convention Center, increasing
tourism. and improving the economy; and
WHEREAS, the acquisition of the Leasehold and the development of the Hotel
are authorized by Chapter 163 of the Florida Statutes.
NOW, THEREFORE, BE IT nUL Y RESOLVED BY THE ClIAIRMAN
AND MEMBERS OF THE MIAMI BEACH REDEVELOPMENT AGENCY as
follows:
1. Subject to the ExecUtive Director and General Counsel of the Agency being
satisfied that all preconditions to the closing on the acquisition of the Leasehold have
been met by the seller:
a The Agency is authorized to acquire the Leasehold..
b. The Agency is authorized to expend up to $3.1 million for the
acquisition of the LeaseholcL
c. The Agency is authorized to take an assignment ofRDP's agreement to
purchase the Leasehold.
d.. The Chairman and Secretary are authorized to execute the Shorecrest
Option Agreement attached hereto and incorporated herein.
2. The Executive Director and General Counsel of the Agency, and their
respective staffs and consultants, are authorized to take all other incidentaL actions in
connection with this resolution.
3. The Chairman. and Members hereby find that the acquisition of the Leasehold
and the development of the Hotel are necessary, are public purposes, '\Nill benefit the
public, and are parts of and are consistent with the City Center Historic Convention
Village Redevelopment and Revitafi'l-"ttion Plan.
4. The Chairman and Members hereby find that the acquisition of the Leasehold
and the development of the Hotel are authorized by Chapter 163, Florida Statutes.
5. Ibis resolution sbaII take effect immediately upon adoption.
PASSED AND ADOPTED this 19th
day of March, 1997.
CHAIRMAN
ATTEST:
Robd' fOA~
SECRETARY
APPROVED ItS TO
FORM & LANGUAGE
& FOR EXECUnON
~
Miami Beach
Redevelopment Agency
1700 Convention Center Drive
Miami Beach, Florida 33139
Telephone: (305) 673-7193
Fax: (305) 673-7772
DATE:
TO:
FROM:
SUBJECT:
REDEVELOPMENT AGENCY MEMORANDUM NO. 97-9
March 19, 1997
Chair.man and Members of the Board
of the Miami Beach Redevelopment Agency
Jose G~rCia~pedrosa. ,.Jl. /;~,
Execut~ve D~rector .If
A RESOLUTION OF T~ CHAIRMAN AND MEMBERS OF THE MIAMI
BEACH REDEVELOPMENT AGENCY (THE"AGENCY") AUTHORIZING THE
AGENCY TO ACQUIRE THE SHORE CREST HOTEL LEASEHOLD
INTEREST; AUTHORIZING THE AGENCY TO PAY $3.1 MILLION FOR
SUCH ACQUISITION; AUTHORIZING THE CHAIRMAN AND SECRETARY
TO EXECUTE THE SHORE CREST OPTION AGREEMENT ATTACHED
HERETO AND INCORPORATED HEREIN; AND AUTHORIZING THE
TAKING OF ALL INCIDENTAL ACTIONS; BUT ALL OF THE ABOVE
SUBJECT TO THE PRIOR APPROVAL OF THE EXECUTIVE DIRECTOR
AND GENERAL COUNSEL OF THE AGENCY.
ADMINISTRATION RECOMMENDATION:
Approve the Resolution.
BACKGROUND
On March 5, 1997, the Miami Beach Redevelopment Agency (the
"Agency"), the City of Miami Beach (the "City"), RDP Royal Palm
Hotel Limited Company ("RDP") and RDP Shorecrest Hotel Limited
Company executed a Letter of Intent ( "LOI") pertaining to the
development and operation of the Royal Palm Crowne Plaza Resort, an
African-American owned convention center hotel in Miami Beach.
Under the terms of the LOI, the Agency's total funding obligation
towards the project is $10 Million, of which $5.5 Million has been
spent to acquire the fee title to the Royal Palm property. The
remaining $4.5 Million will be used to acquire the Shorecrest Hotel
property and the leasehold interest pertaining to the Shorecrest.
5
SUUTIl VUI~r:
l2edevel()pment I)lstrict
Clff CI:~TI:I2
l2edevel()pment l)istJict
RESOLDnON NO_
A RESOLUlTON OF THE CHA..l:&."\fAJ.'V AND ME."IBERs OF THE MlA.Mr
BEACH REDEVELOPME~iT AGENCY (THE "AGENCY") AUTHORIZING
THE AGENcY TO ACQUll.U: THE SHORECREST HOTEL LEASEHOLD
lNTEREST; AUTRORlZl1'iG THE AGENCY TO PAY$3-1 MILLION FOR
SUCH ACQUISlTIoN; AUTHORIZING TIIE CHAIR.i\1:AN" A!'l"D SECRETARY
TO,EXEclJ J.E THE SB:ORECREST OPTION AG:REEl\1:ENr ATTACHED
HERETO'M"D INCORPORATED lIEREIN; AND ADTf..f:ORIZl:N"G TIrE
TAKING OF ALLINCID~TAL ACITONS; BUT ALL OF THE ABOVE
SUBJEcTTO'THE PRIORAPPROV AL OF THE EXEctJTIVE DIRECTOR
AND GEJ.'IfERAL COUNSEL OF THE AGENcy.
WlIEREAs. on. March 5" 1997, the Miami Beach Redevelopment Agency (the
~AgencY"J, the City of Miami Beach (the ,~ityj. RDP ROYal Palm Hotel Limited
Company ("R,DP") and RDP Shorecrest Hotel Limited Company entered into that certain
Letter ofID.tent. (the ....LOl). which sets forth,. among other things. the general. tenus of
proposed definitive agreements concerning the development and operation of an
Afric::an.-Americ:an owned convention hotel (the "Hotel") on the Royal Palm Hotel
property, which. is . owned by the Agency. and the Shorecresr Hotel property. which is to
be owned by theA.:."oency; and
'WHEREAS, the LOr contemplates that the Agency will become the owner oJ;
amongoth~ property. the leasehold interest Pertaining to the Sho~ Hotel property
(the~ehold); and '
WB'EREAs, the LOI :further contemplates that the Agency VlJ.l1 acquire the
Leasehold by'virtneof the ~ from RD1' or au afliliamd eatityto the Agency of a
purchase andsaIe agreement Pertaining to the Leasehold and the CODStIl:IlInm:ion of that
agreement 'between the Agency, as purchaser; ,and the seller; and
WB'EREAs. the agreement to purchase the Leasehold provides for a closing. on
or befure Marclt 31, .1997 and there are no Tegw",-Iy schednled Ageocy Board meetings in
March after the March 19 meeting; and
W'HEREAs~ there are various conditions to the closing on the acquisition. of the
Leasehold which must be met by the seller; and
W'HEREAs, the Agency and RDP have negotiated the teDllS of that certain
Shorecrest Option Agreement. attached. hereto and mcoIporated herein; and
\VB:ERE.As. the acquisition of the Leasehold and the development of the hotel
are parts of and are consistem 'With the City Center Historic Convention Village
~'l
4. The Chairman and Members hereby find that the acquisition of the Leasehold
and the development of the Hotel are author...zed by Chapter 163, Florida Stal:utes.
5. Ibis resolution shall take effect immediately upon adoption..
P_<\SSED AND ADOPTED this
day of March. 1997.
CHAJRJ.'-1AN
A 1lEST:
SECRETARY
APPROVED AS TO
FORM & LANGUAGe
& FOR EXeCUnON
~
9'
SHORECRESTOPTIONAGREEMENT
This Shore crest Option Agreement is made and entered into as of the _ day
of ,1997, by and among RDP ROYAL PALM HOTEL LIMITED COMPANY,
a Florida limited liability company ("RP"); and the MIAMI BEACH
REDEVELOPMENT AGENCY, a Florida public body corporate and politic ("Agency").
BACKGROUND
1. In February 1993, the City CenterlHistoric Convention Village
Redevelopment and Revitalization Area in Miami Beach, Florida, was officially
established by the adoption of a Redevelopment Plan (the "Redevelopment Plan"). The
Redevelopment Plan represents the effort and commitment of the Agency to foster the
development of convention quality hotels, ancillary improvements and facilities, and
necessary linkages to the Miami Beach Convention Center. Pursuant to the
Redevelopment Plan, the Agency has acquired the Royal Palm Hotel (the "Royal Palm
Hotel Property") located at 1545 Collins Avenue, Miami Beach, Florida.
2. The Agency has decided to provide the Mrican-American community with
an opportunity in the hospitality industry by making available the Royal Palm Hotel
and additional financial incentives for an Mrican-American owned hotel (the "Hotel").
3. In furtherance of the Redevelopment Plan, the Agency published Request
for Proposals No. 45-9596 (the "RFP") seeking bids for the development and operation
of a convention hotel to be owned by African-Americans.
4. On June 5, 1996, after a public review process, the Agency selected RP
from among the groups which submitted responses to the RFP and directed
representatives of the Agency to negotiate the terms under which RP would develop,
own and operate the convention hotel in accordance with the requirements of the RFP.
5. As part of RP's response to the RFP, RP offered to cause the property
lying immediately to the south of the Royal Palm Hotel Property commonly known as
the Shorecrest Hotel (the "Shorecrest Hotel Property") having a street address of 1535
Collins Avenue, Miami Beach, Florida, to be developed as part of the Hotel. An affiliate
of RP entered into contracts to acquire the fee title, and the ground lessor and ground
lessee interests in the Shore crest Hotel Property.
6. The Agency has offered financial incentives to RP in connection with the
development of the Hotel. A portion of the Agency's funding towards the development
of the Hotel was used to acquire the fee title to the Royal Palm Hotel Property, which
property is to be leased on a long term basis pursuant to a ground lease (the "Ground
Lease") to RP. The cost of acquiring the Royal Palm Hotel Property by the Agency was
approximately $5.5 million.
7. Since June 5, 1996, RP and the Agency have been involved in extensive
negotiations to structure agreements whereby the Hotel would be developed by RP.
During the course of those negotiations, it became apparent to all parties that it is in
the best interest of the Agency that the Agency acquire the fee title and leasehold
interests in the Shore crest Hotel Property, terminate the existing ground lease (the
"Existing Ground Lease") on said property, and lease the Shorecrest Hotel Property to
RP as part of the Ground Lease. The General Counsel of the Agency has determined
that the acquisition of the interests in the Shore crest Hotel Property and the leasing
2
of the Shore crest Hotel Property to RP as part of the Ground Lease is not a material
modification of RP's bid in response to the RFP.
8. Simultaneous with the execution of this Agreement, RP has caused to be
assigned to the Agency all of its right, title and interest in the agreement described in
Exhibit A attached hereto and made a part hereof (the "Leasehold Contract"), which
agreement is the purchase and sale agreement relating to the acquisition of the
leasehold interest (the "Leasehold Interest") under the Existing Ground Lease, and the
Agency has closed on the transaction contemplated by said Leasehold Contract and has
acquired the Leasehold Interest.
9. Litigation is pending relating to the agreement (the "Fee Contract")
described in Exhibit "B" attached hereto and made a part hereof concerning the
acquisition of the fee title and the lessor's interest in the Existing Ground Lease
(collectively, the "Fee Interests"),
10. In the event of a favorable outcome or settlement of said litigation, RP
intends to cause the Fee Interests to be conveyed to the Agency.
11. The Agency and RP, as of the date hereof, have not yet finalized all of the
definitive agreements which are contemplated by the parties relative to the ownership,
operation and development of the Hotel.
12. The principals of RP have consistently expressed an intention and desire
to develop the Shorecrest Hotel Property as a separate and distinct non-convention
hotel in the event RP is unable to reach agreement with the Agency regarding the
3
ownership, operation and development of the Hotel to be constructed on both the Royal
Palm Hotel and Shore crest Hotel Properties.
13. RP would not have been assigned the Leasehold Contract to the Agency
and RP will not agree to cause the Fee Interests to be conveyed to the Agency without
the Agency agreeing to enter into this Agreement providing for, inter alia, an option in
favor of RP to acquire from the Agency the Leasehold Interest for the purposes
described in' the preceding Section, on terms hereinafter set forth, in the event the
Agency and RP are unable to reach mutually acceptable agreements relating to the
ownership, operation and development of the Hotel.
14. The Agency consistently has expressed its willingness to institute eminent
domain litigation and proceedings to acquire the Shorecrest Hotel Property in
connection with the development of a convention hotel if it deems such to be necessary.
NOW, THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt and adequacy of which are hereby acknowledged, the
parties agree as follows:
1. Recitals. The foregoing recitals are true and correct and incorporated
herein.
2. Acquisition of the Leasehold Interest. Simultaneous with the execution
and delivery of this Agreement and the execution and delivery of the assignment of the
Leasehold Contract to the Agency, the Agency has acquired the Leasehold Interest.
The Agency expended the sum of $3,100,000.00 towards the purchase price of the
4
Leasehold Interest at closing ("Agency's Funding") and RP expended the sum of
$[approx. $956,500] ("RP's Contribution").
3. Ootion to Purchase the Leasehold Interest. In consideration of the
payment of RP's Contribution and for other good and valuable consideration, the
Agency hereby grants to RP the option (the "Option") to purchase the Leasehold
Interest on the terms and conditions set forth in the Terms of Purchase and Sale
attached hereto and made a part hereof as Exhibit C (the "Purchase Terms"). In the
event, on or before October 31, 1997, the Agency and RP are unable or unwilling for
any reason whatsoever in the sole and absolute discretion of each of the parties hereto
to execute and deliver mutually acceptable written agreements relating to the
ownership, operation and development of the Royal Palm Hotel and Shore crest Hotel
Properties as a single convention hotel complex as contemplated by the RFP including,
without limitation, the ground lease, the terms of subordination of ground rent
payments due the Agency in favor of RP's first mortgage holder, a garage agreement,
a development agreement and convention center agreement, RP shall have the right to
exercise the Option.. The Option shall be exercised by RP, if at all, by written notice
to the Agency, in accordance with the notice provisions contained in the Purchase
Terms not later than November 30, 1997 at 5:00 p.m. (the "Option Period"). If the
Option is not exercised in the manner described above, the Agency shall repay to RP
an amount equal to RP's Contribution on or before December 7, 1997, whereupon the
parties shall have no further rights or obligations hereunder. Said payment shall
5
accrue interest from December 7, 1997 to the date of payment at the rate of 14% per
annum.
4. Fee Interest. RP shall, in good faith, attempt to specifically enforce the
Fee Contract and acquire the Fee Interests. Simultaneous with the acquisition of the
Fee Interests by RP, RP shall convey the Fee Interests to the Agency for a mutually
acceptable purchase price. The Agency reserves the right, however, to institute eminent
domain litigation and proceedings with regard to the Fee Interests at such time as the
Agency, in its sole and absolute discretion, believes that further delays in RP acquiring
the Fee Interests pursuant to the Fee Contract jeopardize the timely completion of the
Hotel by RP.
5. RecordinllS. Simultaneous with the execution of this Agreement, the
parties shall execute and deliver a Memorandum of Option setting forth the basic terms
of the Option in a form reasonably acceptable to the parties hereto. The Memorandum
of Option shall be recorded by the Agency among the Public Records of Dade County,
Florida, simultaneous with and immediately after the recording of the instrument
assigning the Leasehold Interest to the Agency. The Agency hereby covenants and
agrees that until the earlier to occur of: (i) the Agency and RP entering into all the
definitive agreements described in Section 3, above; (ii) the expiration of the Option
Period without exercise of the Option by RP and after repayment ofRP's Contribution
to RP, or (Hi) the acquisition of the Leasehold Interest from the Agency by RP after
exercise of the Option, it shall not record or cause to be recorded among the Public
Records of Dade County, Florida, any instrument or document affecting the title to the
6
Shore crest Hotel Property, including any amendments, modifications or a termination
of the Existing Ground Lease, without the prior written consent of RP, which consent
may be withheld by RP in its sole and absolute discretion.
6. Reservation of Ril!'hts. Notwithstanding anything to the contrary, the
Agency reserves the right, in its sole and absolute discretion, to initiate eminent domain
litigation and proceedings, at any time and against any persons or entities including,
but not limited to, RP with regard to the leasehold and/or the fee interests concerning
the Shorecrest Hotel Property; provided, however, RP reserves the right to contest the
Agency's right to prevail in said proceedings based upon, inter alia, this Agreement.
7. Miscellaneous.
7.1 This Agreement has been negotiated and executed in Florida; it
shall be construed and governed in accordance with the laws of the State of Florida,
without application of conflicts of laws principles.
7.2 In the event any term or provision of this Agreement is determined
by appropriate judicial authority to be illegal or otherwise invalid, such provision shall
be given its nearest legal meaning or be construed as deleted as such authority
determines, and the remainder of this Agreement shall be construed to be in full force
and effect.
7.3 In the event of any litigation between the parties under this
Agreement, the prevailing party shall be entitled to reasonable attorneys' fees.
Wherever provision is made in this Agreement for "attorneys' fees," such term shall be
7
deemed to include attorneys' fees and court costs, whether or not litigation IS
commenced, including those for appellate and post judgment proceedings.
7.4 Each party has participated fully in the negotiation and preparation
of this Agreement with full benefit of counsel. Accordingly, this Agreement shall not
be more strictly construed against either party.
7.5 Whenever used in this Agreement, the singular shall include the
plural, the plural shall include the singular, any gender shall include every other and
all genders, and captions and paragraph headings shall be disregarded.
7.6 The captions in this Agreement are for the convenience of reference
only and shall not be deemed to alter any provision of this Agreement.
7.7 Any reference in this Agreement to time periods less than six (6)
days shall, in the computation thereof, exclude Saturdays, Sundays, and legal holidays;
any time period provided for in this Agreement which shall end on a Saturday, Sunday
or legal holiday shall extend to 5:00 p.m. of the next full business day.
7.8 Except for the Letter of Intent between the Agency, RP and the City
of Miami Beach dated March 5, 1997, this Agreement constitutes the entire agreement
between the parties relating to the matters contained herein. This Agreement may not
be changed, altered or modified except by an instrument in writing signed by the party
against whom enforcement of such change would be sought.
7.9 All references in this Agreement to exhibits, schedules, paragraphs,
subparagraphs and sections refer to the respective subdivisions of this Agreement,
unless the reference expressly identifies another document.
8
7.10 All of the terms of this Agreement, shall be binding upon and shall
inure to the benefit of the parties to this Agreement and their respective successors and
assigns.
7.11 Typewritten or handwritten provisions which are inserted in or
attached to this Agreement as addenda or riders and which bear the signature of the
party against whom enforcement of that provision is sought shall control all printed or
pretyped provisions of this Agreement with which they may be in conflict.
7.12 This Agreement may be executed in counterparts.
7.13 Time is of the essence in this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement the day and
year first written above.
Signed, sealed and delivered
in the presence of:
RDP ROYAL PALM HOTEL LIMITED
COMPANY, a Florida limited liability
company
By:
9
ATTEST:
Robert Parcher, Secretary
MIA3-470907.2
l\1IAMI BEACH REDEVELOPMENT AGENCY,
a Florida public body corporate and
politic
By:
Seymour Gelber, Chairman
APPROVED AS TO
FORM & LANGUAGE
& FOR execunoN
~JL:
. oment A9t"cv
.", . '.~'." .
J(!2/7?
Dote
10
EXHIBIT "A"
Purchase and Sale Agreement dated February 2, 1996, by and between JACOB 1535
PROPERTIES, INC. ("Seller") and R. DONAHUE PEEBLES, INC., and/or assigns
("Purchaser"), as amended by Amendment to Purchase and Sale Agreement dated
March 7,1996, by Second Amendment to Purchase and Sale Agreement dated June 17,
1996 and by Third Amendment to Purchase and Sale Agreement dated December 6,
1996.
11
EXHIBIT "B"
Purchase and Sale Agreement dated February 28, 1996, by and between Ignacio Andres
Cardona and Gisela Lizama Cardona, Co-Trustees under Trust Agreement dated
December 29, 1976 ("Seller"), and The R. Donahue Peebles Companies, Inc. and/or
assigns ("Purchaser"), as amended by Amendment to Purchase and Sale Agreement
dated March 29, 1996.
12
EXHIBIT "C"
TERMS OF PURCHASE AND SALE
1. PURCHASE AND SALE. Subject to the terms of this instrument, Seller
agrees to sell to Purchaser and Purchaser agrees to purchase from Seller the following
property (collectively, the "Property"):
1.1 The Leasehold Interest;
1.2 All buildings, structures and other improvements situated on the
Shorecrest Hotel Property to the extent owned by Seller;
1.3 All deposits, licenses, permits, and contract rights pertaining to
ownership and/or operation of the Improvements, or Leasehold Interest, if any;
1.4 All strips, gores, easements, privileges, rights-of-way, riparian and
other water rights, rights to lands underlying any adjacent streets or roads, and other
tenements, hereditaments and appurtenances, if any, pertaining to or accruing to the
benefit of the owner of the Leasehold Interest.
2. CLOSING DATE. Subject to other provisions of this instrument for
extension or termination, closing on the transaction described in this instrument (the
"Closing") shall be held at the offices of the attorneys for Purchaser, Holland & Knight,
701 Brickell Avenue, Miami, Florida 33131, on or before December 31, 1997, on a date
to be determined by Purchaser upon not less than ten (10) days' prior written notice
to Seller (the "Closing Date"), In the event a portion of the Purchase Price is to be
derived from institutional financing or refinancing, the requirements of the lending
institution as to place, time of day and procedures for Closing, and for disbursement
of mortgage proceeds, shall control, provided that disbursement shall occur on the day
of Closing.
3. PURCHASE PRICE.
3.1 The total purchase prIce (the "Purchase Price") to be paid by
Purchaser to Seller for the Property is Three Million One Hundred Thousand and
No/100 Dollars ($3,100,000), in cash at Closing, subject to prorations and adjustments
as provided herein, to be paid by cashier's check or by wire transfer.
4. TITLE. Purchaser shall obtain its own title evidence. Seller shall convey
to Purchaser at closing, good and marketable and insurable title to the Leasehold
Interest, with warranty of title limited to lawful claims of all persons claiming by,
through or under Seller, free and clear of all liens, encumbrances, leases, tenancies,
covenants, conditions, restrictions, rights-of-way, easements and other matters affecting
title, except the following (the "Permitted Exceptions"):
4.1 Ad valorem real estate taxes for the year of closing;
4.2 All applicable zoning ordinances and regulations;
4.3 Rights, title or interest, if any, of the public to use as public beach
or recreational area any part of the Property lying between the water abutting the
Shore crest Hotel Property and the most inland of any of the following: (a) the natural
line of vegetation; (b) the most extreme high water mark; (c) the bulkhead line; or
(d) any other line which has been or which hereafter may be legally established as
relating to such public use;
2
4.4 The Coastal Construction Control Line for Dade County, Florida;
4.5 Possible lack of title to any portion of the Shorecrest Hotel Property
that lies easterly of the Erosion Control Line shown on Plat Book 105, page 62 of the
Public Records of Dade County, Florida, and westerly of the mean high water line of
the Atlantic Ocean;
4.6 Rights and easements of the United States government for commerce,
navigation, recreation and fisheries in and to any portion of said land which has been
created by artificial means or accreted to any portion so created and riparian rights, if
any; and
4.7 Terms and conditions of the Existing Ground Lease.
5. SELLER'S REPRESENTATIONS. WARRANTIES AND COVENANTS.
Seller represents and warrants to Purchaser and covenants and agrees with Purchaser
as follows:
5.1 There are no agreements currently in effect which restrict the sale
of the Leasehold Interest;
5.2 Seller has the right, power and authority to consummate the
transactions contemplated herein;
5.3 At all times prior to and as of Closing, to the best of Seller's
knowledge and belief, all of Seller's representations, warranties and covenants
contained herein shall be true and correct; no representation or warranty by Seller
contained herein contains any untrue statement of a material fact or omits to state a
3
material fact necessary in order to make the statements or information contained in
them or herein not misleading.
6. CONDITIONS PRECEDENT. An express condition precedent to
Purchaser's obligation to close this transaction is the truth and correctness of all of
Seller's representations and warranties and the fulfillment of all of Seller's covenants
at all times prior to and as of Closing.
7. -SELLER.
7.1 If any of Seller's representations and warranties are not true and
correct or Seller's covenants are not fulfilled or all other conditions precedent are not
met as of Closing (or earlier specified date, if any), or Seller fails to perform any of the
terms and conditions herein contained or is otherwise in default hereunder, then
Purchaser, at Purchaser's sole option, may elect to:
7.1.1 Waive the default or failure and close "as is"; or
7.1.2 Cancel the exercise of the Option by written notice to Seller
given on or before the Closing Date, in which event Seller shall pay to RP, within ten
(10) days of the receipt by Seller of such notice, an amount equal to RP's Contribution
together with interest on said amount which shall accrue at the rate of ten (10%)
percent per annum from the date of payment of RP's Contribution by Purchaser to
Seller to acquire the Leasehold Interest. In the event Seller fails to timely pay to
Purchaser RP's Contribution, interest shall accrue on RP's Contribution from the date
of such default to the date of payment at the rate of fourteen (14%) percent per annum;
4
upon such payment, both parties shall be released from all further obligations under
this Agreement; or
7.1.3 Seek specific performance of Seller's obligations hereunder.
7.2 In the event Purchaser fails to purchase the Leasehold Interest in
accordance with the terms hereof, Seller shall pay to Purchaser an amount equal to
RP's Contribution, together with any amounts due Purchaser pursuant to the Letter
of Intent dated March 5, 1997, as it may be amended, between the parties; whereupon
both parties shall be released from all further obligations under this Agreement.
8. PRORATIONS. All proratable items, including real estate taxes, shall be
prorated as of the Closing Date.
9. IMPROVEMENT LIENS. Certified liens for governmental improvements
or special assessments as of the Closing Date, if any, are the responsibility of the Seller
and shall be paid at closing.
10. CLOSING COSTS. At the Closing, Purchaser shall pay the documentary
stamps and surtax, if any, due on the assignment of Leasehold Interest. Each party
shall bear the recording costs of any instruments received by that party, except that
Seller shall pay the recording costs on documents necessary to clear title. Purchaser
shall pay for its own title insurance policy and survey.
11. CLOSING.
11.1 Seller shall convey title to the Leasehold Interest, with limited
warranty of title as described in Section 4, by good and sufficient assignment of lease
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subject only to the Permitted Exceptions. Seller shall also deliver to Purchaser at the
Closing:
11.1.1
a mechanic's lien affidavit, to the title insurer and
Purchaser, in form acceptable to Purchaser's title insurer to delete the standard
exception relating to such liens in Purchaser's leasehold title insurance policy;
11.1.2 an affidavit, to the Title Insurer and Purchaser, that,
to Seller's knowledge, there are no unrecorded easements and that Seller has done
nothing to change the state of facts shown on the Survey, in form acceptable to
Purchaser's Title Insurer to delete the standard exceptions relating to such matters in
Purchaser's leasehold title insurance policy;
11.1.3 a gap affidavit and indemnification agreement
acceptable to Title Insurer for purposes of deleting the "gap" from Purchaser's title
commitment and policy;
11.1.4 instruments necessary to clear title, if any, including
those required under this Agreement to remove standard exceptions from the title
policy;
11.1.5 appropriate assignments of deposits, licenses,
easements, rights-of-way, contract rights, intangible rights and other property and
rights included in this transaction;
11.1.6 appropriate restatements of Seller's covenants,
representations and warranties as of the date of closing;
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11.1.7 a non-foreign certificate and other documentation as
may be appropriate and satisfactory to Purchaser to meet the non-withholding
requirements under FIRPTA and any other federal statute or regulations;
11.1.8 an appropriate reporting form to be submitted with the
deed at time of recordation;
11.1. 9 provided the Agency then holds title to the fee interest
in the Shore crest Hotel Property, an amendment to the Existing Ground Lease, in form
reasonably acceptable to Purchaser and Seller, containing provisions customarily
contained in ground leases so as to permit institutional leasehold financing, on a
nonsubordinated basis, of a hotel on the Shorecrest Hotel Property; and
11.1.10
an instrument, in form and content reasonably
acceptable to Purchaser, reinstating the Existing Ground Lease if, at the time of
closing, said Existing Ground Lease has been merged into the fee title in the Shore crest
Hotel Property then owned by the Seller.
11.2 Seller and Purchaser shall each execute such other documents as
are reasonably necessary to consummate this transaction.
12. BROKERS. The parties each represent and warrant to the other that no
real estate broker, salesman or finder was involved in this transaction. If a claim for
brokerage or similar fees in connection with this transaction is made by any broker,
salesman or finder claiming to have dealt through or on behalf of one of the parties
hereto, then that party shall indemnify, defend and hold the other party harmless from
all liabilities, damages, claims, costs, fees and expenses whatsoever (including
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reasonable attorneys' fees and court costs, including those for appellate matters and
post judgment proceedings) with respect to said claim for brokerage. The provisions
of this section shall survive the Closing or the termination or cancellation of the
Option.
13. ASSIG NABILITY. The right to acquire the Leasehold Interest may be
assigned by Purchaser to an entity in which R. Donahue Peebles has an interest.
14. . INSPECTIONS. Purchaser, and Purchaser's agents and contractors, shall
have the right during the term hereof to enter upon the Property at all reasonable
times for purposes of inspection and making tests and studies. Purchaser hereby agrees
to and does indemnify, defend and hold Seller harmless from all liabilities, damages,
claims, costs, or expenses whatsoever (including reasonable attorneys' fees and court
costs) for bodily injury, death, or property damage resulting from any such inspection,
test or study. The provisions of this Section shall survive the Closing.
15. NOTICES. Any notices required or permitted to be given hereunder shall
be delivered by hand, mailed by certified or registered mail, return receipt requested,
in a postage prepaid envelope, or delivered by a nationally recognized overnight delivery
service, and addressed as described below; notices shall be deemed effective only upon
receipt or refusal of delivery.
Notices to Purchaser:
RDP Royal Palm Hotel Limited Company
701 Brickell Avenue
Suite 2040
Miami, FL 33131
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With a copy to:
Holland & Knight
701 Brickell Avenue, #3000
Miami, Florida 33131
Attn: Stuart K. Hoffman, Esq.
Notices to Seller:
Miami Beach Redevelopment Agency
1700 Convention Center Drive
Miami Beach, FL 33139
Attn: Jose Garcia-Pedrosa, Executive Director
With a copy to:
Murray Dubbin, General Counsel
City of Miami Beach
1700 Convention Center
Miami Beach, FL 33139
16. RISK OF LOSS.
16.1 The Property shall be conveyed to Purchaser in its "as is" condition.
Seller shall not remove any improvements from the Property between the date of this
Agreement and Closing unless agreed to in writing by Purchaser.
16.2 Upon receipt of an offer or any notice or communication from any
governmental or quasi-governmental body seeking to take under its power of eminent
domain the Leasehold Interest, Seller shall promptly notify Purchaser of the receipt of
same and shall send such communication, or a copy of it, to Purchaser. Upon receipt
of such notice, Purchaser shall have the right to rescind the exercise of the Option by
delivery of written notice to Seller within twenty (20) days of Purchaser's receipt of the
communication from Seller, and the closing shall be extended, if necessary, to allow
Purchaser said twenty (20) days. In the event Purchaser elects to rescind, then
Purchaser shall receive a refund of the RP Contribution, in which case both parties
shall be relieved of all further obligations hereunder. In the event Purchaser elects not
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to rescind and closes on the acquisition of the Leasehold Interest, then Purchaser shall
be entitled to all condemnation awards and settlements. Seller and Purchaser agree to
cooperate with each other to obtain the highest and best price for the condemned
property.
16.3 In the event that the Property is damaged or destroyed by fire or
other casualty prior to Closing, then Purchaser shall be entitled to all insurance
proceeds paid after Closing. Seller shall have no obligation to reconstruct.
17. RADON GAS NOTICE. Pursuant to Florida Statutes Section 404.056(8),
Seller hereby makes, and Purchaser hereby acknowledges, the following notification:
RADON GAS: Radon is a naturally occurring radioactive gas
that, when it has accumulated in a building in sufficient
quantities, may present health risks to persons who are
exposed to it over time. Levels of radon that exceed federal
and state guidelines have been found in buildings in Florida.
Additional information regarding radon and radon testing
may be obtained from your county public health unit.
(This notice does not in any way lessen Seller's
representation and warranty regarding radon, above.)
MIA3-471170.2
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