96-22075 RESO #33
,/
RESOLUTION NO. 96-22075
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF
MIAMI BEACH, FLORIDA AUTHORIZING AND DIRECTING THE MAYOR AND
CITY CLERK TO EXECUTE AN AGREEMENT OF LEASE, A CONDOMINIUM
UNIT LEASE, A HOTEL DEVELOPMENT AGREEMENT, A CONVENTION
CENTER AGREEMENT, A COMPLETION GUARANTEE, GARAGE EASEMENT
GUARANTEE, A STOCK PURCHASE AGREEMENT GUARANTEE, A
DECLARATION OF COVENANTS AND RESTRICTIONS, AN ESCROW
AGREEMENT, A QUIT CLAIM DEED AND OTHER DOCUMENTS, AND
AUTHORIZING AND DIRECTING THE CITY TO ENTER INTO THE
TRANSACTIONS CONTEMPLATED BY SUCH AGREEMENTS AND
DOCUMENTS, PERTAINING TO THE LOEWS MIAMI BEACH HOTEL
PROJECT TO BE DEVELOPED AT 1601 COLLINS A VENUE, MIAMI BEACH,
FLORIDA AND A PUBLIC PARKING GARAGE PROJECT TO BE DEVELOPED
A T AND NEAR 16TH STREET BETWEEN COLLINS AND WASHINGTON
AVENUES, MIAMI BEACH, FLORIDA; WAIVING BY AT LEAST A SnTHS VOTE
CERTAIN PROVISIONS OF CITY ORDINANCE NO. 92-2783; APPROVING THE
DISPOSITION OF CERTAIN PROPERTY BY THE MIAMI BEACH
REDEVELOPMENT AGENCY PURSUANT TO FLORIDA STATUTE SECTION
163.380; AND AUTHORIZING THE MAYOR, CITY MANAGER, CITY
A TTORNEY AND CITY CLERK, AND THEIR RESPECTIVE DESIGNEES AND
OUTSIDE CONSULTANTS, TO TAKE SUCH ACfIONS AS ARE NECESSARY TO
EFFECTUA TE THE PURPOSES OF THIS RESOLUTION, INCLUDING,
WITHOUT LIMITATION, MODIFYING, FILLING IN BLANKS IN AND
ATTACHING EXHffiITS TO THE AGREEMENTS.
WHEREAS, in February, 1993, the City Center/Historic Convention Village
Redevelopment and Revitalization Area was officially established by the adoption of a
Redevelopment Plan (the "Redevelopment Plan") resulting from the combined efforts of the City
of Miami Beach (the "City"), the Miami Beach Redevelopment Agency (the "Agency"),
Metropolitan Dade County, and the State of Florida; and
WHEREAS, the purposes of the Redevelopment Plan are, among other things, to eliminate
blight, establish redevelopment, foster the development of convention quality hotels, ancillary
improvements and facilities, and necessary linkages to the Miami Beach Convention Center; and
WHEREAS, pursuant to the Redevelopment Plan, the Agency acquired land, known as Site
I-A, at and near 16th Street and Collins Avenue to facilitate the development ofa convention center
hotel (the "Hotel"); and
WHEREAS, in furtherance of the Redevelopment Plan, the City published a Request for
Proposals (the "RFP") dated November 29, 1993, seeking, among other things, proposals for the
development and operation of a convention center hotel; and
WHEREAS, by virtue of a resolution adopted on July 21, 1994, after a public review
process, the City and the Agency selected St. Moritz Hotel Corporation ("SMHC"), an entity
affiliated with Loews Hotels Holding Corporation ("LHHC"), from among the groups which
submitted proposals pursuant to the RFP and directed representatives of the Agency to negotiate the
terms under which SMHC would develop, construct, own, and operate the Hotel in accordance with
requirements of the RFP; and
WHEREAS, the Agency and SMHC entered into that certain Letter ofIntent dated May 3,
1995, as amended (the "Letter of Intent"), which was approved by LHHC and the City, which,
among other things, provides for the development, construction, furnishing, and equipping of the
Hotel and the development and construction of a public parking garage (the "Public Garage") at and
near 16th Street between Collins and Washington Avenues; and
WHEREAS, after the execution of the Letter of Intent, the Agency proceeded to negotiate
the terms of the various agreements relating to, among other things, the development of the Hotel
and the Public Garage; and
WHEREAS, the proposed forms of the major agreements and documents to which the City
is proposed to be a signatory (collectively, the "Agreements") concerning the Hotel and the Public
Garage are attached hereto and incorporated herein; and
WHEREAS, the City desires to enter into the Agreements, as provided therein, and certain
other necessary agreements in connection with the transactions contemplated hereunder; and
WHEREAS, several conditions need to be met before the Agreements become legally
binding; and
WHEREAS, those conditions are described in that certain Escrow Agreement, which is
also attached hereto and incorporated herein; and
WHEREAS, the Planning Department has completed its analysis pursuant to City Ordinance
No. 92-2783, which analysis is attached hereto and incorporated herein as Exhibit "A"; and
WHEREAS, in accordance with Florida Statutes Section 163.380, the City and the Agency
held a public hearing today concerning the disposition of certain properties relating to the
transactions contemplated by the Agreements.
NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA AS FOLLOWS:
1. The Mayor and City Commission have detennined that the transactions contemplated
by the Agreements serve a valid municipal public purpose in accordance with the provisions of the
Redevelopment Plan.
2
2. The City is authorized and directed to enter into the transactions contemplated by the
Agreements and, in furtherance thereof, the Mayor and City Clerk are authorized and directed to
execute and deliver all necessary agreements and documents, including, without limitation, the
following documents:
(a) That certain Agreement of Lease, attached hereto and incorporated herein as
Exhibit "B", between the Agency and MB Redevelopment Inc. ("MB "), an
entity that will be affiliated with LHHC, pertaining to the land upon which
the Hotel is to be developed, but only as to certain provisions of the lease as
specified therein.
(b) That certain Hotel Development Agreement, attached hereto and
incorporated herein as Exhibit "C", between the Agency and MB, but only
as to the provision of the agreement specified therein.
(c) That certain Convention Center Agreement, attached hereto and incorporated
herein as Exhibit "0", between the City, in its capacity as owner of the
Miami Beach Convention Center, and MB.
(d) That certain Completion Guarantee, attached hereto and incorporated herein
as Exhibit "E", in favor ofMB.
( e) That certain Garage Easement Guarantee, attached hereto and incorporated
herein as Exhibit "F", in favor ofMB.
(f) That certain Quit Claim Deed, attached hereto and incorporated herein as
Exhibit "G", by the City in favor of the Agency, pertaining to property
currently used as a municipal parking lot at and near 16th street between
Collins and Washington Avenues, as described in that Quit Claim Deed.
(g) That certain Escrow Agreement, attached hereto and incorporated herein as
Exhibit "H", between the Agency, the City, SMHC and LHHC.
(h) That certain Condominium Unit Lease, attached hereto and incorporated
herein as Exhibit "I", between the Agency and MB, but only as to certain
provisions of such lease as specified therein.
(i) That certain Stock Purchase Agreement Guarantee, attached hereto and
incorporated herein as Exhibit "J", in favor ofLHHC.
G) That certain Declaration of Covenants and Restrictions by the Agency,
attached hereto and incorporated herein as Exhibit "K", pertaining to the land
upon which the Hotel is to be developed, but only as to certain provisions of
such declaration as specified therein.
3
3. The City Commission hereby finds that the public interest would be served by
waiving the conditions of bidding and appraisal referenced in Section 4 of City Ordinance No. 92-
2783 for the disposition from the City to the Agency of the property now used as a municipal
parking lot and located at and near 16th Street between Collins and Washington Avenues, as
described in the Quit Claim Deed attached hereto and incorporated herein as Exhibit "G".
4. The City Commission hereby waives, by at least a 517ths vote, Section 4 of City
Ordinance No. 92-2783, concerning, among other things, an advertised public bidding process and
the obtaining of an appraisal, with regard to the transfer of property from the City to the Agency by
virtue of that certain Quit Claim Deed, attached hereto and incorporated herein as Exhibit "G".
5. The City Commission hereby approves, pursuant to Florida Statutes Section 163.380,
the disposition by the Agency to MB of those properties to be disposed of as a result of the following
documents between the Agency and MB: that certain Agreement of Lease, that certain Bill of Sale
relating to the property commonly known as the St. Moritz Hotel, that certain Condominium Unit
Lease and that certain Garage Easement Agreement.
6. The Mayor, City Manager, City Attorney and City Clerk, and their respective
designees and outside consultants, are authorized to take such actions as may be necessary to
effectuate the purposes of this Resolution, including, without limitation, executing and delivering
related agreements, making changes, additions or deletions to, filling in blanks in and attaching
exhibits to the Agreements.
7. This Resolution shall take effect immediately upon its adoption.
PASSED and ADOPTED this 17th day of July, 1996.
Ro~f~
CITY CLERK
FORM APPROVED
By kAJ;M:
Date ~!t 1/f}0
ATTEST:
f.\atto\tacalresos\agnexec.res
4
CITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH FLORIDA 33139
CITY OF MIAMI BEACH
COMMISSION MEMORANDUM NO. ~
TO:
Mayor Seymour Gelber and
Memben of the City Commission
DATE: July 17, 1996
FROM:
Jose Garcia-Pedrosa
City Manager
SUBJECT:
ION OF THE MAYOR AND CITY COMMISSION OF
THE CI OF MIAMI BEACH, FLORIDA AUTHORIZING AND
DIRECTING THE MAYOR AND CITY CLERK TO EXECUTE AN
AGREEMENT OF LEASE, A CONDOMINIUM UNIT LEASE, A
HOTEL DEVELOPMENT AGREEMENT, A CONVENTION CENTER
AGREEMENT, A COMPLE TION GUARANTEE, GARAGE EASEMENT
GUARANTEE, A STOCK PURCHASE AGREEMENT GUARANTEE, A
DECLARATION OF COVENANTS AND RESTRICTIONS, AN
ESCROW AGREEMENT, A QUIT CLAIM DEED AND OTHER
DOCUMENTS, AND AUTHORIZING AND DIRECTING THE CITY
TO ENTER INTO THE TRANSACTIONS CONTEMPLATED BY SUCH
AGREEMENTS AND DOCUMENTS, PERTAINING TO THE LOEWS
MIAMI BEACH HOTEL PROJECT TO BE DEVELOPED AT 1601
COLLINS AVENUE, MIAMI BEACH, FLORIDA AND A PUBLIC
PARKING GARAGE PROJECT TO BE DEVELOPED AT AND NEAR
16TH STREET BETWEEN COLLINS AND WASHINGTON AVENUES,
MIAMI BEACH, FLORIDA; WAIVING BY AT LEASE A 5/7THS
VOTE CERT~N PROVISIONS OF CITY ORDINANCE NO. 92-
2783; APPROVING THE REDEVELOPMENT AGENCY PURSUANT
TO FLORIDA STATUTE SECTION 163.380; AND AUTHORIZING
THE MAYOR, CITY MANAGER, CITY ATTORNEY AND CITY
CLERK, AND THEIR RESPF-CTIVE DESIGNEES AND OUTSIDE
CONSULTANTS, TO TAKE SUCH ACTIONS AS ARE NECESSARY
TO EFFECTUATE THE PURPOSES OF THIS RESOLUTION,
INCLUDING, WITHOUT LIMITATION, MODIFYING, FILLING
IN BLANKS IN AND ATTACHING EXHIBITS TO THE
AGREEMENTS.
ADMINISTRATION RECOMMENDATION:
It is recommended that the Mayor and City Commission and the
Chairman and Members of the Redevelopment Agency (RDA) approve the
above transactions and related documents, and authorize the
execution of necessary documents and taking of necessary actions to
implement the project.
AGENDA ITEM
'f\1~
1-ll-crk
429
DATE
BACKGROUND :
The city of Miami Beach and the RDA are at the threshold of an
historic event. The first new major hotel in three decades is
about to be built in Miami Beach. This event comes through the
concerted efforts of this city Commission and RDA, its wisdom to
appoint a respected community leader to chair the effort, and the
hard work of its administrative and legal staff.
ANALYSIS:
The effort began in earnest with the creation of the City Center
Redevelopment Area in February, 1993. An RFP was issued in
November of 1993 and, after a thorough and professional selection
process, Loews was ranked number one, on July 21, 1994.
A detailed letter of intent was entered into on May 3, 1995, which
committed the developer to enter into design development work for
the project. This step is unprecedented in development agreements
and has saved almost a year in the development process. The
developer has obtained all necessary approvals from the City,
except for the building permits, which can be issued immediately
after this action today.
The project is a high-quality, first-class convention hotel which
will help bring substantial new business to the Convention Center.
Several public projects will occur simultaneously with the hotel
development:
. The opening of 16th Street between Collins & Washington
. The development of an aOO-car public parking garage
. The extension of a built boardwalk from the southerly terminus
of the present wooden boardwalk to Lummus Park
. The beautification and improvement of Coll~ns Avenue from
15th Street to Lincoln Road
Finally, three major development projects to the south, the 11
Villagio Condominiums, the 1500 Ocean project (Constructa), and the
Crowne Plaza Hotel will complete the missing pieces of the urban
fabric that will unite the Ocean Drive area to the City
Center/Historic Convention Village area.
CONCLUSION:
The City Commission/RDA should approve the transaction.
JGP:~jm
430
ESCROW AGREEMENT
THIS ESCROW AGREEMENT (the" Agreement"), dated as of the 17th day of July
1996, between MIAMI BEACH REDEVELOPMENT AGENCY, a public body corporate and politic
(the "Agency"), the CITY OF MIAMI BEACH, a municipal corporation of the State of Florida
(the "City"), ST. MORITZ HOTEL CORP., a Florida corporation ("S~mC"), LOEWS HOTELS
HOLDfNG CORPORATION, a Delaware corporation ("LHHC"), and SQUlRE, SA.~1)ERS &
DEMPSEY, an Ohio general partnership (the "Escrow Agent").
RECIT ALS:
A. In February 1993, the City Center/Historic Convention Village Redevelopment a.IlC
Revitalization Area was officially established by the adoption of the Redevelopment Plan, resultjJl~
from the combined efforts of the City, the Agency, Metropolitan Dade County and the State of
Florida. The purposes of the Redevelopment Plan are, among other things, to eliminate blight.
establish redevelopment, foster the development of convention quality hotels, ancillary improvements
and facilities, and necessary linkages to the Miami Beach Convention Center.
B. Pursuant to the Redevelopment Plan, the Agency acquired the Land, known as
Site I-A, which it has agreed to make available for the Hotel.
C. In furtherance of the Redevelopment Plan, the City published a Request for Proposals
(the "RFP") dated November 29, 1993, seeking, among other things, proposals for the development
and operation of a convention headquarters hotel.
D. By virtue of a resolution adopted on July 21. 1994, after a public review process, the
Agency selected SMHC from among the groups which submitted proposals pursuant to the RFP and
directed representatives of the Agency to negotiate the terms under which SMHC would develop.
-;onstruct, own and operate the Hotel in accordance with requirements of the RFP.
E. The Agency and SMHC entered into a Letter of Intent (as the same may have bee:l
amended from time to time, the "Letter of Intent"), dated May 3, 1995, and approved by LIllie anC
the City, which, among other things, provides for the development, construction, furnishing and
equipping of the Hotel.
F. Representatives of the Agency and the City, and SMHC, with the advice and assistanee
of counsel have agreed on the material terms of the principal defInitive documents listed on Exhibit A..
attached hereto and made a part hereof (collectively, the "Escrowed Documents") necessary to
implement the transactions contemplated by the Letter of Intent.
W6.MI961920.011
G. By resolutions adopted July 17, 1996, the Agency and the City have approved the
transactions contemplated by the Escrowed Documents, and have authorized and directed the
appropriate officers of the Agency and the City to date, execute and deliver the Escrowed Documents
and cause them to be become effective, subject to the provisions of this Agreement.
H. By resolutions adopted July 17, 1996, LHHC has approved the transactions
contemplated by the Escrowed Documents, and has authorized and directed the appropriate officers of
LHHC to date, execute and deliver the Escrowed Documents and cause them to be become effective,
subject to the provisions of this Agreement.
1. Definitions. For purposes of this Agreement, although the Ground Lease, as defined in
Exhibit A, is one of the Escrowed Documents, all defined terms used herein shall have the same
meanings as ascribed to such terms in the Ground Lease, as defined in Exhibit A, except as otherwise
noted.
2. Items in Escrow. The Agency, the City, SMHC and LHHC (collectively, the "Parties")
hereby deliver to Escrow Agent the original Escrowed Documents and Escrow Agent hereby
acknowledges receipt of the Escrowed Documents. The Escrowed Documents have been executed by
the parties thereto, but are in escrow, and therefore remain undated, not effective and unenforceable,
until such time as the Escrowed Documents are released from escrow in accordance with the terms of
this Agreement.
3. Agreement of Escrow Agent. Escrow Agent agrees to act, without fee, in accordance
with the terms and conditions of this Agreement and the instructions contained herein.
4. Instructions and Conditions. Escrow Agent shall hold all the Escrowed Documents in
escrow until the earlier of (a) the satisfaction or waiver by the Parties, each in their sole and absolute
discretion, of those certain conditions precedent enumerated on Exhibit B, attached hereto and made a
part hereof (collectively, the "Conditions") or (b) October 31,1996 or such later date as the Parties may
agree to in writing (the "Termination Date"). If by the Termination Date, Escrow Agent has not been
notified by the Parties that all of the Conditions have teen satisfied or waived by the Parties in
accordance with ilie provisions of this Agreement or that the Termination Date has been extended, then
Escrow Agent is instructed to destroy all signatures on the Escrowed Documents. Upon Escrow Agent's
receipt of written notice from the Parties that the Conditions have been satisfied or waived in accordance
with the provisions of this Agreement, Escrow Agent is instructed to deliver the Escrowed Documents to
the Parties at the place and time designated by the Parties in their notice to Escrow Agent of such
satisfaction or waiver. Any Party or Escrow Agent may, at its option, demand a receipt acknowledging
delivery of any Escrowed Documents.
5. Effective Date; Additional Signatures. Upon release of the Escrowed Documents in
accordance with the provisions hereof, the consummation of the transactions contemplated by the Letter
of Intent shall occur. In accordance therewith, (a) the officers for the Parties shall (i) fill-in any and all
blanks in the Escrowed Documents, (ii) attach any and all exhibits that have not heretofore been attached
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W6-MI961920.011
to the Escrowed Documents, (iii) make any necessary revisions to the Escrowed Documents as mutually
agreed to by the Parties and (iv) date the Escrowed Documents as of the date of such release, which date
shall be the effective date thereof, (b) because the parties to the Escrowed Documents have executed
one (I) original of each of the Escrowed Documents, upon release of the Escrowed Documents in
accordance with the provisions hereof, the parties to the Escrowed Documents shall execute additional
originals thereof, in order that each Party have original fully executed counterparts of the Escrowed
Documents and (c) the Parties shall take or cause to be taken such further actions and execute and
deliver or cause to be executed and delivered such other instruments as may be reasonably requested by
the other Parties in order to consummate the transactions contemplated by the Escrowed Documents
(including, without limitation, the closing of the construction financing described on Exhibit B).
6. Disputes.
(a) In the event of any disagreement between the Parties resulting in conflicting
instructions to, or adverse claims or demands upon Escrow Agent with respect to the release of the
Escrowed Documents, Escrow Agent shall refuse to comply with any such instruction, claim or demand
so long as such disagreement shall continue, and in so refusing Escrow Agent shall not release the
Escrowed Documents. Escrow Agent shall not be or become liable in any way to any of the Parties for
its failure or refusal to comply with any such conflicting instructions or adverse claims or demands, and
it shall be entitled to continue so to refrain from acting until such conflicting or adverse demands shall
have (i) been settled by agreement and Escrow Agent receives notice thereof by all the Parties or
(ii) finally been determined by a court of competent jurisdiction.
(b) If any of the Parties or Escrow Agent shall be in disagreement about the
interpretation of this Agreement, or about their respective rights and obligations, or about the propriety
of any action contemplated by Escrow Agent, or if Escrow Agent receives or becomes aware of
conflicting demands or claims with respect to this escrow or the rights of any of the Parties hereto or
documents deposited herein or affected hereby, Escrow Agent may, but shall not be required to, file an
action in interpleader to resolve the disagreement or dispute and, upon filing such action, Escrow Agent
shall be released from all obligations under this Agreement. If any action arising out of this Agreement
is commenced by any of the Parties, Escrow Agent may deposit the Escrowed Documents with the clerk
of the court in which such action is commenced or pending and, upon depositing the Escrowed
Documents, Escrow Agent shall be rdeased from all obligations under this Agreement.
7. Indemnity.
(a) Each of the Parties hereby jointly and severally agree to save harmless, indemnify
and defend (with counsel chosen by Escrow Agent) Escrow Agent for, from and against any loss,
damage, liability, judgment, cost and expense whatsoever, including attorneys' fees (either paid to
retained attorneys or the fair value of services rendered to itself), suffered or incurred by it, by reason of,
or on account of, any misrepresentation made to it or its status or activities as Escrow Agent under this
Agreement, except for any loss, damage, liability, judgment, cost or expense resulting from gross
negligence or willful misconduct on the part of Escrow Agent.
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W6-MI961920.011
(b) Escrow Agent shall not be required to defend any legal proceeding which may be
instituted against it in respect of the subject matter of this Agreement unless requested to do so by all the
Parties and indemnified to Escrow Agent's satisfaction against the cost and expense of such defense. If
any such legal proceeding is instituted against it, Escrow Agent agrees promptly to give notice of such
proceeding to the Parties. Escrow Agent shall not be required to institute legal proceedings of any kind.
8. Liability, Duties and Responsibility of Escrow Agent.
(a) Escrow Agent undertakes to perform only such duties as are expressly set forth in
this Agreement. Escrow Agent shall not be deemed to have any implied duties or obligations under or
related to this Agreement.
(b) Escrow Agent may (i) act in reliance upon any writing or instrument or signature
which it, in good faith, believes to be genuine; (ii) assume the validity and accuracy of any statement or
assertion contained in such a writing or instrument; and (iii) assume that any person purporting to give
any writing, notice, advice or instructions in connection with the provisions of this Agreement has been
duly authorized to do so. Escrow Agent shall not be liable in any manner for the sufficiency or
corrections as to form, manner of execution, or validity of any instrument deposited in escrow, nor as to
the identity, authority, or right of any person executing any instrument.
(c) It is acknowledged that Escrow Agent is counsel for the Agency and the City. It
is agreed that Escrow Agent shall not be disabled or disqualified from representing the Agency and the
City, its officers, directors, employees or agents in connection with any dispute or litigation which may
arise out of or in connection with this Agreement or the transactions contemplated by the Escrowed
Documents as a result of Escrow Agent acting as Escrow Agent under this Agreement and SMHC and
LHHC waive any claim or right to assert a conflict of interest arising out of or in connection with the
foregoing.
9. Notices. Whenever it is provided herein that notice, demand. request, consent. approval
or other communication shall or may be given to, or served upon. any of the Parties, or whenever any of
the Parties desires to give or serve upon the other any notice, demand. request, consent. approval or other
communication with respect hereto, each such notice, demand. request. consent, approval or other
communication shall be in writing and shall be effective for any purpose only if given or served by
(a) certified or registered U.S. Mail. postage prepaid, return receipt requested. (b) personal delivery with
a signed receipt or (c) a recognized national courier service. addressed as follows:
If to SMHC or LHHC:
St. Moritz Hotel Corp.
407 Lincoln Road
Suite 6-k
Miami Beach. Florida 33139
Attention: Mr. Eric A. Nesse
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W6-MI961920.011
and to:
Loews Hotels Holding Corporation
667 Madison Avenue
New York, New York 10021
Attention: Corporate Secretary
with a copy to:
Hughes Hubbard & Reed
201 S. Biscayne Boulevard, Suite 2500
Miami, Florida 33131
Attention: William A. Weber, Esq.
If to the Agency or the City:
Miami Beach Redevelopment Agency
Executive Director
1700 Convention Center Drive
Miami Beach, Florida 33139
with a copy to:
Miami Beach Redevelopment Agency
General Counsel
1700 Convention Center Drive
Miami Beach, Florida 33139
and to:
City of Miami Beach
City Manager
1700 Convention Center Drive
Miami Beach, Florida 33139
with a copy to:
City of Miami Beach
City Attorney
1700 Convention Center Drive
Miami Beach, Florida 33139
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W6-MI961920.011
and
Squire Sanders & Dempsey
Two Renaissance Square
40 North Central Avenue
Suite 2700
Phoenix, Arizona 85004
Attention: Richard F. Ross, Esq.
If to Escrow Agent:
Squire Sanders & Dempsey
201 S. Biscayne Boulevard, Suite 2900
Miami, Florida 33131
Attention: Luis Reiter, Esq.
Any such notice may be given, in the manner provided in this Section, on either party's behalf by its
attorneys designated by such party by notice hereunder. Every notice given hereunder shall be effective
on the date actually received, as indicated on the receipt therefor or on the date delivery thereof is
refused by the recipient thereof. Any Party hereto may by notice delivered to Escrow Agent and the
other Parties, change its address for purposes of this Agreement.
10. Modification. No covenant, agreement, term or condition of this Agreement shall be
changed, modified, altered, waived or terminated except by a written instrument of change,
modification, alteration, waiver or termination executed by all Parties. Escrow Agent shall not be
bound by any modification of this Agreement, unless there is delivered to Escrow Agent a written
modification signed by all the Parties. No such modification shall, without the written consent of
Escrow Agent, modify the provisions of the Agreement relating to the duties, obligations or rights of
Escrow Agent.
11. Successors. This Agreement shall be binding upon and inure to the benefit of the Parties,
their heirs, executors and administrators; provided, however, that neither this Agreement nor any of the
rights, interests or obligations hereunder may be assigned by any of the Parties hereto without the prior
written consent of the other Parties.
12. Construction. This Agreement shall be governed by and construed in accordance with the
laws of the State of Florida, without regard to principles of conflict of laws.
13. Miscellaneous. The titles to the paragraphs or sections of this Agreement are solely for
the convenience of the Parties and Escrow Agent and shall not be used to explain, modify, simplify or
aid in the interpretation of the provisions of this Agreement. All references in this Agreement to the
terms "herein", "hereunder" and words of similar import shall refer to this Agreement, as distinguished
from the paragraph or Section within which such term is located. This Agreement may be executed in
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W6-MI961920. all
counterpartS, each of which shall be deemed an original but all of which together shall represent one
instrument. If any provision of this Agreement or the application thereof to any person or circumstances
is, to any extent, fInally detennined by a court of competent jurisdiction to be invalid and unenforceable,
the remainder of this Agreement, and the application of such provision to persons or circumstances other
than those as to which it is held invalid and unenforceable, shall not be affected thereby and each term
and provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law.
14. Design Development Expense Reimbursement. Paragraph 11 of the Letter of Intent is
hereby deleted in its entirety and replaced with the following:
11. The parties acknowledge that SMHC will, of necessity, incur significant
out-of-pocket costs for professional architectural design, engineering and other technical advice and
services in connection with the design, construction and permitting of the Hotel (the "Design Costs")
prior to the consummation of the transactions contemplated by the Escrowed Documents, as defined in
that certain Escrow Agreement between the Agency, the City, SMHC and LHHC, dated July 17, 1996
(the "Escrow Agreement"). In consideration of the foregoing, and in order to insure the timely
consummation of the transactions contemplated by the Escrowed Documents, SMHC and the Agency
have agreed that SMHC's Design Costs (which Design Costs incurred by SMHC through the
Termination Date (as defined in the Escrow Agreement) are hereinafter referred to as the "Total Design
Costs"), will be subject to reimbursement, as follows:
(a) if the Agency or the City, as applicable, has not, prior to the Termination Date,
entered into binding agreements to raise the funds necessary to meet its obligations as
contemplated by Paragraph 2(b)(3) and Paragraphs 3(a) and (b) of the Letter of Intent, then the
Agency shall pay to SMHC the Total Design Costs, no later than fifteen (15) days after the
later of (i) the Termination Date and (ii) submission by SMHC to the Agency of written
documentation verifying that such Total Design Costs have been incurred;
(b) if SMHC has not by the Termination Date entered into binding financial
commitments to obtain the first mortgage financing as contemplated by Paragraph 2(b)(I) of
the Letter of Intent, SMHC shall bear all Total Design Costs incurred by it (although SMHC
represents to the Agency that, as of the date of the Escrow Agreement, it has obtained such
binding fiuancial commitments);
(c) if the Conditions (as defined in the Escrow Agreement) are not satisfied or waived
by the Termination Date and the Parties thereunder fail to consummate the transactions
contemplated by the Escrow Agreement and the Escrowed Documents, for any reason
whatsoever (other than as expressly set forth in subparagraphs (a) and (b) above), SMHC shall
bear one-half (l/2) of the Total Design Costs and the Agency shall pay to SMHC one-half (l/2)
of the Total Design Costs, no later than fIfteen (15) days after the later of (i) the Termination
Date and (ii) submission by SMHC to the Agency of written documentation verifying that such
Total Design Costs have been incurred.
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W6-MI961920.011
15 . Termination. Paragraph 12( t) of the Letter ofIntent is hereby deleted in its entirety and
. replaced with the following:
(t) Subject to the provisions of Paragraph 11, this Letter of Intent may be terminated
by either party if the Conditions, as defined in the Escrow Agreement, have not been satisfied or waived
in accordance with the provisions of the Escrow Agreement by the Termination Date, as defined in the
Escrow Agreement.
16. Entire Agreement. This Agreement contains all of the promises, agreements, conditions,
inducements and understandings between the Parties and there are no promises, agreements, conditions,
understandings, inducements, warranties or representations, oral or written, express or implied, between
them other than as expressly set forth herein or as may be expressly contained in any enforceable written
agreements or instruments executed simultaneously herewith by the Parties hereto, except for (a) the
Letter of Intent and (b) that certain Hold Harmless and Indemnification Agreement dated December 18,
1995 and December 20, 1995, between the Agency and SMHC, as the same may heretofore have been
or may hereafter be amended.
-8-
W6-MI961920.011
EXECUTION
IN WITNESS WHEREOF, the Parties, intending to be legally bound, have executed this
Agreement as of the day and year first above written.
MIAMI BEACH REDEVELOPMENT AGENCY
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FORM APPROVED
REDEVELOPMENT AGENCY
GENERAlC~
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A TIEST:
By:
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Robert Parcher
Secretary
By: i
,
Date:
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Date:
Date
CITY OF ~I BEACH, FLORIDA
By:_~ob6' ~c..k
Robert Parcher
City Clerk
Date: ;J,.{'1 ,;,If'~
By:
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(
A TIEST:
fORM APPROVED
LEGAL D~
By 1M :tf!~
Date ?11(/~b.
-9-
W6-HI961920.011
ST. MORITZ HOTEL CORP.,
By:
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ATTEST:
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Date:
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Date: :],,('{ 17,1,(91.
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LOEWS HOTELS HOLDING CORPORATION
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Name:
Title:
Date: 'I... ('1 f 7 ! /C,'fb
Date:
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W6-MI961920.011
The undersigned agrees to act as Escrow Agent under the terms and conditions of this Agreement
and is executing this Agreement solely for such purpose.
SQUIRE, SANDERS & DEMPSEY
By:
Name:
Title:
Date: 7..A.,. (7 { t 9 'i (;;
- 11 -
W6-MI961920.011
Exhibit A
List of Escrowed Documents
1. Stock Purchase Agreement between the Agency, as Stockholder, and LHHC, as Buyer, in
connection with the stock ofMB Redevelopment, Inc. ("MBIt).
2.
Lease").
Agreement of Lease between the Agency, as Owner, and MB, as Tenant (the "Ground
3. Hotel Development Agreement between the Agency, as Owner, and MB, as Developer
(the "HDA If).
4. Garage Development Agreement between the Agency, as Owner, and SMHC, as
Developer (the "GDA ").
5. Garage Easement Agreement between the Agency, as Grantor, and MB, as Grantee.
6. Convention Center Agreement between the City, as Owner, and MB, as Hotel Owner.
7. Completion Guarantee from Loews Corporation, as Guarantor, to the Agency, as
Owner under the Hotel Development Agreement.
8. Completion Guarantee from the City, as Guarantor, to MB, as Tenant under the
Ground Lease, regarding certain of the Agency's obligations under Article 21 of the Ground Lease.
9. Garage Easement Guarantee from the City, as Guarantor, to MB, as Grantee under the
Garage Easement Agreement.
10. Stock Purchase Agreement Guarantee from the City, as Guarantor, to MD, as Grantee
under the Garage Easement Agreement.
11. Declaration of Condominium for Loews Miami Beach Hotel, a Condominium, between
the Agency and MB, as Co-Declarants.
12.
Condominium Unit Lease, between the Agency, as Owner, and MB, as Tenant.
13.
Grantee.
Bill of Sale for existing improvements, between the Agency, as Grantor, and MB, as
14.
Declaration of Covenants and Restrictions by the Agency, as Owner.
W6-M1961920.011
15. Quit-Claim Deed from the City, as Grantor, to the Agency, as Grantee, regarding
certain real property relating to the Property, as defined in the GDA.
-2-
W6-MI961920.0ll
Exhibit B
Conditions
On or prior to the Termination Date, the following conditions shall have been satisfied, or
waived by the Parties, each in their sole and absolute discretion:
1. The Agency shall own fee simple title, free and clear of all encumbrances (except those
encumbrances approved by SMHC in its reasonable discretion), to the Property, as defined in the GDA,
on which the Garage and the 16th Street Opening, both as defined in the GDA, will be constructed. The
Agency and the City shall diligently prosecute the pending condemnation action through its conclusion
at the trial court level.
2. The Construction Plans, Development Drawings, GMP and Development Budget, all as
defined in the GDA, shall have been approved Agency and SMHC. The Construction Plans and
Development Drawings shall be based on the preliminary Construction Plans and Development
Drawings as existing on the date of this Agreement prepared by the Architect and Consultant, both as
defined in the GDA.
3. The Title Matters shall not be varied, modified or added to in any manner whatsoever.
Toward that end, the Agency and the City will not pennit or suffer any encumbrance, mortgage, pledge
or hypothecation of its interest in the Land.
4. The Developer and the Agency shall have approved the fmal Plans and Specifications and
the Development Budget, as such terms are defmed in the HDA, for the Hotel, and the Developer shall
have approved in its sole discretion a satisfactory Guaranteed Maximum Price ("GMP") Construction
Contract for the construction of the Hotel in accordance with the Plans and Specifications, which GMP
shall have been submitted to the Agency.
5. The Tenant under the Ground Lease shall have obtained first mortgage construction
financing from Bankers Trust Company (as agent), on terms and c0nditions satisfactory to SMHC, in its
sole discretion.
6. The City and/or the Agency shall have obtained (a) an aggregate of $32,000,000, from a
combination of the Bonds and the HUD Funds, both as defined in the HDA, which $32,000,000 shall be
deposited and applied as described in the HDA, plus (b) additional funds from a combination of bond
proceeds and State of Florida grant moneys sufficient for the construction of the Garage and the 16th
Street Opening, both as defined in the GOA, which funds shall be used to complete the Garage and the
16th Street Opening, both as defined in the GOA, as contemplated by the GOA.
W6-MI961920.011
7. The Parties shall have finalized (i) any and all blanks in the Escrowed Documents to be
filled-in, (ii) any and all exhibits that have not heretofore been attached to the Escrowed Documents,
(iii) any necessary revisions to the Escrowed Documents as mutually agreed to by the Parties and
(iv) the following additional definitive agreements for signature, simultaneously with the release of the
Escrowed Documents:
(a)
Ground Lease.
Beach Easement between the Agency and MB, as described in Section 21.6 of the
(b) Hotel Management Agreement between MB and Loews Miami Beach Hotel
Operating Company Inc., as Hotel Manager.
(c) Attornment Agreement between the Agency, MB and Loews Miami Beach Hotel
Operating Company Inc., as Hotel Manager.
(d) Master Lease, as defined in the Garage Easement Agreement, between the Agency
and MB for the Retail Space, as defined in the Garage Easement Agreement.
(e) Opinions of Counsel by Squire, Sanders and Dempsey and the General Counsel
for the Agency pursuant to the Stock Purchase Agreement.
(f) Opinions of Counsel by Hughes Hubbard & Reed and the General Counsel for
LHHC pursuant to the Stock Purchase Agreement.
(g) Opinions of Counsel by Squire, Sanders and Dempsey and the General Counsel
for the Agency and the City Attorney for the City regarding the Escrowed Documents and other
definitive agreements.
(h) Opinions of Counsel by Hughes Hubbard & Reed and the General Counsel for
LHHC and Loews Corporation regarding the Escrowed Documents and other definitive agreements.
(i) Agreement between the City, the Agency and Bankers Tru.<;t Company regarding
disbursement of funds.
8. . The Tenant under the Ground Lease shall have approved the Report for the 16th Street
End, and any updates to the Reports, all as described in Exhibit 35.3 of the Ground Lease.
-2-
W6-HI961920.011
CITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH FLORIDA 33139
CITY OF MIAMI BEACH
COMMISSION MEMORANDUM NO. ~
TO:
Mayor Seymour Gelber and
Memben 01 the City Commission
DATE: July 17, 1996
FROM:
Jose Garcia-Pedrosa
City Manacer
A RESO ON OF THE MAYOR AND CITY COMMISSION OF
THE CI OF MIAMI BEACH, FLORIDA AUTHORIZING AND
DIRECTING THE MAYOR AND CITY CLERK TO EXECUTE AN
AGREEMENT OF LEASE, A CONDaaNIUM UNIT LEASE, A
HOTEL DEVELOPMENT AGREEMENT, A CONVENTION CENTER
AGREEMENT, A COMPLETION GUARANTEE, GARAGE EASEMENT
GUARANTEE, A STOCK PURCHASE AGREEMENT GUARANTEE, A
DECLARATION OF COVENANTS AN'D RESTRICTIONS, AN
ESCROW AGREEMENT, A QUIT CLAIM DEED AND OTHER
DOCUMENTS, AND AUTHORIZING AND DIRECTING THE CITY
TO ENTER INTO THE TRANSACTICNS CONTEMPLATED BY SUCH
AGREEMENTS AND DOCUMENTS, PERTAINING TO THE LOEWS
MIAMI BEACH HOTEL PROJECT TO BE DEVELOPED AT 1601
COLLINS AVENUE, MIAMI BEACH, FLORIDA.AND A PUBLIC
PARKING GARAGE PROJECT TO BE DEVELOPED AT .AND NEAR
16TH STREET BETWEEN COLLINS AND WASHINGTON AVENUES,
MIAMI BEACH, FLORIDA; WAIVING BY AT LEASE A S/7THS
VOTE CERTAIN PROVISIONS OF CITY ORDINANCE NO. 92-
2783; APPROVING THE REDEVELOPMENT AGENCY PURSUANT
TO FLORIDA STATUTE SECTIa-t 163.380; .AND AUTHORIZING
THE MAYOR, CITY MANAGER, CITY ATTORNEY .AND CITY
CLERK, AND THEIR RESPECTIVE DESIGNEES .AND OUTSIDE
CONSULTANTS, TO TAKE gaCS ACTIONS AS ARE NECESSARY
TO EFFECTUATE THE PURPOSES OF THIS RESOLUTION,
INCLUDING, WITHOUT LIMITATION, MODIFYING, FILLING
IN BLANKS IN AND ATTACHING EXHIBITS TO THE
AGREEMENTS.
SUBJECT:
ADMINISTRATION RECOMMENDATION:
It is recommended that the Mayor and city Commission and the
Chairman and Members of the Redevelopment Agency (RDA) approve the
above transactions and related documents, and authorize the
execution of necessary documents and taking of necessary actions to
implement the project.
AGENDA ITEM
~1~
1-ll-'[k
429
DATE
BACKGROUND :
The City of Miami Beach and the RDA are at the threshold of an
historic event. The first new major hotel in three decades is
about to be built in Miami Beach. This event comes through the
concerted efforts of this city Commission and RDA, its wisdom to
appoint a respected community leader to chair the effort, and the
hard work of its administrative and legal staff.
ANALYSIS:
The effort began in earnest with the creation of the city Center
Redevelopment Area in February, 1993. An RFP was issued in
November of 1993 and, after a thorough and professional selection
process, Loews was ranked number one, on July 21, 1994.
A detailed letter of intent was entered into on May 3, 1995, which
committed the developer to enter into design development work for
the project. This step is unprecedented in development agreements
and has saved almost a year in the development process. The
developer has obtained all necessary approvals from the City,
except for the building permits, which can be issued immediately
after this action today.
The project is a high-quality, first-class convention hotel which
will help bring substantial new business to the Convention Center.
Several public projects will occur simultaneously with the hotel
development:
. The opening of 16th Street between Collins & Washington
. The development of an aOO-car public parking garage
. The extension of a built boardwalk from the southerly terminus
of the present wooden boardwalk to Lummus Park
. The beautification and improvement of Collins Avenue from
15th Street to Lincoln Road
Finally, three major development projects to the south, the II
Villagio Condominiums, the 1500 Ocean project (Constructal, and the
Crowne Plaza Hotel will complete the missing pieces of the urban
fabric that will unite the Ocean Drive area to the City
Center/Historic Convention Village area.
CONCLUSION:
The City Commission/RDA should approve the transaction.
JGP:~jm
430